Macy's Unveils Disguised Delivery Costs, Delays Financial Report
Macy's recently disclosed that an ex-employee concealed delivery costs ranging from $132 million to $154 million over nearly three years, causing a postponement of its quarterly earnings report. The misconduct, which involved falsifying accounting entries related to small package delivery expenses, was discovered during preparations for the third-quarter financial results for the period ending November 2, 2024. Despite the fraud's lack of impact on cash flow or vendor payments, it sparked concerns about corporate oversight and led to an independent forensic examination. Meanwhile, Macy's recorded a 2.4% drop in quarterly sales largely due to weak digital channels and warmer weather, although its upscale brand Bloomingdale’s saw slight growth. The incident exacerbates Macy’s struggles amidst the competitive retail space, with its stock already having decreased by 20% this year. A turnaround strategy includes closing several stores and operational restructuring to realign with market shifts, with thorough financial results anticipated by December 11.