Macy’s is banking on the development of its active category for future growth.
On the company’s second quarter earnings call on Tuesday, Macy’s Inc. outgoing chairman and CEO Jeff Gennette touched on a series of additions to the retailer’s active category including the recent June announcement that the retailer will reintroduce Nike men’s, women’s and kids’ apparel online and in 75 doors in October, with a larger rollout to more than 200 stores planned for spring 2024.
The CEO also mentioned the retailer’s addition of the Hoka brand in the second quarter, calling the active shoe company “highly relevant” to its consumer as it continues to “sell out.”
Adding to the mix, Gennette announced on today’s call that Macy’s will be bringing back select Under Armour men’s product to 150 stores and online beginning in February, a first since the brand paused its apparel relationship with the retailer in 2021.
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According to a Macy’s spokesperson, the assortment is “performance focused” and will have a strong color impact on the floor and will “dominate” categories in tees, polos, and shorts.
As was the case with Nike’s footwear offering, Under Armour’s footwear relationship with Macy’s remained intact via a partnership with Finish Line since 2021. This tie-up is expected to continue once the apparel relaunches early next year, the company said.
“The return of Nike and Under Armour speaks to the strength and reach of Macy’s and our ability to attract sought after wholesale partners,” Gennette said on today’s call. “Looking ahead, we’re working with both brands as well as potential new partners on how to expand further.”
Pressed further by analysts on today’s call about these renewed relationships, incoming Macy’s Inc. CEO Tony Spring added that the reintroduction of Nike is “just a good example” of what’s possible as the company looks to the future. “I think we obviously have built into our expectations the opportunity in Nike,” Spring said. “The other benefit you have is people who come to Macy’s for Nike don’t just buy Nike, they’re going to buy other things. And I think that level of curiosity, that level of newness, is an important ingredient in our success going forward.”
These renewed partnerships come as Nike and Under Armour slowly return to certain wholesale partnerships after a sudden exit in 2021.
Earlier this month, Under Armour president and CEO Stephanie Linnartz said that the brand was looking to enter more wholesale doors in the U.S. The entry into new doors is part of Under Armour’s efforts to lift its sagging U.S. business, which dented its results for the first quarter. Like other footwear brands this quarter, Under Armour’s business in North America was challenged as the region grapples with inventory excesses and conservative orders from wholesale retail partners. Under Armour’s revenue in the region declined 9 percent to $827 million, as part of a broader revenue decline of 2 percent, to $1.3 billion in the first quarter.
On Tuesday, Macy’s Inc. reported an 8 percent decline in net sales to $5.13 billion in the second quarter, down from $5.6 billion in the same period last year. The company also reported a net loss in Q2 of $22 million.
