Macy’s closing 150 stores, or about 30% of its locations, to reposition the Company

NEW YORK--(February 28, 2024) -- Macy’s, Inc. (NYSE: M) announced Tuesday its new strategy, A Bold New Chapter, designed to return Macy’s, Inc. to enterprise growth. Developed by the Macy’s, Inc. leadership team, with the full support of the board of directors, the strategy balances the art and science of retail and is informed by comprehensive customer research.

At the same time as it's planning on closing some locations, Macy's plans to shore up sales by expanding its small-format stores, which it thinks can provide more convenience to customers. It announced plans in October to add up to 30 small-format locations through the fall of 2025, bringing the total number to roughly 42. The next round of expansion starts in the fall.

“A Bold New Chapter serves as a strong call to action. It challenges the status quo to create a more modern Macy’s, Inc. We are making the necessary moves to reinvigorate relationships with our customers through improved shopping experiences, relevant assortments and compelling value,” said Tony Spring, chief executive officer, Macy’s, Inc. “Our teams are energized by the work ahead as we accelerate our path to market share gains, sustainable, profitable growth and value creation for our shareholders.”

A Bold New Chapter

The new strategy aligns the Macy’s, Inc. team across three strategic priorities:

• Strengthen the Macy’s Nameplate: Macy’s plans to put the customer first, prioritizing three key areas to return to top-line growth: 1) Revitalizing the assortment to improve both relevance and value; 2) Modernizing the shopping environment to facilitate a convenient, easy, and frictionless customer experience across channels with continued focus on digital excellence; and 3) Focusing resources by closing approximately 150 underproductive locations, including approximately 50 by the end of the fiscal year, and prioritizing investment in approximately 350 go-forward locations and the continued expansion of small-format stores.
• Accelerate Luxury Growth: Macy’s, Inc. plans to take advantage of its leadership position in the luxury market, where Bloomingdale’s and Bluemercury have been outperformers within the Macy’s, Inc. portfolio and across the broader luxury landscape, by further growing its store fleet and digital presence. As part of the strategy, approximately 15 Bloomingdale’s nameplate stores and at least 30 new Bluemercury stores, along with roughly 30 Bluemercury remodels are anticipated to be opened in new and existing markets over the next three years.
• Simplify and Modernize End-to-End Operations: Over the next three years, the organization plans to rationalize and monetize the supply chain asset portfolio, streamline fulfillment, improve inventory planning and allocation, and deliver a scalable technology platform. Across the organization, Macy’s, Inc. plans to align operations to anticipated future omni-demand and deliver a more efficient operating model that will allow the organization to better serve customers.

Financial Outcomes

With a strong financial foundation, Macy’s, Inc. is positioned to successfully drive sustainable, profitable growth and create shareholder value. Beginning in 2025, Macy’s, Inc. expects:

• Low-single-digit annual comparable Owned + Licensed + Marketplace sales growth;
• Annual SG&A dollar growth below the historic rate of inflation of 2%-3%;
• Annual Adjusted EBITDA dollar growth in the mid-single-digit range;
• Capital spend to be below 2024 levels; and
• Free cash flow to return to pre-pandemic levels.

Financial outcomes do not include any potential impact of the proposed credit card late fee ruling.

So far, these are five Macy’s stores facing closure:

For additional details on A Bold New Chapter, visit macysinc.com/investors.