Macy’s, Inc. opened the June stretch of the US retail earnings calendar with a clear beat. The department store operator reported first quarter fiscal 2026 results before the market opened on June 3, posting comparable sales growth of 3.0%, its strongest first quarter in four years, and lifting its full-year sales and profit outlook. The update lands as investors try to separate genuine momentum from the temporary lift that tax refunds and pay-over-time financing gave the broader sector this spring.
The headline numbers were modest on the top line and stronger underneath. Net sales rose 1.8% to $4.68 billion for the quarter ended May 2, while the metric management cares about most, comparable sales, beat its own guidance across every nameplate. Bloomingdale’s was the standout, with comparable sales up 10.2%, a seventh straight quarter of growth and a record first quarter for the luxury division.
In short
- Beat and raise: Macy’s posted 3.0% comparable sales growth in Q1 fiscal 2026, ahead of guidance, and raised its full-year outlook for sales, comparable sales and adjusted earnings.
- Luxury leads: Bloomingdale’s comparable sales jumped 10.2%, a record first quarter and a seventh consecutive quarter of growth, while Bluemercury rose 6.4%.
- Turnaround traction: The roughly 200 reimagined Macy’s stores under the Bold New Chapter plan grew 2.4%, outpacing the 1.6% comparable gain for the Macy’s nameplate overall.
- Profit ahead of plan: Adjusted diluted EPS of $0.13 beat the company’s guidance, net income rose to $63 million from $38 million, and gross margin held at 38.9% with a 30 basis point tariff drag.
- Raised guidance: Macy’s now expects full-year net sales of $21.5 billion to $21.75 billion, comparable sales of +0.5% to +1.2%, and adjusted diluted EPS of $2.00 to $2.20.
What Macy’s reported in the first quarter
Macy’s released its results at 6:55 a.m. Eastern time on June 3, ahead of a call with analysts. The company framed the quarter as the fifth consecutive period in which results exceeded its own expectations, a streak that now stretches back across the life of the Bold New Chapter strategy that chief executive Tony Spring laid out in early 2024.
Net sales of $4.68 billion were up 1.8% from a year earlier. That top-line figure understates the underlying demand picture because Macy’s has been closing weaker stores, a deliberate pruning that subtracts revenue even as the remaining fleet performs better. On a like-for-like basis, comparable sales on an owned-plus-licensed-plus-marketplace basis rose 3.1% for the go-forward business, with the overall company comparable up 3.0%.
Profit came in well above the company’s own bar. GAAP diluted earnings per share landed at $0.23, while adjusted diluted EPS, which strips out asset sale gains and other items, was $0.13, up from $0.11 a year earlier and above the guidance range management had set in March. Net income climbed to $63 million from $38 million in the prior-year quarter, helped in part by $15 million of gains on real estate dispositions.
The beat was broad rather than narrow. Coming into the print, the central question for analysts was whether the spring strength visible across the sector reflected real demand or a calendar quirk tied to the timing of tax refunds. By beating on comparable sales, gross margin discipline and adjusted earnings simultaneously, Macy’s gave the bulls more to work with than a single line item would have. The fifth straight quarter of exceeding internal expectations also lengthens the track record management can point to when it argues the turnaround is structural.
Operating income for the quarter was $112 million, or 2.3% of total revenue, a reminder that department store economics remain thin even in a good quarter. The improvement in net income outpaced the operating line because of the real estate gains and a more favorable tax and interest picture, which is why management steers investors toward the adjusted figures for a cleaner read on the operating trend.
The three nameplates pulled in the same direction
For the first time in several quarters, all three of the company’s nameplates posted positive comparable sales in the same period. The Macy’s nameplate, the largest and most challenged of the three, rose 1.6%. Bloomingdale’s surged 10.2%, and the Bluemercury beauty chain added 6.4%, extending its own multi-year growth streak.
That breadth matters because Macy’s bears, and there are many, have argued for years that the core Macy’s banner is in secular decline and that only the luxury and beauty units are healthy. A positive comparable at the Macy’s nameplate, however modest, undercuts that thesis for at least one quarter.
| Nameplate | Q1 FY2026 comparable sales | Note |
|---|---|---|
| Macy’s (nameplate) | +1.6% | Reimagined stores grew faster, at +2.4% |
| Bloomingdale’s | +10.2% | Record Q1, seventh straight quarter of growth |
| Bluemercury | +6.4% | Continued multi-year growth streak |
| Total company | +3.0% | Go-forward owned-plus-licensed-plus-marketplace +3.1% |
Why the Bloomingdale’s surge matters
Bloomingdale’s is the smaller of Macy’s two department store banners, but it has become the engine of the investment case. A 10.2% comparable gain in a quarter when many mainstream retailers struggled to grow at all signals that affluent US shoppers kept spending on apparel, handbags, jewelry and beauty even as lower-income households pulled back.
The division has now grown comparable sales for seven consecutive quarters, a run that management attributes to a steady stream of luxury and premium brand additions, elevated in-store service and a younger customer mix drawn in through contemporary labels. The first quarter result was a record for the division’s Q1 history, according to the company.
Modern luxury is doing the heavy lifting
Spring, who ran Bloomingdale’s before taking the top job at the parent company, has repeatedly described the banner as a “modern luxury” play that sits below the European houses but above the mainstream. That positioning has proven resilient. When aspirational shoppers trade down from full-price luxury boutiques, Bloomingdale’s can capture some of that demand, and when the top end stays strong, it benefits directly.
The strength also echoes results elsewhere in the discretionary economy. Jewelry was a bright spot this season, and the read-across from luxury-leaning peers reinforces the picture of a bifurcated consumer. For more on that dynamic, see our coverage of how Signet Jewelers beat its first-quarter estimates and lifted full-year guidance on the back of steady engagement-driven demand.
Why the luxury read is not a guarantee
One quarter of luxury strength does not insulate Macy’s from the wider economy. Bloomingdale’s customer base skews higher income, but it is still exposed to swings in equity markets, housing and consumer confidence. A sharp deterioration in any of those would test whether the seven-quarter streak can reach eight.
Inside the Bold New Chapter turnaround
The Bold New Chapter strategy, unveiled in February 2024, rests on three pillars: investing in a core group of Macy’s stores, accelerating growth at the luxury nameplates, and modernizing the supply chain and store fleet while closing underproductive locations. The first quarter offered fresh evidence that the store-level part of the plan is working.
Reimagined stores keep outrunning the fleet
Macy’s has expanded the reimagined-store concept, which began as a “First 50” pilot, to roughly 200 locations. Those stores receive added staffing in high-traffic areas such as women’s shoes and fitting rooms, fresher inventory and improved visual merchandising. In the first quarter the reimagined group grew comparable sales 2.4%, ahead of the 1.6% gain for the nameplate as a whole.
That spread, while not enormous, is the proof point management points to most often. It suggests that targeted investment in labor and presentation can move the needle even at a banner widely written off as structurally challenged. The company has signaled it intends to apply the playbook to more stores as the year progresses.
Closing the tail while protecting the core
The other side of the strategy is subtraction. Macy’s has been shutting underperforming locations, and those closures reduce reported sales. The company noted that stores closed during fiscal 2025 contributed about $40 million to first-quarter sales a year ago and roughly $145 million on an annual basis, a headwind that the go-forward comparable figure is designed to isolate.
This is the same balancing act other legacy chains are attempting as they pivot toward higher-margin formats and new revenue streams. Electronics retailer Best Buy, for example, has leaned on marketplace commissions and advertising to lift profitability even as core hardware sales stay soft, a shift we examined in our look at how Best Buy’s margin story is moving toward marketplace and retail media.
Bluemercury and the beauty halo
Bluemercury, the smallest of the three nameplates, continued to compound. Its 6.4% comparable gain extends a long growth run and reflects the broader resilience of prestige beauty, a category that has held up across the cycle as shoppers treat cosmetics and skincare as affordable luxuries. Beauty also drives traffic into the larger Macy’s and Bloomingdale’s boxes, giving the category strategic value beyond its own sales line.
How the raised outlook reframes the year
The most consequential part of the release was the upgraded guidance. Coming into the year, Macy’s had guided to a full-year comparable sales range of negative 0.5% to positive 0.5%, effectively flat. After a strong first quarter it now expects comparable sales of positive 0.5% to positive 1.2%, a meaningful upward shift that implies management believes the spring momentum is durable rather than a one-off.
On the top line, the company raised its full-year net sales range to $21.5 billion to $21.75 billion, from $21.4 billion to $21.65 billion. On the bottom line, it lifted its adjusted diluted EPS range to $2.00 to $2.20, from $1.90 to $2.10. The adjusted EBITDA margin guidance was held at 7.7% to 7.9%.
| Metric | Prior FY2026 guidance | Raised FY2026 guidance |
|---|---|---|
| Net sales | $21.40bn to $21.65bn | $21.50bn to $21.75bn |
| Comparable sales | (0.5%) to +0.5% | +0.5% to +1.2% |
| Adjusted diluted EPS | $1.90 to $2.10 | $2.00 to $2.20 |
| Adjusted EBITDA margin | 7.7% to 7.9% | 7.7% to 7.9% |
Holding the EBITDA margin steady while raising sales and EPS tells its own story. It implies the incremental revenue is flowing through at roughly the existing margin structure rather than at a richer rate, consistent with a quarter in which tariffs trimmed gross margin and the company kept investing in labor at its reimagined stores.
The raised midpoint also reframes what the rest of the year has to deliver. With a 3.0% comparable gain banked in the first quarter, the full-year range of positive 0.5% to positive 1.2% implies that management expects the back three quarters to grow more slowly than the spring, a sensibly conservative posture given tougher year-earlier comparisons and an uncertain consumer. In effect, Macy’s has raised the floor without betting that the strongest quarter repeats.
For a company whose shares have long traded at a discount to the sum of its retail and real estate parts, the credibility of the guide matters as much as the numbers. A beat-and-raise update, delivered with a fifth consecutive quarter of clearing its own bar, is the kind of consistency that can slowly rebuild investor trust in management’s forecasting. Whether that translates into a sustained re-rating depends on the holiday quarter.
Margins, tariffs and the cost picture
Gross margin came in at 38.9%, down 30 basis points from a year earlier. Macy’s attributed the entire decline to tariffs, noting that excluding the tariff impact the gross margin rate would have been roughly flat year over year. That framing matters because it positions the margin pressure as an external policy cost rather than a sign of deeper promotional weakness.
Tariffs are now a line item, not a footnote
US import duties have become a recurring feature of retail earnings commentary in 2026. For a department store that sources heavily from Asia across apparel, home and accessories, even a 30 basis point hit is material at scale. Management’s decision to quantify the tariff drag precisely signals how central trade policy has become to the sector’s margin math.
The cost discipline elsewhere was visible. Selling, general and administrative expense was $1.952 billion, or 39.9% of revenue, essentially flat as a share of sales versus a year earlier. That stability, achieved while funding added store labor, points to offsetting savings from the closed stores and supply chain work.
Profit quality and the role of asset sales
Reported net income of $63 million benefited from $15 million in gains on real estate dispositions, a reminder that Macy’s owns valuable property and periodically monetizes it. Adjusted figures strip those gains out: adjusted net income was $35 million and adjusted EBITDA was $290 million, down from $304 million a year earlier, reflecting the margin pressure and continued investment. The gap between GAAP and adjusted earnings is a perennial debate for Macy’s, given the embedded value in its real estate portfolio.
How Macy’s compares with the rest of the Q1 retail field
Macy’s did not report in a vacuum. Its results arrived in a week thick with retail earnings, and the picture across the sector has been better than many feared, even if the reasons for the strength are debated. A cluster of chains posted beats this quarter, helped by an earlier flow of tax refunds and rising use of buy-now-pay-later financing.
The off-price segment, often a barometer of value-seeking behavior, also delivered. We covered how the major off-price retailers beat first-quarter estimates as tax refunds and BNPL masked underlying strain on lower-income shoppers, a dynamic that sits in tension with Macy’s luxury-led strength.
A tale of two consumers
Read together, the quarter’s results sketch a bifurcated US consumer. At the top, Bloomingdale’s 10.2% gain and steady prestige beauty demand point to affluent households spending freely. At the value end, the strength looks more fragile, propped up by refunds and financing rather than rising real incomes. The contrast was visible in value apparel too, where we reported that Citi Trends raised its 2026 outlook after posting a 13.9% comparable gain aimed at budget-conscious shoppers.
| Company | Segment | Q1 FY2026 signal |
|---|---|---|
| Macy’s, Inc. | Department store and luxury | +3.0% comp, raised full-year outlook |
| Off-price chains | Value apparel and home | Beats, aided by refunds and BNPL |
| Citi Trends | Value apparel | +13.9% comp, raised 2026 outlook |
| Signet Jewelers | Specialty jewelry | Beat estimates, lifted guidance |
Where Macy’s sits among department stores
Among traditional department stores, Macy’s stands out for having returned its core banner to positive comparable growth while sustaining double-digit gains at its luxury arm. Rival Nordstrom, now privately held after a take-private completed in 2025, no longer reports quarterly to public markets, and other mid-tier chains have struggled to find a consistent growth formula. That relative position gives Macy’s a measure of scarcity value as one of the few large public pure-play department store operators left.
The balance sheet, cash returns and real estate
Macy’s entered the back half of its turnaround with a stable balance sheet. The company reported $1.3 billion in cash and equivalents against $2.4 billion of total debt, with about $2 billion of available borrowing capacity and no material long-term debt maturities until 2030. That maturity runway gives management room to fund the Bold New Chapter without refinancing pressure.
Dividends and buybacks continue
The company kept returning cash to shareholders. It declared a quarterly dividend of $0.1915 per share, payable July 1, 2026, and repurchased 2.6 million shares for $50 million during the quarter, leaving about $1.1 billion of buyback authorization. With roughly 263.8 million shares outstanding at quarter end, the repurchase pace is steady rather than aggressive, consistent with a company prioritizing reinvestment.
Inventory and cash generation
Merchandise inventories rose 3.6% year over year to $4.833 billion, broadly in line with the sales trajectory and a sign that the company is not sitting on excess stock heading into the summer. Free cash flow was $203 million, calculated as $292 million of operating cash flow less $88 million of capital expenditure and $89 million of capitalized software. Healthy cash generation underpins both the dividend and the continued store investment.
What it means for shoppers, suppliers and the wider sector
For shoppers, the immediate signal is that Macy’s intends to keep investing in the experience at its better stores rather than retreating into discount-led survival mode. Added staffing, fresher assortments and elevated service at the reimagined locations are the visible expression of that choice, and the comparable sales spread suggests customers notice.
For suppliers and brands, a healthier Macy’s is a more reliable wholesale partner and a stronger shelf for premium and luxury labels, particularly through Bloomingdale’s. Brand owners that have been wary of department store exposure may read the quarter as a reason to lean back in, especially in categories like beauty and contemporary apparel where the company is gaining share of attention.
Apparel demand is steadier than feared
The quarter also adds to evidence that US apparel demand has held up better than the gloomiest forecasts. That theme has recurred across fashion-adjacent names this season, including in the rental and resale corner of the market, where we reported that Rent the Runway posted a 29% jump in sales in its first results after founder Jenn Hyman’s exit. Taken together, the data points suggest fashion spending is resilient even as households grow more selective.
New revenue streams sit alongside the core
Like most large retailers, Macy’s is building higher-margin businesses around its core merchandising, including a media network that sells advertising against its shopper data and an expanding owned-brand portfolio. These streams do not yet move the headline numbers, but they offer a path to margin expansion that does not depend on selling more units at full price. The company’s loyalty program, which captures a large share of Macy’s-banner sales, is the connective tissue that makes both the ad business and personalized marketing work.
That positions Macy’s alongside a wider industry shift in which legacy retailers treat their stores, data and traffic as a platform rather than only a place to sell goods. The reimagined-store investment and the media and loyalty assets are meant to reinforce one another: better stores drive more engaged shoppers, and more engaged shoppers generate the data and traffic that make the higher-margin businesses viable.
A template for legacy retail reinvention
More broadly, Macy’s is becoming a closely watched test of whether a legacy department store can reinvent itself without a private-equity carve-up or a wholesale pivot to a new business model. The reimagined-store data and the multi-nameplate portfolio give management a credible, if still unproven, path to sustainable growth. Investors and rivals alike will be watching whether the model scales beyond 200 stores.
Risks and what to watch next
The bullish read comes with caveats. Comparable growth of 1.6% at the Macy’s nameplate is positive but thin, and a single quarter does not reverse years of structural pressure on mid-tier department stores. The raised guidance still implies full-year comparable growth in low single digits, leaving little room for a consumer slowdown in the back half.
Tariffs remain the clearest external risk. The 30 basis point gross margin hit this quarter could widen if duties rise further or if the company chooses to absorb more cost rather than pass it to shoppers. Holiday season sourcing decisions, made months in advance, will determine how much of that pressure flows through in the seasonally critical fourth quarter.
The key items to watch from here are whether Bloomingdale’s can sustain its growth streak past seven quarters, whether the reimagined-store spread holds or widens as the program scales, and whether the holiday quarter validates the raised full-year outlook. The next checkpoint comes with second-quarter results later in the summer, when the durability of the spring momentum will be tested against tougher comparisons.
Frequently asked questions
What did Macy’s report for the first quarter of fiscal 2026?
Macy’s reported net sales of $4.68 billion, up 1.8% year over year, with comparable sales growth of 3.0%, its strongest first quarter in four years. GAAP diluted EPS was $0.23 and adjusted diluted EPS was $0.13, above the company’s guidance. The results were released before the US market opened on June 3, 2026.
How much did Bloomingdale’s grow?
Bloomingdale’s comparable sales rose 10.2% in the quarter, a record first quarter for the division and its seventh consecutive quarter of growth. The company credited additions of luxury and premium brands and elevated in-store service for the strength.
Did Macy’s raise its full-year guidance?
Yes. Macy’s raised its full-year fiscal 2026 outlook for net sales to a range of $21.5 billion to $21.75 billion, comparable sales to positive 0.5% to positive 1.2%, and adjusted diluted EPS to $2.00 to $2.20. The adjusted EBITDA margin guidance was held at 7.7% to 7.9%.
What is the Bold New Chapter strategy?
Bold New Chapter is the turnaround plan chief executive Tony Spring introduced in early 2024. It focuses on investing in a core group of reimagined Macy’s stores, accelerating growth at the Bloomingdale’s and Bluemercury luxury nameplates, and modernizing the supply chain while closing underproductive locations.
How did the reimagined stores perform?
The roughly 200 reimagined Macy’s locations grew comparable sales 2.4% in the quarter, ahead of the 1.6% gain for the Macy’s nameplate overall. Those stores receive added staffing, fresher inventory and improved visual merchandising, and the spread is the company’s main evidence that the investment is working.
How did tariffs affect Macy’s results?
Tariffs reduced gross margin by about 30 basis points, accounting for the entire 30 basis point decline to a 38.9% gross margin rate. Excluding the tariff impact, the company said its gross margin rate would have been roughly flat compared with a year earlier.
What does the quarter say about the US consumer?
The results point to a bifurcated consumer. Affluent shoppers kept spending, reflected in the 10.2% gain at Bloomingdale’s, while strength at the value end of retail looked more dependent on tax refunds and buy-now-pay-later financing. Macy’s leaned on its luxury and beauty exposure to outperform.
What are the main risks to the outlook?
The biggest risks are a slowdown in consumer spending in the back half of the year, further tariff pressure on margins, and the thin growth rate at the core Macy’s nameplate. The raised guidance assumes the spring momentum continues, leaving limited cushion if conditions soften before the holiday quarter.
When does Macy’s report next?
Macy’s will report second-quarter fiscal 2026 results later in the summer. That update will test whether the first-quarter momentum is durable against tougher year-earlier comparisons and will give an early read on holiday-season positioning.