National retailer Macy’s has reported an increase in the first quarter of 2018 due to healthy consumer spending and significant improvements in international tourism, the company said on Wednesday.
The company reported that its comparable sales on an owned basis that were up 3.9 percent in the first quarter of 2018 compared to the first quarter of 2017. On an owned plus licensed basis, comparable sales were up 4.2 percent for the first quarter of 2018.
Net sales in the first quarter of 2018 totaled $5.541 billion, an increase of 3.6 percent, compared with sales of $5.350 billion in the first quarter of 2017. Comparable sales on an owned basis were up 3.9 percent in the first quarter and up 4.2 percent on an owned plus licensed basis.
The company estimates that comparable sales in the first quarter of 2018 benefited approximately 250 basis points from the shift of Friends and Family from the second quarter to the first.
Macy’s, Inc. has also set a new approach to its business in China. The company has come to a mutual agreement to end the joint venture with Fung Retailing Limited. Macy’s will remain active on Alibaba’s e-commerce platform TMall, as well as social media channels. The Macy’s e-commerce team in San Francisco will manage the ongoing China business with operational support from Fung Omni in Shanghai.
“Macy’s, Inc.’s results for the first quarter of 2018 reflect continuing momentum in the business. We exceeded our expectations and saw strong performance across all three brands—Macy’s, Bloomingdale’s, and Bluemercury—as well as across all geographic regions and families of business. We are maintaining a healthy inventory position, which helped us deliver improved gross margin,” said Jeff Gennette, Macy’s, Inc. chairman and chief executive officer. “The winning formula for Macy’s, Inc. is a healthy brick-and-mortar business, robust e-commerce and a great mobile experience. While we have more work to do, the continuing improvement in our stores is encouraging and we once again achieved double-digit growth in the digital business. Our best customer is responding well to the improvements we’ve made to her experience in our stores, on .com and through the Macy’s app.”
“Our first quarter performance reflects solid execution of our North Star Strategy, including merchandising and marketing activities. We also saw continued healthy consumer spending and significant improvements in international tourism. Taken together, these positive factors give us confidence to raise both our sales and earnings guidance for the fiscal year,” continued Gennette. “Heading into the second quarter, we are intensely focused on laying the foundation for our 2018 strategic initiatives to support improved performance in the back half of the year.”