Several American department store chains continue to underperform. Both Macy’s and Kohl’s experienced turnover slumps compared to the previous year, even though they both managed to beat analysts’ expectations.
Important period incoming
The chains have tried to steady the ship for quite some time now, but have not succeeded: Macy’s second quarter turnover dropped from 5.9 billion dollars (5 billion euro) in 2016 to 5.6 billion dollars (4.8 billion euro) this year. Like-for-like turnover also slumped 2.8 %. Kohl’s turnover dropped 1 % to 4.14 billion dollars (3.5 billion euro).
Analysts had forecast these drops, but they also point out that the actual harsh times are now incoming. Department store chains really need to take advantage of the upcoming “back to school” and holiday season. Both Macy’s and Kohl’s managed to lower their costs, which contributed to better profit results: Kohl’s profit grew 49 % to 208 million dollars (175 million euro) and Macy’s experienced a 9 million dollar increase to 113 million dollars (almost 100 million euro).
Nordstrom is the exception
Nordstrom is the sole exception, because it did manage a turnover increase in the past second quarter. Its increased online customer base was the main reason for that, something other chains have failed to do. Nordstrom’s like-for-like turnover also grew 1.7 %, but its profit slumped 6 % to 110 million dollars (93.6 million euro).
Macy’s announced last year that it would shut down 100 stores in order to sell the real estate, something Kohl’s will not do. The latter is contemplating smaller stores instead of just shutting them down.