Macy’s Raises 2026 Outlook After Q2 Comparable Sales Rise 2.7%

Macy’s raised its full-year 2026 outlook after reporting stronger second-quarter results, with companywide comparable sales up 2.7% and earnings improving from a year earlier. The department-store operator said its three nameplates all posted comparable-sales gains in the quarter ended Aug. 1, helping lift both its sales and profit guidance for the year.

The update matters because Macy’s entered 2026 with a cautious forecast shaped in part by tariff pressure and an uncertain discretionary-spending backdrop. Thursday’s results suggested demand held up better than that earlier stance implied, especially at Bloomingdale’s and Bluemercury, while the core Macy’s banner also stayed positive.

Macy’s disclosed the results in an earnings release furnished to the Securities and Exchange Commission. Net sales rose 1.1% to $4.866 billion in the second quarter, while other revenue increased to $193 million from $187 million a year earlier.

Comparable-sales gains were broad, though the luxury banners led

The headline 2.7% comparable-sales increase refers to Macy’s, Inc. as a whole rather than the Macy’s nameplate alone. That distinction is important. Within the portfolio, Macy’s comparable sales rose 1.1%, Bloomingdale’s comparable sales climbed 11.3%, and Bluemercury comparable sales increased 6.2%.

Macy’s said its go-forward business, which includes ongoing locations and digital operations across the company’s nameplates, posted a 2.8% comparable-sales increase. At the Macy’s banner, comparable sales at Reimagine 200 locations were up 1.9%, showing that the stores receiving the company’s priority investment continued to outperform the broader fleet.

The second quarter marked another period of positive comparable sales across all three nameplates. Bloomingdale’s delivered its highest second-quarter sales volume in the brand’s history, according to the company, while Bluemercury extended its own run of growth. That mix matters for investors because it suggests Macy’s recent strategy has not depended only on one part of the portfolio.

Net sales growth remained more modest than comparable-sales growth because the company is still cycling the effect of prior store closures. Macy’s said net sales would have increased 1.9% excluding the impact of fiscal 2025 store closures, which contributed approximately $35 million in the second quarter of 2025. In other words, the company’s like-for-like performance looked stronger than the reported sales figure alone would suggest.

Margins and earnings improved, though tariff refunds played a role

Gross margin was 41.5% in the quarter, up 180 basis points from a year earlier. Macy’s said that figure included a 180 basis point benefit from net tariff refunds, partly offset by a 10 basis point headwind from ongoing tariff and fuel costs. Excluding those effects, gross margin still improved by 10 basis points, indicating that the quarter was not supported only by a one-off benefit.

Selling, general and administrative expense totaled $1.709 billion, down $76 million from a year earlier, while the SG&A rate improved by 170 basis points to 33.9% of total revenue. The company attributed that to lower incentive compensation and tighter expense management, partly offset by investments in growth initiatives and higher performance-based compensation tied to stronger results.

Operating income rose to $386 million from $233 million a year earlier. GAAP diluted earnings per share doubled to $0.62 from $0.31. Adjusted diluted EPS came in at $0.63. Macy’s said adjusted diluted EPS excluding the net tariff refund benefit rose 14% from the prior-year quarter, compared with adjusted diluted EPS of $0.35 a year earlier.

Adjusted EBITDA increased to $457 million, or 9.0% of total revenue, compared with $368 million, or 7.5% of total revenue, in the second quarter of 2025. The company ended the quarter with $1.3 billion in cash and cash equivalents and total debt of $2.4 billion. It said it had no material long-term debt maturities until 2030, a point that helps explain why Macy’s continues to discuss shareholder returns and reinvestment in the same breath.

Shareholder returns remained part of the story. Macy’s said it returned $101 million to shareholders through cash dividends in the first half of 2026 and repurchased $100 million of stock during the same period. That left $1.0 billion remaining under its repurchase authorization as of Sept. 5.

Macy’s lifted guidance and said more investment is coming

For fiscal 2026, Macy’s now expects net sales of $21.675 billion to $21.825 billion, up from its prior range of $21.5 billion to $21.75 billion. It also raised its comparable-sales growth outlook to 1.0% to 1.5%, compared with previous guidance of 0.5% to 1.2%.

The company increased its adjusted EBITDA margin forecast to 7.8% to 8.0%, versus 7.7% to 7.9% before. It also raised adjusted diluted EPS guidance to $2.15 to $2.35 from $2.00 to $2.20. The revised outlook incorporates reinvestment of most tariff refunds, with about $0.05 per share expected to flow through to full-year adjusted diluted EPS.

Macy’s said tariff refunds net of reinvestment added $0.23 per share to adjusted diluted EPS in the second quarter, while about $0.18 per share of reinvestment in the second half is built into guidance. That framing suggests management is using much of the temporary benefit to support merchandising, store and luxury-banner initiatives rather than treating it solely as a near-term earnings windfall.

The company also said its full-year guidance still assumes macroeconomic and geopolitical factors could affect discretionary spending, and it described the forecast as a prudent one intended to preserve flexibility. Even so, the upward revisions imply management sees enough operating momentum to invest while still expecting better full-year profitability.

Macy’s is scheduled to report third-quarter 2026 results in November. That report will show whether the recent run of comparable-sales gains can continue through the more important holiday selling season and whether Bloomingdale’s and Bluemercury can keep outpacing the flagship Macy’s banner.