Earnings call transcript Q1 2023

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Operator

Greetings, and welcome to the Macy's, Inc.

First Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.

I will now turn the call over to Pamela Quintiliano, Vice President of Investor Relations. Pamela, you may now begin.

Pamela Quintiliano

operator. you, Thank and everyone, joining us. Good thanks morning, for are me President, Chairman our the Macy's today on call Jeff and Gennette, With Inc. CEO; Tony Spring, and and Adrian our and CEO-Elect; Mitchell, CFO. COO

presentation section of website, quarter press first our our posted with Investors release, macysinc.com. Along a the on has XXXX been

Litigation and forward-looking statements Unless otherwise of could the assumptions differ the forward-looking All are uncertainties with Securities will subject These the and Exchange discussion uncertainties statements Securities subject in to and we factors these comparisons harbor XXXX. to be to provisions materially Commission. cause Comparisons Private that performance. risks XXXX. noted, contained best Act mentioned provided expectations detailed are benchmark the filings is to actual safe A and today. of results XXXX where provide our from of versus Reform appropriate to are the

discussing In measures. we be financial providing of non-GAAP certain operations, the results will our

these You well regarding can is measures used two A Today's on website. of being find conclusion others replay the call webcast as the available this our of as additional Investors hours approximately be our call. website. section information non-GAAP will financial after on

it I'll over that, Jeff. turn With to

Jeff Gennette

Pam. Thanks,

for joining So good everyone, and thank morning, us. you

a getting navigate they our have Before an environment. moment continued extremely to I started, team want take to acknowledge to and how dynamic macro

to believe more of U.S. pressure demand previously in were be essentials banking in On quarter at and than Subsequently, We crisis earnings pulled consumer, the back anticipated fourth to reallocated identified and macro services. to and worsen macro in temperatures call, compounding factors, to were our note, that further that mid-March the spend The landscape. they cooler but the as said surrounding particularly we we discuss more decelerated food, began Macy's, headwinds. layoffs so On expected some effect headlines current let's XXXX April. trends we and XXXX. intense compared

year, quarter the remainder year we have macro continue assuming half mid-March in our the back headwinds are and of the through for planned the and positioned second business potentially and have ensure We well actions to compete. the we decisive to of worsen, April taken

into go discuss detail and versus at achieved February gross sales above shortly. EPS down were We line quarter diluted adjusted our March largely let's performed line But first margin $X.XX results. rate first, year-over-year. of expectations will in with We these inventories more net on expectations. X% and early below, in were was

and several worsened mentioned, April events, including We in Friends Macy's, As the spring season in break important March. previously Family entered and confident product late Easter. of had trends our and

April progressed, the sold in declined sales inventory XX.X% our had through quarter an of demand and consumer with exposure which income quarter. net holiday declined an XX% or the X.X% household pronounced licensed last As and has about decline the increase X.X% the roughly Macy's, carryover. at Macy's year. its largest began The worsened identified under. with nameplates. By lower and comparable nameplate, middle inventory discipline, versus at the $XX,XXX and average $XXX,XXX under a most of of owned on limited to and with fourth customers income fall We basis was XX% Consistent across majority plus or product we sales

weather-appropriate we conversion healthy and were special and average temperatures but of fashion, product. apparel March, spring challenged. experienced hindsight, did early seasonless in weather and have was while Most occasion including country enough summer time, the but spring period not over-indexed extended below enough an footwear. by with without In too early for traffic we colder converted set well was Store fashion early of and in balance

buying closer below deliberate how discretionary in more were they spend need. increasingly are became allocating expectations as sell-throughs and Ultimately, our customer to

for known are are including On that men's the all particularly and discretionary women's categories and less tailored sportswear beauty, outperformed. career dependent, weather side, fragrances, we flip

categories and certain to in a including textiles, comeback housewares experience top began is of also We pandemic encouraging. table, which

At freshness often, which outperformed locations XXX emphasis stores a These and they within in proposition. Macy's operate a by more curates from price the product and comp plus full-line lower licensed flows store points point seasonless Backstage, value benefited merchandise strong approximately locations owned on sales basis basis. on in which greater a

stores We plan currently including store more this XXX back nine stages, XXX open and within operate a to year.

although our owned impacted Bloomingdale's plus X.X% also gain expectations. were versus Macy's. at declined intensity Bluemercury and year. basis last licensed in and rate were line a Bloomingdale's were sales nameplates, comparable pressures, sales X.X% down Net with same the not by XX.X% luxury as Our macro results or an roughly on

in and particularly value-conscious outlet strength that contemporary men's continued Bloomingdale's the appeals part are more beauty, and to apparel undeveloped outperform. relatively women's Bloomingdale's the housewares. also luxury fragrances, of nameplate registered customer to

as Bluemercury, and At X.X% last sales rose and sales increased results and strength versus care skin XX.X% expectations, retailer. from a medical beauty competitive once unique position a well mix gain luxury benefiting from clinical our in color. X.X% exceeded benefiting as differentiated again Net year, comparable product as

across Quarter-to-date, April accelerated have nameplates. demand trends from

has compelling our As to the more well turned customer seasonal, has our offerings and weather points. price responding been

demand. pent-up We also are likely benefiting from

Bluemercury, tier, have indicate of not Bloomingdale's clarity been income improvements encouraging, a improvements are monitoring. do not by at indicating Although customer further healthier or which whether consumer. trend These we we these a bifurcation closely behavior potentially of and strongest a reflective have change on

was first expectations, Inc. While have ultimately at as end our Macy's, did adjusted better than we not quarter liked. strong as would EPS we

to quarter problems carry not will We one the next. from

for quickly are assortments view we a taking moved of our customer. back time, improve also same of the more our half. composition At cautious We the have to the

second potential quarter full pressures the end through and of while macro both persist, end the ranges guidance progresses. in of as they contemplates high our heightened that April The assume year deterioration mid-March year experienced low

remains levels to and support if to above are we to into chase of right Availability they with that will liquidity year's product confident improves, use we position, strength reserve, last our of demand If we which will demand curves, be able ample as receipt secure inventory our areas strong robust, justified. goods the is materialize.

Now we in actions half specific back compete longer the well we to have let's and turn ensure are taken the term. positioned to to

the For markdowns depth that as of we promotional and have Macy's receipts timing to the were flows clearance second following rapid includes unable the liquidate first demand. moving events, accelerated deterioration May This slower at and spring we quarter, merchandise. transitional in to well impact as seasonal quarter

science We to promotions and our approach merchandise are utilizing with pricing maximize to markdowns margin. tools precision

timing, value and the amount adjusted of receipts. also have proposition composition, We

into and like gifting working, For emphasis our further the are categories and beauty, sportswear third and are on career down-trending are fourth quarters, that leaning we reducing categories.

will Valentine's the Looking we specifically last have exclusives and quarter our position beauty, Mother's this and fourth that great more our strong leverage at destination, newness where had year, Day leading gifting vendor to toys. in compared in and Day including year, a relationships we performance as

warm at been the to also Adjustments We need closer made flow recognized need. have cold to product for weather a of goods balance Macy's. and better

to our our year-round In competitive to we algorithms taken, margin addition, flow maximize receipt pricing are to stronger content. position seasonless partners value and in-stock our and improved offer even to sales, updated proposition. messaging assortment, speak within enhanced core fashion working positioning and marketing actions Other with more

price imperative mix mutually diverse care customers that to elevated This share appropriate not brands that Macy's customers an right and national is morning, the we are of relationship beneficial that are about strategy It we shopping with brands, means omnichannel fall. private excited elevated our assortment, fashion offering. our compelling This and to to we the lowest enhanced appeal base. offering mean Value this back It and reflects content that experiences. bringing the value to Nike and have with does the fashion-conscious right points including the our price. provide nameplate

Line Starting will men's, in plus will selection, cash in sold an October, spring focused locations critical Finish tall in preservation our We partnership with term. nationwide. to be in our of and achieving Footwear online and and big are including long Balance kids, locations key the our to to women's, sheet scaling additional Nike Nike look licensed available gear locations. continue and be health XXXX. We bags expanded remain size on goals. apparel, forward

a ways working, and enterprise clear ago, project of complexity. drive prioritization key we About on capabilities our cost-savings months six to reduce reimagine across embarked

trends, for this Given savings that of and accelerated, XXXX. $XXX year quarter work was have late first $XXX to and cost million we $XXX roughly million savings identified additional in an of million

in have also this specifics, million. We vectors reduced remain growth roughly CapEx five Adrian by our discuss spend $XX protected. will investments but year's the planned

Our results. ambitions greater recent than are our

in XXXX. challenges a single-digit double-digit and are seasoned we levers to sales achieve low our a continue that we and to retailer, margin pull understand we'll EBITDA adjusted beginning As sustainable the aspiration of low the needed growth facing,

at respect The that that next and Adrian's is and Financial a for the developer. a and into promotion further has amount Officer well-deserved I lead biggest and consumer brand have reputation is an excellent and innovator, and team risk rate the incoming deserved. strategy Spring. we us talent as Tony to pressures Chief right that marks year. is am as CEO, marketer this achieving Operating tremendous Chief an confident personal Officer, merchant professional well He future. I builder that an first And accelerated to have goal of a call on the intensify

to together. of will to so to have to over both. acumen and you're our financial thinking future position what you set for comments. look enabled has up crucial Congratulations know achieve it and brief financial continue I Tony, to achieve you turn make hear some I strategic I'm to him Adrian's to And for forward from investments to going us excited all success. us strength current

Tony Spring

Directors and thank for our you for And you Thank for introduction, support. to support. and their Jeff, leadership confidence Board your tremendous of the and

how honored take their am been entire have to our and business. to CEO Inc.'s and Macy's want February. role also colleagues upcoming to for leadership acknowledge our Please on chosen commitment to the humbled ongoing this and know team brands I I

to For a those curious generalist, consider who I the and before, start let's a I and level ambition self-awareness of to I lead. background you my approach leadership. of not met with teams high brings myself have

you I know, many began years Bloomingdale's As ago. career XX my at roughly of

my During merchandise, I've split my time tenure, senior leadership. equally between stores marketing, somewhat and

I've the driving as was that in always the viewed I I back, area As the engine look business. was

intertwined they Today, I realize complementary how are. all and

and compelling. be our products As curated merchant, must a

personalized. our engaging, and a strategy inspiring As must marketer, be

Of course, to experience of and as our the is our a closely large brands commerce. source digital window linked

experience leader, must differentiated colleagues a rally around customer. we enjoyable an our store and centered on the As

of a ensure senior balance of that elements. all as includes recipe Finally, these right the leader, our we must

take to acknowledge the Over the to last distinct a decade, Bloomingdale's. I've my leading privilege I there. of had moment want team

following. loyal and sales tenure, a a offers Coming customer we record our curated off colleague and and achieved merchandise During assortment Bloomingdale's anniversary, engagement. XXXth my has

is distinctive loyalty is and belief and campaigns, which there. animating pop-ups Our best-in-class, our my events, program many retailers marketing underscores activations personal with in

and to Inc. view gives on-mall of and luxury, to off-price satisfy our as off-mall, appetite us an our multi-category brands, categories. I Macy's customers' national multichannel, all of incredible multigenerational brands, platform the to portfolio nameplates and opportunity to representing for private unparalleled

what makes an the acknowledge be we of is outsider/insider is us have experience heightened which which a this My to we've our perspective to room important important brand, exciting improve. That modernized it's at business, but for the that success, period also our we've to so beneficial It's bring part up made during nameplates, tremendous potential to uncertainty. sets recognize to future Macy's Bloomingdale's progress as across of.

forward I'm about. sharing listen months, passionate and my view. renowned for so approach thoughts what's and several disciplined which I revised I and thing a progresses. one merchandise, do I to marketing and a long eyes to not include Recent maintaining intend while next possible which the with know and and certain to digital look areas is to responsibility, this new controllables. as business our is results observations near-term will I outlook continue that focus have year the learn on term of and my my One strategy. Over lead changed a clear incredibly

cold weather However, overemphasizing out we rather seasonless first merchandise. seasonal in balance and of spring quarter, the were merchandise

markdown amount composition buys and to adjusted quarter related the timing for the have holiday. the containing the are We and second fall of and

teams thoughts the the which XXXX top on to my term. line resources and our provide our now of beyond. want growth that vectors, long I to back focus bring five to growth our Macy's, a will Turning take designed Inc. each to are on leverage and in moment to

each that believe to we early, contributor still future. While meaningful be a will the

with First, private Macy's let's brands. start

of the appropriate combination unique the I compelling customers, firmly brands our brands is tied that for brands, has the even my have their curation success of believe popular That brand In the more been of I pleasure private success and of to the strategy. working of target formulas right had private value our all national compelling new equation. Bloomingdale's closely role, with one of both Bluemercury. our on at and team Macy's

first at Macy's. Club both Men's and the During have segments broader INC of been Women's apparel outperformed their reimagined, Room quarter, which respective

ahead, are offer newest Looking our brand, the we of which excited this and women's accessories launch about tuned. apparel summer. Stay later will

vector store Macy’s our to and total small is allow market at and new us optimize second growth Our replacement, both stores. format Bloomingdales' portfolio through densification opportunities. These

They our that's customers, trips. of existing a frequency physically with our locations to localized large-format experience traditional higher balance and on mall closer encouraging target off-mall more a

better these our We're learning customers. stores serve very Results continuing enhance to are we how day can are encouraging. and every

plus one year sales opened regarding and being markets physical the we at off-mall stores existing available owned During achieved and Customer formats. particularly group. first we of scores, are Interestingly, colleagues experiencing experience the checkout helpful comparable format our environment, limited-to-no licensed are where high. in quarter, least cannibalization positive small fiscal ease open

Instead, term, consumers, continues retail work off-mall and we in-person accelerated to bullish we're more dominant be sharing customers making forward this opportunity shopping as the develops look Long for trips. small further. locations store are evaluating method format about enable potential as We U.S. growth. remain to shopping a to additional

Now our on third marketplace. Macy's vector, to growth

to We resulted existing categories, customer seeing expanding and are new customers a increased has younger and basket size. new respond in which our

approximately seeing those roughly indicators strong a quarter not approximately compared gross XXXX customers first XX% the merchandise value rate average ending in We're of order XXX jumping per quarter value and XXX During brands. to order of added marketplace's we XX% growth increasing over with the brands marketplace. the fourth above and quarter, units

Needless earlier launch excited to fall. very in marketplace a say, we Bloomingdale's the to are

are Bluemercury, is excited and their sought-after marketing core vector record continue luxury. customer. XXXX to their satisfying at we're invest nameplates. teams both attracting growth sales and in brands, fourth both leveraging fiscal to Our representing With Bloomingdale's The distinctive

Based assortment. on and for beauty made business store, Macy's, and our larger see vendors At with elevate a commitment marketplace the nameplates. to with a opportunity power of both relationships our luxury I customers, growth in we've our digital

Macy's Mer, is This began that the Maison a we're is in first has Beauty, We offer more the a to [indiscernible] Armani; seeing price Ford; very name resistance more added Gucci, at in Margiela; and luxury limited and environment, horizon. which Tom XXXX including brands, exclusive; beauty even La just many and area since current few. even [indiscernible]; on an partnerships

personalized believe true power but and fifth XX Last messaging. really unlock vector, and to a our me. with communications. the talk I our both will certainly consumers not at right offer offerings it The right to merchandise be resonates growth the time least, promotional over with for offers million

by value on of event level leaned customers' we customer's show predictive based tests, a quarter, personalization our structure. within first behavioral the category of propositions different allow which various offer. were to and us During into of typical offer models These discount

[indiscernible] and engagement. such accelerators to sales cycle and can offers in that to is offers foster customer life This offers earn-back suggest stronger Testing as at-risk loyalty targeted customers. margin growth, personalized expansion addition

have and our campaigns to in use quarter, second We inform and we'll view accelerated Bluemercury. Bloomingdale's of the opportunities analytics-powered at our both learnings

to since and bring thoughtful the almost so I turn three transition He even he skills over this working seamless before years this on complementary let and it more is ago. the noticeable and succession closely impact had leadership and Adrian has am with a joined that so me the makes counsel, to Now have company. I to organization say excited What how to him partnership. be I Adrian, his

will shareholders and our getting despite maturities debt health, return macroeconomic know to the With Inc. look rate the XXXX us uncertainty until sheet interest and within fixed to profitable progress. forward of to environment. opportunities balance material debt we to sharing flexibility financial give growth. our the long-term support, I Macy's including all to Jeff's in you to continue invest and capital Our no return

it Now over to I'll turn Adrian.

Adrian Mitchell

and good everyone. Tony, Thanks, morning,

chain bringing Board three and my on start Financial ago by me. recently responsibilities opportunity our belief my execution the responsibilities thanking and stores, I as goals. include trust Officer the of to me as technology. Officer, From to years and supply want to I design in and With ongoing for expanding Jeff have new go deeper to Operating the their long-term into Chief Chief

creating drives impact aim we and As am by hyper-focused margin this sustainable faster, growth value, those alignment building to have maximize I on business. opportunity a meaningful model operating and longer-term and a that priorities flexible on that on will efficient more more sales

have questions. to How That's experience? with stores to started physical assortment how enhancing updated a omnichannel future. shopping fundamental our with omnichannel we do tackle growth I the our optimize flow, experience our accelerate further the to effort. we the we about small-format capabilities support footprint infrastructure better the customers in do I chain merchandise as while improve our store to it, serve and think evaluating localized multiyear can end-to-end And What shopping supply do aspirations, to and growth we inventory technology our aspire planning modernize how and deliver and several

Reflected been with in a lot of identifying tour, months, DCs areas on on a opportunity. more last the time technology the two and listening team stores, I've spending

in including and balance large-scale in technology, analytics, stores marketing to strategy, and my operations, merchandising, consulting background serves transformation and His stores retail supply nice and years also across and a these highly on As turnover have businesses, up been of impressed I've been and amount in see have these significant a the stability encouraged teams. with ramping hiring, Tony. my spent data in experience been I to I've as with and retention talent time chain.

stores while on modernizing focused inside omni He our specialists understands is retail fashion and and department operations. out transformational a seasoned operator that

needed of into future. Inc. to Macy's are what We is propel the fully aligned

our offer approach and to chase value disciplined to not customers a and unprofitable our maintain and will markdown inventories differentiated We sales. we'll liability, products

us, that's stakes. For now table

of continue simultaneously growth starting XXXX. Looking in core I to ahead, and recent foundation remain vectors. low committed businesses the single-digit Despite EBITDA low while investing to growth of in will a five sales we aspiration achieving our headwinds, double-digit Tony margin our strengthen our and sustainable

provide results Now our before levers our five first an value-creation walk quarter on the I update XXXX through outlook. let's of

own decreased and sales. licensed net X.X% $X prior the sales sales owned ticket X.X%, category First, decline Macy's, X.X%. rose of Inc We versus of driven an by basis increases omnichannel mix. billion, year. Comparable generated on a plus AUR

year, a and an expect AUR to For we lower continue in ticket markdowns of improvement the mix. year-over-year through increases, combination category

Next, other revenue.

As a quarter, other was beginning revenues Macy's reclassing previously revenue. caption, and reported Credit reported we are this card Media were Media credit SG&A. revenue card Network revenue reminder, within own revenues as their Macy's to Network while

During the sales. X.X% million, down were quarter, million other $XXX card net year. Credit revenues were of from $XX revenues last

lower points a As card XX revenues was Network were year, primarily or million $XX sales, portfolio. net percent basis last higher versus the the reflecting than in bad within prior debt million revenue of impact X.X% of Media the year. credit $XX Macy's

creation second the to Moving lever, gross margin. value

year. XX prior levels mix lower by shifts. rate offset XX%, the clearance promotion margin and points was from and of Our margin basis Merchandise lean was category inventory gross above beginning year benefiting flat, markdowns,

point versus contributed penetration. delivery a last to mitigation it packages year, decline expense, continued order per X-point As in rates, and to efforts digital in better reductions relates contracted improvement XX primarily on a cost basis

net half is timing, in XX-month Trailing to productivity. productivity. drive last composition in third beginning The was reflecting the to receipts sales inventory creation the sell-throughs down X% inventory the comparable are strengthen sales of amount our turnover the quarter in declined versus line inventory X% and Inventory with to expected decline. lever and Adjustments year, period. back decline value second year-over-year,

$X.XX fourth SG&A million increased to of is as was the than discipline last billion. creation year. basis Expense lever. or SG&A $XX a points percent XXX higher revenue total value X.X% XX.X%,

wage As and includes continued higher and reflects X was in incentives year-over-year and competitive The colleagues fully dollars across a the lapping implemented for increases year. rate on investments benefits. reminder, of minimum these SG&A colleagues the last increase in May pay stores

and first $X.XX $X.XX was in versus increase quarter accounting the adjusted also After EPS and taxes, SG&A includes diluted for expense. amortization XXXX. in depreciation interest

value Lastly, creation allocation. fifth capital the lever

Our top focus liquidity. is

investments returning to We a business healthy our our a and balance to vectors shareholders. and to take continue allocation, thoughtful five capital prioritizing sheet, in approach growth capital

we year proceeds to compared due lower estate quarter, of million generated invested versus the $XXX the real flow expenditures. of to in cash from $XXX last current primarily last earnings capital year. Free In of flow first an $XXX million million. $XXX operating million cash was quarter We outflow in year, inclusive

As $XX authorization, million. part for of shares X.X approximately open-ended we repurchase back bought share our million

We $XX of also paid million dividends.

to outlook. Now our on

Let's start efforts. savings a with discussion our of cost

savings an outlook. As $XXX Jeff for million of mentioned, incremental year versus our cost this prior we have identified

gross XXXX and and be For be $XXX be and XXXX, been as and margin the we in will in in A in $XXX the the year progresses the fourth has build most XX% savings Roughly estimate the margin, impacting quarter. first between savings gross significant be to the recognized of will SG&A. in SG&A. million remainder million, portion will small both quarter. Savings

so our it year of on is which second let's stance. remain discuss April. macro many with cautious assumes The the quarter full prudent they contemplate to high customer. mid-March experienced outlook, pressure With in while low stable mixed end end worsen through pressures our a signals, both assumes take levels ongoing Now and

that reserves the operational If continue demand will several improves, into the We will and over we and we have embrace chase past implemented financial intra-quarter. to our years. disciplines lean

proof worsen, and Alternatively, will do to We May if for to we can do points and not wait enough. flexibility to going have the further are we trends better. improved adjustments. But trends our are make that, demand

have made the third and correcting been We quarters. have course adjustments to second, and fourth

Macy's, sales to for $XX.X are expectations billion billion. our now year, as $XX.X Inc. of net follows: full the at Looking

X% about year-over-year. basis down on XX-week a owned-plus X.X% sales license Comparable to be to

deeper revenue for of third reminder, in As quarters. the fourth of X.X% is outlook XX% card revenue net The our Other compares inventory rate in A be annual expectation reduction our revenues about in sales of accounting with of our expectations. markdowns quarter card clean that. to credit position. to ensure a result primarily drive and third a sales to in enter the a ease XX.X% credit to margin second XX% XX% we and for sell-throughs the gross on quarter reduced

an viewed a should course. quarter be second in not The exception, as change

Our philosophy remains unchanged.

We to on focused margin. continue be protecting gross

the to the conversion dollar intent expansion. and margin with stimulate year navigate increased will We

Our annual estimate pricing shortage margin includes we owned our gross Starting QX, to further science automate call rate expectations. also we to promotions increased outlook for an shrink, capabilities strategic our initial relative which to inventory. have enhanced in from vendor direct

This pricing unit margin opportunity inventory that and our gives us expansion maximizes the elasticities, to and an turnover left category solution incorporates bring automated inventory sales owned portfolio. optimizes dollar to

a as refine savings earlier. pricing. In the total our is to about continued SG&A along cost XX.X% a work also discussed which landscape enhances our competitive XX.X%, reduction better around expected understanding the sales we addition, percent to our location-level us provides be and competitive in intelligence, with expectations, decisions the of of to revenue reflecting

estimating X.X% X.X% as of net of from $X.XX negative relative to EBITDA account X.X% as previous interest This percent total adjusted our taxes, or into adjusted And a roughly diluted are of increased After we of revenue a to to sales. roughly EPS and takes shortage $X.XX impact annual percent $X.XX. to X.X% a expectations.

does consider potential guidance half. share impact EPS proactive the of repurchases taken does back for adjusted Our the but the actions assume not

points of the margin Gross quarter, quarter no to down second XXX $X.X rate expect the XXXX. basis than second to more of For $X be we for sales billion. net billion

with to May adjust to includes quarter that we markdowns remaining expectations. quarter updated unable align receipts clearance and address The seasonal our to first second time in were inventory sales

expect deterioration We year. quarterly this to be to the prior only

mid-single inventories EPS be $X.XX. be on last is basis. to to percentage to to low a $X.XX to Adjusted diluted year End-of-quarter expected down digits

While There respond, no we focused and consumers work. on and customer line product, for how experience offering our the this finish macro is best cannot control environment value. our the we remain

we have made significant few Over progress the across past organization. the years,

merchants have Macy's model on level build rather incentivized Inc. processes. markdown We by our their performance and to negotiation into with category reduced upfront and vendors, allowances, data than reliance the respective cost an analytics at shifted our

the how ahead, in These shifting XXXX, to educated past. more much we to healthier are place further incorporate accounting our which cost help is in a running together than should disciplines. Looking from Macy's and business speak nameplate the actions

needs early we we annual in recognize customers. The we we to responding current headwind environment gives into foundation balance executing climate March, on we our and the clarity agile the ensure So while meet disciplines have the growth of first to macroeconomic our our our originally and business when our than us created remaining goals. decision-making has built larger with culture introduced long-term are a the on anticipated outlook while

the We remain low double-digit our with that XXXX, sales committed macro to aspiration growth persist. assumption beginning low sustainable a single-digit and fiscal even margin in of achieving pressures EBITDA adjusted

With over that, I'll turn remarks. closing the call back to Jeff some for

Jeff Gennette

Adrian. Thanks,

before, again. with and that weathered has do so we history store department a will modern a are these storms rich We

tools process operational data-driven in periods navigate to future. advantages as financial uncertain us Our we that are the health, continue to efficiencies and allow invest and unique through

team a here at competitive are We Macy's.

still. We are not standing

better improving to our serving committed are customers We business. our and

the and half growth our second Our preserving XXXX in our future goals. and on achieving of fully teams aligned, focused remain sales including opportunities, EBITDA protecting are we and

we it open And with will up that, Q&A. for operator,

Operator

[Operator from Instructions] Today's first Matthew go coming question of is ahead. Boss Please JPMorgan.

Matthew Boss

Great, thanks.

So confidence category income your excess finally, just you the you have fruit on And as do top where the dynamic backdrop, Adrian, this then congrats helm? any recent acceleration the by the trends? elaborate particular, seen of high or you and by hand clearing you across in And quarter? the low-hanging whether this where could opportunity what's level, comfort in this for line take cadence with for cohorts? first, acceleration, on on largest promotion, most see of maybe end Tony, your with inventory Jeff,

Jeff Gennette

me So go and first, then Adrian. turn over we'll Matt, to let and it Tony

further looked line, then what our latter saw to the in in at hit you March, demand, the the March. happening even It in and when top part the was as started of you did cadence the of it deteriorate On February was what of April. and expectations that decelerated month early - our

So pretty receipts sold thought the so back have fresh we - in that you we of at we what was, the We basically fall content there. had not the carryover look enough some seasonal as aggressively first there through the half. when had in we categories categories, at appropriate and the holiday, we quarter, those transitional half and of level look saw did in

We down. we transitioned when into sell-throughs regular market not we have had started and at we seasonal, spring and did to expected that and well price the

that's is So levels where with that of quarter. into the which going the to we're second where in the up, the quarter bucketed that to see inventory piece to have third to when deal we we're units come those kind appropriate going starting be

of line. So that of would top the be on kind the cadence

at you When month across bounce trends recent the you in the saw definitely a but May, Bluemercury. you pronounced back Bloomingdale's look when most nameplates, of look at and

making. that or pent-up the categories, it the that the comment of is that's One for it's acceleration macro warm that environment. an saw So demand attributing we sell-throughs We're where improvement two to a we're in is things. is weather definitely which

answer We yet. don't that know

the have way the year. more half as back the to of between by end second rest get reiterate balance March when trend the through guide the quarter businesses all April the penetration look just you that category, of for brand, we where to the and and our obviously quarters. year, We at, extended differences important Certain we're at looked become of through of you at So much of by the both the the year. from lots

one-year this even CAGR. looked XXXX. very We scientifically. went back did at at at We CAGR. We a two-year the and We looked looked

the looked step we of So that's macro if and top how worse. the And we they get really lower at end how looking guide then when the end. at in we was the were approached conditions

in implied our that what's strategy, is that customers know how you the at that are transacting. responding So look in moment our sure our guide to are we make is when overall to objective

the buying side, would they're I now, tell much closer particularly right on about the What is need. customer Macy's to you

with is reserves the the able of to to opportunity our be in So the market have inventory time respond we to in prudent. have receipt that's all that abundance

your part answer question. first it of turn over your I'll to So Tony to

Tony Spring

as customer I excited I a to Thanks, say, dedicated, challenging certainly first the brand a Matt. results passionate excited would business multigenerational opportunity base. I'm climate. about despite the about and at overall Macy's that is the off, beloved business really and committed see team obviously the with being Macy's

luxury. opportunities of believe more execute should our more really off-price an I should be see, and Inc. do customer. leverage colleagues make I one scale the both our be we portfolio however, for the our to Macy's to that operation, The can asset. business the experience for from to easier fully enjoyable simplify

job think good of opportunity done part science or data I the leaning business. the a of we've into our on STEM

imagination, I and think art if you think more of inspiration. storytelling curation, on do STEAM, of we have business, part to the work our

Adrian Mitchell

to Terrific, Matt, morning good you.

Just that management. clearing answer to out the The inventory. speak And as simple through is we're and you close inventory of of the confident second have we topic record inventory coming out in on around know, the the track quarter.

quarter. and getting we're better Our every is clear, track better record and

year last ended we perspective, in put down to X% in Just inventory.

quarter X% down the first in ended inventory. We

the We to to end quarter down expect digits on low mid-single inventory. second

our tools. are we confident and So, capabilities given our

the context, early. the terms having what in we the is experienced in inventories the we about way fresh and to put in think that mix we is Now transitioned reality the And of first content. quarter just volume,

coming was the of able have bet coming of fourth clear That we because holiday. out and quarter for out a were to us limited carryover

tailored, warm in spring men's So, healthy our numbers. beauty quarter, numbers; very most numbers; career position, but a we look content, weather, you But the of weather cooled. soft seasonal sportswear, numbers; at the entered for solid healthy when healthy

our in have place, through be able we'll balanced the inventory season. and to inventory to entering perspective actions and So, that which we And clear putting track fall on a are we get record in back we're work a on. confident tools our the

Matthew Boss

Thanks, best of luck.

Operator

you. Cowen. Please go question The coming Thank TD from next Oliver ahead. Chen is of

Oliver Chen

for guidance. what's and Hi merchandise I margins the and and in Jeff, was back Tony about curious half Adrian, promotions implied

do efficiently? that As just those the love your most you Would also do behavior? And you duration the things take consumer the with of do QX, markdowns monitoring and in you're take on what's how those?

you that the are broadly that? counts, to in would more Thanks the Tony, what younger And likely do and And on and comp opportunity respect is I how volatility the love you with strategies they that. thoughts customer everybody. think assume lastly, about are transaction dissecting your

Jeff Gennette

me Hi Oliver, let questions. take two your of

as points think to when year. going XXX quarter. for as indicated, going in obviously we thought we first fourth in levels we're basis saw be the last you at last the be the that, that look both we second, that it the of merchandise to year's So within above that was in margins, anticipating we We're third the and

full than year. Now, previous the be will year the higher

we've will us we price overhang the and it higher And can doing we through we you and you the POS marked markdowns we as spring anticipating that there. are is part see the what that now look What before that were those. when right down been doing on first from have expect at take appropriate

in we So getting a year. and have We've last a which of got higher that did margins has we're cycle - AURs playing through. number that than we're we categories higher

points that expecting We're which know looking categories on is to our we're in right sharper price for other there's, value continue. customer getting as that now. promotional then we the And

what You doing and with seeing But doing we're in [indiscernible] can what outlet sales. price we're in our what as well as we're specials arms backstage. see with both

to year, content comparable be to that looking where now last we're we going all and where are to the going right Those at of be. is were

be where at to is pricing have look look be to back when we we're when the So, at we're half to we a Probably going going of with respect back the important the lot newness. we more where confidence promotion. half with with

year. and last learnings all from based And our all to of with the on that categories fourth we've how that going gifting rebuilt where quarter we we're had of be

is that merchandise how margin. So

margins stable Tony? to So described, as and to the expect merchandise be continue promotional so I've

Tony Spring

Oliver, the question. thanks for

we continue will Let first, say me to multi-generational a attract customer.

think target team I start five But has the the with of how did advantage the I'm more of and of generations than in store question fact younger customer being we younger proud customer as years that business I shopping with an terms grow ago. and have it's we us. base, generated we Bloomingdale your department a that the

team first market merchant distribution or to the looking the through inquiring be starts consumers our for, own channels, and our marketplace with in brands. brands so challenging those It are through having

online Second strong know we the have We sure digital younger starts in a presence first and is then social strategy. powerful a obviously that thirdly, space. the making customer

I remember, also think, we've life made some progress. moments. I We our being part still are add brands have of do. at all great more work of a would to

younger I first those all birthdays, an we opportunity know whether house, And of think XXs, wedding, sweet a anniversaries, have job, can are that And own so share is business. customer. greater first to that

Adrian Mitchell

Oliver, it's you. to with morning, great Good be

the deterioration clear want more then than margin, me the made year Let speak When amplify to very the to isolated margin, the it regards I'll Jeff a to no to annual basis second our going higher consumer. year. just the merch and that point points outlook XXX With for that on of last be than look quarter. to is is on gross you at be margin,

that beat and to softness margin And we for cautious think With we year, consumer the back actually the the consumer. regards to experienced we're being had on given half fourth about about as the the last third opportunity in quarters. just the year, of we the

we April. better of perspective. from month the of out But seen Now have it's May, early tell trends than what we in our coming to saw slightly too

to we're assumes the trends, of trends. March low guide end April of cautious the So, taking actually a worsening end our guide, high and consumer the approach of which reflects our

think it early stance. favorability demand? Is and a it's a that is Is warm taking new it too it As we're on so it May trend? pent-up we Is compelling For more us, weather? trends cautious the tell, about to values? there,

Oliver Chen

Thank you, regards. best

Adrian Mitchell

you. Thank

Operator

ahead. Brooke Thank go Goldman you. next question is Sachs. The Please coming from of Roach

Brooke Roach

lower-income was engagement you're context you ended question. any if sub and Good provide seeing further Jeff, cohorts, trends or evidence more your Are down and morning, thank as you a demographic? the on customer higher-income demographic among moved trade the into your ticket could you or our demographic that, traffic you, wondering seeing cohorts bit between and I quarter May. pressure of specific on for taking

more much And being are expect from? sourced to then the bottom on you Adrian, And context you. Where a structure? to are Thank that How for little you savings cost opportunities do there your can cost drop these you additional bit optimize to savings identified. cost to provide further continue line? the

Jeff Gennette

Brooke, question let start customer on me your behavior. So with

been a we're by that are seeing with exact some that entailing speak seen reported Macy's, percentage. the we're cases, have What and spend we're that about more past we've down, types, not either down seeing another responding the in backstage As is of they're it's not responding trade all yet. to out or customer quarters, brand Market it's to basically same seeing in customers we to I'll is trip, What Macy's them.

across look basket AUR you all the at in they last dynamics customers our basically When size year. visits you same our is an of in what their what - had exact of transactions, about see the increase is

expectation is with. out going units. with higher doing AUR, buying that's They're of same. with they're about the the they're basket They're coming size they're less what what the So so the is spending buying, x and

the house, and are The backstage backstage you're in seeing, we're types aggregate. look one the that seeing is when but that in in showing main you out spend showing of seeing ones at where you're But are income - before. up in more up getting them not that we're didn't

So what Bluemercury was saw trend, at month of improvement in both we the though separation a as the in the well the Bloomingdale's. May, as of trend

our does Macy's affluent watching very is carefully. something that one obviously, radar they customer, So, there it Raj, - Are that's screen the now healthier is customer. that to up see they're that right on more showing than

Adrian Mitchell

bit me With about months cost you, to you let morning well. little context. savings, work a to regards this Brooke, great ago. to be good started of six We with give as

source is the And year-to-date of quarter so, comes two saw the we've the those places. in what really first and been doing, The from that given savings we trends activities. accelerate

The XX%. first is margin, represents about which gross

SG&A. is around second The

freight, margin, to focus our rates. inbound and we've lower delivery we contract been able our gross Within on network, our expense, really carrier

the growth and So SG&A, for about this side business, the it's balance trickle should years out identifying actually future system. us. SG&A non-payroll within into and organization repositioning is expenses the remaining operating The something we really on reducing that take complexity the the for actually that around can of is

This year, opportunity. million of incremental we've an $XXX identified

annualized the million. million run to is rate year, Next $XXX $XXX

CapEx love if that to forecast responding reduced to you to to we've dimension addition billion actually $XXX In $X the about our million. add environment, from

investing are team, the to clear, back to protected. get be the and growth to But in We're appropriately initiatives in XXXX. vectors the growth

So, for very good term. making the adjustments, where very going we're in be business we've surgical, and just been to longer disciplined it's

Brooke Roach

Thank you very much.

Jeff Gennette

Thank Brooke. you,

Operator

of Advisory Telsey The you. question Thank Please Dana Group. coming from ahead. Telsey is next go

Dana Telsey

can year, strategy, And Tony, small the expand for what also, Macy's you see store to can you're store for to and you. Macy's? from improvement Tony, Bloomingdale's categories. you back Thank as bringing do, expecting Welcome, the see little both bit half over the on a the AUR which in Bloomingdale's you of please And on expand the welcome, component? lastly, in

Jeff Gennette

that expect a - A Hi let first X.X% me have Dana, going quarter that AUR. one the is take from our of in X% what higher a was so category saw increase. AUR mix. on And lot to about the almost We you post do half. back we're

are trending in environment. driving up us for we at see on our that, There's which categories there. last of is see based the higher that look you AUR and other year is when So some below the you what categories where AUR

price time. when searching cycle, value for competitive we've that in best particular as our that our they're the matching, at looking we're look got customers ensuring you How at

year-over-year. we expect in an AUR do So, improvement

talking I and think POS the as reflects of that in clearance. outlook planned have as that doing our the that the in for we well quarter half we're second all for we're what markdowns both back expectation about markdowns heightened the

good What I in shape. our bring is inventory up really just that is

now to in we committed right we very So other are in categories, spring opportunities chasing while that. we are merchandise, heightened are

business, of we our always the game have the even the reserve categories, our across have trending out market that's freshness of and name there in to because in ones is down content We are available inventory the all that purchase.

any signal on based that our Macy' s are merchants how So have, collective merchants and remember doing. it's rewarded all our that the demand brand just

addressed the being to huge customers right there's for are right us So ensure, time. right opportunities with the that the at content

but end at the AUR there with customers receipts going improvement making going. are consistent all our and be are that to we're where - the our but So, is of of through sure day, that,

Tony Spring

one in fan Dana, the I connect would your the how becoming do we curation, one the from versus of other we nice that am. I No appreciate bigger a develop question brand business to is is strength Bloomingdale's again, question. reframe I than a offer. without to stronger portfolio. learn is certainly assortments each Bloomingdale's another. can We variety expanded bringing redundancy But

of a how strong, we do brands. portion for base, of has business, Bloomingdale's large create representing great, best our but their a programs stronger each customer best customer

for a engage base their both part retail online. Flower in-store credit to theatre, the the motivate gets Bloomingdale's more customer While programs compelling the and heritage. are of Fireworks, frequently, as all develop Parade, brand to Show to Macy's Each needs

forward forward. we So, going do looking can to I'm what

Adrian Mitchell

well. and as format actually you is regards with focus of our our stores to growth part be to good that. on store small is the With Dana, strategy

looking As about the we the the size about with. we're store having centers at, the locations we format we've think looking good feel power conversations at the we're been box that strategy, and

those excited stores, about the no the comp not we're against, small that as which is what in conversation, Tony comp big box to as is are thing earlier we're a to very on spoke cannibalization But positive comp. the able in what is seeing on stores, basis well growth that

and on special we're as things quite here, progress. more to we'll So, share information something

Dana Telsey

Thank you.

Operator

is question from next of Citi. go The Paul Please coming ahead. you. Lejuez Thank

Paul Lejuez

versus the similar more e-com Hi, store your fall And stores, level? the e-com how to it at thanks was isolated business guys. or over off a saw quarter you if performed Curious Thanks. then planning if how into the came you I'm half year just about inventory manage how in you're the curious versus about thinking you currently? would second talk how you could inventories

Jeff Gennette

their to very Paul, we however, were be in expecting in .com so first We year into the .com stores. stores that to that, and came going the and were happened the quarter. of terms case Hi that, modeling similar was performance what

basically the penetration stores that resettling of where customers of more just we in coming to were terms back So in remember .com. as the are This channel. is

what digital. digitally, transact pandemic were in after we 'XX in were Obviously, settles the or influenced they they penetration XX%. XX%. in in XXXX, And there. do research they at XX% high either a XX% at by That there a of of we But very see 'XX,

.com to stores the big what both for point stores that good. was with been consistent the tell relatively has on I the So traffic were headline off in you business and we where the pretty digital is, one quarter, with expected. first respect would

same stores, in rate. So, down in basically up both slightly at about the online, conversion flattish

reset we outstanding hoisted about ideas growth versus in economically earlier Gen attracting expect a to an the strategies, quarter. we're So, the to us our one is, feasible is going this particularly penetration Z as what with in and have customer, of that's big first is more we by it 'XX do future expect the in be past. between for aggressive be but we with stores marketplace in that to the year we're carry not do ones doing in was the question, think the Marketplace marketplace. We're lot them, But of to had very of going excited and to categories digital really the And beyond. the beginning Oliver's stages it. where

content off has spring very us have I sell-throughs we to what healthy seeing as to pretty of plan kind we spring buckets, that we with reserve. performed to outside different seasonal So, value a the Again, just remind, much relates think that when it. way across and of and everything expected all drop the else it inventory, happened in

sales the So in back plan, if hold receipts. we're buying into we a

upfront all markdown We've to of worked on or working MDA an in at model that new out the a our have past. working that model model by we used versus allowance costing

not really for the we needless not customer perfect and where signal have receipts here. not we're seen demand, So, we buying are

down a pricing to relates as science We've so much have We how really opportunity. goods. good it got we mark

as in pricing wherever responsive in retailers that we how the Levi making not and values sure as better that we're that so well where being well disappointed much with a our developing a science carry, opportunities based priced, signals be, marketing are that might to on we like items personalized customer We it demand lot the very promote goods and common see versus there or competitor. but is of just

mix. not control, talked about say would outside the spring goes what I a of that So surprises sell-through. all into lot And inventory we terms of of seasonal just that in

Adrian Mitchell

to The morning. the would importance few earlier the thing question add, around inventory on one good amplify the a Paul, just going and back mix of to things I volume content.

expectations to about think we sales the we've year. volume, the back As made of already for for our the align volume adjustments the with balance half

The into half half to mix going the for the the QX gets really were liability back year. taken actions into minimize important of the back in

And in about the the The fourth the I quarter. would shift exceeds beauty been thing be into business is which amplify to we're going think spoke first our leaning the into of beauty And is back gifting half, XX% earlier when XX% one business our the more and gifting, going getting to in that you through destination. content quarter, but we're the the quarter. in first growing has Jeff

with did that we fourth So, moving the in year in want as we newness, strength. quarter. a toys newness have year. you don't we'll the more of forget being ourselves Disney really distortion we're well position Nike as than this And to feel And about last into

Paul Lejuez

Good you. Thank luck.

Jeff Gennette

Paul. Thanks

Operator

from The is Thank Stanley. next you. Morgan Alex Please coming go Straton question ahead. of

Alex Straton

a the have Great, here. group couple question. for just for thanks the I so much taking

penetration for that First, opportunity I label the private know higher was year. an

has you. just same your from still way on last and back you there? in Or on just do where at view anything if talk second, in invest has outlined And question slowdown? you've a savings cost there wondering I'm follow-up So all earlier pared quarter? that quick plan stands the people the and to demand now then the changed Thank been

Adrian Mitchell

question your cost repeat the the you apologies. SG&A on of we quite it, didn't our could or savings, catch Alex,

Alex Straton

last all do back to you if and been in No still slowdown? people problem. quarter in pared invest just outlined on you tech demand The the the same that's plan question or that at way was

Adrian Mitchell

you. Got

Jeff Gennette

Alex, take of will part private the and the Adrian let question. second your then me brand, take

on the Our same. ambition remains brands private

basically our We see over of call and brands time. particular basically penetration. about been as Room, been growing that have - about touched have this in heard XX% you've was have talk and which it us Club do So been they burnished. INC that And

well. So they're quite performing

got then you portfolio. a coming, we've And look when at we've whole what got

We all the being have XX X.X private years. over touched brands that next are

in So, that we're right the middle of now.

we'll that, women's. first brand but key in details all based is that the is does one accessories, It basics. the across tuned and the basics address coming it we're seasonal talking - of stay summer, So those on about it's seasonless across new

We're be, mugs full one will it's where factors, and in and that. raise the excited at look is years actually that in give we'll - brands will the growth big only But on it of not that a when opportunity. quite the do penetration about you the margin think we opportunity, rundown you why is the out private

our customer doing of brand, is strong the really we biggest size look are of customer brand at value. identity types, course, points which strategic against pain for fit, private compelling But you original with when design, the importantly, and, really and relevant one sourcing, things that five

learnings very launch forward we're So, bullish of and to develop brands sharing those and those strategies look and we them. as on all private

Adrian Mitchell

you're but of the in front Jeff about of term clarity and long-term. navigating losing and Tony, the from importance think near terms Alex, I I us, not is what what's in today the hearing sight of

the of next in in and to terms which the $XXX cost uncertainty year, in out savings $XXX this about what's translate we've will prudent current million million accelerated that's million being happening environment year. $XXX the So there, to

is We've that our billion $XXX year. of we for key million be to current people. keep The invest spend in to in capital whether to tech, in will reduced $X our whether projections be continue that this mind growth, from thing that terms

necessary move actions growth aggressive this get taking in growth to protect as investments years. and uncertain we're through to future growth period, will positive So us profitable we that the

productive operating and model. in to efficiencies we'll growth the ways vectors, more drive continue continue find So, to We'll our with our to assets we'll invest in be

Alex Straton

Good lot. Thanks luck. a

Adrian Mitchell

you. Thank

Operator

question Grom you. go Haskett. next is Gordon coming Thank ahead. Please of from Chuck The

Chuck Grom

for the Hi, how the you about much. your deep business. if and important you suppliers? I that thanks to could just and think of a talked little I'm conversations wondering that's product flowing further bit on have some closer very And and elaborate that on front need, Jeff, interesting with been

Jeff Gennette

Yes, Chuck.

to reserve, in that season. at respond mentioned, the So you always is when available as receipt I look

in So, we're not advance. that allocating

cut back, to something we cost we the build wanted is we're when of the in gave system, the MDA went on to signaling season, customer model that. the that kind So to we jump when versus that that into upfront all model us and a able liquidity of

of respond we where you year. look we liquidity, the balance to sure at did, make past that So the play you total will full for balance we that the do though, the see out year. is discipline that down to that to retain a when took been of receive cuts year, and honed well has for that didn't take We sales reserve over the our

were that the there that down against doing see had those We right So receipts are ensure conversations brands. categories we to put categories trending. to well with that not that are we're trending able

us. merchant has that those knows This customers for is discipline not, with single our Every own. a really receipts assets continue - expect and balanced that us. conversation are serve And company to their that to

how find to that. single - mentioned, inventory we're able there's to I as plenty things in soon the of mean every are be week ordering as as And respond based market trending. on So I to we

Chuck Grom

particular, areas. And table elaborate you is and the what of interesting. out in saw and across apparel a you then And very you housewares wonder and other if just much. from I top Okay textiles helpful. Thank category could which improving called board, you in perspective,

if could wondering tells about what trends quarters you on the that elaborate that was just I area? and So, you few in that next over

Jeff Gennette

been women's think right categories Yes, quarter and was now we're expectations when apparel our the in the from of bulk first you seeing our in so the men's, drop what in that seasonal about is kids. in

would be too is content again, not early is or summer that or that content. the early tell whether So or and to environment. spring And that all whether not

So, we're working now. through that right

number that we of But What's business rest to of across have is the we're that we of continues taking that to right pricing third fragrance, be pockets got to mentioned, center core. as the - category on the quarter. treatment. units and is ensure going are going all the the color in you've going in into strength strong The beauty

to been You've like that home turnaround from you in categories, a has [indiscernible] as our us opportunity like things textiles the for with us coming, newness got quarter. you're fourth mentioned, going the real see

that there. to quarter. side. We see see the right of it out the demand now based coming Macy's our call, see depressed in on that of to of the is starting see really On the - life the We're we The home curve in for on in pandemic about We're and where Bloomingdale's last quite We there. the first starting tabletop, housewares signs brand were looking signs the they to business and life started of talked robust. signs there. quite

at the categories, I Lejuez' and comment So again, to when made penetrate look question is how that each earlier, overall Paul look in the at you quarter. they a categories to need what look to think at you Adrian

gifting penetration are our today what the the we our for that those first customer where idea our the half two much we higher we today confidence know quarter having and the is of and plan for we in for fourth underpinning. in the with strengths our see beauty conservative And So our what feel like about a quarter is being derisked customers trending and in guide of back appropriate in this completely positively year.

Chuck Grom

thanks Great, Jeff.

Operator

UBS. question from final for We're Sole you. Thank go showing question today. time Jay coming ahead. final of is Please The one

Jay Sole

we'll partnership? there? you and Or do Macy's a And how time can sales you. that just bit to sort percent be to was Nike wanted little inventory about it? expect long-term for tell the had of a maybe this you ask from this big couple And last a getting I of quarters new this Maybe Nike partnership. of partnership Thank see us like together? back a about is came how then as

Jeff Gennette

long-term or half. partnership so, where together as provide last businesses to at of Hi multi-brand enhanced. for the of certain and that partnership And a out multi-category we a and We've opportunity and and it took are our our kids Jay, footwear to a and we're in brand a look a long-term customer I the year elevated been is pause. we outside Nike really committing experience basically license

quoting it what our of we the we didn't of year. disappointed that we're past important one customers We customer. so, And not were the lots to brands for carry had it's obviously, that but over used do, most

of this [indiscernible] with active doing customers. balance very So many to uniform the excited We're of to brands. is It about like assortments. things our obviously, what other Reebok important we're the engagement, for our gives our

this is we a be, real catalyst else balance assortments. apparel without cannibalizing to So believe, going in the of the much

across win that when a multi-categories customers for So a million-plus and us. our look come think wanting And at win Nike, it's this is curation you for for we XX to us Nike.

have are that management we pause those that with conversations on the Nike took. So the we

So, you're come of in, the October. going see in it month to

the it's into more apparel, weren't bags, many, including obviously, carrying - women's, It's and going locations, we to tall expands it's men's plus in online be to it's through 'XX. size it You key and kids area it many big in areas. that out licensed have gear. locations get then the we that's It's as

Our finish line business has been have doors and in in that strong, quite continue we today. so the will that all

Jay Sole

you much. so Got it, thank

Jeff Gennette

Jay. Thanks

Operator

to I'd this over Thank Gennette At Mr. floor you. turn the closing to time, for comments. back like

Jeff Gennette

talking in for everybody, forward August to Look our results. second with first Macy's, interest your you summer. you, - thank a our have to again and in with quarter everybody, Just great

Operator

your you thank Ladies participation. today's concludes This for and gentlemen, event.

this You webcast of and time, day. may the disconnect rest log and enjoy your your lines at off the

Macy's (M) 1 Jun 232023 Q1 Earnings call transcript