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Macy's raises its full-year 2026 guidance after posting a Q1 earnings beat, with Bloomingdale's surging 10.2% and the Bold New Chapter strategy delivering results.
- Q1 2026 adjusted EPS of $0.13 beat the $0.03 consensus; net sales rose 1.8% to $4.68 billion.
- Full-year comparable sales guidance raised to 0.5%–1.2%, up from the prior range of -0.5% to +0.5%.
- Bloomingdale's posted a seventh consecutive quarter of comparable sales growth, rising 10.2%.
Lead
Macy's, Inc. (M) raised its full-year 2026 financial outlook on June 3, reporting first-quarter results that surpassed analyst expectations and offered the clearest evidence yet that the retailer's multi-year restructuring is translating into durable revenue gains. Net sales reached $4.68 billion for the quarter ended May 3, a 1.8% year-over-year increase, while total comparable sales advanced 3.0%—the strongest first-quarter performance the chain has recorded in four years.What Happened
Adjusted diluted earnings per share came in at $0.13, a tenfold increase over the $0.03 Wall Street consensus, and GAAP diluted EPS reached $0.23. Adjusted EBITDA totaled $290 million, representing 5.9% of total revenue.
The company responded by lifting its full-year net sales guidance to $21.5–$21.75 billion, from a prior range of $21.4–$21.65 billion, and raising its adjusted diluted EPS outlook to $2.00–$2.20, versus the previous $1.90–$2.10. Full-year comparable sales growth guidance was revised upward to 0.5%–1.2% from a prior band of -0.5% to +0.5%. Adjusted EBITDA margin is projected at 7.7%–7.9%.
Macy's stock climbed approximately 3% in after-hours trading following the announcement, extending a twelve-month gain of roughly 35%.Turnaround Strategy: Bold New Chapter
The results mark the second full year of the company's "Bold New Chapter" turnaround initiative under CEO Tony Spring, a program anchored on concentrating resources in a smaller, higher-performing store fleet while accelerating the luxury and beauty segments.
Macy's plans to close 150 underproductive locations by 2028, with 64 closures completed in fiscal 2025 and 14 more planned for 2026. Simultaneously, the company has expanded its "Reimagine" investment program to 200 stores, up from an initial 125. Those renovated locations posted comparable sales of 2.4% in Q1, outpacing the broader Macy's nameplate average of 1.6%, which itself returned to positive territory. Reimagine stores now account for approximately 75% of the company's go-forward sales base.
In fiscal year 2025—the first complete annual period under the restructured model—comparable sales returned to growth at 1.5%, net income reached $507 million, and free cash flow was $797 million. The company returned $447 million to shareholders through dividends and buybacks over that year.
Bloomingdale's and Bluemercury Drive the Upside
The luxury and prestige beauty divisions remain the clearest proof points in the retail outlook narrative. Bloomingdale's posted a 10.2% comparable sales gain in Q1 2026, its seventh consecutive quarter of improvement, following 9.9% growth in Q4 fiscal 2025. Management attributed the streak partly to the January 2026 bankruptcy filing of Saks Global, which has allowed Bloomingdale's to capture displaced luxury shoppers.
Bluemercury, the prestige skincare and beauty banner, recorded 6.4% comparable sales growth in the quarter, continuing a streak of positive comparable performance spanning 18 or more consecutive quarters. The company is opening approximately 30 new Bluemercury locations as it moves to capture a larger share of the estimated $100 billion prestige beauty market.Tariff Headwinds and Macro Uncertainty
The raised guidance is not without caveats. Management acknowledged that tariff exposure is expected to compress gross margins by 20–30 basis points in fiscal 2026 compared with the prior year, a drag that is already embedded in the revised outlook. Inventory levels rose 3.6% year over year, reflecting both demand support and precautionary positioning.
The company maintained $1.3 billion in cash at quarter-end against $2.4 billion in total debt. During Q1, Macy's repurchased 2.6 million shares for $50 million and paid $50 million in dividends. The board has increased the dividend by 27% since reinstating it in 2021.
