Macy's raises annual profit forecast on tariff refunds, quarterly sales beat

Macy's, Inc. (NYSE:M) raised its full-year profit outlook after quarterly sales topped analyst estimates, helped by a boost from tariff refunds, even as shares of the department store operator fell 3% on weaker-than-expected guidance. The company reported second-quarter revenue of $4.9 billion, above the $4.83 billion analysts had expected and up 1.1% from a year earlier. Adjusted earnings came in at $0.63 per share, including $0.23 from tariff refunds. Excluding the refunds, adjusted earnings per share were $0.40, ahead of the $0.37 estimate and up 14% from a year earlier. GAAP earnings per share doubled to $0.62, also boosted by the refunds. Adjusted EBITDA, which included the tariff refund benefit, totaled $457 million. Macy's received $98 million in tariff refunds tied to the International Emergency Economic Powers Act during the quarter, along with $18 million after quarter end, for a total of $116 million. The net benefit came to $84 million pre-tax, adding $0.23 per share after tax and 180 basis points to gross margin. Gross margin for the quarter was 41.5%, including the refund impact; excluding it, gross margin rose 10 basis points. Comparable sales rose 2.7% for the quarter. Sales at the company's go-forward business increased 2.8%, while Macy's namesake banner posted a 1.1% comparable sales gain. Bloomingdale's comparable sales jumped 11.3%, and Bluemercury climbed 6.2%. For fiscal 2026, Macy's now expects revenue of $21.7 billion to $21.8 billion, up from its prior range of $21.5 billion to $21.75 billion but below the $21.91 billion analysts had forecast. The company raised its adjusted EPS guidance to a range of $2.15 to $2.35, from $2 to