Macy’s, a cornerstone of American retail for over 165 years, has announced the closure of 65 more stores following the Christmas holiday. This move is part of a larger effort to shed 150 underperforming locations over the next three years, as the company grapples with changing consumer habits and increased financial pressures.
In a third-quarter earnings call on Wednesday, Macy’s CEO Tony Spring outlined the strategy, confirming that the latest round of closures will occur after the holiday season, traditionally the retailer’s busiest time of year. “We now expect to close roughly 65 locations this year,” Spring said, signaling a continuation of the company’s efforts to streamline operations and focus on more profitable locations.
This announcement follows Macy’s February statement that 50 stores would close by the end of the fiscal year. The retailer is clearly moving aggressively to adapt to challenges in the retail sector, including competition from e-commerce giants and evolving shopping behaviors.
Macy’s opened its first store 175 years ago.
It’s been an American Icon since before the Civil War.
Now, it too is closing stores.
What is causing our oldest institutions to collapse? pic.twitter.com/CBonL4WoWR
— Dr. Thom, Ph.D., CPA 🇺🇸 🇺🇸 🇺🇸 (@TAG2335) December 14, 2024
Complicating matters for Macy’s is the fallout from an internal scandal involving a $154 million accounting error. According to a Securities and Exchange Commission (SEC) filing, the error stemmed from “a single employee” who falsified documentation and made “erroneous accounting accrual entries” related to small package delivery expenses.
Macy’s Chief Operating Officer and CFO Adrian Mitchel clarified that the incident was not theft and did not affect revenues, cash flow, or vendor payments. However, the revelation delayed the company’s third-quarter earnings report and prompted an independent investigation. In response, Macy’s plans to overhaul its financial reporting controls to prevent similar issues in the future.
Macy’s, founded in 1858, has long been synonymous with American retail, from its flagship store in Manhattan to its annual Thanksgiving Day Parade. Yet, like many traditional department stores, it faces mounting challenges in an increasingly digital world.
The decision to close stores is part of a broader restructuring strategy to focus on high-performing locations and enhance its digital presence.
While Macy’s continues to streamline its operations, the closures represent more than just a business decision—they mark the ongoing transformation of the retail industry. Iconic names like Macy’s are struggling to maintain their footing in an environment dominated by online shopping and changing consumer preferences.
