The iconic but struggling US department store Macy's announced plans on Tuesday to close almost a third of its eponymous locations by 2026 while building up its upscale Bloomingdale's and Bluemercury brands.
In a new strategy dubbed a "Bold New Chapter" aimed at breathing new life into the 166-year-old retailer, the company said it would shut 150 "underproductive" Macy's locations.
It will close 50 of them by the end of the current fiscal year, it said, without mentioning how many employees would be impacted.
The plan was unveiled a month after it rejected an unsolicited takeover bid.
The company, which had announced in January it would pare its workforce by 3.5 percent, said in a statement that the new strategy would prioritize investment in the remaining 350 Macy's locations.
It added that it "plans to take advantage of its leadership position in the luxury market" as Bloomingdale's and Bluemercury have been "outperformers" within the company's portfolio.
The company said 15 Bloomingdale's nameplate stores and at least 30 new Bluemercury stores would open in new and existing markets over the next three years, along with 30 remodeled Bluemercury sites.
Department stores like 166-year-old Macy's have seen their results suffer for years as consumers increasingly move online, and have been forced to reduce in size -- a trend exacerbated by the Covid-19 pandemic.
Macy's CEO Tony Spring said the "Bold New Chapter" strategy would "challenge the status quo to create a more modern" company.
"We are making the necessary moves to reinvigorate relationships with our customers through improved shopping experiences, relevant assortments and compelling value," he said in a statement.
Along with the new strategy, the company released its year-end results for 2023, posting declining revenues and a sharp drop in profits.
Sales came in at $23.1 billion, down 5.5 percent from the previous year, the company said.
Net profits remained in the black at $105 million, but fell sharply by 91 percent.
Macy's, which is the marquis sponsor of New York's massive Thanksgiving Day parade each year, said in January that it had rejected a $5.8 billion takeover bid from outside investors.
Macy's received "an unsolicited, non-binding proposal from Arkhouse Management and Brigade Capital Management to acquire all of the outstanding shares of the company for $21 per share in cash on December 1, 2023," the company said at the time.
In a letter to the two firms cited in the statement, Macy's chairman Jeff Gennette said he had "serious reservations" about their ability to finance the deal.
In pre-market trading on Tuesday, Macy's shares were down 0.9 percent at $19.13.
