Macy's Stock Drops 5% to 16-Month Low Amid Profit Warning

Macy's shares fell significantly as the retailer reported mixed fourth-quarter earnings and issued a profit warning due to 'external uncertainties.' The company's revenue was $7.7 billion, slightly missing analyst expectations, but their adjusted earnings per share of $1.80 exceeded estimates. Despite some progress in its turnaround strategy with a 0.8% sales growth at its First 50 stores, Macy's is projecting a decline in same-store sales between 0.5% and 2% for 2025, and a revenue forecast of $21 billion to $21.4 billion, below expectations. The company is also dealing with the impact of tariffs imposed by the Trump administration, which may affect pricing strategies. CEO Tony Spring emphasized a cautious outlook due to these uncertainties, including planned store closures and intensified cost pressures. Analysts are particularly concerned about how tariffs might affect national brands and whether costs will be passed on to consumers.