The entrances of Macy's are decorated for Christmas in New York City.
Macy's raised its full-year forecast on Thursday after reporting fiscal third-quarter earnings and sales that beat analysts' expectations.
Macy's shares jumped more than 9% in premarket trading.
Macy's added over four million new customers in the quarter and benefited from an improved economic environment, according to CEO Jeff Gennette.
The company teased the launch of a new digital marketplace in the second half of the century. The announcement comes as activist JANA PARTNERS has taken a stake in the business and is pressuring Macy's to spin off its e-commerce operations from its stores, hoping to fetch a greater valuation than what Macy's has today.
A similar split was pursued earlier this year. The spin off of its e-commerce unit from its stores has led to it preparing for an initial public offering at a higher valuation.
Macy's has not commented on the proposal.
Macy's did better than analysts expected in the three-month period ended October 30.
31 cents expected
$5.2 billion expected
Macy's reported net income of $239 million, or 76 cents per share, compared with a loss of $91 million, or 29 cents a share, a year earlier. The company earned $1.23 per share, better than the 31 cents that analysts had predicted.
Sales increased to $5.4 billion from $3.99 billion a year ago. It was ahead of estimates for $5 billion.
Macy's reported comparable sales growth of 35.6% on an owned plus licensed basis. Analysts had been looking for a growth of 29.3%.
Digital sales increased by 49% on a two-year basis. The company said its online business made up a third of total sales.
Comparable sales rose 38.5% at Bloomingdale's. The company said shoppers with more money spent on luxury handbags, fine jewelry, men's shoes and apparel.
Macy's now sees revenue between $24.12 billion and $24.28 billion, compared with a previous range of $23.55 billion to $23.97 billion.
It expects full-year adjusted earnings per share to hit $4.76, up from a previous forecast of $3.41 to $3.75.
The analysts had been looking for adjusted earnings per share of $3.89.
The operator of the department store raised its outlook for the year, sending its shares up 8% in premarket trading.
The new digital marketplace the company is launching will help Macy's expand its assortment of products at a lower cost, according to the company's chief digital and customer officer. Third-party merchants will be able to sell their goods on the websites of Macy's and Bloomindales. Macy's said it has a partnership with Mirakl to power the platform.
Macy's has a goal of $10 billion in online revenue by 2023, but this marketplace should add more sales.
Bed Bath & Beyond plans to create a marketplace for third parties to sell items on its site. It is a push to mimic the marketplaces that companies like Amazon, Walmart and Target already have. It is not clear if these retailers will be successful.
Macy's stock has given shares a boost. Year to date, shares have rallied more than 174%. The market value of the retailer is $9.55 billion.
The full press release from Macy's can be found here.
