updated - May 28, 2020 Thursday EDT
Macy's, the country's largest department store chain, reported a 23 percent increase in net income in the recent third quarter after it trimmed down on its spending.
According to a statement released by Macy's today, the department store's net income increased to $217 million (61 cents per share) from $177 million (47 cents per share) in 2013.
The increase in sales thanks to Macy's cutting down on its expenses. Selling, administrative and general expenses went down to $2 billion in the third quarter, lower than the $2.1 billion it reported last year.
The company also maintained its gross margins despite having troubles getting customer traffic. Several investors also had low expectations for the retail giant, which made it easier for it to fulfil its shareholders' whims, according to Richard Jaffe, a New York based analyst at Stifel Nicolaus & Co.
"The good news is they didn't have to take a lot of markdowns and they found a way to cut expenses," Jaffe said. "Despite the sales miss, you have to say -- all things considered -- not so bad. There were expectations for lesser results."
Macy's shares went up 2.4 percent to $60 in New York, while the stock also increased 9.7 percent throughout the course of the year.
Despite booming sales this year, Macy's cut its projections this year. This year, the company predicted that profit would be $4.25 to $4.335 per share, down from $4.50 per share last year, and lower than the analysts expectations of $4.40 per share.
Chief Executive Officer Terry Lundgren is coping with a broader retail slump and a shift toward e-commerce, putting pressure on the company while it faces the most important holiday season of the year.
In a bid to lure in more shoppers this year, Macy's plans to open stores early at 6 p.m. on Thanksgiving day, two hours earlier than it did in 2013.
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