The US retail group Macy’s Inc. felt the effects of the increasingly deteriorating consumer sentiment in the first quarter of the 2023/24 financial year. On Thursday, the company then lowered its forecasts for the full year.
For the 13 weeks ended April 29, group sales totaled $5.17 billion. It was thus 7.0 percent below the level of the same quarter of the previous year. Retail sales fell 6.8 percent to $4.98 billion.
The company expected economic burdens on consumers, but from late March “demand trends continued to deteriorate,” admitted CEO Jeff Gennette. The retailer then decided to increase the price reductions for the second quarter in order to boost the sale of surplus spring goods.
In addition to the decline in sales, higher personnel costs also weighed on the result in the first quarter. The net profit shrank by 45.8 percent to 155 million US dollars (144 million euros). However, the analysts had feared an even more significant decline in advance.
In view of the negative sales trend and the more extensive discounts that have now been planned, management has revised its annual forecasts downwards. Revenue is now expected to be in the range of $22.8 billion to $23.2 billion after previously targeting $23.7 billion to $24.2 billion. The target range for adjusted earnings per share was lowered to $2.70-$3.20 from $3.67-$4.11.