Macy’s (M) Q3 2017 earnings results were released before opening bell this morning, and the department store operator reported adjusted earnings of 23 cents per share on $5.28 billion in revenue. Analysts had been expecting adjusted earnings of 19 cents per share on $5.3 billion in sales. In last year’s third quarter, Macy’s reported $5.6 billion in revenue. The company said part of the year-over-year decline in sales was due to store closures.

By Macy’s Inc./Fairlyoddparents1234 [Public domain], via Wikimedia Commons

Macy’s Q3 2017 earnings

On a GAAP basis, Macy’s Q3 2017 earnings per share rose to 12 cents from 5 cents per share last year. Comparable store sales fell 3.6% year over year on an owned plus licensed basis, which was much worse than the decline of 2.9% that had been expected. On an owned basis, same-store sales declined 4% year over year.

“Importantly, we also saw better gross margin performance primarily due to our tightly controlled inventory position,” CEO Jeff Gennette said in a statement with the Macy’s Q3 2017 earnings release. “A highlight of the third quarter was the launch of the new Star Rewards loyalty program – our best customers are responding positively. We also saw continued double-digit growth in digital and are encouraged by the potential of Backstage in Macy’s stores.”

Macy’s reaffirms full-year outlook

Macy’s reaffirmed its previous guidance for the full year. The department store chain continues to expect comparable store sales to decline by 2.2% to 3.3% on an owned basis. On an owned plus licensed basis, Macy’s still expects comparable store sales to fall by 2% to 3%. The company looks for total sales to fall by 3.2% to 4.3% in fiscal 2017, which includes a 53rd week.

The company said again that it expects a benefit of 1 cent per share in adjusted earnings due to its merchandising operations restructuring. Macy’s now looks for full-year adjusted earnings to come in between $3.38 and $3.63 per share for the year. The company also expects a benefit from the sale of its Union Square Men’s building in San Francisco during the fourth quarter, so excluding that gain, it looks for adjusted earnings to be between $2.91 and $3.16 per share.