The slump added to significant short-term losses for owners of the iconic retailing brand, with the stock down over 60% so far in 2020.
In early July, Macy's revealed some brutal operating and financial metrics for the early days of the pandemic. Thanks to the fact that most of its stores were closed to shoppers in April and May, fiscal first-quarter sales fell by more than 50%. Inventory and impairment charges amplified that challenge and contributed to a $4 billion loss for the period. After adjusting for these writedowns, Macy's still moved from a $137 million profit to a $630 million loss in Q1. "The first quarter of 2020 was challenging for the country, the industry, and Macy's," CEO Jeff Gennette said in an early July press release.
Like most of its peers, Macy's has been encouraged by rebounding growth rates as economies reopened following COVID-19 shutdowns. Still, the department store chain's path back toward revenue growth, let alone profitability, will be hampered by sluggish customer traffic levels at least into 2021.