Macy’s reduced its full-year profit projection because of tariff expenses yet kept its sales outlook steady which demonstrates careful strategic adaptation. Macy’s now predicts fiscal 2025 adjusted earnings between $1.60 and $2.00 per share instead of its previous forecast of $2.05 to $2.25.
CEO Tony Spring revealed that 15 to 40 cents of the profit reduction comes from higher import tariffs because 20% of Macy’s products come from China. Macy’s will use specific price increases together with product line modifications to minimize the effects of the tariff costs.
Spring explained that the company uses a customized approach instead of a single universal solution. The company will keep some prices unchanged but will increase others and possibly remove certain products from the market.
The company achieved better-than-expected adjusted earnings per share of 16 cents during the quarter that ended May 3. The company generated $4.6 billion in revenue which exceeded market predictions but decreased from $4.85 billion during the previous year.
The company faces declining discretionary spending and stronger promotional competition yet its stock price increased by more than 1% during midday trading on Wednesday.
