The department store operator says shoppers have cut back on buying apparel, and foreign tourists have curbed spending. It cut its earnings outlook. Fred Katayama reports.
Melancholy at Macy's. Quarterly profit plummeted forty percent as sales fell for a fifth straight quarter. Shoppers have cut back on buying clothing. And a strong dollar has pushed foreign tourists to curb spending, which has fallen for the second straight year at its Macy's and Bloomingdale's department stores. Macy's says, it could make up some ground in the fourth quarter, but it cut its forecast for earnings this fiscal year. And it sees the decline in comparable sales widening further. Macy's CEO Terry Lundgren said, "We are not counting on the consumer to spend more." Macy's is hoping to bring back customers by putting out more exclusive merchandise and improving customer service. And it said it would try to wring more value from its real estate, looking at proposals for joint ventures with potential partners. Macy's shares, down nearly 44 percent over the last 12 months, fell sharply further in early trading. Other retailers have been suffering as consumers shy away from apparel and younger shoppers stay away from malls and shop online instead.