Macy's, Inc. (M)·Q3 2025 Earnings Summary

Executive Summary

• Macy’s will report Q3 2025 on December 3; as of Nov 20, 2025, the 8-K 2.02 and the Q3 call transcript are not yet available. This pre-earnings recap synthesizes prior two quarters, updated FY guidance, and Q3 guidance to set expectations. Management scheduled the call/webcast for 8:00 a.m. ET on Dec 3 .
• Q2 2025 exceeded guidance: net sales $4,812M, adjusted EPS $0.41, best comps in 12 quarters, and FY 2025 net sales and adjusted EPS guidance were raised on Sept 3 .
• Q3 2025 guidance: net sales $4.5–$4.6B; comps -1.5% to +0.5%; core adj. EBITDA margin 3.3–3.7%; adjusted EPS loss of $0.20 to $0.15, including ~$20M asset sale gains .
• Catalysts heading into Q3: supply chain modernization via new automated China Grove, NC fulfillment center, expected to increase speed/efficiency; dividend maintained at $0.1824 per share (payable Jan 2, 2026) .

What Went Well and What Went Wrong

• What Went Well

  • Positive sales momentum: Q2 comparable sales rose 1.9% (O+L+M), best in 12 quarters; Bloomingdale’s +5.7% comps, Bluemercury +1.2% comps; Reimagine 125 stores outperformed .
  • Cost/credit support: Q2 adjusted EPS $0.41 beat guidance on discipline in SG&A and higher credit revenues (+$28M YoY to $153M) .
  • Management tone and strategy: “Bold New Chapter” showing progress; CEO Tony Spring emphasized being a “multi-brand, multi-category, omni-channel retailer,” with clean inventories (-0.8% YoY) and strong customer experience metrics (record NPS) .

• What Went Wrong

  • Margin pressure: Q2 gross margin rate fell 80 bps to 39.7% due to proactive markdowns and product bought under prior tariff rates .
  • Tariff headwinds: Incremental tariffs increased expected FY GM impact to 40–60 bps (from 20–40 bps), implying ~$0.25–$0.40 EPS headwind; management sees most incremental impact in Q4 .
  • Unit softness/mix: Despite traffic/AOV improvements, unit demand was softer; SG&A as % of revenue increased (38.9% in Q2) due to lower sales and reinvestment .

Financial Results

Income statement snapshot and Q3 guidance

Segment and comp trends

Operating KPIs

Non-GAAP adjustments (Q2): Adjusted EPS excludes $0.08 of impairment/restructuring, $0.05 loss on extinguishment, partially offset by $0.03 tax impact .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Our performance highlights the advantages of being a multi-brand, multi-category, omni-channel retailer… enterprise-wide improvements… give us further confidence that our Bold New Chapter initiatives can drive sustainable, long-term profitable growth.” – Tony Spring, Q2 release .
• “Adjusted EPS of $0.41 was above our guidance… reflecting comparable sales growth, disciplined expense controls, and tariff mitigation actions.” – Tony Spring, Q2 call .
• “We have an always-on approach to profit improvement… efficiencies through automation, resource optimization, and streamlining,” with a prudent view of the consumer and tariffs .
• On tariffs: “We previously had [20–40 bps GM impact]… increased to 40–60 bps… We expect the majority of the incremental impact to impact Q4.” – Tom Edwards .
• China Grove FC: “A significant step in modernizing our supply chain… building a faster, more efficient and agile network.” – Tom Edwards (COO & CFO) .

Q&A Highlights

• Tariffs and pricing: Management is taking a surgical approach to pricing, negotiating with vendors, diversifying origin, and expects most incremental impact in Q4; consumer showing resilience but is “choiceful” .
• SG&A and reinvestment: ~$30M Q2 SG&A savings while reinvesting in go-forward initiatives; longer-term leverage expected via cost actions; guidance keeps SG&A dollars down in H2 .
• Category and comps: Strength in women’s contemporary/career, men’s tailored, fine jewelry/watches; unit demand softer; inventories clean and flexible .
• Credit: Portfolio healthy; Q2 credit revenues +$28M YoY; initiatives to lift usage into 2025 .

Estimates Context

• S&P Global consensus: Unable to retrieve via SPGI at this time (daily limit exceeded). We will update this section post-release with S&P Global consensus comparisons.
• Publicly reported projections: Yahoo Finance page indicated projected Q3 2025 EPS of -$0.14 and revenue of $4.59B as of mid-November; treat as indicative only until S&P Global is available .
• We will anchor estimate comparisons on S&P Global data once accessible and update beat/miss determinations accordingly.

Key Takeaways for Investors

• Setup into Q3: Company guided to a small loss and flattish sales amid tariff headwinds; watch for gross margin cadence and any mix/markdown commentary on the call .
• Momentum in go-forward portfolio: Reimagine 125, Bloomingdale’s, and Bluemercury continue to outperform; narrative hinges on scaling initiatives and offsetting softness in untouched fleet .
• Tariffs are the swing factor: FY GM headwind now 40–60 bps vs 20–40 bps prior; magnitude/timing of mitigation and Q4 impact matter for EPS trajectory .
• Structural levers intact: Supply chain modernization (China Grove), private brand rebuild, marketplace expansion, and disciplined SG&A provide medium-term margin/FCF upside .
• Balance sheet flexibility: Net long-term debt reduced ~$340M through refinancing; no meaningful maturities until 2030; dividend maintained .
• Trading lens: Near-term print risk around tariffs and holiday promo intensity; upside skew if margins prove more resilient and Bloomingdale’s/Bluemercury sustain share gains .
• Post-call actions: Reassess FY guide, Q4 tariff flow-through, private brand penetration targets, credit revenue run-rate; update consensus comparisons when S&P Global access resumes.

Additional references:

• Q2 2025 press release and 8-K (financial statements and guidance) –.
• Q1 2025 press release (trend baseline) –.
• Q4 2024 release and call (strategic context) – –.
• Q3 2025 call/event details and scheduling .
• China Grove fulfillment center opening (operations) .
• Dividend declaration .