Macy’s says taking ‘prudent approach’ to FY25 guidance

Macy’s (M), Inc. is taking a prudent approach to its FY25 guidance, reflecting the external uncertainties the company and its customers are facing. On a quarterly basis, the company does not expect its results to be linear as the year progresses, which is a reflection of the Year Two initiatives gaining traction, comparability impacts and the timing of asset sale gains. The company expects gross margin rate expansion to be driven by continued improvements in the company’s merchandise assortments, benefiting from product mix and disciplined inventory management, which are expected to support healthier sell-throughs. The company plans to reinvest SG&A savings from store closures in customer-facing growth initiatives that enhance the omni-channel shopping experience across nameplates, and colleague benefits, including compensation. In FY25, the company anniversaries the conversion to cost accounting.In FY25, the company expects digital penetration to be slightly over a third of net sales and depreciation & amortization to be ~$925M. The company’s comparable sales have the most opportunity for improvement in 2Q25 given easier year-over-year compares. The company expects fundamental improvements in Macy’s Reimagine 125 locations and digital to be offset by the ~225 go-forward Macy’s locations that have not yet received initiatives and the stores the company has planned for closure in 2025 and beyond. Comments taken from investor presentation slides.