UPDATE: Macy's Posts Downbeat Q2 Profit, Lowers Same-Store Sales Outlook

Shares of Macy's

tumbled more than 5% in pre-market trading after the company reported downbeat second-quarter earnings and lowered its full-year same-store sales outlook. Macy's now projects full-year same-store sales to rise 1.5% to 2%, versus its earlier outlook for a rise of 2.5% to 3%. The Cincinnati, Ohio-based company's quarterly net income surged to $292 million, or $0.80 per share, versus $281 million, or $0.72 per share, in the year-ago period. Its sales climbed to $6.27 billion versus $6.07 billion. However, analysts were expecting earnings of $0.86 per share on revenue of $6.30 billion. Sales at stores open at least a year climbed 3.4%, versus expectations for a 3.9% rise. Macy's operating income surged to $571 million in the quarter from $534 million. The company closed Macy's stores in Bradenton, FL, and York, PA in August 2014. In the second half of 2014, the company announced its plans to open 3 new Macy's stores in Sarasota, FL, Las Vegas, NV, and The Bronx in New York City. During the quarter, Macy's repurchased around 8.9 million shares of its common stock for a total of around $517 million. Macy's reaffirmed its earnings forecast for the full year. “Our sales trend improved at both Macy's and Bloomingdale's in the second quarter, reflecting a rebound in shopping activity once weather patterns normalized. We also benefitted from a shift in a major Macy's promotional event into the first two days of the quarter," Terry J. Lundgren, Macy's, chairman and chief executive officer said. Macy's shares dropped 5.29% to $56.60 in pre-market trading.