# Macy's, Inc. (M)

Informational only - not investment advice.

CIK: 0000794367
SIC: 5311 Retail-Department Stores
SIC breadcrumb: [Retail Trade](/division/G/) > [General Merchandise Stores](/major-group/53/) > [SIC 5311 Retail-Department Stores](/industry/5311/)
Latest 10-K filed: 2026-03-27
SEC page: https://www.sec.gov/edgar/browse/?CIK=794367
Filing source: https://www.sec.gov/Archives/edgar/data/794367/000162828026021721/m-20260131.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 22621000000 | USD | 2026 | 2026-03-27 |
| Net income | 642000000 | USD | 2026 | 2026-03-27 |
| Assets | 16238000000 | USD | 2026 | 2026-03-27 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-27. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000794367.json. Derived margins are computed from the extracted annual SEC facts.

| Metric | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  |  |  |  |  | 25,399,000,000 | 25,449,000,000 | 23,866,000,000 | 23,006,000,000 | 22,621,000,000 |
| Net income | 627,000,000 | 1,566,000,000 | 1,108,000,000 | 564,000,000 | -3,944,000,000 | 1,430,000,000 | 1,146,000,000 | 45,000,000 | 582,000,000 | 642,000,000 |
| Operating income | 1,371,000,000 | 1,864,000,000 | 1,738,000,000 | 970,000,000 | -4,475,000,000 | 2,350,000,000 | 1,689,000,000 | 301,000,000 | 909,000,000 | 1,030,000,000 |
| Diluted EPS | 2.02 | 5.10 | 3.56 | 1.81 | -12.68 | 4.55 | 4.08 | 0.16 | 2.07 | 2.32 |
| Assets | 19,851,000,000 | 19,583,000,000 | 19,194,000,000 | 21,172,000,000 | 17,706,000,000 | 17,590,000,000 | 16,866,000,000 | 16,246,000,000 | 16,402,000,000 | 16,238,000,000 |
| Stockholders' equity | 4,323,000,000 | 5,745,000,000 | 6,436,000,000 | 6,377,000,000 | 2,553,000,000 | 3,621,000,000 | 4,082,000,000 | 4,035,000,000 | 4,552,000,000 | 4,860,000,000 |
| Cash and cash equivalents | 1,297,000,000 | 1,455,000,000 | 1,162,000,000 | 685,000,000 | 1,679,000,000 | 1,712,000,000 | 862,000,000 | 1,034,000,000 | 1,306,000,000 | 1,246,000,000 |
| Net margin |  |  |  |  |  | 5.63% | 4.50% | 0.19% | 2.53% | 2.84% |
| Operating margin |  |  |  |  |  | 9.25% | 6.64% | 1.26% | 3.95% | 4.55% |

## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-06-04. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000794367.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q2 | 2022-07-30 |  |  | 0.99 | reported discrete quarter |
| 2022-Q3 | 2022-10-29 |  |  | 0.39 | reported discrete quarter |
| 2023-Q1 | 2023-04-29 |  |  | 0.56 | reported discrete quarter |
| 2023-Q2 | 2023-07-29 | 5,280,000,000 | -22,000,000 | -0.08 | reported discrete quarter |
| 2023-Q3 | 2023-07-29 |  | -22,000,000 |  | reported discrete quarter |
| 2023-Q3 | 2023-10-28 | 5,038,000,000 |  | 0.15 | reported discrete quarter |
| 2023-Q4 | 2024-02-03 | 8,375,000,000 | -70,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-05-04 | 5,000,000,000 | 62,000,000 | 0.22 | reported discrete quarter |
| 2024-Q2 | 2024-05-04 |  | 62,000,000 |  | reported discrete quarter |
| 2024-Q3 | 2024-08-03 |  | 150,000,000 |  | reported discrete quarter |
| 2024-Q2 | 2024-08-03 | 5,096,000,000 |  | 0.53 | reported discrete quarter |
| 2024-Q3 | 2024-11-02 | 4,903,000,000 |  | 0.10 | reported discrete quarter |
| 2024-Q4 | 2025-02-01 | 8,007,000,000 | 342,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-05-03 | 4,793,000,000 | 38,000,000 | 0.13 | reported discrete quarter |
| 2025-Q2 | 2025-05-03 |  | 38,000,000 |  | reported discrete quarter |
| 2025-Q2 | 2025-08-02 | 4,999,000,000 |  | 0.31 | reported discrete quarter |
| 2025-Q3 | 2025-08-02 |  | 87,000,000 |  | reported discrete quarter |
| 2025-Q3 | 2025-11-01 | 4,913,000,000 |  | 0.04 | reported discrete quarter |
| 2025-Q4 | 2026-01-31 | 7,916,000,000 | 507,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-05-02 | 4,892,000,000 | 63,000,000 | 0.23 | reported discrete quarter |

## Macro Cross-References
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit
- [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy
- [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter
- [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index
- [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate
- [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm
- [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate
- [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio
- [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed
- [CE16OV](/indicator/CE16OV/): Employment Level
- [ICSA](/indicator/ICSA/): Initial Claims
- [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm
- [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period
- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [M2SL](/indicator/M2SL/): M2
- [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance
- [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States
- [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States
- [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States
- [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States
- [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States
- [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized
- [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized
- [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks
- [GDP](/indicator/GDP/): Gross Domestic Product
- [GPDI](/indicator/GPDI/): Gross Private Domestic Investment
- [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment
- [PCEC](/indicator/PCEC/): Personal Consumption Expenditures
- [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services
- [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt
- [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit
- [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts
- [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures
- [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing
- [USCONS](/indicator/USCONS/): All Employees, Construction
- [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade
- [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities
- [USGOVT](/indicator/USGOVT/): All Employees, Government
- [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private
- [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods
- [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- [BUSINV](/indicator/BUSINV/): Total Business Inventories
- [EXPGS](/indicator/EXPGS/): Exports of Goods and Services
- [IMPGS](/indicator/IMPGS/): Imports of Goods and Services
- [IR](/indicator/IR/): Import Price Index (End Use): All Commodities
- [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/794367/000162828026040820/m-20260502.htm

Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization.
Confidence: high
Filing date: 2026-06-04
Report date: 2026-05-02

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

For purposes of the following discussion, all references to "first quarter of 2026" and "first quarter of 2025" are to the Company's 13-week fiscal periods ended May 2, 2026 and May 3, 2025, respectively.

The following discussion should be read in conjunction with the Consolidated Financial Statements and the related notes included elsewhere in this report, as well as the financial and other information included in the 2025 10-K. The following discussion contains forward-looking statements that reflect the Company's plans, estimates and beliefs. The Company's actual results could materially differ from those discussed in these forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those discussed below and elsewhere in this report (particularly in "Risk Factors" and in "Forward-Looking Statements") and in the 2025 10-K (particularly in "Risk Factors" and in "Forward-Looking Statements"). This discussion includes Non-GAAP financial measures. For information about these measures, see the disclosure under the caption "Important Information Regarding Non-GAAP Financial Measures".

On February 18, 2026, the Company announced an update to its non-GAAP financial disclosures. These changes do not impact its historical or future GAAP metrics and disclosures. The updated disclosures, which encompass comparable sales, owned-plus-licensed-plus-marketplace ("OLM") dollar sales, revenues and non-GAAP earnings metrics, are intended to both simplify disclosures and provide increased clarity on the key metrics that support our growth profile and go-forward operating performance. Beginning this quarter, adjusted earnings metrics reflect our new non-GAAP metrics.

Quarterly Overview and Company Strategy

The Company is in its third year of the execution of its Bold New Chapter strategy, which firmly places energy and focus on the needs of our customers and is centered on an enhanced omni-channel shopping experience across all three of our nameplates. This strategy prioritizes improving the shopping environment and elevating the customer experience, while closing underproductive Macy's stores to focus resources and investments on its go-forward enterprise. During the first quarter of 2026, the Company delivered enterprise-wide growth, better-than expected performance across all key metrics, and our highest comparable sales in four years with all nameplates and channels positive. The Company's results reflect the progress it is making on each pillar of the Bold New Chapter strategy, with key highlights as follows:

•.Strengthen and Reimagine the Macy's nameplate

◦Reimagine 200 Locations: In the first quarter of 2026, we expanded learnings to an additional 75 locations for a total of 200 reimagined Macy's locations. The investments in the additional 75 stores have continued emphasis on customer experience, and build on learnings from the first two years of our Bold New Chapter strategy. The Reimagine 200 locations continued to outperform the rest of the Macy's fleet in the first quarter of 2026. We believe these locations are now better organized, easier to shop and have a more compelling visual presentation. Within each category we are driving higher interest and engagement through increased differentiation. We are carving out floor space to leverage new trends while maintaining a presence in existing categories and brands.

◦Revitalize assortment: Our assortment matrix evolution continues to gain traction as we elevate our product curation to deliver a more compelling mix of newness and fashion. Our merchants continue to be focused on clarity of offering, enhanced variety and reduced redundancies. During the first quarter of 2026, we introduced Rothy's, Donna Karan Weekend and Ted Baker Men's. In addition, we expanded Abercrombie kids offerings to infants and toddlers, and further expanded store distribution of Reiss, Free People, Theory and Rodd & Gunn.

◦Customer Experience: Macy's delivered its highest first quarter net promoter score on record. During the quarter, we introduced Ask Macy's, our new AI-powered conversational shopping assistant shaped by data and insights from thousands of colleagues. It serves as a starting point for discovery across channels and initial results indicate that customers engaging with Ask Macy's have higher conversion rates.

•.Accelerate luxury growth

◦Bloomingdale's: Bloomingdale's achieved its highest first quarter sales in its 154-year history. From a category perspective, ready-to-wear, men's apparel, fine jewelry, shoes and tabletop were standout contributors to this performance. Bloomingdale's provides its customers with a compelling and distinct experience through matrix elevation, new brand additions, and a vibrant shopping experience, including collaborations, activations and personalized customer service. In the first quarter of 2026, we introduced a number of designer brands , including Chloe ready-to-wear, Isabel Marant, Phoebe Philo, Parke Denim, Heirlome and Khaite Shoes. We also expanded the reach of our Very Important Client program, which cater to our highest spenders, and hosted our newest campaign, California Love, which featured California inspired events, animation and brand exclusives.

◦Bluemercury: Bluemercury achieved another quarter of comparable sales growth. Results continued to be driven by makeup, dermatological skincare and fragrances including Byredo and Parfums de Marly, as well as Dr. Diamond's Metacine and Skinceuticals. New and remodeled stores continued to outperform the remainder of the locations.

16

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MACY'S, INC.

•.Simplify and modernize end-to-end operations

◦The scope of the pillar has expanded this year to incorporate optimizing and scaling enterprise-wide organizational excellence, which we believe more accurately reflects the Company's organizational model and innovation capabilities. This pillar supports revenue growth and customer experience enhancements to drive efficiencies. The Company has been testing, refining and implementing initiatives, including Artificial Intelligence ("AI"), and we believe there are meaningful opportunities to better serve our customers and support our colleagues.

Comparable sales1 highlights for the first quarter of 2026 versus the first quarter of 2025 related to components of the Bold New Chapter strategy are as follows:

•Macy's, Inc. comparable sales increased 3.0%.

•Macy's, Inc. go-forward business, inclusive of go-forward locations and digital across nameplates, total revenue was $4,776 million and comparable sales increased 3.1%. The Company's nameplate highlights include:

◦Macy's comparable sales increased 1.6%.

•Reimagine 200 locations comparable sales, included within Macy's go-forward business comparable sales, increased 2.4%.

◦Bloomingdale's comparable sales increased 10.2%.

◦Bluemercury comparable sales increased 6.4%.

1 Comparable sales refers to owned-plus-licensed-plus-marketplace sales. All reported nameplate comparable sales results are on a go-forward basis.

17

Table of Contents

MACY'S, INC.

Results of Operations

Comparison of the First Quarter of 2026 and the First Quarter of 2025

First Quarter of 2026

First Quarter of 2025

Amount

% to Net Sales

% to Total Revenue

Amount

% to Net Sales

% to Total Revenue

(dollars in millions, except per share figures)

Net sales

$

4,682 

$

4,599 

Other revenue

210 

4.5 

%

194 

4.2 

%

Total revenue

4,892 

4,793 

Cost of sales

(2,860)

(61.1)

%

(2,795)

(60.8)

%

Selling, general and administrative expenses

(1,952)

(39.9)

%

(1,913)

(39.9)

%

Gains on sale of real estate

15 

0.3 

%

16 

0.3 

%

Impairment, restructuring and other benefits (costs)

17 

0.3 

%

(7)

(0.1)

%

Operating income

$

112 

2.3 

%

$

94 

2.0 

%

Net income

$

63 

$

38 

Diluted earnings per share

$

0.23 

$

0.13 

Supplemental Financial Measures

Gross margin

$

1,822 

38.9 

%

$

1,804 

39.2 

%

Digital sales as a percentage of net sales

34 

%

33 

%

Supplemental Non-GAAP Financial Measures

Adjusted net income

$

35 

$

31 

Adjusted diluted earnings per share

$

0.13 

$

0.11 

Adjusted EBIT

$

80 

$

85 

Adjusted EBITDA

$

290 

$

304 

See pages 22 to 23 for reconciliations of the supplemental non-GAAP financial measures to their most comparable GAAP financial measure and for other important information.

First Quarter of 2026

First Quarter of 2025

Net sales

$

4,682 

$

4,599 

Change in comparable sales

3.0 

%

(1.2)

%

Digital sales as a percent of net sales

34 

%

33 

%

Net sales for the first quarter of 2026 increased $83 million, or 1.8%, compared to the first quarter of 2025. Excluding the $40 million impact of the 14 non-go-forward locations that closed at the end of fiscal 2025, net sales grew 2.7%. The increase in net sales was driven by sales growth at all three nameplates. At Macy's, sequential improvement across all lines of business was realized in the first quarter of 2026, with watches, petites, dresses, career, kids, handbags, fragrances and shoes outperforming the total Macy's comparable store sales, while big-ticket home, especially furniture, and plus size categories were softer compared to the first quarter of 2025.

18

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MACY'S, INC.

First Quarter of 2026

First Quarter of 2025

$

% to Net Sales

$

% to Net Sales

Credit card revenues, net

$

172 

3.7 

%

$

154 

3.3 

%

Macy's Media Network, net

38 

0.8 

%

40 

0.9 

%

Other revenue

$

210 

4.5 

%

$

194 

4.2 

%

The increase in other revenues compared to the first quarter of 2025 was due to a $18 million increase in credit card revenues which continued to be driven by a strong credit portfolio and prudent management of net credit losses. Macy's Media Network revenues were 5.0% below the first quarter of 2025, reflecting a shift in timing of advertising spend on a year-over-year basis.

First Quarter of 2026

First Quarter of 2025

$

% to Net Sales

$

% to Net Sales

Cost of sales

$

(2,860)

61.1 

%

$

(2,795)

60.8 

%

Gross margin

$

1,822 

38.9 

%

$

1,804 

39.2 

%

Gross margin rate declined 30 basis points in the first quarter of 2026 compared to the first quarter of 2025 due to an approximately 30 basis point tariff impact. Excluding the tariff impact, the gross margin rate would have been approximately flat to the first quarter of 2025.

First Quarter of 2026

First Quarter of 2025

SG&A expenses

$

(1,952)

$

(1,913)

As a percent to total revenue

39.9 

%

39.9 

%

Selling, general and administrative ("SG&A") expenses increased $39 million, or 2.0%, in the first quarter of 2026 compared to the first quarter of 2025. During the first quarter of 2026, the Company continued to invest in its go-forward business, including Reimagine 200 locations and Bloomingdale's. These investments were partially offset by ongoing cost containment efforts. SG&A expenses as a percent to total revenue in the first quarter of 2026 were flat compared to the first quarter of 2025.

First Quarter of 2026

First Quarter of 2025

Gains on sale of real estate

$

15 

$

16 

Asset sale gains in both the first quarter of 2026 and 2025 primarily reflect the monetization of store locations.

First Quarter of 2026

First Quarter of 2025

Impairment, restructuring and other benefits (costs)

$

17 

$

(7)

The $17 million of impairment, restructuring and other benefits recognized in the first quarter of 2026 primarily relate to the benefit recognized from lease modifications.The $7 million of impairment, restructuring and other costs recognized in the first quarter of 2025 primarily relate to store closure costs.

First Quarter of 2026

First Quarter of 2025

Net interest expense

$

(25)

$

(27)

The decrease in net interest expense, excluding loss on extinguishment of

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization.
Confidence: high

Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to promote understanding of the results of operations and financial condition of the Company. MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and the accompanying Notes to Financial Statements (Part II, Item 8 of this Form 10-K). This section generally discusses the results of operations for 2025 compared to 2024 and 2023. The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the fiscal years ended January 31, 2026 to February 1, 2025 and February 3, 2024. For a full discussion of changes from the fiscal year ended February 1, 2025 to the fiscal year ended February 3, 2024, refer to Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended February 1, 2025 (filed March 21, 2025). This section also contains forward-looking statements that reflect the Company's plans, estimates and beliefs. The Company's actual results could materially differ from those discussed in these forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those discussed below and elsewhere in this report, particularly in "Risk Factors" and "Forward-Looking Statements."

Fiscal 2025 Overview and Company Strategy

The Company completed its second year of the execution of its Bold New Chapter strategy, which is focused on the needs of our customer and is centered on an enhanced omni-channel shopping experience across all three of our nameplates. This strategy prioritizes improving the shopping environment and elevating the customer experience, while closing underproductive Macy's stores to focus resources and investments on its go-forward enterprise. During fiscal 2025, the Company continued to make progress on the three pillars within the Bold New Chapter strategy, as follows:

•Strengthen and Reimagine Macy's nameplate

◦Reimagine 125 Locations: In early February 2025, we overlaid successful initiatives from the First 50 locations to an additional 75 stores for a total of 125 reimagined Macy's locations. The investments in the additional 75 stores have continued emphasis on customer experience, and build on learnings from the first year of our Bold New Chapter strategy. The Reimagine 125 locations outperformed the rest of the Macy's fleet in 2025. These locations are now better organized, easier to shop and have a more compelling visual presentation. Within each category we are driving higher interest and engagement through increased differentiation. We are carving out floor space to leverage new trends while maintaining a presence in existing categories and brands.

◦Revitalize assortment: Our assortment matrix evolution continues to gain traction as we elevate our product curation to deliver a more compelling mix of newness and fashion. Our merchants continue to be focused on clarity of offering, enhanced variety and reduced redundancies. Our strong balance sheet, large addressable market and loyal customer base are attractive differentiators to brands and partners. Our off-price concept, Backstage, and digital Macy's Marketplace remained strong. Backstage and Marketplace fill white space in our assortments and help us maintain loyal customers seeking more price and brand variety.

◦Customer Experience: We are supporting our omnichannel customer experience by investing in colleagues that includes rolling out enhanced education, a tiered approach to staffing and events and dedicated colleagues for specific merchandise areas. In addition, we are taking a more localized approach to enable store-level empowerment and deliver against distinct customer preferences in each of the markets we serve.Through these efforts, in 2025, Macy's delivered its best net promoter score on record.

•Accelerate luxury growth

◦Bloomingdale's: Bloomingdale's achieved its highest owned-plus-licensed-plus-marketplace comparable sales growth in 14 quarters, sequential improvement in its net promoter score and its best holiday on record. From a category perspective, fragrance, women’s contemporary, designer apparel and fine jewelry were standout contributors to this performance. We introduced several new brands that are already driving results including Totem, Christian Louboutin, Victoria Beckham Beauty, Skims, Messika and Vuori. These brands are inspiring existing customers, attracting new ones and further strengthening Bloomingdale’s relevancy.

◦Bluemercury: Bluemercury achieved its 20th consecutive quarter and sixth consecutive year of comparable sales growth. Results continued to be driven by expanded brand partnerships in dermatological skincare, color and fragrance including Skinceuticals, Dr Diamonds Metacine, Sisley Paris and Parfums De Marley.

22

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•Simplify and modernize end-to-end operations

◦Efforts to drive meaningful change for our customers, and operational and financial performance, continue to progress. We opened our new state-of-the-art fulfillment and store replenishment center, China Grove, which incorporates automation, robotics and artificial intelligence into our delivery ecosystem. The facility helps modernize and strengthen our supply chain and provides us the opportunity to increase accuracy and timeliness of deliveries and further reduce our delivery costs. Our end-to-end work gives us the ability to invest in our growth ambitions, while simplifying our business model.

Comparable sales highlights for 2025 versus 2024 related to components of the Bold New Chapter strategy are as follows:

•Macy's, Inc. comparable sales were up 1.5% on an owned-plus-licensed-plus-marketplace basis.

◦Macy's, Inc. go-forward business comparable sales, inclusive of go-forward locations and digital across nameplates, were up 1.7% on an owned-plus-licensed-plus-marketplace basis.

•Company's nameplate highlights include:

◦Macy's comparable sales were up 0.4% on an owned-plus-licensed-plus-marketplace basis. Macy's go-forward business comparable sales, inclusive of Macy’s go-forward locations and digital, were up 0.6% on an owned-plus-licensed-plus-marketplace basis.

•Reimagine 125 locations comparable sales, included within Macy's go-forward business comparable sales, were up 1.0% on an owned-plus-licensed-plus-marketplace basis.

◦Bloomingdale's comparable sales were up 7.4% on an owned-plus-licensed-plus-marketplace basis.

◦Bluemercury comparable sales were up 1.6%.

See pages 30 to 31 for reconciliations of non-GAAP financial measures to the most comparable U.S. generally accepted accounting principles ("GAAP") financial measures and other important information.

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Analysis of Results of Operations

2025

2024

2023

Amount

% to Net Sales

% to Total Revenue

Amount

% to Net Sales

% to Total Revenue

Amount

% to Net Sales

% to Total Revenue

(dollars in millions, except per share figures)

Net sales

$

21,764 

$

22,293 

$

23,092 

Other revenue

857 

3.9 

%

713 

3.2 

%

774 

3.4 

%

Total revenue

22,621 

23,006 

23,866 

Cost of sales

(13,497)

(62.0)

%

(13,740)

(61.6)

%

(14,224)

(61.6)

%

Selling, general and administrative expenses (SG&A)

(8,240)

(36.4)

%

(8,330)

(36.2)

%

(8,375)

(35.1)

%

Gains on sale of real estate

48 

0.2 

%

144 

0.6 

%

61 

0.3 

%

Impairment, restructuring and other costs

(230)

(1.0)

%

(171)

(0.7)

%

(1,027)

(4.3)

%

Interchange fee settlement, net

328 

1.4 

%

— 

— 

%

— 

— 

%

Operating income

$

1,030 

4.6 

%

$

909 

4.0 

%

$

301 

1.3 

%

Net Income

$

642 

$

582 

$

45 

Diluted earnings per share

$

2.32 

$

2.07 

$

0.16 

Supplemental Financial Measure

Gross margin

$

8,267 

38.0 

%

$

8,553 

38.4 

%

$

8,868 

38.4 

%

Digital sales as a percent of net sales

35 

%

33 

%

33 

%

Supplemental Non-GAAP Financial Measures

Increase (decrease) in comparable sales on an owned-plus-licensed-plus-marketplace basis

1.5 

%

(0.9)

%

(6.0)

%

Adjusted diluted earnings per share

$

2.32 

$

2.64 

$

3.28 

EBITDA

$

1,873 

$

1,760 

$

1,075 

Adjusted EBITDA

$

1,842 

$

1,977 

$

2,236 

See pages 30 to 31 for reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measure and for other important information.

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Comparison of 2025 and 2024

2025

2024

Net sales

$

21,764 

$

22,293 

Change in comparable sales on an owned plus licensed plus marketplace basis

1.5 

%

(0.9)

%

Digital sales as a percent of net sales

35 

%

33 

%

Net sales for 2025 were down $529 million, or 2.4%, compared to 2024. The decline was mainly due to store closures at the end of fiscal year 2024, which contributed approximately $700 million of annual net sales in the prior year. Comparable sales on an owned-plus-licensed-plus-marketplace basis increased 1.5%.

2025

2024

$

% to Net Sales

$

% to Net Sales

Credit card revenues, net

$

669 

3.1 

%

$

537 

2.4 

%

Macy's Media Network, net

188 

0.9 

%

176 

0.8 

%

Other revenue

$

857 

3.9 

%

$

713 

3.2 

%

Proprietary credit card sales penetration

40.1 

%

41.6 

%

The increase in other revenues from 2024 to 2025 was driven by a $132 million, or 25% increase, in credit card revenues which continued to be driven by a strong credit portfolio. Macy Media Network grew $12 million, or 7% from 2024, driven by benefits from our Amazon ad partnership which started this year.

2025

2024

Cost of sales

$

(13,497)

$

(13,740)

As a percent to net sales

62.0 

%

61.6 

%

Gross margin

$

8,267 

$

8,553 

As a percent to net sales

38.0 

%

38.4 

%

Gross margin rate decreased by 40 basis points from 2024 to 2025. The decline was driven by the impact of tariffs, net of the Company's tariff mitigation efforts.

2025

2024

SG&A expenses

$

(8,240)

$

(8,330)

As a percent to total revenue

36.4 

%

36.2 

%

SG&A expenses decreased $90 million, or 1%, from 2024 to 2025 due to the net impact of the benefit of the 64 closed Macy's locations and ongoing expense savings initiatives, partially offset by investments in its go-forward business.

2025

2024

Gains on sale of real estate

$

48 

$

144 

Asset sale gains in both 2025 and 2024 primarily reflect the monetization of non-go-forward store locations.

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2025

2024

Impairment, restructuring and other costs

$

(230)

$

(171)

The $230 million and $171 million of impairment, restructuring and other costs recognized in 2025 and 2024, respectively, primarily relate to actions that align with the Company's Bold New Chapter strategy. The primary costs consist of $160 million and $88 million non-cash asset impairment charges and $47 million and $44 million of restructuring charges recognized in 2025 and 2024, respectively. The impairment charges recognized in fiscal 2025 and 2024 primarily relate to non go-forward locations and the remaining amount is associated with corporate and other assets. The restructuring charges recognized in fiscal 2025 and 2024 are primarily related to employee termination and severance charges.

2025

2024

Interchange fee settlement, net

$

328 

$

— 

The $328 million of income recognized in 2025 relates to the settlement of agreements to resolve credit card interchange fee litigation matters, net of legal fees.

2025

2024

Benefit plan income, net

$

16 

$

16 

The Company recorded non-cash net benefit plan income related to the Company's defined benefit plans. This income includes the net amount of interest cost, expected return on plan assets and amortization of prior service costs or credits and actuarial gains and losses. Benefit plan income remained flat from 2024 to 2025.

2025

2024

Pension settlement charges

$

(67)

$

(46)

Pension settlement charges in 2025 were primarily related to the pro-rata recognition of net actuarial losses associated with the Company's defined benefit retirement plans as the result of lump sum distributions associated with retiree distribution elections.

2025

2024

Net interest expense

$

(97)

$

(115)

The 16% decrease in net interest expense, excluding losses on extinguishment of debt, from 2024 to 2025 was primarily driven by a decrease in interest expense as a result of the reduction in average outstanding debt balances following debt repayment and refinancing transactions that occurred in fiscal 2024 and 2025, including transactions in the second quarter of 2025 that resulted in an approximate $340 million reduction in long-term debt.

2025

2024

Effective tax rate

24.4 

%

23.7 

%

Federal income statutory rate

21 

%

21 

%

In 2025, income tax expense of $207 million, or 24.4% of pretax income, reflects a different effective tax rate as compared to the Company's federal income tax statutory rate of 21% driven primarily by the impact of state and local taxes. In 2024, income tax expense of $181 million, or 23.7% of pretax income, reflects a different effective tax rate as compared to the company's federal income tax statutory rate of 21% driven primarily by the impact of state and local taxes.

Liquidity and Capital Resources

The Company's principal sources of liquidity are cash from operations, cash on hand and the asset-based credit facility described below. Material contractual obligations arising in the normal course of business primarily consist of long-term debt and related interest payments, lease obligations, merchandise purchase obligations, retirement plan benefits and self-insurance reserves. See Notes 4, 6 and 9 to the Consolidated Financial Statements included in Item 8 of this Report for amounts outstanding on January 31, 2026, related to leases, debt and retirement plans, respectively. Merchandise purchase obligations represent future merchandise payables for inventory purchased from various suppliers through contractual arrangements and are expected to be funded through cash from operations.

We believe that our available cash, together with expected future cash generated from operations, the amount available under our credit facility and credit available in the market will be sufficient to satisfy our anticipated needs for working capital, capital expenditures and cash dividends for at least the next 12 months and the foreseeable future thereafter.

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Capital Allocation

The Company's capital allocation goals include maintaining a healthy balance sheet and investment-grade credit metrics to be best-positioned for access to bank and capital market funding under all economic scenarios, followed by investing in the business through initiatives to drive long-term profitable growth and returning capital to shareholders through dividends and share repurchases.

The Company ended the year with a cash and cash equivalents balance of $1,246 million, a decrease from $1,306 million in 2024. Also, the Company is party to the ABL Credit Facility with certain financial institutions providing for a $2,100 million Revolving ABL Facility. As of January 31, 2026, borrowing capacity of the ABL Credit Facility was $1,957 million, which reflects a $143 million reduction due to standby letters of credit outstanding.

2025

2024

2023

Net cash provided by operating activities

$

1,430 

$

1,278 

$

1,305 

Net cash used by investing activities

(639)

(592)

(913)

Net cash used by financing activities

(852)

(413)

(220)

Operating Activities

Net cash provided by operating activities was $1,430 million in 2025 compared to $1,278 million in 2024. The increase was primarily driven by working capital changes.

The Company's future material contractual obligations and commitments as it relates to operating activities as of January 31, 2026 are approximately $6.0 billion of operating lease obligations primarily due after 2030 and $3.6 billion of other obligations, the majority consisting of merchandise purchase obligations due in less than one year. Note 4 and Note 14 to the Financial Statements provide additional information on operating leases and other obligations, respectively.

Investing Activities

The Company's 2025 capital expenditures were $740 million, mainly driven by digital and technology investments as well as omni-channel capabilities. The Company also opened 12 new stores in 2025 across nameplates and formats and continued to invest in its current stores. The net cash used by investing activities was offset by $107 million of net proceeds from the disposition of assets.

The Company expects capital expenditures to be approximately $800 million during 2026. The Company's spend will be primarily focused on initiatives that will continue to support the Bold New Chapter strategy, including digital and technology investments, investments in our remaining go-forward locations and omni-channel capabilities. These expenditures are expected to be financed with cash from operations and existing cash and cash equivalents. There can be no assurance that current expectations will be realized and plans are subject to change upon further review of capital expenditure needs or based on the current economic environment.

Financing Activities

Dividends

The Company paid dividends totaling $197 million in 2025 and $192 million in 2024. The Board of Directors declared regular quarterly dividends of 18.24 cents per share on the Company's common stock, paid on April 1, 2025, July 1, 2025, October 1, 2025 and January 2, 2026, to Macy's, Inc. shareholders of record at the close of business on March 14, 2025, June 13, 2025, September 15, 2025 and December 15, 2025, respectively.

On February 27, 2026, the Company's Board of Directors declared a regular quarterly dividend of 19.15 cents per share on its common stock, payable April 1, 2026, to shareholders of record at the close of business on March 13, 2026. Subsequent dividends will be subject to approval of the Board of Directors, which will depend on market and other conditions.

Stock Repurchases

On February 22, 2022, the Company announced that its Board of Directors authorized a new $2.0 billion share repurchase program, which does not have an expiration date. During 2025, the Company repurchased 17.7 million shares of its common stock at an average cost of $14.21 per share for $251 million. During 2024, the Company did not repurchase any shares of its common stock on the open market. As of January 31, 2026, $1.1 billion remained available under the authorization. Repurchases may be made from time to time in the open market or through privately negotiated transactions in accordance with applicable securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, on terms determined by the Company.

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Debt Transactions

The Company completed the following debt transactions in 2025:

•On April 9, 2025, the Company, entered into an amendment to its ABL Credit Facility which reduced the asset-based credit facility from $3,000 million to $2,100 million, extended the maturity date to April 2030 and maintained similar collateral support, but reduced commercial letter of credit fees and unused facility fees. The Company had no outstanding borrowings under the ABL Credit Facility as of January 31, 2026 and February 1, 2025.

•On July 29, 2025, the Company completed three debt transactions:

◦Issuance of $500 million aggregate principal amount of 7.375% senior unsecured notes due August 1, 2033. The Company used the net proceeds from the notes offering, together with cash on hand, to fund the tender offer and redemption described below,

◦Redemption of $393 million aggregate principal amount of senior notes and debentures and

◦Completion of a tender offer in which $251 million aggregate principal amount of senior notes and debentures were tendered for early settlement. The total cash cost for the tender offer was $255 million.

•On August 28, 2025, the Company redeemed $194 million aggregate principal amount of senior notes and debentures, related to the July 29, 2025 debt transactions.

The Company recognized $33 million of losses related to the extinguishment of debt on the Consolidated Statements of Income in 2025.

The Company completed the following debt transactions in 2024:

•On September 18, 2024, the Company completed a tender offer in which $221 million of certain senior notes and debentures were tendered for early settlement. The total cash cost for the tender offer was $225 million and was funded using cash on hand.

•The Company borrowed and repaid $301 million under the ABL Credit Facility in 2024.

At January 31, 2026, no notes or debentures contained provisions requiring acceleration of payment upon a debt rating downgrade. However, the terms of approximately $2,185 million in aggregate principal amount of the Company's senior notes outstanding at that date require the Company to offer to purchase such notes at a price equal to 101% of their principal amount plus accrued and unpaid interest if there is both a change of control (as defined in the applicable indenture) of the Company and the notes are rated by specified rating agencies at a level below investment grade.

The Company's future contractual obligations and commitments as it relates to financing activities as of January 31, 2026 are $2.4 billion of long-term debt obligations, $1.3 billion of related interest, $143 million of standby letters of credit and $19 million of finance lease obligations. Note 6 and Note 4 to the Financial Statements provide additional information on debt and finance leases, respectively.

As of January 31, 2026, the Company's credit rating and outlook were as described in the table below:

Moody's

Standard &

Poor's

Fitch

Long-term debt

Ba1

BB+

BBB-

Outlook

Stable

Stable

Stable

The Company may at any time and from time to time purchase, redeem, prepay, refinance, or otherwise retire any amount of outstanding indebtedness pursuant to the terms of such indebtedness, in open market or negotiated transactions, via tender offer or otherwise, including through the incurrence of new indebtedness, as the Company considers appropriate in light of market conditions and other relevant factors.

Guarantor Summarized Financial Information

The Company has senior unsecured notes and senior unsecured debentures (collectively the Unsecured Notes) outstanding with an aggregate principal amount of $2,441 million outstanding as of January 31, 2026, with maturities ranging from 2027 to 2043. The Unsecured Notes constitute debt obligations of Macy's Retail Holdings, LLC ("MRH", or "Subsidiary Issuer"), a 100%-owned subsidiary of Macy's, Inc. (Parent together with the Subsidiary Issuer are the Obligor Group), and are fully and unconditionally guaranteed on a senior unsecured basis by Parent. The Unsecured Notes rank equally in right of payment with all of the Company's existing and future senior unsecured obligations, senior to any of the Company's future

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subordinated indebtedness and are structurally subordinated to all existing and future obligations of each of the Company's subsidiaries that do not guarantee the Unsecured Notes. Holders of the Company's secured indebtedness, including any borrowings under the ABL Credit Facility, will have a priority claim on the assets that secure such secured indebtedness; therefore, the Unsecured Notes and the related guarantee are effectively subordinated to all of the Subsidiary Issuer's and Parent and their subsidiaries' existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness.

The following tables include combined financial information of the Obligor Group. Investments in subsidiaries of $7,016 million as of January 31, 2026 have been excluded from the Summarized Balance Sheets. Equity in the earnings of non-Guarantor subsidiaries of $1,761 million have been excluded from the Summarized Statement of Operations. The combined financial information of the Obligor Group is presented on a combined basis with intercompany balances and transactions within the Obligor Group eliminated.

Summarized Balance Sheet

January 31, 2026

(in millions)

ASSETS

Current Assets

$

1,033 

Noncurrent Assets

5,357 

LIABILITIES

Current Liabilities

$

1,741 

Noncurrent Liabilities (a)

6,800 

a)Includes net amounts due to non-Guarantor subsidiaries of $2 million

Summarized Statement of Operations

2025

(in millions)

Net Sales

$

1,098 

Consignment commission income (a)

3,176 

Other revenue

166 

Cost of sales

(526)

Operating loss

(1,198)

Loss before income taxes (b)

(811)

Net loss

(435)

a)Income pertains to transactions with ABL Borrower, a non-Guarantor subsidiary

b)Includes $684 million of dividend income from non-Guarantor subsidiaries

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Important Information Regarding Non-GAAP Financial Measures

The Company reports its financial results in accordance with U.S. generally accepted accounting principles ("GAAP"). However, management believes that certain non-GAAP financial measures provide users of the Company's financial information with additional useful information in evaluating operating performance. Management believes that providing earnings before interest, taxes, depreciation and amortization ("EBITDA") is a non-GAAP financial measure which the Company believes provides meaningful information about its operational efficiency by excluding the impact of changes in tax law and structure, debt levels and capital investment. In addition, management believes that excluding certain items that are not associated with the Company's core operations and that may vary substantially in frequency and magnitude from period-to-period from net income (loss), diluted earnings (loss) per share and EBITDA provide useful supplemental measures that assist in evaluating the Company's ability to generate earnings and leverage sales, respectively, and to more readily compare these metrics between past and future periods. Management also believes that EBITDA and Adjusted EBITDA are frequently used by investors and securities analysts in their evaluations of companies, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. The Company uses certain non-GAAP financial measures as performance measures for components of executive compensation.

Non-GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, the Company's financial results prepared in accordance with GAAP. Certain of the items that may be excluded or included in non-GAAP financial measures may be significant items that could impact the Company's financial position, results of operations or cash flows and should therefore be considered in assessing the Company's actual and future financial condition and performance. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures presented herein may not be comparable to similar measures provided by other companies.

Adjusted Net Income and Adjusted Diluted Earnings Per Share

The following is a tabular reconciliation of the non-GAAP financial measures adjusted net income to GAAP net income and adjusted diluted earnings per share to GAAP diluted earnings per share, which the Company believes to be the most directly comparable GAAP measures.

2025

2024

2023

Net Income

Diluted

Earnings

Per Share

Net Income

Diluted

Earnings

Per Share

Net Income

Diluted

Earnings

Per Share

(millions, except per share data)

As reported

$

642 

$

2.32 

$

582 

$

2.07 

$

45 

$

0.16 

Impairment, restructuring and other costs

230 

0.83 

171 

0.61 

1,027 

3.69 

Interchange fee settlement, net

(328)

(1.19)

— 

— 

— 

— 

Pension settlement charges

67 

0.24 

46 

0.16 

134 

0.48 

Losses on extinguishment of debt

33 

0.12 

1 

— 

— 

— 

Income tax impact of items identified above

(1)

— 

(55)

(0.20)

(293)

(1.05)

As adjusted

$

643 

$

2.32 

$

745 

$

2.64 

$

913 

$

3.28 

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EBITDA and Adjusted EBITDA

The following is a tabular reconciliation of the non-GAAP financial measure EBITDA and Adjusted EBITDA to GAAP net income, which the Company believes to be the most comparable GAAP measure.

2025

2024

2023

(millions)

Net income

$

642 

$

582 

$

45 

Interest expense - net

97 

115 

135 

Losses on extinguishment of debt

33 

1 

— 

Federal, state and local income tax expense (benefit)

207 

181 

(2)

Depreciation and amortization

894 

881 

897 

EBITDA

$

1,873 

$

1,760 

$

1,075 

Impairment, restructuring and other costs

230 

171 

1,027 

Interchange fee settlement, net

(328)

— 

— 

Pension settlement charges

67 

46 

134 

Adjusted EBITDA

$

1,842 

$

1,977 

$

2,236 

Critical Accounting Estimates

The preparation of our consolidated financial statements in accordance with U.S. GAAP requires that we make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We base our estimates on historical experience and on assumptions that we believe to be reasonable, and we continue to review and evaluate these estimates. For further information on significant accounting policies, see discussion in Note 1 to the Consolidated Financial Statements included in Item 8 of this Report.

Long-Lived Asset Impairment and Restructuring Charges

The carrying values of long-lived assets, inclusive of right of use ("ROU") assets, are periodically reviewed by the Company whenever events or changes in circumstances indicate that the carrying value may not be recoverable, such as historical operating losses or plans to close stores before the end of their previously estimated useful lives. Additionally, on an annual basis, the recoverability of the carrying values of individual stores is evaluated. A potential impairment has occurred if projected future undiscounted cash flows are less than the carrying value of the assets. The estimate of cash flows includes management's assumptions of cash inflows and outflows directly resulting from the use of those assets in operations. When a potential impairment has occurred, an impairment write-down is recorded if the carrying value of the long-lived asset exceeds its fair value. In both fiscal 2025 and fiscal 2024, the Company determined impairment charges were necessary for certain of its long-lived assets as disclosed further in Note 3. If estimated cash flows significantly differ in the future, the Company may be required to record additional asset impairment write-downs.

If the Company commits to a plan to dispose of a long-lived asset before the end of its previously estimated useful life or changes its use of corporate assets, estimated cash flows are revised accordingly and the Company may be required to record an asset impairment charge. Additionally, related liabilities arise such as severance, contractual obligations and other accruals associated with store closings from decisions to dispose of assets. The Company estimates these liabilities based on the facts and circumstances in existence for each restructuring decision. The amounts the Company will ultimately realize or disburse could differ from the amounts assumed in arriving at the asset impairment and restructuring charge recorded.

Goodwill and Intangible Assets

The Company reviews the carrying value of its goodwill and other intangible assets with indefinite lives at least annually, as of the end of fiscal May, or more frequently if an event occurs or circumstances change, for possible impairment. For impairment testing, goodwill has been assigned to reporting units which consist of the Company's retail operating divisions. Macy's and Bluemercury are the only reporting units with goodwill as of January 31, 2026, and 98% of the Company's goodwill is allocated to the Macy's reporting unit.

The Company may elect to evaluate qualitative factors to determine if it is more likely than not that the fair value of a reporting unit or fair value of indefinite lived intangible assets is less than its carrying value. If the qualitative evaluation indicates that it is more likely than not that the fair value of a reporting unit or indefinite lived intangible asset is less than its carrying amount, a quantitative impairment test is required. Alternatively, the Company may bypass the qualitative assessment for a reporting unit or indefinite lived intangible asset and directly perform the quantitative assessment. This determination can be made on an individual reporting unit or asset basis, and performance of the qualitative assessment may resume in a subsequent period.

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The quantitative impairment test involves estimating the fair value of each reporting unit and indefinite lived intangible asset and comparing these estimated fair values with the respective reporting unit or indefinite lived intangible asset carrying value. If the carrying value of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to such excess, limited to the total amount of goodwill allocated to the reporting unit. If the carrying value of an individual indefinite lived intangible asset exceeds its fair value, such individual indefinite lived intangible asset is written down by an amount equal to such excess.

Estimating the fair values of reporting units and indefinite lived intangible assets involves the use of significant assumptions, estimates and judgments with respect to a variety of factors, including projected sales, gross margin and SG&A expense rates, capital expenditures, cash flows and the selection and use of an appropriate discount rate and market values and multiples of earnings and revenues of similar public companies. Projected sales, gross margin and SG&A expense rate assumptions and capital expenditures are based on the Company's annual business plan or other forecasted results. Discount rates reflect market-based estimates of the risks associated with the projected cash flows of the reporting unit or indefinite lived intangible asset.

The use of different assumptions, estimates or judgments in the goodwill impairment testing process, including with respect to the estimated future cash flows of the Company's reporting units, the discount rate used to discount such estimated cash flows to their net present value and the reasonableness of the resultant implied control premium relative to the Company's market capitalization, could materially increase or decrease the fair value of the reporting unit and/or its net assets and, accordingly, could materially increase or decrease any related impairment charge.

For the Company's annual impairment assessment as of the end of fiscal May 2025 and 2024, the Company elected to perform a qualitative impairment test on its goodwill and intangible assets with indefinite lives and concluded that it is more likely than not that the fair values exceeded the carrying values and goodwill and intangible assets with indefinite lives were not impaired.

The Company continues to monitor the key inputs to the fair values of its reporting units. A decline in market capitalization or future declines in macroeconomic factors or business conditions may result in additional impairment charges in future periods.

Pension and Supplementary Retirement Plans

The Company has a funded defined benefit pension plan ("the Pension Plan") and an unfunded defined benefit supplementary retirement plan ("SERP"). The Company accounts for these plans in accordance with ASC Topic 715, Compensation - Retirement Benefits. Under ASC Topic 715, an employer recognizes the funded status of a defined benefit postretirement plan as an asset or liability on the balance sheet and recognizes changes in that funded status in the year in which the changes occur through comprehensive income (loss). Additionally, pension expense is generally recognized on an accrual basis over the average remaining lifetime of participants. The pension expense calculation is generally independent of funding decisions or requirements.

The Pension Protection Act of 2006 provides the funding requirements for the Pension Plan which are different from the employer's accounting for the plan as outlined in ASC Topic 715. No funding contributions were required, and the Company made no funding contributions to the Pension Plan in 2025 and 2024. As of the date of this report, the Company does not anticipate making funding contributions to the Pension Plan in 2026.

The calculation of pension expense and pension liabilities requires the use of a number of assumptions. Changes in these assumptions can result in different expense and liability amounts, and future actual experience may differ significantly from current expectations. The Company believes that the most critical assumptions relate to the long-term rate of return on plan assets (in the case of the Pension Plan) and the discount rate used to determine the present value of projected benefit obligations.

The Company's assumed annual long-term rate of return for the Pension Plan's assets was 5.50% for 2025 and 5.30% for 2024 and 2023 based on expected future returns on the portfolio of assets. As of January 31, 2026, the Company increased the assumed annual long-term rate of return for the Pension Plan's assets to 6.00% based on expected future returns on the portfolio of assets. The Company develops its expected long-term rate of return assumption by evaluating input from several professional advisors taking into account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term inflation assumptions. Pension expense increases or decreases as the expected rate of return on the assets of the Pension Plan decreases or increases, respectively. Lowering or raising the expected long-term rate of return assumption on the Pension Plan's assets by 0.25% would increase or decrease the estimated 2026 pension expense by approximately $5 million.

The Company discounted its future pension obligations using a weighted-average rate of 5.23% at January 31, 2026 and 5.52% at February 1, 2025 for the Pension Plan and 5.28% at January 31, 2026 and 5.54% at February 1, 2025 for the SERP. The discount rate used to determine the present value of the Pension Plan and SERP obligations is based on a yield curve constructed from a portfolio of high quality corporate debt securities with various maturities. Each year's expected future benefit payments are discounted to their present value at the appropriate yield curve rate, thereby generating the

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overall discount rate for Pension Plan and SERP obligations. As the discount rate is reduced or increased, the pension liability would increase or decrease, respectively, and future pension expense would decrease or increase, respectively. Lowering the discount rates by 0.25% would increase the projected benefit obligations at January 31, 2026 by approximately $29 million and would decrease estimated 2026 pension expense by approximately $1 million. Increasing the discount rates by 0.25% would decrease the projected benefit obligations at January 31, 2026 by approximately $28 million and would increase estimated 2026 pension expense by approximately $1 million.

The Company estimates the service and interest cost components of net periodic benefit costs for the Pension Plan and SERP. This method uses a full yield curve approach in the estimation of these components of net periodic benefit costs. Under this approach, the Company applies discounting using individual spot rates from the yield curve composed of the rates of return from a portfolio of high quality corporate debt securities available at the measurement date. These spot rates align to each of the projected benefit obligation and service cost cash flows.