Macy’s Cuts 2025 Profit Forecast, Raises Prices Amid Tariff Impact

Macy's has announced selective price hikes and reduced its annual profit forecast due to the impact of tariffs—particularly those on Chinese imports—imposed during President Trump's administration. CEO Tony Spring emphasized a 'surgical' approach, with price increases limited to specific items where the value proposition justifies the cost, while some products may be dropped altogether. The company expects tariffs to reduce its annual gross margin by 20 to 40 basis points and has responded by canceling or delaying orders, renegotiating with suppliers, and reducing sourcing from China. Macy's now anticipates adjusted earnings per share for 2025 in the range of $1.60 to $2.00, down from a previous projection of $2.05 to $2.25, with 15 to 40 cents of the drop directly attributed to tariffs. Despite reporting better-than-expected first-quarter results and maintaining its annual sales forecast, Macy's continues to face broader challenges from slowing consumer spending and heightened competition across the retail sector. The company is also progressing with a turnaround strategy focused on closing underperforming stores and investing in its Bluemercury and Bloomingdale’s brands.