By Kiera Howard 
CINCINNATI, May 15, 2025 – Macy’s plans to close 150 stores nationwide after reporting a $21.3 billion sales drop, company officials confirmed Thursday. The massive retail restructuring, officially called “A Bold New Chapter,” aims to revitalize the struggling department store chain amid shifting consumer shopping behavior and persistent financial challenges.
Already, 55 of the initial 66 locations marked for closure have ceased operations, with the remaining 95 stores expected to close by the end of fiscal 2026. The company will maintain approximately 350 locations once the store closure strategy is fully implemented.
Macy’s CEO Tony Spring described the initiative as “a comprehensive strategy designed to steer the company back towards sustainable and profitable sales growth by fundamentally reshaping its operations, brand positioning, and customer engagement model,” according to company statements from February 2024.
The retailer’s financial performance has steadily worsened in recent years amid the ongoing retail industry decline. Net sales fell 5.5% to $23.09 billion in fiscal 2023, followed by another 3.5% drop to $22.3 billion in 2024. The company now projects fiscal 2025 sales between $21.0 and $21.4 billion, according to official quarterly results.
Department store challenges continue to mount across the sector. Industry analysts note that Macy’s struggles mirror broader issues in traditional retail. Many retailers nationwide face pressure from e commerce on brick and mortar stores, discount retailers, and shopping patterns that changed during the pandemic.
This situation, according to Macy’s corporate filings, “illustrates a complex web of challenges that demand a multifaceted strategic response” from the company and the entire department store sector.
Table of Contents
Remaking the Macy’s Experience
The company’s transformation strategy extends beyond closing underperforming retail locations. After consulting 60,000 customers, Macy’s developed a four part plan to address department store sector viability:
First, reinvigorate the core brand through improved merchandise assortments balancing private and market brands, improved in store service with more staff and better visual presentation, modernized marketing, and a quicker supply chain.
Second, optimize the store portfolio by closing approximately 150 underproductive locations while investing in 350 stores the company refers to as “go forward” locations to ensure the future of physical stores in their network.
Third, expand luxury retail through about 15 new Bloomingdale’s and 30 new Bluemercury locations, demonstrating a clear focus on upscale market segments.
Fourth, accelerate digital growth by improving e commerce capabilities while recognizing the impact of online shopping on brick and mortar retail.
The company describes its omnichannel retail strategy objective as creating “a network where physical stores and digital platforms complement and reinforce each other, offering customers choice and convenience in how they shop,” according to its latest quarterly report.
Early results from the company’s “First 50” store revitalization project show promise amid Macy’s sales performance challenges. These pilot locations achieved 1.6% comparable sales growth in fiscal 2024 while the rest of the chain declined. Based on this success, Macy’s is expanding the initiative to 75 additional stores, creating what the company calls the “Go Forward 125” group.
Communities Feel the Impact
In Rochester, New York, the closure of Macy’s at The Mall at Greece Ridge shows the community impact of the Macy’s restructuring plan. A WARN notice filed with New York State on January 9, 2025, detailed that 127 workers would be affected by two store closures in Rochester and Massapequa, with the locations scheduled to close by April 11.
Mall management across affected locations face the challenge of filling large anchor spaces in the current retail environment. Smaller retailers within these centers often report declining foot traffic after anchor store closures, highlighting the cascading effect on retail centers.
CBS News reports the first wave of closures includes locations across many states, with high concentrations in California, Florida, and the Northeast. The iconic Broadway Plaza location in Los Angeles is among the casualties of the Macy’s store closure strategy.
For affected employees, Macy’s provides severance packages for eligible workers. Documentation from the 2020 closure of a Downtown Seattle location, published by UFCW 3000, showed severance packages included one week of pay for every full year of service, with a cap at 26 weeks.
Wall Street Remains Cautious
Investors have adopted a measured approach to Macy’s transformation plans. The stock has declined 6.03% year to date through early May, with market capitalization between $3.28 and $4.33 billion.
Most analysts maintain “Hold” ratings on the stock, with TipRanks reporting 16 Hold ratings compared to just 3 Buy and 1 Sell as of May 2025. Recent actions include JP Morgan maintaining a Neutral rating with a $13 price target, while UBS reiterated a Sell rating with an $8 target.
Complicating matters, Macy’s disclosed an accounting irregularity in late 2024 involving $151 million in concealed delivery expenses spanning nearly three years. According to FreightWaves, the misconduct stretched from the fourth quarter of 2021 through November 2, 2024, with a single employee intentionally making erroneous accounting entries to misclassify or hide these costs.
Department Store Strategies Diverge
While Macy’s pursues restructuring, competitors are taking different approaches to similar challenges in the face of the retail apocalypse.
Nordstrom reported a 2.2% revenue increase for fiscal 2024, with comparable sales up 3.6%. Their strategy emphasizes service excellence, exclusive product lines, and expansion of their discount Rack division to combat the impact of e commerce on brick and mortar locations.
Kohl’s saw a 7.2% sales decrease with comparable sales down 6.5%. They’ve focused on partnerships like Sephora shop in shops and strengthening their value proposition amid changing retail trends.
Dillard’s managed strong profitability despite a 2% sales decrease, delivering $593.5 million in net income with $36.82 EPS. Their success stems from disciplined inventory management and focus on higher margin fashion, offering another approach to department store challenges.
The upscale market shows particular strength amid the broader retail turbulence. This trend explains Macy’s emphasis on expanding Bloomingdale’s and Bluemercury, which posted comparable sales growth of 2.5% and 4.0% respectively in FY2024.
The premium segment growth extends beyond retail. Even during economic uncertainty, high end experiences like luxury villa rentals in Greece maintain strong demand as affluent consumers prioritize quality over cost savings, paralleling the strategy behind Macy’s upscale brand expansion.
An analysis by The Economic Times projects a record 15,000 store closures across U.S. retailers in 2025, highlighting the sector wide transformation underway.
Path Forward Requires Balance
For Macy’s transformation to succeed, analysts identify several key factors: effective execution of their store closure strategy, successful scaling of the “First 50” model, premium market growth, digital competitiveness to address the impact of e commerce, and strict financial discipline.
The company aims to generate $600 to $750 million from property sales through 2026, with $144 million already realized in FY2024. These funds will help finance investments in remaining stores and support Macy’s restructuring plan.
Macy’s management has expressed confidence in the underlying strategy of “A Bold New Chapter” while consistently voicing caution regarding the external operating environment, citing macroeconomic uncertainties, inflationary pressures, potential disruptions to global trade, and other factors that could impact consumer spending.
For a company with roots dating to 1858, this transformation represents its most important evolution in retail. Whether Macy’s can reinvent itself amid the retail industry decline or joins the growing list of retail casualties remains to be seen.
What’s certain is that Macy’s to close 150 stores after sales drop $21.3 billion signals a fundamental shift in American retail, with implications extending far beyond the company itself.