August 23, 2017
Macy’s quietly lays off 100 in cost saving move
Beleaguered mall stalwart Macy’s is eliminating about 100 jobs as it consolidates its merchandising, planning and private brands operations into one department.
It has also named a former eBay executive, Hal Lawton, as its new president.
The consolidation will save the company an estimated $30 million a year, including approximately $5 million, or 1 cent per share, for the the fourth quarter of 2017. According to Macy’s, the change will mean one-time costs of approximately $20 million to $25 million, mostly in the third quarter.
Macy’s stock rose 51 cents, or 2.6%, to $19.53, in pre-market trading Tuesday.
Retailers from J.C. Penney and Sears, to Gander Mountain and The Limited are closing locations as more shoppers buy online and visits to the mall dwindle. And Macy’s, an iconic department store chain, has been one of the most vivid examples of how traditional retailers who once dominated the shopping landscape are struggling to reinvent themselves.
After an earnings report last week that predicted total sales for the full year will be 3.2% to 4.3% lower than in 2016, Macy’s CEO Jeff Gennette told investors that the current retail environment creates “a great sense of urgency” for the company to innovate at a more rapid pace.