Pressured by unrelentingly lackluster store traffic, Macy’s Inc. announced today its plans to cut 10,100 jobs across its dwindling portfolio of stores.
Following up on plans announced in August — when the retailer said it would close 100 of its 730 stores over the next few years and shift more resources online — Macy’s said that it expects to save $550 million, beginning this year, as a result of its massive streamlining.
Of the 10,100 planned cuts, 6,200 positions are in management, while 3,900 workers are expected to be displaced when the company closes 63 Macy’s stores this spring. (The 63 stores are a part of the 100 closures announced in August.)
“We are closing locations that are unproductive or are no longer robust shopping destinations due to changes in the local retail shopping landscape, as well as monetizing locations with highly valued real estate,” Macy’s chairman CEO Terry Lundgren, who will step down from the helm this year, said in a release. “These are never easy decisions, and we are committed to treating associates affected by these closings with respect and transparency.”
Watch on FN
In conjunction with the announcement, Macy’s also pre-released sluggish holiday sales. The company said its November and December comparable sales on an owned-plus-licensed basis declined by 2.1 percent year-over-year. On an owned basis, comparable sales declined by 2.7 percent during the period.
With traffic trending downward, Macy’s lowered its full-year adjusted earnings per share guidance to a range of $2.95 to $3.10, compared with previous guidance of $3.15 to $3.40.
The news sent Macy’s shares tumbling in after-market trading. As of 4:55 p.m. ET today, its stock price had slipped 9.5 percent, to $35.84.