NEW YORK - Macy's announced a series of cost-cutting moves Wednesday that it said would generate savings of about $100 million annually.
The retailer said it will lay off about 1.4% of its workforce, close some stores and open others, and combine its Midwest and North regions.
About 2,500 people are expected to lose their jobs. However, the company said hiring will continue in some areas, such as online operations, keeping the workforce at its current level of about 175,000 employees.
"We have identified some specific areas where we can improve our efficiency without compromising our effectiveness in serving the evolving needs of our customers," CEO Terry Lundgren said in a press release.
The retailer will close five Macy's stores in early spring and open five, plus three Bloomingdale's stores. Those closing: Fiesta Mall, Mesa, Ariz.; Metcalf South Shopping Center, Overland Park, Kan.; Jamestown Mall, Florissant, Mo.; Medley Centre, Irondequoit, N.Y.; and Fashion Place Mall, Murray, Utah.
The retailer will also combine its Midwest Region with its North Region to create a new North Central Region.
The lost jobs and store closings come with a cost: The company said it will record a one-time charge of $120 million to $135 million for the fiscal quarter ending Feb. 1, cutting into profits.
Macy's said comparable store sales rose 3.6% in the November-December holiday shopping season compared with the same period last year.
The company stood by its annual earnings forecast of $3.80 to $3.90 per diluted share - suggesting a $1.4 billion to $1.5 billion profit for the fiscal year. The company also said that for the first time, it expects to earn $4.40 to $4.50 per diluted share in the next fiscal year, suggesting a profit of about $1.7 billion.
The company currently has 794 Macy's stores, 37 Bloomingdale's and 13 Bloomingdale's outlet stores.
Macy's stock price was up 5.3% to $54.60 in after-hours trading.