(Businesshala) – Macy’s Inc and Kohl’s Corp raised their full-year sales and profit outlooks on Thursday, signaling that department store operators have weathered supply chain shocks and are gearing up for the all-important holiday season. Was well stocked.
Retailers also exceeded market estimates for third-quarter sales, benefiting from increased spending on perfume, clothing and formal wear by Americans returning to offices and social events. His shares rose 7% each in premarket trading.
The retail sector has faced pressure this year from shipping logjams, closed factories in Asia and raw material shortages, with major companies such as Nike Inc warning of product shortages during the holiday season.
But Macy’s moves to accelerate shipments and order products earlier in the year helped boost its inventory level by 19.4% in the quarter ended September.
“The company implemented a number of measures to minimize supply chain disruptions and is not expected to be materially impacted during the fourth quarter of 2021,” the company said in a statement.
Kohls said their inventory levels were up around 1% — a key category for department stores, while easing concerns about a shortage of women’s apparel.
Macy’s full-year net sales are expected to be $24.12 billion to $24.28 billion, up from $23.55 billion to $23.95 billion previously.
“I don’t think all supply chain problems have been fixed, but the guidance that Macy’s raised can give people a sense of ease that there will be enough product,” said Empire Financial Research analyst Berna Barsha.
Gross margin growth of 1% over pre-pandemic 2019 levels, aided by fewer promotions and full-price sales, should come as a relief to investors at a time when large retailers like Walmart Inc. and Target Corp. Struggling with supply costs. , Barshe said.