Investing.com -- Macy’s (NYSE:M) has reported a decline in second quarter adjusted earnings, as the department store chain's move to roll out discounts aimed at clearing spring collections weighed on top-line returns.
Adjusted diluted profit per share slipped to $0.26 during the 13 weeks ended on July 29, down from $1.00 in the same period last year. But the figure still topped Bloomberg consensus estimates for per share income of $0.14.
Net sales, meanwhile, dropped by 8% annually to $5.13 billion, with both demand at both brick-and-mortar locations and online decreasing.
"Other" revenue slumped to $150 million due in part to a rise in credit card delinquencies. Macy's noted that while it was expecting to see more shoppers fall behind on monthly credit card payments following a recent spike in interest rates, the speed of this increase in delinquencies has been "faster than expected."
"This negatively impacted second quarter results," Macy's said in a statement.
The company also flagged that it will take a "cautious approach on the consumer" throughout the rest of 2023 because of ongoing "macroeconomic pressures and uncertainty." It also reiterated its previously lowered outlook for adjusted diluted earnings per share of $2.70 to $3.20 on full-year net sales of $22.8B to $23.2B.
Macy's slashed the forecast in June, citing a need to conservatively account for a slowdown in customer spending on nonessential items.
Shares in the company edged lower in choppy premarket U.S. trading on Tuesday.