It was expected that America’s department store chains suffered through another disappointing holiday season.
The category of retailers that includes J.C. Penney (NYSE:JCP), Nordstrom (NYSE:JWN), and Macy’s (NYSE:M) saw overall sales decline 1.8% from Nov. 1 through Dec. 24, according to a study by Mastercard Spending Pulse that tracked retail spending trends across all payment types, including cash and check.
When Macy’s reported quarterly earnings at the end of November, it trimmed its full-year sales and profit outlook. The company blamed its lackluster results, in part, on “weaker than anticipated performance in lower-tier malls.” But CEO Jeff Gennette had said he had “confidence” in Macy’s holiday plans.
Comparable sales at Macy’s proved lower by 0.7% at its owned stores, over the November/December period, down 0.6% at its owned plus licensed.
There were six fewer days between Thanksgiving Day and Christmas Day in 2019 compared with a year earlier, making for the shortest holiday season calendar possible. Analysts said the short shopping season put more pressure on companies to lure shoppers in with deals.
Some retailers likely deployed steeper and more frequent discounting, which in turn puts pressure on profit margins.
As of Tuesday’s market close, Macy’s shares were down a little more than 40% over the past 12 months. The department store chain has a market cap of roughly $5.5 billion.
Macy’s shares opened Wednesday up 38 cents, or 2.2%, to $18.05.