Stronger sales driven by a strategy of tailoring merchandise to local markets helped lift Macy's profits, the retail giant reported on Tuesday, as earnings and revenue for the quarter beat Wall Street's expectations.
Net income was $730 million, or $1.83 per diluted share, down from $745 million, or $1.74 per diluted share when the company had more outstanding shares.
Excluding one-time expenses related to store closings and the early retirement of outstanding debt, the company earned $2.05 per share, up from $1.70 a share in the year-earlier period.
Revenue rose 7 percent to $9.35 billion from $8.72 billion a year ago.
Analysts had expected the department store chain, which also operates Bloomingdale's stores, to report earnings excluding items of $1.99 a share on $9.30 billion in revenue, according to a consensus estimate from Thomson Reuters.
During the quarter, same-store sales rose 3.9 percent. For the full fiscal year, same-store sales rose by 3.7 percent for the year, down from 5.3 percent in 2011.
Looking ahead, the company said it expects revenue at stores open a year to rise 3.5 percent in 2013. Earnings for the fiscal year are expected to fall between $3.90 a share and $3.95 a share, compared with analysts estimates of $3.41 a share for the fiscal year.
Macy's and rival department store J.C. Penney are involved in an ongoing lawsuit over a partnership with Martha Stewart. The suit centers around whether Macy's has the exclusive right to sell Martha Stewart-branded products.
— The Associated Press contributed to this report