Macy's, Inc.
For the period ended Aug 2, 2025. Filed Sep 10, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Aug 2, 2025 · Filed Sep 10, 2025
M$23.08-4.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-05-03; filed 2025-06-05.
0001628280-25-029500
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-08-02; filed 2025-09-10.
0000794367-25-000145
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 77 previous paragraphs and 86 current paragraphs.
35 unchanged; 30 reworded; 18 added; 11 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 17 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
◦Macy's delivered its strongest second quarter net promoter score on record.
Current report
◦Revitalize assortment: Our assortment matrix evolution continues to gain traction. As one of our vendors' largest partners, we receive compelling product from the brands our customers are asking for, such as Coach, Donna Karan, Levi’s and Ralph Lauren, all of which have thrived at Macy's. We have been attracting new partners, including abercrombie kids, expanding distribution of existing labels such as Sam Edelman, Hugo Boss and Good American, and continuing to update our private brand assortments. Our off-price concept, Backstage, and Macy's Marketplace remained strong. Backstage and Marketplace fill white space in our assortments and help us maintain loyal customers seeking more price and brand variety.
Current report
◦Bloomingdale's: Bloomingdale's achieved its highest second quarter sales and net promoter score on record. During the second quarter, ready-to-wear, fine jewelry, fragrance and tabletop performance were standout contributors to this performance. Bloomingdale's is also known for its special capsules and exclusive partnerships, which build brand excitement and support increased visits to our stores and online. This summer, we had takeover events by contemporary brands MOTHER and STAUD and introduced our latest limited-edition AQUA collaboration, Aqua X Ava Phillippe.
Current report
◦Bluemercury: Bluemercury achieved its 18th consecutive quarter of comparable sales growth. Results were driven by dermatological skincare and recent brand launches including Byredo, Victoria Beckham Beauty and Charlotte Tilbury.
Current report
◦Efforts to drive meaningful change for our customers, and operational and financial performance, continue to progress. We are finding efficiencies through automation, resource optimization and streamlining of processes and are continuing to explore practical applications of artificial intelligence and machine-based learning. Our end-to-end work gives us the ability to invest in our growth ambitions, while simplifying our business model.
Current report
Comparison of the Second Quarter of 2025 and the Second Quarter of 2024
Current report
Net sales for the second quarter of 2025 decreased $125 million, or 2.5%, compared to the second quarter of 2024. The decline was mainly due to the closing of 64 non-go-forward locations last year, which contributed to approximately $170 million of the decline in net sales. Excluding the impact of these store closures, net sales grew 0.9%, which was driven by sales growth at Bloomingdale’s and Bluemercury. At Macy's, comparable sales of women’s contemporary and career, as well as men’s tailored clothing, outperformed the second quarter of 2024. In addition, fine jewelry, watches, textiles and mattresses continued to experience strong demand.
Current report
Gross margin rate declined 80 basis points in the second quarter of 2025 compared to the second quarter of 2024. The decrease in gross margin was driven by proactive markdowns on remaining early Spring assortments and product to maintain inventory health and the flow-through of product bought under the 145% China tariffs.
Current report
Asset sale gains in the second quarter of 2025 reflect the monetization of store locations. Asset sale gains in the second quarter of 2024 mainly related to the sale of one Macy's Furniture location.
Current report
Comparison of the 26 Weeks Ended August 2, 2025 and August 3, 2024
Current report
Gross margin rate decreased 40 basis points in 2025 compared to 2024. The decrease in gross margin was primairly driven by proactive markdowns on remaining early Spring assortments and product to maintain inventory health and the flow-through of product bought under the 145% China tariffs.
Current report
SG&A expenses decreased $28 million, or 0.7%, in 2025 compared to 2024 due to the net impact of the benefit from closed Macy's locations and ongoing cost containment efforts, partially offset by investments in its go-forward business, including Reimagine 125 locations and Bloomingdale's. The increase in SG&A expenses as a percent to total revenue in 2025 was due to a decline in net sales compared to 2024.
Current report
The decrease in net interest expense, excluding loss on extinguishment of debt, in 2025 compared to 2024 wasprimarily driven by a decrease in interest expense as a result of the debt transactions that occurred in fiscal 2024 and 2025.
Current report
The Company completed the following debt transactions in the first half of 2025:
Current report
•On July 29, 2025, the Company completed three debt transactions which resulted in the recognition of $13 million of losses related to the extinguishment of debt on the Consolidated Statements of Income:
Current report
◦Issuance of $500 million aggregate principal amount of 7.375% senior unsecured notes due August 1, 2033. The Company used the net proceeds from the notes offering, together with cash on hand, to fund the tender offer and redemption described below,
Current report
◦Redemption of $393 million aggregate principal amount of senior notes and debentures and issuance of an irrevocable notice of redemption to redeem $194 million aggregate principal amount of senior debentures that was settled after the end of the second quarter of 2025, and
Current report
◦Completion of a tender offer in which $251 million aggregate principal amount of senior notes and debentures were tendered for early settlement. The total cash cost for the tender offer was $255 million.
Removed paragraphs (11)
Previous report
◦Macy's net promoter scores continued to improve year-over-year.
Previous report
◦Revitalize assortment: Our assortment matrix evolution continues to gain traction. Recently introduced contemporary apparel brands Good American, Theory and Nic+Zoe have been well-received, and Coach and Donna Karan continue to resonate with our customers. Our off-price concept, Backstage, and Macy's Marketplace remained strong. In the first quarter of 2025, Backstage outperformed the full-line stores in which it operates by several hundred basis points while Marketplace achieved approximately 40% gross merchandise value growth. Backstage and Marketplace fill white space in our assortments and help us maintain loyal customers seeking more price and brand variety.
Previous report
◦Bloomingdale's: Bloomingdale's positive comparable sales in the first quarter of 2025 benefited from brand launches such as Prada shoes and handbags online, Reformation ready-to-wear and Burberry, and also benefited from improvements in availability and pricing. Bloomingdale's continues to emphasize exclusive partnerships and collaborations that align and reinforce its core identity, positioning and strategy.
Previous report
◦Bluemercury: Bluemercury achieved its 17th consecutive quarter of comparable sales growth driven by the 24 new and remodeled doors opened in 2024, ongoing strength in dermatological skincare, recent brand launches, and a more targeted approach to loyalty communications and offers.
Previous report
◦Efforts to drive meaningful change for our customers, and operational and financial performance, continues to move forward. We are simplifying our business model, containing the cost to serve across the value chain, streamlining its asset portfolio to deliver profitable sales growth, and reinvesting the benefits captured to self-fund an improved Macy's customer shopping experience.
Previous report
Comparison of the First Quarter of 2025 and the First Quarter of 2024
Previous report
Gross margin rate was flat and merchandise margin rate 1 improved 40 basis points in the first quarter of 2025 compared to the first quarter of 2024. The increase in merchandise margin rate is primarily due to favorable shortage and lower liquidations, offset by higher delivery expense as a percent of net sales.
Previous report
1 Merchandise margin is defined as net sales less cost of sales less net delivery expense.
Previous report
The Amended & Extended ABL Credit Facility is secured on a first priority basis (subject to customary exceptions) by (i) all assets of the ABL Borrower including all such inventory and the proceeds thereof and (ii) the equity of the ABL Borrower. The ABL Parent guarantees the ABL Borrower’s obligations under the Amended & Extended ABL Credit Facility.
Previous report
The Amended & Extended ABL Credit Facility contains customary borrowing conditions including a borrowing base equal to the sum of (i) 90% of the net orderly liquidation percentage of eligible inventory, minus (ii) customary reserves. Amounts borrowed under the Amended & Extended ABL Credit Facility are subject to interest at a rate per annum equal to, at the ABL Borrower’s option, either (i) adjusted SOFR (calculated to include a 0.10% credit adjustment spread) plus a margin of 1.25% to 1.50% or (ii) a base rate plus a margin of 0.25% to 0.50%, in each case depending on revolving line utilization. The Amended & Extended ABL Credit Facility also contains customary covenants that provide for, among other things, limitations on indebtedness, liens, fundamental changes, restricted payments, and prepayment of certain indebtedness as well as customary representations and warranties and events of default typical for credit facilities of this type.
Previous report
The Amended & Extended ABL Credit Facility also requires Macy’s, Inc. and its restricted subsidiaries to maintain a fixed charge coverage ratio of at least 1.00 to 1.00 as of the end of any fiscal quarter if Availability plus Suppressed Availability (each as defined in the Amended & Extended ABL Credit Facility) is less than the greater of (a) 10% of the Loan Cap (as defined in the Amended & Extended ABL Credit Facility) and (b) $175 million, in each case, as of the end of such fiscal quarter.
Reworded paragraphs (30)
Previous wording
For purposes of the following discussion, all references to "first quarter of 2025" and "first quarter of 2024" are to the Company's 13-week fiscal periods ended May 3, 2025 and May 4, 2024, respectively.
Current wording
For purposes of the following discussion, all references to "second quarter of 2025" and "second quarter of 2024" are to the Company's 13-week fiscal periods ended August 2, 2025 and August 3, 2024, respectively. References to the "first half of 2025" or "2025" and the "first half of 2024" or "2024" are to the Company's 26-week fiscal periods ended August 2, 2025 and August 3, 2024, respectively.
Previous wording
The Company started its second year in the implementation of its strategy, A Bold New Chapter, whichf irmly places energy and focus onthe needs of our customer and is centered on an enhanced omni-channel shopping experience across all three of our nameplates. This strategy prioritizes improving the shopping environment and elevating the customer experience, while closing underproductive Macy's stores to focus resources and investments on its go-forward enterprise. During the first quarter of 2025, the Company continued to make progress on the three pillars within the Bold New Chapter strategy, as follows:
Current wording
The Company is in its second year of the execution of its strategy, A Bold New Chapter, whichf irmly places energy and focus onthe needs of our customer and is centered on an enhanced omni-channel shopping experience across all three of our nameplates. This strategy prioritizes improving the shopping environment and elevating the customer experience, while closing underproductive Macy's stores to focus resources and investments on its go-forward enterprise. During the second quarter of 2025, the Company continued to make progress on the three pillars within the Bold New Chapter strategy, as follows:
Previous wording
◦Reimagine 125 Locations: In early February 2025, we overlaid successful initiatives from the First 50 locations to an additional 75 stores for a total 125 reimagined Macy's locations. The additional 75 stores have continued emphasis on customer experience, and build on learnings from the first year of our Bold New Chapter strategy. The Reimagine 125 locations outperformed the rest of the Macy's fleet in the first quarter of 2025. Customers are responding well to our redefined product and experience.
Current wording
◦Reimagine 125 Locations: In early February 2025, we overlaid successful initiatives from the First 50 locations to an additional 75 stores for a total 125 reimagined Macy's locations. The additional 75 stores have continued emphasis on customer experience, and build on learnings from the first year of our Bold New Chapter strategy. The Reimagine 125 locations continued to outperform the rest of the Macy's fleet in the second quarter of 2025. Customers are responding well to elevated merchandise, more effective staffing and localized events as we continue to see stronger Reimagine 125 performance in traffic, average order value and net promoter scores relative to the broader nameplate.
Previous wording
Comparable sales highlights for the first quarter of 2025 versus the first quarter of 2024 related to components of A Bold New Chapter strategy are as follows:
Current wording
Comparable sales highlights for the second quarter of 2025 versus the second quarter of 2024 related to components of A Bold New Chapter strategy are as follows:
Previous wording
•Macy's, Inc. comparable sales declined 2.0% on an owned basis and declined 1.2% on an owned-plus-licensed-plus-marketplace basis.
Current wording
•Macy's, Inc. comparable sales were up 0.8% on an owned basis and up 1.9% on an owned-plus-licensed-plus-marketplace ("O+L+M") basis.
Previous wording
◦Macy's, Inc. go-forward business comparable sales, inclusive of go-forward locations and digital across nameplates, declined 1.8% on an owned basis anddeclined 0.9% on an owned-plus-licensed-plus-marketplace basis.
Current wording
◦Macy's, Inc. go-forward business comparable sales, inclusive of go-forward locations and digital across nameplates, were up 1.1% on an owned basis andup 2.2% on an O+L+M basis.
Previous wording
◦Macy's comparable sales declined 2.9% on an owned basis anddeclined 2.1% on an owned-plus-licensed-plus-marketplace basis. Macy's go-forward business comparable sales, inclusive of Macy’s go-forward locations and digital, declined 2.7% on an owned basis and declined 1.9% on an owned-plus-licensed-plus-marketplace basis.
Current wording
◦Macy's comparable sales were up 0.4% on an owned basis andwere up 1.2% on an O+L+M basis. Macy's go-forward business comparable sales, inclusive of Macy’s go-forward locations and digital, were up 0.7% on an owned basis and up 1.5% on an O+L+M basis.
Previous wording
•Reimagine 125 locations comparable sales, included within Macy's go-forward business comparable sales, declined 1.3% on an owned basis anddeclined 0.8%on an owned-plus-licensed basis.
Current wording
•Reimagine 125 locations comparable sales, included within Macy's go-forward business comparable sales, were up 1.1% on an owned basis andup 1.4%on an O+L+M basis.
Previous wording
◦Bloomingdale'scomparable sales increased 3.0% on an owned basis and increased 3.8% on an owned-plus-licensed-plus-marketplace basis.
Current wording
◦Bloomingdale'scomparable sales increased 3.6% on an owned basis and increased 5.7% on an owned-plus-licensed-plus-marketplace basis.
Previous wording
◦Bluemercury comparable sales increased 1.5% on an owned basis.
Current wording
◦Bluemercury comparable sales increased 1.2% on an owned basis.
Previous wording
See pages 22 to 24 for reconciliations of the supplemental non-GAAP financial measures to their most comparable GAAP financial measure and for other important information.
Current wording
See pages 26 to 28 for reconciliations of the supplemental non-GAAP financial measures to their most comparable GAAP financial measure and for other important information.
Previous wording
SG&A expenses increased $2 million, or 0.1%, in the first quarter of 2025 compared to the first quarter of 2024. During the first quarter of 2025, the Company continued to invest in customer-facing go-forward business initiatives through its end-to-end operations work and savings from closed locations. The increase in SG&A expenses as a percent to total revenue in the first quarter of 2025 was due to a decline in net sales compared to the first quarter of 2024.
Current wording
Selling, general and administrative ("SG&A") expenses decreased $29 million, or 1.5%, in the second quarter of 2025 compared to the second quarter of 2024. During the second quarter of 2025, the Company continued to invest in its go-forward business, including Reimagine 125 locations and Bloomingdale's. These investments were offset by the net impact of the benefit from closed Macy's locations and ongoing cost containment efforts. The increase in SG&A expenses as a percent to total revenue in the second quarter of 2025 was primarily due to a decline in net sales compared to the second quarter of 2024.
Previous wording
The decrease in net interest expense in the first quarter of 2025 compared to the first quarter of 2024 was primarily driven by reduction in interest expense as a result of the tender offer completed in the third quarter of 2024, in which $221 million aggregate principal amount of certain senior notes and debentures were tendered for early settlement.
Current wording
The decrease in net interest expense, excluding loss on extinguishment of debt, in the second quarter of 2025 compared to the second quarter of 2024 was primarily driven by a decrease in interest expense as a result of the debt transactions that occurred in fiscal 2024 and 2025.
Previous wording
The income tax expense of $30 million, or 44.1% of pretax income, for the first quarter of 2025 and $36 million, or 36.7% of pretax income, for the first quarter of 2024, reflect a different effective tax rate as compared to the Company’s federal income tax statutory rate of 21%. The income tax effective rates for the first quarter of 2025 and the first quarter of 2024 were impacted primarily by the effect of state and local taxes and the vesting and cancellation of certain stock-based compensation awards.
Current wording
The income tax expense of $28 million, or 24.3% of pretax income, for the second quarter of 2025 and $45 million, or 23.1% of pretax income, for the second quarter of 2024, reflect a different effective tax rate as compared to the Company’s federal income tax statutory rate of 21%. The income tax effective rates for the second quarter of 2025 and the second quarter of 2024 were impacted primarily by the effect of state and local taxes.
Previous wording
Net sales for the first quarter of 2025 decreased $247 million, or 5.1%, compared to the first quarter of 2024. The decline was mainly due to the closing of the 64 non-go-forward locations last year, which contributed to approximately $170 million of the decline in net sales. Sales growth during the first quarter of 2025 at Bloomingdale’s and Bluemercury was offset primarily by weakness in Macy’s due to weaker than expected international tourism.
Current wording
Net sales for 2025 decreased $372 million, or 3.8%, compared to 2024. The decline was mainly due to the closing of 64 non-go-forward locations last year, which contributed to approximately $340 million of the decline in net sales. Excluding the impact of these store closures, net sales declined 0.3%, driven by weakness at Macy's in the first quarter of 2025 offset by growth at Bloomingdale’s and Bluemercury.
Previous wording
The increase in other revenues included a $37 million increase in credit card revenues primarily due to higher profit share, reflecting both a strong credit portfolio and continued active management of net credit card losses. Macy's Media Network grew $3 million, or 8% from the first quarter of 2024, driven by growth in advertiser spend.
Current wording
The increase in other revenues included a $64 million increase in credit card revenues primarily due to higher profit share, reflecting both a strong credit portfolio and continued active management of credit card losses. Macy's Media Network grew $3 million, or 4%, compared to 2024, driven by growth in advertiser spend.
Previous wording
Asset sale gains in thefirst quarter of 2025 reflected themonetization of store locations and right-sizing of the Company's supply chain network.
Current wording
Asset sale gains in 2025 reflect the monetization of store locations and right-sizing of the Company's supply chain network while asset sale gains in 2024 mainly related to the sale of one Macy's Furniture location.
Previous wording
The Company ended thefirst quarter of 2025 with a cash and cash equivalents balance of $932 million, an increase of $56 million from $876 million at the end of thefirst quarter of 2024. The Company is party to an ABL Credit Facility with certain financial institutions providing for a $2,100 million asset-based credit facility. As of May 3, 2025, borrowing availability was $1,956 million, which reflects a $144 million reduction due to standby letters of credit outstanding.
Current wording
The Company ended thesecond quarter of 2025 with a cash and cash equivalents balance of $829 million, an increase of $183 million from $646 million at the end of thesecond quarter of 2024. The Company is party to an ABL Credit Facility with certain financial institutions providing for a $2,100 million asset-based credit facility. As of August 2, 2025, borrowing availability was $1,957 million, which reflects a $143 million reduction due to standby letters of credit outstanding.
Previous wording
The net cash used by operating activities in the current year versus net cash provided by operating activities in the prior year was primarily driven by increased working capital requirements and lower earnings after excluding non-cash adjustments.
Current wording
The net cash provided by operating activities in the current year versus the prior year was primarily driven by decreased working capital requirements as a result of the implementation of our Bold New Chapter strategy as well as a decrease in cash taxes paid, net refunds received.
Previous wording
The Company's capital expenditures were $177 million in 2025 compared to $229 million in 2024. Capital expenditures in the current year are primarily focused on digital and technology investments as well as omni-channel capabilities.
Current wording
The Company's capital expenditures were $343 million in 2025 compared to $432 million in 2024. Capital expenditures in the current year are primarily focused on digital and technology investments as well as omni-channel capabilities.
Previous wording
The Company paid dividends totaling $51 million and $48 million in 2025 and 2024, respectively.
Current wording
The Company paid dividends totaling $100 million and $96 million in 2025 and 2024, respectively.
Previous wording
On February 22, 2022, the Board of Directors authorized a new $2,000 million share repurchase program, which does not have an expiration date. During the first quarter of 2025, the Company repurchased approximately 8.7 million shares of its common stock at an average cost of $11.66 per share on the open market under its share repurchase program. The Company did not repurchase any shares of its common stock during the first quarter of 2024. As of May 3, 2025, $1,274 million remained available under the authorization. Repurchases may be made from time to time in the open market or through privately negotiated transactions in accordance with applicable securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, on terms determined by the Company.
Current wording
On February 22, 2022, the Board of Directors authorized a $2,000 million share repurchase program, which does not have an expiration date. During the first half of 2025, the Company repurchased approximately 12.6 million shares of its common stock at an average cost of $11.96 per share on the open market under its share repurchase program. The Company did not repurchase any shares of its common stock during the first half of 2024. As of August 2, 2025, $1,224 million remained available under the authorization. Repurchases may be made from time to time in the open market or through privately negotiated transactions in accordance with applicable securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, on terms determined by the Company.
Previous wording
On April 9, 2025, Macy’s Inventory Funding LLC (the “ABL Borrower”), an indirect subsidiary of Macy’s, Inc. (“Macy’s”), and Macy’s Inventory Holdings LLC (the “ABL Parent”), a direct subsidiary of Macy’s and the direct parent of the ABL Borrower, entered into an amendment (the “Amendment”) to the credit agreement governing the existing $3,000 million asset-based credit facility (the “Existing ABL Credit Facility”), which was set to expire in March 2027. The Amendment reduced the asset-based credit facility to $2,100 million (the “Amended & Extended ABL Credit Facility”) and extended the maturity date to April 2030. The Amendment therefore provides Macy’s with access to $2,100 million of committed liquidity for the next five years. The ABL Borrower may request increases in the size of the Amended & Extended ABL Credit Facility up to an additional aggregate principal amount of $1,750 million. The Amended & Extended ABL Credit Facility replaces the Existing ABL Credit Facility, with similar collateral support, but reduced commercial letter of credit fees and unused facility fees.
Current wording
•On April 9, 2025, the Company, entered into an amendment to its ABL Credit Facility which reduced the asset-based credit facility from $3,000 million to $2,100 million, extended the maturity date to April 2030 and maintained similar collateral support, but reduced commercial letter of credit fees and unused facility fees. The Company hadno outstanding borrowings under the ABL Credit Facility as of August 2, 2025 and August 3, 2024.
Previous wording
The Company had $2,785 million aggregate principal amount of senior unsecured notes and senior unsecured debentures (collectively the "Unsecured Notes") outstanding as of both May 3, 2025 and February 1, 2025 with maturities ranging from 2025 to 2043. The Unsecured Notes constitute debt obligations of Macy's Retail Holdings, LLC ("MRH" or "Subsidiary Issuer"), a 100%-owned subsidiary of Macy's, Inc. ("Parent" and together with the "Subsidiary Issuer," the "Obligor Group"), and are fully and unconditionally guaranteed on a senior unsecured basis by Parent. The Unsecured Notes rank equally in right of payment with all of the Company's existing and future senior unsecured obligations, senior to any of the Company's future subordinated indebtedness, and are structurally subordinated to all existing and future obligations of each of the Company's subsidiaries that do not guarantee the Unsecured Notes. Holders of the Company's secured indebtedness, including any borrowings under the ABL Credit Facility, will have a priority claim on the assets that secure such secured indebtedness; therefore, the Unsecured Notes and the related guarantees are effectively subordinated to all of the Subsidiary Issuer's and Parent and their subsidiaries’ existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness.
Current wording
The Company had $1,941 million aggregate principal amount of senior unsecured notes and senior unsecured debentures (collectively the "Unsecured Notes") outstanding as of both August 2, 2025 and February 1, 2025 with maturities ranging from 2027 to 2043. The Unsecured Notes constitute debt obligations of Macy's Retail Holdings, LLC ("MRH" or "Subsidiary Issuer"), a 100%-owned subsidiary of Macy's, Inc. ("Parent" and together with the "Subsidiary Issuer," the "Obligor Group"), and are fully and unconditionally guaranteed on a senior unsecured basis by Parent. The Unsecured Notes rank equally in right of payment with all of the Company's existing and future senior unsecured obligations, senior to any of the Company's future subordinated indebtedness, and are structurally subordinated to all existing and future obligations of each of the Company's subsidiaries that do not guarantee the Unsecured Notes. Holders of the Company's secured indebtedness, including any borrowings under the ABL Credit Facility, will have a priority claim on the assets that secure such secured indebtedness; therefore, the Unsecured Notes and the related guarantees are effectively subordinated to all of the Subsidiary Issuer's and Parent and their subsidiaries’ existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness.
Previous wording
The following tables include combined financial information of the Obligor Group. Investments in subsidiaries of $9,914 million and $9,905 million as of May 3, 2025 and February 1, 2025, respectively, have been excluded from the Summarized Balance Sheets. Equity in earnings of non-Guarantor subsidiaries of $359 million for the 13 weeks ended May 3, 2025 has been excluded from the Summarized Statement of Operations. The combined financial information of the Obligor Group is presented on a combined basis with intercompany balances and transactions within the Obligor Group eliminated.
Current wording
The following tables include combined financial information of the Obligor Group. Investments in subsidiaries of $10,166 million and $9,905 million as of August 2, 2025 and February 1, 2025, respectively, have been excluded from the Summarized Balance Sheets. Equity in earnings of non-Guarantor subsidiaries of $402 million and $761 million for the 13 and 26 weeks ended August 2, 2025 have been excluded from the Summarized Statement of Operations. The combined financial information of the Obligor Group is presented on a combined basis with intercompany balances and transactions within the Obligor Group eliminated.
Previous wording
(a)Includes net amounts due to non-Guarantor subsidiaries of $1 million and $1 million as of May 3, 2025 and February 1, 2025, respectively.
Current wording
(a)Includes net amounts due to non-Guarantor subsidiaries of $2 million and $1 million as of August 2, 2025 and February 1, 2025, respectively.
Previous wording
(b)Includes $370 million of dividend income from non-Guarantor subsidiaries for the 13 weeks ended May 3, 2025.
Current wording
(b)Includes $150 million and $520 million of dividend income from non-Guarantor subsidiaries for the 13 and 26 weeks ended August 2, 2025.
Previous wording
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that certain non-GAAP financial measures provide users of the Company's financial information with additional useful information in evaluating operating performance. Management believes that providing supplemental changes in comparable sales on an owned-plus-licensed basis and an owned-plus-licensed-plus-marketplace basis, which includes the impact of growth in comparable sales of departments licensed to third parties and marketplace sales, as applicable, assists in evaluating the Company's ability to generate sales growth, whether through owned businesses, departments licensed to third parties or marketplace sales, on a comparable basis, and in evaluating the impact of changes in the manner in which certain departments are operated. Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measure which the Company believes provides meaningful information about its operational efficiency by excluding the impact of changes in tax law and structure, debt levels and capital investment. In addition, management believes that excluding certain items that are not associated with the Company's core operations and that may vary substantially in frequency and magnitude from period-to-period from net income (loss), diluted earnings (loss) per share and EBITDA provide useful supplemental measures that assist in evaluating the Company's ability to generate earnings and leverage sales, respectively, and to more readily compare these metrics between past and future periods. Management also believes that EBITDA and Adjusted EBITDA are frequently used by investors and securities analysts in their evaluations of companies, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. The Company uses certain non-GAAP financial measures as performance measures for components of executive compensation.
Current wording
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that certain non-GAAP financial measures provide users of the Company's financial information with additional useful information in evaluating operating performance. Management believes that providing supplemental changes in comparable sales on an owned-plus-licensed basis and an owned-plus-licensed-plus-marketplace basis, which includes the impact of growth in comparable sales of departments licensed to third parties and marketplace sales, as applicable, assists in evaluating the Company's ability to generate sales growth, whether through owned businesses, departments licensed to third parties or marketplace sales, on a comparable basis, and in evaluating the impact of changes in the manner in which certain departments are operated. Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measure which the Company believes provides meaningful information about its operational efficiency by excluding the impact of changes in tax law and structure, debt levels and capital investment. In addition, management believes that excluding certain items that are not associated with the Company's core operations and that may vary substantially in frequency and magnitude from period-to-period from net income (loss), diluted earnings (loss) per share and EBITDA provide useful supplemental measures that assist in evaluating the Company's ability to generate earnings and leverage sales, respectively, and to more readily compare these metrics between past and future periods. Management also believes that EBITDA, Adjusted EBITDA and Core Adjusted EBITDA are frequently used by investors and securities analysts in their evaluations of companies, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. The Company uses certain non-GAAP financial measures as performance measures for components of executive compensation.
Previous wording
The following is a tabular reconciliation of the non-GAAP financial measure of changes in comparable sales on an owned-plus-licensed-plus-marketplace basis, to GAAP comparable sales (i.e., on an owned basis), which the Company believes to be the most directly comparable GAAP financial measure.
Current wording
The following is a tabular reconciliation of the non-GAAP financial measure of changes in comparable sales on an owned-plus-licensed-plus-marketplace (O+L+M) basis, to GAAP comparable sales (i.e., on an owned basis), which the Company believes to be the most directly comparable GAAP financial measure.
Previous wording
(1)Represents the period-to-period percentage change in net sales from stores in operation for one full fiscal year for the 13 weeks ended May 3, 2025 and May 4, 2024. Such calculation includes all digital sales and excludes commissions from departments licensed to third parties and marketplace. Stores impacted by a natural disaster or undergoing significant expansion or shrinkage remain in the comparable sales calculation unless the store, or material portion of the store, is closed for a significant period of time. Definitions and calculations of comparable sales may differ among companies in the retail industry.
Current wording
(1)Represents the period-to-period percentage change in net sales from stores in operation for one full fiscal year for the 13 and 26 weeks ended August 2, 2025 and August 3, 2024. Such calculation includes all digital sales and excludes commissions from departments licensed to third parties and marketplace. Stores impacted by a natural disaster or undergoing significant expansion or shrinkage remain in the comparable sales calculation unless the store, or material portion of the store, is closed for a significant period of time. Definitions and calculations of comparable sales may differ among companies in the retail industry.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
The increase in other revenues compared to the second quarter of 2024 included a $28 million increase in credit card revenues which was primarily driven by a strong credit portfolio and continued active management of net credit card losses. Macy's Media Network revenues were flat to the second quarter of 2024.
Current report — wording carried from elsewhere
See pages 26 to 28 for reconciliations of the supplemental non-GAAP financial measures to their most comparable GAAP financial measure and for other important information.
Current report — wording carried from elsewhere
Income tax expense of$58 million and $80 million, or 31.9% and 27.4% of pretax income, for 2025 and 2024, respectively, reflect a different effective tax rate as compared to the Company’s federal income tax statutory rate of 21%. The income tax effective rates for the 26 weeks ended August 2, 2025 and August 3, 2024 were impacted by the effect of state and local taxes and the vesting and cancellation of certain stock-based compensation awards.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The Company hadno outstanding borrowings under the ABL Credit Facility as of May 3, 2025 and May 4, 2024.