The earnings miss Wednesday by highly regarded Macy's raised a red flag about what's to come from the slew of retailers set to report profits.
"As one of the top-performing and best-executing retailers in the industry, Macy's second-quarter earnings miss is an ominous early marker for retail that could portend further disappointing results over the coming weeks," said Ken Perkins, president of Retail Metrics.
Macy's earlier cut its full-year same-store sales forecast, saying a 3.3 percent rise in second-quarter sales would not make up for weakness in the first quarter, when harsh winter weather kept shoppers away.
The department store said it expects same-store sales to increase 1.5 to 2 percent for the full year. It had earlier forecast an increase of 2.5 to 3 percent.
Despite the shortfall, Stifel Nicolaus analyst Richard Jaffe said the retailer "indicated that trends improved at both Macy's and Bloomingdale's in the second quarter, reflecting a rebound in shopping activity once the weather turned seasonable."
Wells Fargo analyst Paul Lejuez noted that Macy's miss was primarily due to weaker margins, driven by promotions, but said sales were still strong.
"Once all have reported, we don't think Macy's will seem so bad," he said. "After all, gross profit dollars increased showing that the company is at least driving sales with its promotions. Not all will be so fortunate."