Macy’s Announces Layoffs and Store Closures

The retail giant Macy’s (NYSE:M) has declared its plans to trim approximately 13% of its corporate staff, which translates to about 2,350 positions, and shut down five of its stores, The Wall Street Journal disclosed in a late Thursday report.

Addressing the concerning move, CEO Jeff Gennette and president Tony Spring wrote in a memo, “Despite our strong and tangible progress over the last few years, we remain under pressure,” as cited by the publication.

Furthermore, the memo revealed that Spring will succeed Gennette as CEO in February. The company aims to enhance automation in its supply chain and is outsourcing some roles. It also plans to reduce management layers to expedite decision-making processes.

Alongside the workforce reductions, Macy’s will be closing five stores and parting with two furniture locations. The shuttered stores are situated in California (2), Arlington, Va., Lihue, Hawaii, and Tallahassee, Fla.

Struggling with plummeting sales since the onset of the COVID-19 pandemic, the department store has already downsized its headcount by 28,000 and shuttered 119 stores. Persistent rumors of a potential buyout have encircled the company since last year, with Sycamore Partners being the latest suitor under consideration.

Despite these challenges, the possibility of an acquisition has lent support to the stock price, which has rebounded from a low of $10.59 in November to over $21 per share last month. Macy’s shares closed slightly higher on Thursday.