{"id":52349,"date":"2023-08-24T05:03:49","date_gmt":"2023-08-24T09:03:49","guid":{"rendered":"https:\/\/ifintechworld.com\/uncategorized\/macys-warning-of-weak-second-half-demand-hits-retail-sector-shares\/"},"modified":"2023-08-24T05:03:52","modified_gmt":"2023-08-24T09:03:52","slug":"macys-warning-of-weak-second-half-demand-hits-retail-sector-shares","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=52349","title":{"rendered":"Macy’s warning of weak second-half demand hits retail sector shares"},"content":{"rendered":"
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\u00a9 Reuters. FILE PHOTO: The R.H. Macy and Co.flagship department store is seen in midtown New York, New York, U.S. November 11, 2015. REUTERS\/Brendan McDermid\/File Photo <\/span>
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By Savyata Mishra<\/p>\n

(Reuters) -Macy’s on Tuesday warned of weak consumer spending through the crucial holiday shopping season and signaled a faster-than-expected rise in credit card payment delays.<\/p>\n

Shares of the department store chain closed 14% down at $12.66, their worst day since June 2020. The stock has lost nearly 39% this year.<\/p>\n

The company kept its 2023 forecasts unchanged despite beating Wall Street expectations for the second quarter. Its cautious view also weighed on the retail sector shares, including Kohl’s (NYSE:) and Nordstrom (NYSE:).<\/p>\n

“The macro environment is having the lion’s share of the impact on credit and is a real indicator of where we think the health of the consumer is … supporting our cautious approach,” Macy’s (NYSE:) CFO Adrian Mitchell said on a conference call. <\/p>\n

In a clear sign that higher borrowing costs were straining customers, Macy’s credit card revenue, which accounted for about 2% of the total revenue in the quarter, slumped 41%.<\/p>\n

“The biggest negative surprise was the sharp fall-off in credit income,” Citi analyst Paul Lejuez said.<\/p>\n

The retailer, like Target and Tapestry (NYSE:), has seen a drop in demand from middle-income customers as they cut back spending on apparel and handbags amid elevated inflation.<\/p>\n

This led to bloated inventories for U.S. retailers. Throughout the quarter, Macy’s cleared excess stock after a move to convert its merchandise for the spring and summer hurt demand, leading to a slip in gross margin.<\/p>\n

“It is prudent to maintain our cautious view on the consumer and their capacity to spend on the discretionary categories,” Mitchell said.<\/p>\n

Macy’s reaffirmed its expectations for 2023 sales of $22.8 billion to $23.2 billion and adjusted full-year profit per share between $2.70 and $3.20.<\/p>\n

“What was expected from retailers is that the second half of the year would be easier because comps would be easier … (but) they are up against the consumer slowing down,” said Jessica Ramirez, an analyst with Jane Hali and Associates.<\/p>\n

It posted market-beating adjusted earnings per share of 26 cents, while comparable sales for Macy’s-owned and licensed stores fell by a smaller-than-expected 7.3%.<\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. FILE PHOTO: The R.H. Macy and Co.flagship department store is seen in midtown New York, New York, U.S. November 11, 2015. REUTERS\/Brendan McDermid\/File Photo By Savyata Mishra (Reuters) -Macy’s on Tuesday warned of weak consumer spending through the crucial holiday shopping season and signaled a faster-than-expected rise in credit card payment delays. Shares […]<\/p>\n","protected":false},"author":1,"featured_media":2857,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[1],"tags":[83],"class_list":["post-52349","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-uncategorized","tag-featured","post_format-post-format-video"],"yoast_head":"\nMacy's warning of weak second-half demand hits retail sector shares | iFintechWorld<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. FILE PHOTO: The R.H. 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