Macy’s (NYSE: $M) gave investors a reason to look again after posting a fourth quarter that beat expectations and suggested its turnaround strategy is starting to gain traction. The retailer reported fiscal Q4 2025 results on March 18, 2026. Net sales came in at $7.6 billion, ahead of its own guidance, while company-wide comparable sales rose 1.8%. It signals a clear improvement in a business many investors had been treating as structurally challenged, especially after a long stretch of revenue pressure tied to store closures and shifting consumer habits.
The bigger signal was not just that Macy’s beat, but where the strength came from. Go-forward comparable sales for the overall company rose 2.0%, while Bloomingdale’s delivered a standout holiday quarter with comparable sales up 9.9% and Bluemercury posted a 1.3% comp gain. Even the core Macy’s banner, which has been the biggest concern for bulls and bears alike, managed comparable sales growth of 0.4%, with go-forward comparable sales up 0.6%. That suggests the company’s strategy of focusing on stronger locations, improving assortments, and leaning into better execution is beginning to produce measurable results.
Q4 Results Show a Better Business
On the bottom line, Macy’s reported GAAP diluted EPS of $1.84 and adjusted diluted EPS of $1.67, both above expectations. Quarterly net income was reported at $507 million, while adjusted EPS topped analyst estimates of $1.53.
There were still weak spots beneath the headline win. Total Q4 net sales were down 1.7% year over year, and sales at the Macy’s nameplate fell 3.2% when store closures were included. Gross margin also slipped 50 basis points to 35.2%, with the company pointing to an approximately 60 basis point tariff impact. While the quarter was strong enough to change the tone, it was not a clean, across-the-board retail rebound story. Macy’s is still managing through pressure in its legacy fleet even as its stronger assets perform better.
Outlook
Macy’s guided fiscal 2026 net sales to $21.4 billion to $21.65 billion, down from $21.8 billion in fiscal 2025, and projected adjusted EPS of $1.90 to $2.10, below analyst expectations. Management also warned that tariffs, macro uncertainty, and geopolitical risks could pressure margins and consumer spending, especially in the first half of the year.
Market Performance
Wall Street reacted fast. Macy’s shares jumped about 9% in premarket trading after the earnings release, after closing the prior session near a five-month low. The stock had fallen about 23% year to date before the report, which helps explain why a clean beat sparked such a sharp relief rally. A few minutes after the opening bell on March 18, 2026, the stock was up 5.13% to $17.80 per share.
Macy’s is not being priced like a growth story going into the print. It is being priced like a retailer still fighting for relevance. When a stock is already down, even a modestly strong quarter can trigger a powerful re-rating if investors start to believe the downside case was too aggressive.
Is Now the Time to Buy Macy’s?
The bull case is clearer now. Macy’s returned to annual comparable-sales growth in fiscal 2025, generated $1.4 billion in operating cash flow, ended the year with $1.2 billion in cash, and returned $448 million to shareholders through dividends and buybacks. It is also expanding its strategic store initiative from Reimagine 125 to Reimagine 200 in 2026, showing management believes the formula is working.
Macy’s finally gave the market real evidence that its turnaround is gaining traction, but this is still a transition story, not a finished comeback. For investors who believe stronger execution at Macy’s, continued strength at Bloomingdale’s, and disciplined capital returns can outweigh the risks, the stock may look more attractive after this quarter. For everyone else, the next few quarters will need to confirm that Q4 was the start of something durable, not just a good holiday-season headline.
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