Macy's, Inc.
Department Store RetailFounded 1858- Updated July 2025
Reviewed by Swet Parvadiya
Last reviewed: July 2025
CorpDigest
Macy's, Inc.
Company History
Founded 1858 in New York, New York
Last reviewed: 2025-07-15 · By Swet Parvadiya
Macy's, Inc. generated $24.48 billion in fiscal 2024 revenue by operating a tri-banner portfolio consisting of Macy's, Bloomingdale's, and Bluemercury, executing the most aggressive real estate contraction in its 166-year history by announcing the closure of 150 underperforming stores to concentrate on the top 75 U.S. markets, a strategic pivot that represents a fundamental admission that the traditional department store model is structurally obsolete and no longer capable of generating adequate returns on invested capital. The company's gross margin of 39.8% is sustained by a proprietary private brand portfolio that yields a 1,200 basis point margin premium over national brands, providing the financial flexibility to fund a $1 billion shareholder return program and invest in the modernization of its omnichannel fulfillment network, a margin advantage that is critical to the company's ability to maintain its profitability in an increasingly competitive and price-sensitive retail environment. Macy's ship-from-store network leverages over 500 retail locations as decentralized distribution nodes, reducing last-mile delivery costs by 18% and enabling next-day delivery to over 70% of the U.S. population, creating a formidable competitive advantage against pure-play e-commerce competitors, a logistical capability that fundamentally transforms the company's physical retail footprint from a liability in the e-commerce era into a massive, distributed competitive asset. Under the leadership of CEO Tony Spring, the company is executing the 'Bold New Chapter' strategic initiative, targeting $1 billion in annualized savings and $750 million in incremental sales by fiscal 2026 through the optimization of its real estate footprint, the acceleration of its small-format store rollout, and the aggressive expansion of its off-mall beauty concept, Bluemercury, a comprehensive turnaround plan that is critical to the company's long-term viability and its ability to generate sustainable returns for its shareholders. Despite the structural decline of the traditional shopping mall and intense competitive pressure from off-price retailers, Macy's massive scale, highly optimized omnichannel capabilities, and disciplined execution of its strategic turnaround plan position the company to navigate the transition, improve its margin profile, and continue to generate substantial free cash flow for its shareholders, a strategic position that provides the company with the financial flexibility to invest in strategic growth initiatives and return capital to shareholders while simultaneously funding the significant investments required to modernize its business and adapt to the ongoing structural shifts in the retail industry.
Rowland Hussey Macy was the founder of R.H. Macy and Company, having opened a small dry goods store in the Sixth Avenue neighborhood of Manhattan, New York City, in 1858. Macy, a Quaker whaler from Nantucket, was guided by the Quaker principle of 'strictly correct' business practices, and he introduced revolutionary retail concepts for the era, including fixed pricing with no haggling, daily cash-only transactions, and a money-back guarantee. The store's success was meteoric, and by 1875, Macy had consolidated the entire operation into a single, massive building at the corner of Broadway and 14th Street, creating one of the first true department stores in the United States. Following Macy's death in 1877, the store was purchased by his employees, the Straus brothers, who expanded the business aggressively, moving the flagship store to its current iconic location at Herald Square in 1902. Macy's vision of prioritizing transparency, quality, and customer trust created a brand equity that has endured for over 166 years, establishing the foundation for the national dominance that defines Macy's, Inc. today.
Rowland Hussey Macy opens a small dry goods store in Manhattan, introducing fixed pricing and a money-back guarantee, quickly establishing a reputation for quality and integrity.
The Straus brothers move the flagship store to its current iconic location at 34th Street and Broadway, creating a massive, city-block-long emporium that became the largest store in the world.
The company hosts the first Macy's Thanksgiving Day Parade in New York City, which quickly becomes a national tradition and cements the Macy's brand in the American consciousness.
Following a 1992 Chapter 11 bankruptcy, R.H. Macy & Co. is acquired by Federated Department Stores, creating the largest department store operator in the United States.
Federated acquires The May Department Stores Company for $11.5 billion, adding iconic regional banners like Marshall Field's and Filene's to the portfolio, establishing national dominance.
The company completes the conversion of all regional banners, including Marshall Field's and Filene's, to the Macy's nameplate, creating a unified national brand identity.
Macy's announces the most aggressive real estate contraction in its history, closing 150 underperforming stores to concentrate on the top 75 U.S. markets, targeting $1 billion in annualized savings by 2026.
Federated Department Stores acquired The May Department Stores Company to achieve national scale, eliminate a major competitor, and acquire iconic regional banners like Marshall Field's, Filene's, and Kaufmann's, creating the largest department store operator in the United States.
Federated Department Stores acquired the bankrupt R.H. Macy & Co. out of Chapter 11, consolidating the two largest department store operators in the United States and acquiring the iconic Macy's brand name and its highly profitable Herald Square flagship.
Macy's acquired Bluemercury, a rapidly growing off-mall beauty retailer, to accelerate its presence in the high-margin prestige beauty category and gain access to a specialized, customer-centric retail format that complemented the traditional department store model.