Macy’s, Inc. Reports Fiscal Year 2025 & Q4 Results – Exceeds Guidance, Issues 2026 Outlook
Macy’s, Inc. Reports Fiscal Year 2025 and Q4 Results: Outperforms Guidance and Issues 2026 Outlook
Key Highlights
- Fiscal Year 2025 and Q4 Results Exceed Guidance: Macy’s, Inc. ended FY2025 with results that surpassed its previously issued guidance. The company’s “Bold New Chapter” strategy gained traction across all its nameplates during the fourth quarter.
- Strong Financial Position: Macy’s closed FY2025 with \$1.2 billion in cash and cash equivalents, and \$2.0 billion in available borrowing capacity under its asset-based credit facility. Total debt stood at \$2.4 billion, with no material long-term debt maturities until 2030.
- Shareholder Returns: Macy’s returned \$48 million to shareholders via dividends in Q4 2025, and a total of \$197 million for the full fiscal year.
- 2026 Guidance: Macy’s issued its guidance for Fiscal 2026, projecting net sales between \$21.4 billion and \$21.65 billion, comparable sales change of -0.5% to +0.5%, adjusted EBITDA as a percent of total revenue between 7.7% and 7.9%, and adjusted diluted earnings per share (EPS) guidance of \$1.90 to \$2.10.
- Non-GAAP Financial Measures: Macy’s continues to provide non-GAAP metrics including EBITDA, adjusted EBITDA, core adjusted EBITDA, adjusted net income, and adjusted diluted EPS, with reconciliations to GAAP detailed in the release.
Detailed Financial and Operational Review
Q4 and FY2025 Performance
- Net Income: Q4 net income was \$342 million, with full-year net income at \$642 million.
- Earnings Per Share: Q4 basic EPS was \$1.23 and diluted EPS was \$1.21; full-year basic EPS was \$2.10 and diluted EPS was \$2.07.
- Total Revenue: FY2025 revenue reached \$21.8 billion.
- Adjusted EBITDA: For FY2025, adjusted EBITDA margin was 7.9% of total revenue.
- Comparable Sales: Full-year comparable sales rose 1.5%.
- Gross Margin: Gross margin for FY2025 was \$8.27 billion, or 35.7% of sales.
- Operating Income: Operating income for the year was \$1.03 billion.
- Cash Flow: Cash, cash equivalents, and restricted cash at year-end were \$1.25 billion.
- Free Cash Flow and Capital Expenditures: FY2025 capital expenditures were \$373 million for property and equipment, and \$367 million for capitalized software.
Shareholder-Focused Initiatives
- Quarterly Dividends: Macy’s returned \$197 million in cash to shareholders through dividends in FY2025, including \$48 million in Q4.
- Share Repurchases: The company’s guidance does not factor in any potential share repurchases under its current authorization, suggesting further return of capital is possible.
2026 Outlook and Guidance
| Metric |
FY2026 Guidance |
FY2025 Actuals |
| Net Sales |
\$21.4B – \$21.65B |
\$21.8B |
| Comparable Sales Change |
(0.5%) to 0.5% |
1.5% |
| Adjusted EBITDA Margin |
7.7% – 7.9% |
7.9% |
| Adjusted Diluted EPS |
\$1.90 – \$2.10 |
\$2.10 |
Note: Guidance does not include any impact from potential future share repurchases.
Key Shareholder Information and Potential Price Sensitive Items
- Outperformance vs Guidance: Macy’s exceeded its own guidance for FY2025, reflecting positive momentum in the business.
- Solid Liquidity and No Near-Term Debt Maturities: The company’s strong liquidity position and lack of significant debt maturities until 2030 reduce refinancing risk and support future investments or shareholder returns.
- Dividend Continuity and Potential for More Returns: Consistent dividends and the potential for further share repurchases may support share valuation.
- 2026 Guidance Slightly Lower Topline: The 2026 net sales guidance is slightly lower than 2025 actuals, signaling potential headwinds or management caution.
- Non-GAAP Adjustments: The company’s use of adjusted EBITDA and EPS, excluding impairment, restructuring, pension charges, and gains/losses on real estate, provides a clearer picture of underlying earnings but should be monitored for large one-time items that could impact GAAP results.
- No Reconciliation for Forward-Looking Non-GAAP Measures: Macy’s does not provide guidance for the items excluded from adjusted results due to forecasting difficulty, which may introduce some uncertainty for investors.
- Potential Impact of Strategic Execution: Success of the “Bold New Chapter” strategy, performance across all brand nameplates, and further real estate actions remain key swing factors for future performance.
Conference Call Information
Macy’s will host a conference call for analysts and investors (dial-in: 1-877-407-0832). A replay will be available on the company’s investor relations website and by phone (1-877-660-6853, passcode 13757973).
Non-GAAP Financial Metrics
Macy’s provides non-GAAP measures such as adjusted EBITDA, core adjusted EBITDA, adjusted net income, and adjusted diluted EPS. These exclude items like impairment, restructuring, pension settlement charges, interchange fee settlement, debt extinguishment losses, and gains on sale of real estate. Reconciliations and further details are included in the release.
Contact Information
Disclaimer
This article is for informational purposes only and is not investment advice. All financial data is as reported by Macy’s, Inc. in their official filings. Investors should review the full earnings report and consult with a financial advisor before making decisions. This article may contain forward-looking statements subject to risks and uncertainties, and actual results may differ.
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