How Macy's CEO Engineered a Surprise Turnaround: 20% Stock Jump on First Comparable Sales Growth Since 2022

TradingKey - Macy's Inc. shares surged 20% on Wednesday as the market expressed confidence in its recent performance improvement, with the company not only significantly raising its full-year profit forecast but also reporting its first comparable-store sales growth in nearly three years.

Source: TradingKey

In its second-quarter earnings report, Macy's overall comparable-store sales increased 1.9% year-over-year, marking the first positive growth since the first quarter of 2022 and the largest increase in three years.

The performance recovery was primarily driven by 125 core Macy's stores, including high-end brand Bloomingdale's and beauty chain Bluemercury, ending the company's streak of 13 consecutive quarters of revenue decline.

Tony Spring, who became CEO in 2024 after long serving as head of Macy's high-end chain Bloomingdale's, quickly launched a series of reform measures aimed at improving operational efficiency and customer experience. These included optimizing shoe department layouts to reduce clutter and enhance shopping convenience, introducing new brands such as DKNY and Good American to diversify product offerings, and improving service quality by increasing the number of fitting room attendants.

During Wednesday's conference call with analysts, Spring shared a customer thank-you letter in which the shopper expressed surprise at the store's clean environment and helpful staff. “I read every customer note that I receive,” Spring said. “Listening to feedback is one of the most important ways we can improve and grow our business.”

Meanwhile, the company has accelerated its store optimization efforts. At the beginning of this year, Macy's announced plans to close 66 unprofitable stores this year, with a total of 150 closures planned over the next three years. As of August 2, Macy's store count had decreased from 506 in the second quarter of last year to 449.

"We still have more locations and supply chain facilities to close," Spring said.

"We'll talk more about that on the fourth quarter call, but it's getting to the right state in our portfolio. I'm a big believer in stores ... but we also have to prune still, a little bit more, to make sure that we have the right relevant portfolio of stores."

Although management is confident about the company's future growth, Telsey Advisory Group’s Dana Telsey maintained a Market Perform rating, citing limited near-term visibility amid competitive retail conditions, macroeconomic pressures, and tariff risks.