Macy's Flagship Sees Surprise Sales Surge Amid Retail Slump

In a rare piece of good news for the struggling retail sector, Macy's flagship store on 34th Street in New York City saw a surprise sales surge last quarter. The department store chain reported that its same-store sales, a key metric, rose for the first time in three years, sending its stock soaring to its second-biggest single-day gain ever.

Macy's is cautiously optimistic about the upcoming holiday season, raising its profit forecast for the year after cutting it last quarter. The company is banking on its higher-income shoppers, especially at its pricey Bloomingdale's and Bluemercury stores, to keep spending on $200 serums and designer totes despite price hikes due to tariffs. While overall sales growth was less than 1% in the past quarter, the positive trend could represent a revival for the company, which has been circled by buyout firms in the past two years.

As part of its makeover, Macy's is focusing on fewer stores that get more attention, a strategy that appears to be paying off. The company's upscale Bloomingdale's and beauty brand Bluemercury are achieving greater same-store sales growth than the Macy's namesake stores, underscoring the retailer's shift towards catering to its wealthier customer base.