Macy's, Inc. Q4 FY2025 earnings call

• Strategic pillars: Strengthening and reimagining Macy's, accelerating and differentiating luxury, simplifying and modernizing end to end operations. - Macy's nameplate saw growth from reimagined locations and digital, with improved assortment and staffing. - Bloomingdale's had broad-based growth across categories, new brand introductions. - Blue Mercury's growth in skin care and fragrances.
• Operational highlights: Fourth quarter net sales, comps, and core adjusted EBITDA exceeded guidance, Thanksgiving Day Parade had record viewership, Bloomingdale's Happy Together campaign had high impressions.

For Macy's nameplate, 2025 achieved 0.6% go-forward comparable sales growth, with reimagined 125 locations contributing 1% growth. Digital channel is about one-third of annual sales. Bloomingdale's achieved 7.4% comparable sales growth in 2025, broad-based across stores and digital. Blue Mercury achieved 1.6% annual comparable sales growth, driven by dermicological skin care and fragrances.

Full year 2026 expected net sales $21.4 - $21.65B, Macy's Inc. comparable sales -0.5% to +0.5%, other revenue ~$920M, gross margin 38.3 - 38.6% with tariff impact 20 - 30 basis points, adjusted EBITDA 7.7% - 7.9% of total revenue, adjusted diluted EPS $1.90 - $2.10. First quarter 2026 expected net sales ~$4.575 - $4.625B, Macy's Inc. comparable sales +0.5 - 1.5%, adjusted EBITDA 4.9% - 5.1% of total revenue, adjusted EPS -1 cent to +1 cent.

Q: Given macro and consumer volatility, how resilient is Macy's Inc. and what gives confidence?

A: Tony mentions strong balance sheet, traction across nameplates, multi-brand etc.

Q: On AUR vs units, Tom says AUR growing due to strategy, basket increasing.

Q: On Bloomingdale's inflection, Tony says broad-based growth.

Q: On Macy's go-forward banner comps, Tony says reimagined stores contributing.

Q: On first quarter top-line guidance, Tom says prudently baked in.

Q: On appealing to price-sensitive consumer, Tony says balance of promotion and brands.

Q: On gross margin beyond tariffs, Tom says underlying performance positive.

Q: On Macy's reimagined stores progression, Tony says empowering locally.

Q: On store closures, Tom says extending to 2028.

Q: On categories driving upside, Tony mentions women's contemporary etc.

Q: On digital profitability, Tony says digital is profitable.

Q: On CapEx for reimagined stores, Tony says capital light.

Q: On credit card and media revenues, Tom says healthy.

Q: On go-forward store expectations, Tony says focus on OLM growth.

Q: On Q1 EBIT flow-through, Michael says tariffs and SG&A investments.

Q: On younger consumers, Tony says focus on life moments.

Q: On SGA investments and interest expense, Tom says investments in growth and consistent interest expense.

Q: On younger customer in Macy's, Tony says life moments drive traffic.

Q: On beauty business, Tony says growth in Blue Mercury and Bloomingdale's beauty assortments