Macy's To Close 66 Stores Under 'Bold New Chapter' Strategy

Macy's

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(RTTNews) - Department store chain Macy's Inc. is closing 66 Macy's non-go-forward store locations in 2025, as part of its strategic plan, called "A Bold New Chapter", aiming to return to sustainable, profitable sales growth.

The move comes after the Omni-channel fashion retailer, which owns Macy's, Bloomingdale's and Bluemercury brands, slashed its fiscal 2024 adjusted earnings guidance in early December after reporting weak profit and revenues in its third quarter. However, the company then had raised annual net sales outlook.

In a statement, the New York City -based company noted that the planned store closures include 9 stores each in California and New York, 7 in Florida, and 6 in Texas, among others.

Tony Spring, chairman and chief executive officer of Macy's, said, "Closing any store is never easy, but as part of our Bold New Chapter strategy, we are closing underproductive Macy's stores to allow us to focus our resources and prioritize investments in our go-forward stores, where customers are already responding positively to better product offerings and elevated service."

The Bold New Chapter strategy, announced in February 2024, would see closure of approximately 150 underproductive stores over a three-year period while investing in its 350 go-forward Macy's locations through fiscal 2026.

Since starting the strategy, the company noted that its investments in the pilot Macy's stores, First 50, have boosted sales for three consecutive quarters. Macy's said it enters 2025 well-positioned to build momentum with a stronger store fleet.

In December, Barington Capital Group, L.P., along with Thor Equities LLC, had recommended that the retailer make changes in its capital allocation strategy and consider other structural actions for improvement, after pointing out that its shares had suffered in the past decade due to long-term challenges in the department store sector and previous management missteps.

Barington and Thor also had expressed their concern that Macy's cash could be misallocated in the future through wasteful and ineffective capital expenditure programs.

In response, Macy's had assured its commitment towards delivering sustainable, profitable growth, and stressed then that its new strategic plan, which involves closing stores with low productivity, as well as cost reductions, would result in consistent revenue growth and profit improvements.

On the NYSE, Macy's had closed Thursday's regular trading down 2.02 percent, at $16.03. In the extended trading, the shares lost 1 percent further, at $15.88.