Macy’s reports lower-than-expected sales, forms China JV

The global sell-off in equities continued Wednesday and US shares started decidedly lower, as traders took flight after China’s second currency devaluation in two days.

Net sales declined 2.6 percent to $6.10 billion, the fourth drop in six quarters. Instead, it earned 64 cents, down…

Macy’s Inc. on Wednesday cut its sales guidance for the year after reporting steeper-than-expected slides in sales and profit in its second quarter. For Macy’s, already a popular destination for Chinese-Americans and Chinese visitors to the United States, the joint venture is expected to develop significant new learnings on customer preferences and buying patterns within China.

Mr. Lundgren said Macy’s expects improvement in the second half of the year.

In corporate news stateside, the big stories were that e-commerce giant Alibaba, which listed in New York to much fanfare last year, and retail giant Macy’s – both had earnings reports out. Macy's also reported that its profit and sales missed expectation. And this month, Macy’s is expanding same-day delivery for online shoppers to nine additional markets, for a total of 17. “There is demand for the quality and variety of power brands and authentic products associated with the world-famous name of Macy’s”. “Fung Retailing has deep experience and expertise in Chinese retailing, and the Macy’s-Fung partnership will be instrumental to helping set up and operate our test”.

Macy’s, which has been selling online in China since 2011 through its flagship Macys.com, projects $50 million in online sales in China next year. He explained that the agreement with Alibaba will helps Macy’s strengthen its relationship with global customers, and subsequently increase sales. And the results from Macy’s earnings showed that the retailer is not immune from the trend.

During the quarter, earnings fell 20% to 64 cents a share, well below analyst forecasts for 76 cents per share.

Macy’s now says that it expects annual sales to be down 1 percent, down from its original forecast of up 1 percent for the fiscal year. Macy's has inked a deal with Tishman Speyer for a real estate purchase and sale agreement that will enable a re-creation of Macy's Brooklyn store.

Alibaba Group Holding Ltd (NYSE:BABA) lost -5.38% on trading of 31.60 million shares as opposed to its average trading volume of 11.52 million.

The company repurchased approximately 8.0 million shares of its common stock in the second quarter of 2015 for a total of approximately $552 million.