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Macy’s said it will close 65 stores this year, an increase from the 50 locations it previously announced it would shutter by the end of the fiscal year. The closures are part of its plan to eliminate roughly 150 underperforming stores over the next three years.
The department store chain made the update public in its third quarter earnings call Wednesday.
“We now expect to close roughly 65 locations this year,” Macy’s CEO Tony Spring said on the call. “In line with our typical cadence, closures will occur post holiday.
Macy’s had delayed reporting its third-quarter earnings after an employee hid up to $151 million in expenses related to delivering small packages. The retailer, which also owns Bloomingdale’s and Bluemercury, last month said it discovered the accounting issue on one of its accrual accounts while preparing its quarterly financial statements.
The company revealed new details on the incident Wednesday, saying that an independent investigation found that “a single employee with responsibility for small package delivery expense accounting intentionally made erroneous accounting accrual entries and falsified underlying documentation,” according to a Securities and Exchange Commission filing.
Macy’s COO and CFO On Adrian Mitchell said the error “was not theft” and that “there was no impact to revenues, and there was no impact to cash or inventories as all vendors were fully paid.”
The company said is overhauling its controls over financial reporting.
Department stores struggling
Macy’s isn’t alone in shuttering brick-and-mortar locations. The retailer’s acceleration of store closures comes as department stores struggle, with fewer shoppers visiting malls, and more Americans making purchases online.
U.S. retailers have announced more than 7,100 store closures through the end of November 2024. That represents a 69% jump from the same time last year, according to recent data from research firm CoreSight. Forty-five retailers have filed for bankruptcy protection so far this year, compared with 25 retail bankruptcies in all of 2023, the report found.
Macy’s, meanwhile, is betting on the success of its other brands, Bloomingdale’s and Bluemercury. It plans to open 15 Bloomingdale’s stores and 30 Bluemercury locations over the next three years, while also remodeling about 30 existing Bluemercury stores, the company said.
Macy’s stock has dropped roughly 20% over the past year.
