Macy’s has delayed its third-quarter earnings report due to a revelation that an employee concealed delivery expenses amounting to $132 to $154 million over recent years. Instead of the full report, Macy’s released preliminary sales figures that disappointed Wall Street, showing a 2.4% drop in net sales to $4.74 billion, slightly below the $4.77 billion expected. The market had been keenly awaiting Macy’s financial outlook amidst a challenging holiday retail environment that favors major players like Walmart and Amazon.
The accounting discrepancies occurred between the fourth quarter of 2021 and the third quarter of 2024, during which Macy’s recorded $4.36 billion as delivery expenses. The employee involved has been dismissed, and an independent investigation confirmed no other involvement or impact on cash management or vendor payments.
The discovery has affected Macy’s share price, which fell by 3.5%. The retailer has rescheduled its earnings report to December 11, where it will also discuss its outlook for the fourth quarter and full year. Despite the setback, CEO Tony Spring highlighted that November sales trends are performing better as the company prepares for the holiday season.
Morningstar analyst David Swartz downplayed the financial impact of the misreported expenses, though the incident suggests Macy’s was unprepared for such discrepancies. As the holiday season approaches, not just Macy’s but also other department store chains like Target are expected to face muted sales due to consumer selectivity and a focus on more affordable essentials.
In a statement, Spring assured stakeholders that efforts are underway to resolve the issue expediently and focus on executing Macy’s strategy for a successful holiday season. Macy’s continues to work diligently to address this matter and maintain consumer confidence during this critical retail period.
Original Story https://www.livemint.com/news/us-news/macys-delays-q3-results-after-finding-employee-hid-millions-in-delivery-expenses-11732556884349.html
Category :
Tags:
