Macy’s Q2 Losses Were Big, But Jewelry Sales Were Resilient

In its second quarter earnings call with investors, Macy’s announced that it incurred steep losses, but that its stores rebounded better than anticipated after the COVID-19 lockdowns.

The company’s net losses totaled $431 million, and comparable sales were down 34.7%. Net sales fell to $3.56 billion, from $5.55 billion in the same period a year ago.

Though foot traffic was sparse, and several categories (notably apparel and luggage) were weak performers throughout the quarter, the company saw sales for luxury goods ascend.

As a result, Macy’s Inc. plans to “lean hard” into luxury at both Macy’s and Bloomingdale’s stores—after seeing surprisingly strong sales in fine jewelry, high-end shoes and handbags, and accessories at both businesses.

The strongest-selling categories at Macy’s stores were housewares and textiles, fine jewelry, fragrances, activewear, and sleepwear. Bloomingdale’s top sellers were home accessories, handbags, fine jewelry, and women’s shoes.

All three Macy’s Inc. brands—Macy’s, Bloomingdale’s, and Blue Mercury—saw significant declines in foot traffic in major cities, including New York and Chicago, where tourism dried up almost overnight due to the pandemic.

Digital sales were a bright spot for the retailer: They grew 53% in the second quarter due in large part to the lockdowns. Though since stores opened in June, that rush to online shopping has moderated, the brand reported.

Macy’s Inc. CEO and chairman Jeff Gennette said on the call, “Restarting our stores’ business was our top priority, and we successfully accomplished that while also ensuring that our digital business remained strong…going into this crisis, we had a well-developed digital business.”

He added that holiday 2020 is the brand’s imminent focus, and that the company plans to invest in fashion, digital, and “omnichannel.”

Top: The exterior of Macy’s Herald Square (photo courtesy of Macy’s)

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