Macy's Inc. Reports Strong Q1 Performance in 2026
Macy's Inc. has unveiled its financial results for the first quarter of 2026, showcasing a robust performance driven by strategic initiatives aimed at enhancing customer experience and driving growth across all brand segments. The company is actively implementing its "Bold New Chapter" strategy, which emphasizes an improved omni-channel shopping experience, store reimagination, and a refreshed product assortment.
1. Quarterly Performance Highlights
In a notable turnaround, Macy's reported a 3.0% increase in comparable sales, marking its highest comparable sales growth in four years. The company achieved a net sales increase of $83 million, or 1.8%, year-over-year, culminating in total revenue of $4.89 billion for the quarter. Excluding the impact of closed non-go-forward locations, net sales growth stood at 2.7%.
The growth was bolstered by strong performances across all nameplates, particularly in categories such as watches, dresses, and handbags. However, some areas, including big-ticket home items, showed softer performance.
| Jun 2025 | Jun 2026 | |
|---|---|---|
Net Income | 558M | 667M |
Profit | 558M | 667M |
Net Income Continuing | 558M | 667M |
Income Tax Expense | 175M | 207M |
Pretax Income | 733M | 874M |
Non-operating Income | -145M | -174M |
Operating Income | 878M | 1.04B |
Revenue | 22.79B | 22.72B |
Costs and Expenses | 21.92B | 21.68B |
Cost of Revenue | 13.58B | 13.56B |
Operating Expenses | 8.33B | 8.12B |
Selling, General & Administrative | 8.33B | 8.27B |
Other Operating Expenses | 0 | -152M |
2. Strategic Initiatives: Store Reimagination and Product Assortment
Macy's has been actively reimagining its store layouts, expanding the initiative to 200 locations. During Q1 2026, the company added 75 reimagined stores, which significantly outperformed the rest of the fleet. This initiative focuses on creating a better shopping experience through improved organization and visual presentation, ultimately enhancing customer engagement.
In addition to store reimagination, Macy's has revitalized its product assortment, introducing new brands such as Rothy's, Donna Karan Weekend, and Ted Baker Men's. The expansion aims to create a more compelling mix of offerings and respond to evolving customer preferences.
3. Customer Experience Enhancements
Macy's has achieved its highest first-quarter net promoter score on record, indicating substantial improvements in customer satisfaction. A new AI-powered shopping assistant, Ask Macy's, has been introduced, demonstrating initial success in boosting conversion rates among users.
4. Luxury Segment Growth
The luxury segment has shown exceptional growth, with Bloomingdale's achieving its highest first-quarter sales in its 154-year history. This success was driven by strong performances in ready-to-wear, men's apparel, and fine jewelry. The introduction of new designer brands and the expansion of the Very Important Client program have significantly contributed to this growth. Bluemercury also reported comparable sales growth, fueled by strong demand for makeup and skincare products.
5. Financial Results Overview
Macy's financial metrics for Q1 2026 reflect the company's ongoing commitment to strategic growth, albeit with some challenges. The gross margin rate experienced a slight decline due to tariff impacts, while selling, general, and administrative expenses increased as the company continued to invest in its strategic initiatives.
| Jun 2025 | Jun 2026 | |
|---|---|---|
Total Assets | 16.08B | 16.30B |
Total Current Assets | 6.29B | 6.89B |
Cash and Equivalents | 932M | 1.29B |
Net Inventories | 4.66B | 4.83B |
Notes and Loans Receivable | 241M | 302M |
Non-trade Receivables | 10M | 0 |
Prepaid Expenses | 445M | 467M |
Total Non-current Assets | 9.79B | 9.41B |
Intangible Assets | 1.25B | 1.24B |
Net PP&E | 4.96B | 4.63B |
Lease Assets | 2.22B | 2.08B |
Other Non-current Assets | 1.35B | 1.44B |
Total Liabilities and Equity | 16.08B | 16.30B |
Other Equity and Liabilities | 3.75B | 3.53B |
Total Liabilities | 7.88B | 7.93B |
Total Current Liabilities | 4.38B | 4.67B |
Accounts Payable and Accrued Liabilities | 4.38B | 4.67B |
Current Debt | 6M | 0 |
Total Non-current Liabilities | 3.49B | 3.26B |
Long-term Debt | 2.77B | 2.43B |
Non-current Deferred Tax Liabilities | 721M | 828M |
Total Equity and Non-controlling Interests | 4.45B | 4.83B |
Total Equity | 4.45B | 4.83B |
6. Capital and Liquidity Position
As of the end of Q1 2026, Macy's reported a cash balance of $1.294 billion, an increase from the previous year. The company maintains access to a $2.1 billion asset-based credit facility, providing significant borrowing capacity. The capital allocation strategy remains focused on maintaining a healthy balance sheet while investing in growth initiatives and returning capital to shareholders through dividends and share repurchases. In Q1, Macy's repurchased approximately 2.6 million shares of its common stock.
| Jun 2025 | Jun 2026 | |
|---|---|---|
Net Change in Cash | 56M | 362M |
Net Cash from Operating Activities | 1.08B | 1.78B |
Operating Profit | 558M | 667M |
Adjustment to Operating Profit | 527M | 1.11B |
Net Cash from Investing Activities | -508M | -655M |
Productive Assets | 513M | 646M |
Other Investing Activities | 5M | -9M |
Net Cash from Financing Activities | -521M | -769M |
Debt | -222M | -335M |
Dividends | 195M | 196M |
Equity Issuance/Repurchase | -98M | -204M |
Other Financing Activities | -6M | -34M |
7. Conclusion
Macy's Inc. has demonstrated resilience and strategic focus in Q1 2026, achieving growth across its nameplates while enhancing customer experiences. The effective execution of the Bold New Chapter strategy, alongside significant investments in store reimagination and product assortment, positions the company for continued success in an evolving retail landscape.
With a commitment to sustainability and corporate responsibility as part of its Environmental, Social, and Governance (ESG) strategy, Macy's is poised to navigate the challenges and opportunities that lie ahead in the retail sector.
