Macy’s is Closing 125 Stores and Cutting 2,000 Jobs

In an effort to climb out of its battered state, retailer Macy’s has announced that it will be closing 125 stores and slashing around 2,000 corporate jobs.

The company also said that it would close 125 department stores over the next three years as it closes its Cincinnati headquarters and tech offices in San Francisco.

Macy’s aims to turn its focus to opening smaller-format stores in strip centers as it exits weaaker shopping malls. The company has already closed over 100 stores since 2015.

The company expects net sales in fiscal 2022 to be within a range of $23.2 billion to $23.9 billion, while earnings per share, on an adjusted basis, will be between $2.50 and $3.00.

“We are taking the organization through significant structural change to lower costs, bring teams closer together and reduce duplicative work,” said CEO Jeff Gennette.

He added, “The changes we are making are deep and impact every area of the business, but they are necessary. I know we will come out of this transition stronger, more agile and better fit to compete in today’s retail environment.”

The company has also said that it is on track for its private brands to make up 25% of sales by 2025.

Macy’s said it will grow four of its “best” in-house brands — International Concepts, Alfani, Style & Co., and Charter Club — to be worth $1 billion each.

“We’re already well on our way,” Patti Ongman, Macy’s chief merchandising officer said this week. “Private brands are already among our highest margins, but we continue to find ways to improve. We’re building new sourcing and supply chain capabilities.”

Over the past five years, shares of Macy’s have lost well over half its value. In the last 12 months shares have fallen over 30%.

Disclaimer: We have no position in Macy’s Inc. (NYSE: M) and have not been compensated for this article.