Macys 2026 Q3 Earnings Net Income Plummets 60.7% to $11 Million

Macy's (M) reported fiscal 2026 Q3 earnings on Dec 10, 2025, with revenue declining 0.6% to $4.71 billion and net income falling 60.7% to $11 million. The results highlight persistent challenges in core retail segments despite strategic investments in digital and supply chain automation.

Revenue

Total revenue dipped to $4.71 billion, with Women’s Apparel ($1.10 billion) and Men’s and Kids’ ($1.02 billion) driving the largest shares. Home/Other revenue reached $638 million, while Macy’s Media Network contributed $42 million. Credit card revenues declined to $158 million, and other revenue streams totaled $200 million. The performance underscores mixed demand across categories amid broader retail sector headwinds.

Earnings/Net Income

Earnings per share (EPS) plummeted 60% to $0.04, and net income fell to $11 million, reflecting margin pressures and operational costs. The sharp decline in profitability signals ongoing struggles to balance cost management with strategic investments.

Price Action

M shares surged 14.30% month-to-date, outpacing a 3.70% daily gain and 3.56% weekly rise, suggesting investor optimism about long-term recovery efforts.

Post-Earnings Price Action Review

A strategy of buying M stock when revenue beats expectations and selling after 30 days yielded a 195.81% return, outperforming the 139.85% benchmark. With a 0.00% maximum drawdown and Sharpe ratio of 0.90, the approach demonstrated disciplined risk-adjusted performance, appealing to growth-focused investors.

CEO Commentary

The CEO emphasized Macy’s commitment to its "A Bold New Chapter" strategy, prioritizing store reimagination, product revitalization, and digital innovation. Automation and AI-driven supply chain upgrades were highlighted as critical to long-term competitiveness, though near-term profit pressures remain.

Guidance

The company reaffirmed its focus on omni-channel expansion and cost efficiency but provided no specific revenue or EPS guidance for future periods.

Additional News

Macy’s disclosed a new supply chain facility integrating automation and AI to enhance operational efficiency, aligning with its digital transformation goals. The SEC 10-Q filing also noted legal challenges, including a court ruling that allows a wage-and-hour lawsuit against the retailer to proceed. Meanwhile, the company reiterated its commitment to reducing reliance on arbitral disputes in employment matters.

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