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Macy’s Reports Surprisingly Profitable First Quarter

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Macy’s Reports Surprisingly Profitable First Quarter

It’s a good day to be a Macy’s exec. The company reported a surprisingly profitable first quarter this morning—and noted that consumers spent abundantly on clothing, luggage, and other categories that had flatlined during the height of the COVID-19 pandemic.

Macy’s first quarter saw comparable sales up 62.5% on an owned basis, and up 63.9% on an owned-plus-licensed basis, compared to the first quarter of 2020.

Digital sales represented 37% of net sales, which is a 6 percentage point decline from digital sales in the first quarter of 2020 (the start of the pandemic). But it represents a 13 percentage point improvement over online sales in the first quarter of 2019.

The bump would seem to indicate that American consumers—with stimulus checks in hand and vaccinations in arms—are ready to shop again. And not just online.

“We outperformed sales expectations across all three of our brands: Macy’s, Bloomingdale’s, and Bluemercury,” said Jeff Gennette, chairman and chief executive officer of Macy’s, in an investor statement. “These results were driven by the positive effects of the government stimulus program and expanding vaccine rollout, coupled with…investments in our digital platforms.”

He added, “As consumers seek to reengage with each other, we are seeing promising signs that our core customers are shopping again.”

The company also said it brought in 4.6 million new customers this past quarter, which is a 23% increase compared to the same quarter last year. Forty-seven percent of those new customers shopped online.

As a result of this stellar first-quarter performance, the company has raised its full-year 2021 guidance.

“Our achievements in the first quarter, combined with the faster than anticipated economic recovery, give us the confidence to update our full-year 2021 guidance,” said Adrian Mitchell, chief financial officer of Macy’s, in the same statement.

In a call with investors, Gennette said the company doesn’t view its new profitability as “a short-term pop,” insisting, “There are pent-up demand opportunities.”

Follow Emili Vesilind on Instagram: @emilivesilind

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