Macy’s had welcomed a new era of success this year, but its recent announcement to cut its full-year guidance has changed the story. Despite good quarterly earnings, the world-renowned department store has revised its outlook for the rest of the year, leaving many wondering what lies ahead.
1. Macy’s Makes Minor Upward Turn
Macy’s stock renews investor confidence
The performance of the retail giant Macy’s gained a small but promising upward turn this week, giving investors much-needed assurance and breathing life into the company’s earnings prospects. Of note was a 4.8% stock increase, which was the biggest one-day gain in nearly a year and a half.
Driving the company’s renewed success this week were improved customer activity, which in part were attributed to expanding digital sales and successful loyalty program initiatives. The former included Macy’s creating an app with augmented reality tech to help customers design their own living spaces in 3D, as well as rolling out a virtual stylist program. The latter measure means customers can now earn rewards for digital shopping activities, such as signing up for the Macy’s newsletter.
These efforts have been well received so far, and are allowing Macy’s to slowly but surely reclaim some of its past glory and reputation from years past. This bodes well for the future of the brand and the long-term success of its investors as well.
2. Lowering Full-Year Outlook
Weighing the Risks
The second quarter of the year is an important time for assessing annual outlook. This is especially true if the first quarter results are disrupted by market or industry changes. Major companies may choose to lower their full-year outlook in order to remain competitive. When this happens, key considerations must be taken:
- How might the revised outlook affect employee morale?
- Are there adjustments that could be made to make up for lost revenue?
- Do current strategies still apply in light of the new outlook?
These are the questions businesses must ask themselves when altering their existing plans. To minimize further disruption, it’s often a good idea to act swiftly and decisively. After all, no one wants to be caught in a situation where they’ve made a guess about the future and then have to backtrack afterward. As such, it’s important to consider all angles before revising the full-year outlook.
Adapting the Message
It’s also important to consider how to communicate the revised outlook externally. This may be especially true when the changes affect a company’s share price. Appropriate messaging should be crafted in order to ensure investors, customers, and partners are kept in the loop without causing unnecessary panic.
When revising and dispersing a new outlook, there should be an emphasis placed on remaining positive and confident. Confidence can engender trust in any situation, and it’s important to remain steadfast in any downturns. There are also several ways to spin the news in a positive light, such as noting how the revised outlook fits in with larger trends or how the business is adapting to the long-term vision.
3. Positive Earnings Bring Hopeful Outlook
When companies in the stock market post positive quarterly earnings, it usually means one thing: things are looking up. Each positive report is a sign that the market is becoming strong and that investor confidence is growing. Here are a few very encouraging signs that positive earnings bring for the near future:
- Increased Market Dynamism. Positive earnings show that companies are meeting their financial goals and making more profit than expected. This awakens more investors to the market, creating a wave of new energy and buying interest, which can bolster prices and help bring in new life.
- Stronger Economic Infrastructure. With successful companies driving more investment and actively expanding through marketing, investments and the development of services, the infrastructure supporting the economy can become stronger. This increased infrastructure can create more jobs and economic stability.
As more positive earnings come in, we can be sure the outlook is becoming more auspicious. Overall, this is a very encouraging sign that things are set to improve and that business will be more lucrative in the near future.
4. Reinvigorating Macy’s 2019 Forecast
With new strategies and innovative tactics, Macy’s outlook for the remainder of 2019 is looking up.
- Business Transformation: Macy’s has implemented a variety of transforming strategies such as the launch of a mobile app, curated pop-up shops, and the opening of city-exclusive in-store experiences. These initiatives have garnered positive support and engagement from customers.
- Digital Platforms: The company shifted gears and focused on digital integration across its sites in order to optimize fan engagement. Macy’s expanded its virtual offerings by partnering with established brands such as Nike, Under Armour and others.
Macy’s has also ramped up its marketing efforts, with a revised promotional calendar as well as the introduction of flash sales that are designed to keep customers engaged and motivated. This forward-thinking strategy has proven to be effective, based on reports of increased revenue across different departments. Although there is still room for improvement, Macy’s outlook for the second half of 2019 is looking strong.
Macy’s earnings jump this quarter was a welcome surprise to investors with the retail giant beating expectations. Even so, due to the increased uncertainty in the market, Macy’s management had to make some tough decisions going forward and took a realistic approach with its revised outlook. As Macy’s continues to navigate these uncharted waters, investors, customers, and other stakeholders await news of further developments.
