Macy's Exceeds Q4/FY25 Guidance, Returns to Sales Growth, Raises Dividend; Issues Cautious FY26 Outlook

summarizeSummary

Macy's reported Q4 and FY25 results that exceeded guidance, marked by a return to comparable sales growth and a 5% dividend increase, but issued a cautious outlook for FY26.

check_boxKey Events

• Exceeded Q4 and FY25 Guidance

  Macy's, Inc. reported Q4 2025 net sales of $7.6 billion and comparable sales growth of 1.8%, both exceeding guidance. Fiscal Year 2025 comparable sales grew 1.5%, marking a return to positive growth, and adjusted diluted EPS of $2.32 surpassed the company's guidance range.

• Increased Quarterly Dividend

  The board of directors declared a 5% increase in the regular quarterly dividend to 19.15 cents per share, payable on April 1, 2026, reflecting confidence in the company's financial health.

• Significant Shareholder Returns

  In fiscal year 2025, Macy's returned $448 million to shareholders, including $197 million in cash dividends and $251 million in share repurchases. Approximately $1.1 billion remains under the current share repurchase authorization.

• Cautious FY26 Guidance Issued

  The company provided a conservative outlook for fiscal year 2026, projecting net sales between $21.4 billion and $21.65 billion, comparable sales change between (0.5%) and 0.5%, and adjusted diluted EPS between $1.90 and $2.10, all lower than FY25 actuals.

auto_awesomeAnalysis

Macy's reported strong fourth quarter and fiscal year 2025 results, exceeding its own guidance for net sales, comparable sales, and adjusted diluted EPS. Notably, the company returned to positive comparable sales growth for the full fiscal year. This positive performance is further underscored by a 5% increase in its quarterly dividend and significant share repurchases, demonstrating a commitment to shareholder returns. However, the fiscal year 2026 guidance is more conservative, projecting a potential decline in net sales and comparable sales, and lower adjusted diluted EPS compared to FY25 actuals. This cautious outlook suggests management is factoring in macroeconomic uncertainties and tariff impacts, despite the positive momentum from its 'Bold New Chapter' strategic initiatives. Investors should weigh the strong past performance and shareholder-friendly actions against the tempered forward guidance.