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M Macy`s

Document and Entity Information

Document and Entity Information - shares3 Months Ended
May 01, 2021May 29, 2021
Cover [Abstract]
Document Type10-Q
Document Quarterly Reporttrue
Document Transition Reportfalse
Document Period End DateMay 1,
2021
Entity File Number1-13536
Entity Registrant NameMacy's, Inc.
Entity Incorporation, State or Country CodeDE
Entity Tax Identification Number13-3324058
Entity Address, Address Line One151 West 34th Street
Entity Address, City or TownNew York
Entity Address, State or ProvinceNY
Entity Address, Postal Zip Code10001
City Area Code212
Local Phone Number494-1621
Title of 12(b) SecurityCommon Stock, $.01 par value per share
Trading SymbolM
Security Exchange NameNYSE
Entity Current Reporting StatusYes
Entity Interactive Data CurrentYes
Entity Filer CategoryLarge Accelerated Filer
Entity Small Businessfalse
Entity Emerging Growth Companyfalse
Entity Shell Companyfalse
Entity Central Index Key0000794367
Current Fiscal Year End Date--01-29
Document Fiscal Year Focus2021
Document Fiscal Period FocusQ1
Amendment Flagfalse
Entity Common Stock, Shares Outstanding311,868,429

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Income Statement [Abstract]
Net sales $ 4,706 $ 3,017
Credit card revenues, net159 131
Cost of sales(2,889)(2,501)
Selling, general and administrative expenses(1,748)(1,598)
Gains on sale of real estate6 16
Impairment, restructuring and other costs(19)(3,184)
Operating income (loss)215 (4,119)
Benefit plan income, net15 9
Interest expense(79)(49)
Losses on early retirement of debt(11)0
Interest income0 2
Income (loss) before income taxes140 (4,157)
Federal, state and local income tax benefit (expense)(37)576
Net income (loss) $ 103 $ (3,581)
Basic earnings (loss) per share $ 0.33 $ (11.53)
Diluted earnings (loss) per share $ 0.32 $ (11.53)

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net income (loss) $ 103 $ (3,581)
Amortization of net actuarial loss and prior service credit on post employment and postretirement benefit plans included in net income, before tax10 12
Tax effect related to items of other comprehensive income(2)(3)
Total other comprehensive income, net of tax effect8 9
Comprehensive income (loss) $ 111 $ (3,572)

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in MillionsMay 01, 2021Jan. 30, 2021May 02, 2020
Current Assets:
Cash and cash equivalents $ 1,798 $ 1,679 $ 1,523
Receivables205 276 170
Merchandise inventories4,230 3,774 4,923
Prepaid expenses and other current assets1,007 455 519
Total Current Assets7,240 6,184 7,135
Property and Equipment - net5,798 5,940 6,425
Right of Use Assets2,853 2,878 2,672
Goodwill828 828 838
Other Intangible Assets – net436 437 439
Other Assets927 1,439 1,072
Total Assets18,082 17,706 18,581
Current Liabilities:
Short-term debt294 452 739
Merchandise accounts payable2,545 1,978 2,196
Accounts payable and accrued liabilities2,616 2,927 2,757
Income taxes63 0 80
Total Current Liabilities5,518 5,357 5,772
Long-Term Debt4,558 4,407 4,918
Long-Term Lease Liabilities3,166 3,185 2,923
Deferred Income Taxes868 908 944
Other Liabilities1,297 1,296 1,327
Shareholders' Equity2,675 2,553 2,697
Total Liabilities and Shareholders’ Equity $ 18,082 $ 17,706 $ 18,581

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in MillionsMay 01, 2021Jan. 30, 2021May 02, 2020
Statement Of Financial Position [Abstract]
Accumulated depreciation and amortization $ 4,550 $ 4,400 $ 4,560

Consolidated Statements of Chan

Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in MillionsTotalCommon Stock [Member]Additional Paid-in Capital [Member]Accumulated Equity [Member]Treasury Stock [Member]Accumulated Other Comprehensive Income (Loss) [Member]
Beginning balance at Feb. 01, 2020 $ 6,377 $ 3 $ 621 $ 7,989 $ (1,241) $ (995)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)(3,581)(3,581)
Other comprehensive income9 9
Common stock dividends(117)(117)
Stock-based compensation expense6 6
Stock issued under stock plans(1)(62)61
Other4 4
Ending balance at May. 02, 20202,697 3 565 4,291 (1,180)(982)
Beginning balance at Jan. 30, 20212,553 3 571 3,928 (1,161)(788)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)103 103
Other comprehensive income8 8
Stock-based compensation expense11 11
Stock issued under stock plans0 (24)24
Ending balance at May. 01, 2021 $ 2,675 $ 3 $ 558 $ 4,031 $ (1,137) $ (780)

Consolidated Statements of Ch_2

Consolidated Statements of Changes in Shareholders' Equity (Parenthetical)3 Months Ended
May 02, 2020$ / shares
Statement Of Stockholders Equity [Abstract]
Common Stock, Dividends, Per Share, Declared $ 0.3775

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Cash flows from operating activities:
Net income (loss) $ 103 $ (3,581)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Impairment, restructuring and other costs19 3,184
Depreciation and amortization224 237
Stock-based compensation expense11 6
Gains on sale of real estate(6)(16)
Benefit plans10 12
Amortization of financing costs and premium on acquired debt8 0
Deferred income taxes(43)(225)
Changes in assets and liabilities:
Decrease in receivables71 236
(Increase) decrease in merchandise inventories(457)265
(Increase) decrease in prepaid expenses and other current assets(56)12
Increase in merchandise accounts payable674 629
Decrease in accounts payable and accrued liabilities(114)(531)
(Increase) decrease in current income taxes75 (353)
Change in other assets, liabilities, and other items not separately identified(25)(39)
Net cash provided (used) by operating activities494 (164)
Cash flows from investing activities:
Purchase of property and equipment(61)(122)
Capitalized software(38)(38)
Disposition of property and equipment8 21
Other, net17 26
Net cash used by investing activities(74)(113)
Cash flows from financing activities:
Debt issued500 1,500
Debt issuance costs(9)0
Debt repurchase premium and expenses(12)0
Debt repaid(503)(4)
Dividends paid0 (117)
Decrease in outstanding checks(276)(231)
Net cash provided (used) by financing activities(300)1,148
Net increase in cash, cash equivalents and restricted cash120 871
Cash, cash equivalents and restricted cash beginning of period1,754 731
Cash, cash equivalents and restricted cash end of period1,874 1,602
Supplemental cash flow information:
Interest paid52 38
Interest received0 3
Income taxes paid (net of refunds received) $ 5 $ 2

Consolidated Statements of Ca_2

Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in MillionsMay 01, 2021May 02, 2020
Statementof Cash Flows Restricted Cash [Abstract]
Restricted cash and cash equivalents $ 76 $ 79

Organization and Summary of Sig

Organization and Summary of Significant Accounting Policies3 Months Ended
May 01, 2021
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Organization and Summary of Significant Accounting Policies1.
Organization and Summary of Significant Accounting Policies Nature of Operations Macy's, Inc., together with its subsidiaries (the "Company"), is an omnichannel retail organization operating stores, websites and mobile applications under three brands (Macy's, Bloomingdale's and bluemercury) that sell a wide range of merchandise, including apparel and accessories (men's, women's and kids'), cosmetics, home furnishings and other consumer goods. The Company has stores in 43 states, the District of Columbia, Puerto Rico and Guam. As of May 1, 2021, the Company's operations were conducted through Macy's, Market by Macy’s, Macy’s Backstage, Bloomingdale's, Bloomingdale's The Outlet, and bluemercury. Bloomingdale's in Dubai, United Arab Emirates and Al Zahra, Kuwait are operated under a license agreement with Al Tayer Insignia, a company of Al Tayer Group, LLC. A description of the Company's significant accounting policies is included in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2021 (the "2020 10-K"). The accompanying Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto in the 2020 10-K. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates and assumptions are subject to inherent uncertainties, including the ultimate financial impact of the COVID-19 pandemic, which may result in actual amounts differing from reported amounts. The Consolidated Financial Statements for the 13 weeks ended May 1, 2021 and May 2, 2020, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) considered necessary to present fairly, in all material respects, the consolidated financial position and results of operations of the Company. Seasonality Because of the seasonal nature of the retail business, the results of operations for the 13 weeks ended May 1, 2021 and May 2, 2020 (which do not include the Christmas season) are not necessarily indicative of such results for the full fiscal year. Comprehensive Income (Loss) Total comprehensive income (loss) represents the change in equity during a period from sources other than transactions with shareholders and, as such, includes net income (loss). For the Company, the only other components of total comprehensive income (loss) for the 13 weeks ended May 1, 2021 and May 2, 2020 relate to post employment and postretirement plan items. Settlement charges incurred are included as a separate component of income (loss) before income taxes in the Consolidated Statements of Operations. Amortization reclassifications out of accumulated other comprehensive loss are included in the computation of net periodic benefit cost (income) and are included in benefit plan income, net on the Consolidated Statements of Operations. See Note 6, "Benefit Plans," for further information. COVID-19 Pandemic As the COVID-19 pandemic continues into fiscal 2021, the Company remains focused on prudent cash management, maintaining strong liquidity, and executing its strategic initiatives. In addition, the Company continues to prioritize health and safety measures in its stores and facilities to protect the well-being of its customers and colleagues. Although the Company has experienced recovery in operating results during the first quarter of 2021 as compared to fiscal 2020, certain stores continued to operate under local governmental orders or restrictions. The full impact of COVID-19 will continue to depend on future developments, including the continued spread and duration of the pandemic, variant strains of COVID-19, the availability and distribution of effective medical treatments or vaccines as well as any related federal, state or local governmental orders or restrictions. In addition, numerous uncertainties continue to surround the pandemic and its ultimate impact on the Company, including the timing and extent of any recovery in consumer traffic and spending, and potential delays, interruptions and disruptions in the Company’s supply chain, all of which are highly uncertain and cannot be predicted. As further disclosed in the Company’s 2020 Form 10-K, on March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law, which permitted, among other benefits, the carryback of certain net operating losses. Based on the Company’s 2020 fiscal results, a $520 million income tax receivable has been recognized as of May 1, 2021, associated with this net operating loss carryback benefit. This income tax receivable is estimated to be received in the first quarter of 2022 and is included within prepaid expenses and other current assets on the Company’s Consolidated Balance Sheet.

Impairment, Restructuring and O

Impairment, Restructuring and Other Costs3 Months Ended
May 01, 2021
Restructuring Costs And Asset Impairment Charges [Abstract]
Impairment, Restructuring and Other Costs2 .
Impairment, Restructuring and Other Costs
13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
Impairments
$
18
$
3,150
Restructuring
(1
)
25
Other
2
9
Total
$
19
$
3,184
During the 13 weeks ended May 1, 2021, the Company incurred non-cash impairment charges totaling $18 million primarily related to capitalized software assets. During the 13 weeks ended May 2, 2020, primarily as a result of the COVID-19 pandemic, the Company incurred non-cash impairment charges totaling $3,150 million

$3,070 million of goodwill impairments, with $2,972 million attributable to the Macy's reporting unit and $98 million attributable to the bluemercury reporting unit.

$80 million of impairments primarily related to long-lived tangible and right of use assets to adjust the carrying value of certain store locations to their estimated fair value. A summary of the restructuring and other cash activity for the 13 weeks ended May 1, 2021 and May 2, 2020 related to the Polaris strategy, which was announced in February 2020 and included within accounts payable and accrued liabilities, is as follows:
Severance and other benefits
Professional fees and other related charges
Total
(millions)
Balance at February 1, 2020
$
115
$
9
$
124
Additions charged to expense
25
7
32
Cash payments
(82
)
(6
)
(88
)
Balance at May 2, 2020
$
58
$
10
$
68
Severance and other benefits
Professional fees and other related charges
Total
(millions)
Balance at January 30, 2021
$
14
$
2
$
16
Additions charged to expense
5

5
Cash payments
(16
)
(2
)
(18
)
Balance at May 1, 2021
$
3
$

$
3

Earnings (Loss) Per Share

Earnings (Loss) Per Share3 Months Ended
May 01, 2021
Earnings Per Share [Abstract]
Earnings (Loss) Per Share3 .
Earnings (Loss) Per Share The following tables set forth the computation of basic and diluted earnings (loss) per share:
13 Weeks Ended
May 1, 2021
May 2, 2020
Net Income
Shares
Net Loss
Shares
(millions, except per share data)
Net income (loss)
$
103
310.7
$
(3,581
)
309.7
Shares to be issued under deferred compensation and other plans
0.9
0.9
$
103
311.6
$
(3,581
)
310.6
Basic earnings (loss) per share
$
0.33
$
(11.53
)
Effect of dilutive securities:
Stock options and restricted stock units
7.0

$
103
318.6
$
(3,581
)
310.6
Diluted earnings (loss) per share
$
0.32
$
(11.53
)
In addition to the stock options and restricted stock units reflected in the foregoing tables, stock options to purchase 14.7 million shares of common stock and restricted stock units relating to 11.7 million shares of common stock were outstanding at May 1, 2021, but were not included in the computation of diluted earnings per share because their inclusion would have been antidilutive or they were subject to performance conditions that had not been met. For the 13 weeks ended May 2, 2020, as a result of the net loss for the quarter, all options and restricted stock units have been excluded from the calculation of diluted earnings per share and, therefore, there was no difference in the weighted average number of common shares for basic and diluted loss per share as the effect of all potentially dilutive shares outstanding was anti-dilutive. Stock options to purchase 17.3 million shares of common stock and restricted stock units relating to 3.4 million shares of common stock outstanding at May 2, 2020 were excluded from the computation of diluted earnings per share.

Revenue

Revenue3 Months Ended
May 01, 2021
Revenue From Contract With Customer [Abstract]
Revenue4 .
Revenue Net sales Revenue is recognized when customers obtain control of goods and services promised by the Company. The amount of revenue recognized is based on the amount that reflects the consideration that is expected to be received in exchange for those respective goods and services. The Company's revenue generating activities include the following: Retail Sales Retail sales include merchandise sales, inclusive of delivery income, licensed department income, sales of private brand goods directly to third party retailers and sales of excess inventory to third parties. Sales of merchandise are recorded at the time of shipment to the customer and are reported net of estimated merchandise returns and certain customer incentives. Commissions earned on sales generated by licensed departments are included as a component of total net sales and are recognized as revenue at the time merchandise is sold to customers. Service revenues (e.g., alteration and cosmetic services) are recorded at the time the customer receives the benefit of the service. The Company has elected to present sales taxes on a net basis and, as such, sales taxes are included in accounts payable and accrued liabilities until remitted to the taxing authorities. Macy’s accounted for 87 % of the Company’s net sales f or each of the 13 weeks ended May 1, 2021 and May 2, 2020 . In addition, digital sales accounted for approximately 37 % and 43 % of the Company’s net sales for the 13 weeks ended May 1, 2021 and May 2, 2020 , respectively. Disaggregation of the Company's net sales by family of business for the 13 weeks ended May 1, 2021 and May 2, 2020 were as follows:
13 Weeks Ended
Net sales by family of business
May 1, 2021
May 2, 2020
(millions)
Women's Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances
$
2,023
$
1,215
Women's Apparel
913
579
Men's and Kids'
932
573
Home/Other (a)
838
650
Total
$
4,706
$
3,017
(a)
Other primarily includes restaurant sales, allowance for merchandise returns adjustments and breakage income from unredeemed gift cards. Merchandise Returns The Company estimates merchandise returns using historical data and recognizes an allowance that reduces net sales and cost of sales. The liability for merchandise returns is included in accounts payable and accrued liabilities on the Company's Consolidated Balance Sheets and was $225 million, $159 million and $184 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively. Included in prepaid expenses and other current assets is an asset totaling $136 million, $103 million and $130 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively, for the recoverable cost of merchandise estimated to be returned by customers. Gift Cards and Customer Loyalty Programs The Company only offers no-fee, non-expiring gift cards to its customers. At the time gift cards are sold or issued, no revenue is recognized; rather, the Company records an accrued liability to customers. The liability is relieved and revenue is recognized equal to the amount redeemed at the time gift cards are redeemed for merchandise. The Company records revenue from unredeemed gift cards (breakage) in net sales on a pro-rata basis over the time period gift cards are actually redeemed. At least three years of historical data, updated annually, is used to determine actual redemption patterns. The Company maintains customer loyalty programs in which customers earn points based on their purchases. Under the Macy’s Star Rewards loyalty program, points are earned based on customers’ spending on Macy’s private label and co-branded credit cards as well as non-proprietary cards. The Company’s Bloomingdale’s Loyallist and bluemercury BlueRewards programs provide tender neutral points-based programs to their customers. The Company recognizes the estimated net amount of the rewards that will be earned and redeemed as a reduction to net sales at the time of the initial transaction and as tender when the points are subsequently redeemed by a customer. The liability for unredeemed gift cards and customer loyalty programs is included in accounts payable and accrued liabilities on the Company's Consolidated Balance Sheets and was $580 million, $616 million and $732 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively. Credit Card Revenues, net In 2005, the Company entered into an arrangement with Citibank, N.A. ("Citibank") to sell the Company's private label and co-branded credit cards ("Credit Card Program"). Subsequent to this initial arrangement and associated amendments, in 2014, the Company entered into an amended and restated Credit Card Program Agreement (the "Program Agreement") with Citibank. As part of the Program Agreement, the Company receives payments for providing a combination of interrelated services and intellectual property to Citibank in support of the underlying Credit Card Program. Revenue based on the spending activity of the underlying accounts is recognized as the respective card purchases occur and the Company’s profit share is recognized based on the performance of the underlying portfolio. Revenue associated with the establishment of new credit accounts and assisting in the receipt of payments for existing accounts is recognized as such activities occur. Credit card revenues include finance charges, late fees and other revenue generated by the Company’s Credit Card Program, net of fraud losses and expenses associated with establishing new accounts. Under the terms of the Program Agreement, if sales decrease by more than 34% over a twelve-month period as compared to the Benchmark Year, defined as the twelve-month period from July 2006 to June 2007 in the Program Agreement, Citibank has the ability to provide written notice to terminate the agreement prior to the end of its current term. Based on the results for the Company’s February 2021 fiscal period, sales for the twelve-month period ended February 27, 2021 decreased by more than 34% as compared to the Benchmark Year. On June 4, 2021, the Company received a written notice of termination of the Program Agreement from Citibank. The Company plans to continue negotiations with Citibank as well as evaluate a potential transfer of its Credit Card Program to another financial service entity. Upon receipt of the written notice of termination, the Company has six months to exercise, or not exercise, an option to purchase the assets of the Program Agreement, or nominate a third party to purchase such assets, and a subsequent six month period to complete such transfer, subject to potential extensions as more fully described in the Program Agreement. The Company and Citibank are required to continue to meet their respective obligations and provide support pursuant to the terms of the Program Agreement through this period

Financing Activities

Financing Activities3 Months Ended
May 01, 2021
Debt Disclosure [Abstract]
Financing Activities5 .
Financing Activities The following table shows the detail of debt repayments:
13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
9.5%
$
2
$
2
9.75%
1
1
3.875%
156

2.875%
136

4.375%
49

3.625%
150

6.65%
5

7.6%
4

$
503
$
3
On March 17, 2021, Macy’s Retail Holdings, LLC (“MRH”), a direct, wholly owned subsidiary of Macy’s, Inc., completed an offering of $500 million in aggregate principal amount of 5.875% senior notes due 2029 (the “2029 Notes”) in a private offering (the “Notes Offering”). The 2029 Notes mature on April 1, 2029. The 2029 Notes are senior unsecured obligations of MRH and are unconditionally guaranteed on a senior unsecured basis by Macy’s, Inc. MRH used the net proceeds from the Notes Offering, together with cash on hand, to fund the tender offer discussed below. On March 17, 2021, the Company completed a tender offer in which $500 million of senior notes and debentures were tendered for early settlement and purchased by MRH. The total cash cost for the tender offer was $17 million with the remainder funded through the net proceeds from the private offering discussed above. The Company recognized $11 million of loss related to the early retirement of debt on the Consolidated Statements of Operation during the first quarter of 2021.

Benefit Plans

Benefit Plans3 Months Ended
May 01, 2021
Pension And Other Postretirement Benefit Expense [Abstract]
Benefit Plans6 .
Benefit Plans The Company has defined contribution plans which cover substantially all colleagues who work 1,000 hours or more in a year. In addition, the Company has a funded defined benefit plan ("Pension Plan") and an unfunded defined benefit supplementary retirement plan ("SERP"), which provides benefits, for certain colleagues, in excess of qualified plan limitations. Effective January 1, 2012, the Pension Plan was closed to new participants, with limited exceptions, and effective January 2, 2012, the SERP was closed to new participants. In February 2013, the Company announced changes to the Pension Plan and SERP whereby eligible colleagues no longer earn future pension service credits after December 31, 2013, with limited exceptions. All retirement benefits attributable to service in subsequent periods are provided through defined contribution plans. In addition, certain retired colleagues currently are provided with specified health care and life insurance benefits ("Postretirement Obligations"). Eligibility requirements for such benefits vary, but generally state that benefits are available to eligible colleagues who were hired prior to a certain date and retire after a certain age with specified years of service. Certain colleagues are subject to having such benefits modified or terminated. The defined contribution plan expense and actuarially determined components of the net periodic benefit cost (income) associated with the defined benefit plans are as follows:
13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
401(k) Qualified Defined Contribution Plan
$
22
$
13
Pension Plan
Service cost
$

$
1
Interest cost
12
19
Expected return on assets
(40
)
(45
)
Recognition of net actuarial loss
8
10
$
(20
)
$
(15
)
Supplementary Retirement Plan
Interest cost
3
4
Recognition of net actuarial loss
3
3
$
6
$
7
Total Retirement Expense
$
8
$
5
Postretirement Obligations
Interest cost

1
Recognition of net actuarial gain
(1
)
(1
)
$
(1
)
$

Fair Value Measurements

Fair Value Measurements3 Months Ended
May 01, 2021
Fair Value By Fair Value Hierarchy Level Extensible List [Abstract]
Fair Value Measurements7 .
Fair Value Measurements The following table shows the Company's financial assets that are required to be measured at fair value on a recurring basis, by level within the hierarchy as defined by applicable accounting standards: Level 1: Quoted prices in active markets for identical assets Level 2: Significant observable inputs for the assets Level 3: Significant unobservable inputs for the assets
May 1, 2021
May 2, 2020
Fair Value Measurements
Fair Value Measurements
Total
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
(millions)
Marketable equity and debt securities
$
82
$
38
$
44
$

$
102
$
28
$
74
$

Other financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, receivables, certain short-term investments and other assets, short-term debt, merchandise accounts payable, accounts payable and accrued liabilities and long-term debt. With the exception of long-term debt, the carrying amount of these financial instruments approximates fair value because of the short maturity of these instruments. The fair values of long-term debt, excluding capitalized leases, are generally estimated based on quoted market prices for identical or similar instruments, and are classified as Level 2 measurements within the hierarchy as defined by applicable accounting standards. The following table shows the estimated fair value of the Company's long-term debt:
May 1, 2021
May 2, 2020
Notional Amount
Carrying Amount
Fair Value
Notional Amount
Carrying Amount
Fair Value
(millions)
Long-term debt
$
4,610
$
4,558
$
4,643
$
4,903
$
4,918
$
3,698

Organization and Summary of S_2

Organization and Summary of Significant Accounting Policies (Policies)3 Months Ended
May 01, 2021
Accounting Policies [Abstract]
Nature of OperationsNature of Operations Macy's, Inc., together with its subsidiaries (the "Company"), is an omnichannel retail organization operating stores, websites and mobile applications under three brands (Macy's, Bloomingdale's and bluemercury) that sell a wide range of merchandise, including apparel and accessories (men's, women's and kids'), cosmetics, home furnishings and other consumer goods. The Company has stores in 43 states, the District of Columbia, Puerto Rico and Guam. As of May 1, 2021, the Company's operations were conducted through Macy's, Market by Macy’s, Macy’s Backstage, Bloomingdale's, Bloomingdale's The Outlet, and bluemercury. Bloomingdale's in Dubai, United Arab Emirates and Al Zahra, Kuwait are operated under a license agreement with Al Tayer Insignia, a company of Al Tayer Group, LLC. A description of the Company's significant accounting policies is included in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2021 (the "2020 10-K"). The accompanying Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto in the 2020 10-K.
Use of EstimatesUse of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates and assumptions are subject to inherent uncertainties, including the ultimate financial impact of the COVID-19 pandemic, which may result in actual amounts differing from reported amounts. The Consolidated Financial Statements for the 13 weeks ended May 1, 2021 and May 2, 2020, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) considered necessary to present fairly, in all material respects, the consolidated financial position and results of operations of the Company.
SeasonalitySeasonality Because of the seasonal nature of the retail business, the results of operations for the 13 weeks ended May 1, 2021 and May 2, 2020 (which do not include the Christmas season) are not necessarily indicative of such results for the full fiscal year.
Comprehensive Income (Loss)Comprehensive Income (Loss) Total comprehensive income (loss) represents the change in equity during a period from sources other than transactions with shareholders and, as such, includes net income (loss). For the Company, the only other components of total comprehensive income (loss) for the 13 weeks ended May 1, 2021 and May 2, 2020 relate to post employment and postretirement plan items. Settlement charges incurred are included as a separate component of income (loss) before income taxes in the Consolidated Statements of Operations. Amortization reclassifications out of accumulated other comprehensive loss are included in the computation of net periodic benefit cost (income) and are included in benefit plan income, net on the Consolidated Statements of Operations. See Note 6, "Benefit Plans," for further information.
COVID-19 PandemicCOVID-19 Pandemic As the COVID-19 pandemic continues into fiscal 2021, the Company remains focused on prudent cash management, maintaining strong liquidity, and executing its strategic initiatives. In addition, the Company continues to prioritize health and safety measures in its stores and facilities to protect the well-being of its customers and colleagues. Although the Company has experienced recovery in operating results during the first quarter of 2021 as compared to fiscal 2020, certain stores continued to operate under local governmental orders or restrictions. The full impact of COVID-19 will continue to depend on future developments, including the continued spread and duration of the pandemic, variant strains of COVID-19, the availability and distribution of effective medical treatments or vaccines as well as any related federal, state or local governmental orders or restrictions. In addition, numerous uncertainties continue to surround the pandemic and its ultimate impact on the Company, including the timing and extent of any recovery in consumer traffic and spending, and potential delays, interruptions and disruptions in the Company’s supply chain, all of which are highly uncertain and cannot be predicted. As further disclosed in the Company’s 2020 Form 10-K, on March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law, which permitted, among other benefits, the carryback of certain net operating losses. Based on the Company’s 2020 fiscal results, a $520 million income tax receivable has been recognized as of May 1, 2021, associated with this net operating loss carryback benefit. This income tax receivable is estimated to be received in the first quarter of 2022 and is included within prepaid expenses and other current assets on the Company’s Consolidated Balance Sheet.
RevenueNet sales Revenue is recognized when customers obtain control of goods and services promised by the Company. The amount of revenue recognized is based on the amount that reflects the consideration that is expected to be received in exchange for those respective goods and services. The Company's revenue generating activities include the following: Retail Sales Retail sales include merchandise sales, inclusive of delivery income, licensed department income, sales of private brand goods directly to third party retailers and sales of excess inventory to third parties. Sales of merchandise are recorded at the time of shipment to the customer and are reported net of estimated merchandise returns and certain customer incentives. Commissions earned on sales generated by licensed departments are included as a component of total net sales and are recognized as revenue at the time merchandise is sold to customers. Service revenues (e.g., alteration and cosmetic services) are recorded at the time the customer receives the benefit of the service. The Company has elected to present sales taxes on a net basis and, as such, sales taxes are included in accounts payable and accrued liabilities until remitted to the taxing authorities. Macy’s accounted for 87 % of the Company’s net sales f or each of the 13 weeks ended May 1, 2021 and May 2, 2020 . In addition, digital sales accounted for approximately 37 % and 43 % of the Company’s net sales for the 13 weeks ended May 1, 2021 and May 2, 2020 , respectively. Disaggregation of the Company's net sales by family of business for the 13 weeks ended May 1, 2021 and May 2, 2020 were as follows:
13 Weeks Ended
Net sales by family of business
May 1, 2021
May 2, 2020
(millions)
Women's Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances
$
2,023
$
1,215
Women's Apparel
913
579
Men's and Kids'
932
573
Home/Other (a)
838
650
Total
$
4,706
$
3,017
(a)
Other primarily includes restaurant sales, allowance for merchandise returns adjustments and breakage income from unredeemed gift cards. Merchandise Returns The Company estimates merchandise returns using historical data and recognizes an allowance that reduces net sales and cost of sales. The liability for merchandise returns is included in accounts payable and accrued liabilities on the Company's Consolidated Balance Sheets and was $225 million, $159 million and $184 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively. Included in prepaid expenses and other current assets is an asset totaling $136 million, $103 million and $130 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively, for the recoverable cost of merchandise estimated to be returned by customers. Gift Cards and Customer Loyalty Programs The Company only offers no-fee, non-expiring gift cards to its customers. At the time gift cards are sold or issued, no revenue is recognized; rather, the Company records an accrued liability to customers. The liability is relieved and revenue is recognized equal to the amount redeemed at the time gift cards are redeemed for merchandise. The Company records revenue from unredeemed gift cards (breakage) in net sales on a pro-rata basis over the time period gift cards are actually redeemed. At least three years of historical data, updated annually, is used to determine actual redemption patterns. The Company maintains customer loyalty programs in which customers earn points based on their purchases. Under the Macy’s Star Rewards loyalty program, points are earned based on customers’ spending on Macy’s private label and co-branded credit cards as well as non-proprietary cards. The Company’s Bloomingdale’s Loyallist and bluemercury BlueRewards programs provide tender neutral points-based programs to their customers. The Company recognizes the estimated net amount of the rewards that will be earned and redeemed as a reduction to net sales at the time of the initial transaction and as tender when the points are subsequently redeemed by a customer. The liability for unredeemed gift cards and customer loyalty programs is included in accounts payable and accrued liabilities on the Company's Consolidated Balance Sheets and was $580 million, $616 million and $732 million as of May 1, 2021, January 30, 2021 and May 2, 2020, respectively. Credit Card Revenues, net In 2005, the Company entered into an arrangement with Citibank, N.A. ("Citibank") to sell the Company's private label and co-branded credit cards ("Credit Card Program"). Subsequent to this initial arrangement and associated amendments, in 2014, the Company entered into an amended and restated Credit Card Program Agreement (the "Program Agreement") with Citibank. As part of the Program Agreement, the Company receives payments for providing a combination of interrelated services and intellectual property to Citibank in support of the underlying Credit Card Program. Revenue based on the spending activity of the underlying accounts is recognized as the respective card purchases occur and the Company’s profit share is recognized based on the performance of the underlying portfolio. Revenue associated with the establishment of new credit accounts and assisting in the receipt of payments for existing accounts is recognized as such activities occur. Credit card revenues include finance charges, late fees and other revenue generated by the Company’s Credit Card Program, net of fraud losses and expenses associated with establishing new accounts. Under the terms of the Program Agreement, if sales decrease by more than 34% over a twelve-month period as compared to the Benchmark Year, defined as the twelve-month period from July 2006 to June 2007 in the Program Agreement, Citibank has the ability to provide written notice to terminate the agreement prior to the end of its current term. Based on the results for the Company’s February 2021 fiscal period, sales for the twelve-month period ended February 27, 2021 decreased by more than 34% as compared to the Benchmark Year. On June 4, 2021, the Company received a written notice of termination of the Program Agreement from Citibank. The Company plans to continue negotiations with Citibank as well as evaluate a potential transfer of its Credit Card Program to another financial service entity. Upon receipt of the written notice of termination, the Company has six months to exercise, or not exercise, an option to purchase the assets of the Program Agreement, or nominate a third party to purchase such assets, and a subsequent six month period to complete such transfer, subject to potential extensions as more fully described in the Program Agreement. The Company and Citibank are required to continue to meet their respective obligations and provide support pursuant to the terms of the Program Agreement through this period

Impairment, Restructuring and_2

Impairment, Restructuring and Other Costs (Tables)3 Months Ended
May 01, 2021
Restructuring Costs And Asset Impairment Charges [Abstract]
Schedule of Impairment, Restructuring and Other Costs13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
Impairments
$
18
$
3,150
Restructuring
(1
)
25
Other
2
9
Total
$
19
$
3,184
Summary of Restructuring and Other Cash ActivityA summary of the restructuring and other cash activity for the 13 weeks ended May 1, 2021 and May 2, 2020 related to the Polaris strategy, which was announced in February 2020 and included within accounts payable and accrued liabilities, is as follows:
Severance and other benefits
Professional fees and other related charges
Total
(millions)
Balance at February 1, 2020
$
115
$
9
$
124
Additions charged to expense
25
7
32
Cash payments
(82
)
(6
)
(88
)
Balance at May 2, 2020
$
58
$
10
$
68
Severance and other benefits
Professional fees and other related charges
Total
(millions)
Balance at January 30, 2021
$
14
$
2
$
16
Additions charged to expense
5

5
Cash payments
(16
)
(2
)
(18
)
Balance at May 1, 2021
$
3
$

$
3

Earnings (Loss) Per Share (Tabl

Earnings (Loss) Per Share (Tables)3 Months Ended
May 01, 2021
Earnings Per Share [Abstract]
Computation of Basic and Diluted Earnings (Loss) Per ShareThe following tables set forth the computation of basic and diluted earnings (loss) per share:
13 Weeks Ended
May 1, 2021
May 2, 2020
Net Income
Shares
Net Loss
Shares
(millions, except per share data)
Net income (loss)
$
103
310.7
$
(3,581
)
309.7
Shares to be issued under deferred compensation and other plans
0.9
0.9
$
103
311.6
$
(3,581
)
310.6
Basic earnings (loss) per share
$
0.33
$
(11.53
)
Effect of dilutive securities:
Stock options and restricted stock units
7.0

$
103
318.6
$
(3,581
)
310.6
Diluted earnings (loss) per share
$
0.32
$
(11.53
)

Revenue (Tables)

Revenue (Tables)3 Months Ended
May 01, 2021
Revenue From Contract With Customer [Abstract]
Sales From Merchandise CategoryDisaggregation of the Company's net sales by family of business for the 13 weeks ended May 1, 2021 and May 2, 2020 were as follows:
13 Weeks Ended
Net sales by family of business
May 1, 2021
May 2, 2020
(millions)
Women's Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances
$
2,023
$
1,215
Women's Apparel
913
579
Men's and Kids'
932
573
Home/Other (a)
838
650
Total
$
4,706
$
3,017
(a)
Other primarily includes restaurant sales, allowance for merchandise returns adjustments and breakage income from unredeemed gift cards.

Financing Activities (Tables)

Financing Activities (Tables)3 Months Ended
May 01, 2021
Debt Disclosure [Abstract]
Detail of Debt RepaymentsThe following table shows the detail of debt repayments:
13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
9.5%
$
2
$
2
9.75%
1
1
3.875%
156

2.875%
136

4.375%
49

3.625%
150

6.65%
5

7.6%
4

$
503
$
3

Benefit Plans (Tables)

Benefit Plans (Tables)3 Months Ended
May 01, 2021
Pension And Other Postretirement Benefit Expense [Abstract]
Schedule of Costs of Retirement PlansThe defined contribution plan expense and actuarially determined components of the net periodic benefit cost (income) associated with the defined benefit plans are as follows:
13 Weeks Ended
May 1, 2021
May 2, 2020
(millions)
401(k) Qualified Defined Contribution Plan
$
22
$
13
Pension Plan
Service cost
$

$
1
Interest cost
12
19
Expected return on assets
(40
)
(45
)
Recognition of net actuarial loss
8
10
$
(20
)
$
(15
)
Supplementary Retirement Plan
Interest cost
3
4
Recognition of net actuarial loss
3
3
$
6
$
7
Total Retirement Expense
$
8
$
5
Postretirement Obligations
Interest cost

1
Recognition of net actuarial gain
(1
)
(1
)
$
(1
)
$

Fair Value Measurements (Tables

Fair Value Measurements (Tables)3 Months Ended
May 01, 2021
Fair Value By Fair Value Hierarchy Level Extensible List [Abstract]
Fair Value of Plan Assets Measured on a Recurring BasisThe following table shows the Company's financial assets that are required to be measured at fair value on a recurring basis, by level within the hierarchy as defined by applicable accounting standards: Level 1: Quoted prices in active markets for identical assets Level 2: Significant observable inputs for the assets Level 3: Significant unobservable inputs for the assets
May 1, 2021
May 2, 2020
Fair Value Measurements
Fair Value Measurements
Total
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
(millions)
Marketable equity and debt securities
$
82
$
38
$
44
$

$
102
$
28
$
74
$
Estimated Fair Values of Company's Long Term DebtThe following table shows the estimated fair value of the Company's long-term debt:
May 1, 2021
May 2, 2020
Notional Amount
Carrying Amount
Fair Value
Notional Amount
Carrying Amount
Fair Value
(millions)
Long-term debt
$
4,610
$
4,558
$
4,643
$
4,903
$
4,918
$
3,698

Organization and Summary of S_3

Organization and Summary of Significant Accounting Policies (Narrative) (Details) $ in MillionsMay 01, 2021USD ($)State
Organization And Summary Of Significant Accounting Policies [Line Items]
Number of states in which entity operates | State43
COVID-19 Pandemic [Member] | Prepaid Expenses and Other Current Assets [Member]
Organization And Summary Of Significant Accounting Policies [Line Items]
Income tax receivable, COVID-19 | $ $ 520

Impairment, Restructuring and_3

Impairment, Restructuring and Other Costs - Schedule of Impairment, Restructuring and Other Costs (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Restructuring Costs And Asset Impairment Charges [Abstract]
Impairments $ 18 $ 3,150
Restructuring(1)25
Other2 9
Total $ 19 $ 3,184

Impairment, Restructuring and_4

Impairment, Restructuring and Other Costs - Narrative (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Restructuring Cost And Reserve [Line Items]
Impairments $ 18 $ 3,150
Goodwill impairment, COVID-193,070
Tangible Asset Impairment, COVID-1980
Macy's Reporting Unit
Restructuring Cost And Reserve [Line Items]
Goodwill impairment, COVID-192,972
Bluemercury Reporting Unit
Restructuring Cost And Reserve [Line Items]
Goodwill impairment, COVID-19 $ 98

Impairment, Restructuring and_5

Impairment, Restructuring and Other Costs - Summary of Restructuring and Other Cash Activity (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Restructuring Cost And Reserve [Line Items]
Additions charged to expense $ 2 $ 9
Polaris Strategy
Restructuring Cost And Reserve [Line Items]
Beginning Balance16 124
Additions charged to expense5 32
Cash payments(18)(88)
Ending Balance3 68
Polaris Strategy | Employee Severance
Restructuring Cost And Reserve [Line Items]
Beginning Balance14 115
Additions charged to expense5 25
Cash payments(16)(82)
Ending Balance3 58
Polaris Strategy | Other Restructuring
Restructuring Cost And Reserve [Line Items]
Beginning Balance2 9
Additions charged to expense0 7
Cash payments(2)(6)
Ending Balance $ 0 $ 10

Earnings (Loss) Per Share (Comp

Earnings (Loss) Per Share (Computation of Basic and Diluted Earnings (Loss) Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Earnings Per Share [Abstract]
Net income (loss) $ 103 $ (3,581)
Net Income (Loss) Available to Common Stockholders, Basic $ 103 $ (3,581)
Basic earnings (loss) per share $ 0.33 $ (11.53)
Net Income (Loss) Available to Common Stockholders, Diluted $ 103 $ (3,581)
Diluted earnings (loss) per share $ 0.32 $ (11.53)
Weighted Average Number of Shares Issued, Basic310.7 309.7
Shares to be issued under deferred compensation and other plans0.9 0.9
Average number of shares outstanding, basic311.6 310.6
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements7 0
Average number of shares outstanding, diluted318.6 310.6

Earnings (Loss) Per Share (Narr

Earnings (Loss) Per Share (Narrative) (Details) - shares shares in Millions3 Months Ended
May 01, 2021May 02, 2020
Employee Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount14.7 17.3
Restricted Stock Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount11.7 3.4

Revenue (Narrative) (Details)

Revenue (Narrative) (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020Feb. 27, 2021Jan. 30, 2021
Macy's sales to total Company sales87.00%87.00%
Percentage of digital sales37.00%43.00%
Contract with Customer, Refund Liability $ 225 $ 184 $ 159
Contract with Customer, Right to Recover Product136 130 103
Contract with Customer, Liability, Current $ 580 $ 732 $ 616
Minimum [Member]
Sales decrease benchmark percentage34.00%
Sales decrease percentage34.00%

Revenue (Sales From Merchandise

Revenue (Sales From Merchandise Category) (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Net sales $ 4,706 $ 3,017
Women's Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances [Member]
Net sales2,023 1,215
Women's Apparel [Member]
Net sales913 579
Men's and Kids' [Member]
Net sales932 573
Home/Other [Member]
Net sales $ 838 $ 650

Financing Activities (Detail Of

Financing Activities (Detail Of Debt Repayments) (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Repayments of Debt $ 503 $ 3
9.5% Amortizing Debentures Due 2021 [Member]
Repayments of Debt $ 2 $ 2
Debt instrument interest rate, stated percentage9.50%9.50%
9.75% Amortizing Debentures Due 2021 [Member]
Repayments of Debt $ 1 $ 1
Debt instrument interest rate, stated percentage9.75%9.75%
3.875% Senior Notes Due 2022 [Member]
Repayments of Debt $ 156 $ 0
Debt instrument interest rate, stated percentage3.875%3.875%
2.875% Senior Notes Due 2023 [Member]
Repayments of Debt $ 136 $ 0
Debt instrument interest rate, stated percentage2.875%2.875%
4.375% Senior Notes Due 2023 [Member]
Repayments of Debt $ 49 $ 0
Debt instrument interest rate, stated percentage4.375%4.375%
3.625% Senior Notes Due 2024 [Member]
Repayments of Debt $ 150 $ 0
Debt instrument interest rate, stated percentage3.625%3.625%
6.65% Senior Debentures Due 2024 [Member]
Repayments of Debt $ 5 $ 0
Debt instrument interest rate, stated percentage6.65%6.65%
7.6% Senior Debentures Due 2025 [Member]
Repayments of Debt $ 4 $ 0
Debt instrument interest rate, stated percentage7.60%7.60%

Financing Activities (Narrative

Financing Activities (Narrative) (Details) - USD ($)Mar. 17, 2021May 01, 2021May 02, 2020
Extinguishment of debt $ 500,000,000
Debt Instrument, Repurchase Amount17,000,000
Gains (losses) on early retirement of debt $ 11,000,000 $ 0
5.875% Senior Notes due 2029
Face amount $ 500,000,000
Debt instrument interest rate, stated percentage5.875%
Debt instrument, maturity dateApr. 1,
2029

Benefit Plans (Narrative) (Deta

Benefit Plans (Narrative) (Details)3 Months Ended
May 01, 2021Hour
Pension And Other Postretirement Benefit Expense [Abstract]
Number of hours required for participation in defined benefit and defined contribution plans1,000

Benefit Plans (Net Periodic Ben

Benefit Plans (Net Periodic Benefit Cost) (Details) - USD ($) $ in Millions3 Months Ended
May 01, 2021May 02, 2020
Total Retirement Expense $ 8 $ 5
Pension Plan [Member]
Service cost0 1
Interest cost12 19
Expected return on assets(40)(45)
Recognition of net actuarial (gain) loss8 10
Total net periodic benefit cost(20)(15)
Supplementary Retirement Plan [Member]
Interest cost3 4
Recognition of net actuarial (gain) loss3 3
Total net periodic benefit cost6 7
Other Postretirement Benefits Plan [Member]
Interest cost0 1
Recognition of net actuarial (gain) loss(1)(1)
Total net periodic benefit cost(1)0
401(k) Qualified Plan [Member] | Defined Contribution Plan [Member]
Defined contribution plan, cost $ 22 $ 13

Fair Value Measurements (Financ

Fair Value Measurements (Financial Assets Measured At Fair Value On A Recurring and Nonrecurring Basis) (Details) - USD ($) $ in MillionsMay 01, 2021May 02, 2020
Marketable equity and debt securities $ 82 $ 102
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Marketable equity and debt securities38 28
Significant Observable Inputs (Level 2) [Member]
Marketable equity and debt securities44 74
Significant Unobservable Inputs (Level 3) [Member]
Marketable equity and debt securities $ 0 $ 0

Fair Value Measurements (Estima

Fair Value Measurements (Estimated Fair Value Of Company Long Term Debt) (Details) - USD ($) $ in MillionsMay 01, 2021May 02, 2020
Long-term debt $ 4,643 $ 3,698
Notional Amount
Long-term debt4,610 4,903
Carrying Amount
Long-term debt $ 4,558 $ 4,918