Macy's slashes corporate, management jobs in restructuring due to COVID-19

Andrew Cummings
June 29, 2020

For fiscal 2020, the company expects pre-tax costs of about $180 million for these restructuring activities, the majority of which will be recorded in the second quarter and all of which will be in cash.

Macy's Inc. had around 123,000 employees at the end of January. The company said it would cut staff numbers at store level as well as in its supply chain and customer support networks, and would adjust these as sales recover. Some 775 Macy's, Bloomingdale's, and Bluemercury stores remained closed from March 18 to May 4, with nearly 7 weeks of inactivity followed by a gradual reopening process. The company estimated it will post a quarterly net loss of $652 million, or $2.10 per share, for the first fiscal quarter.

Previously this year, the greatest division store gained $4.5 billion in new funding to protect the impact of the pandemic on its base line.

Macy's had in May warned of almost $1 billion in operating losses in its first quarter and said it would turn into a "smaller company".

Police vehicles park outside Macy's flagship Herald Square store in NY city after it was broken into on June 1, 2020.

The pandemic "has significantly impacted our business", chief executive Jeff Gennette said in a statement. "While the reopening of our stores is going well, we do anticipate a gradual recovery of business". I want to thank all of our colleagues - those who have been active and those on furlough - for helping us get through this hard time, and I want to express my deep gratitude to the colleagues who are departing for their service and contributions. Macy's said it would bring back most of its remaining furloughed employees in the first week of July. Macy's has also obtained about $4.5 billion in financing that Gennette said would make it "a more stable, flexible company".

Investors, however, are still concerned about Macy's future and sent the stock lower in Thursday trade.

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