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Macy's has delayed its earnings call due to an accounting error involving a single employee who concealed between $132 million and $154 million in delivery expenses. The employee, who no longer works for the company, intentionally made erroneous accounting accrual entries to hide these expenses over a nearly three-year period, from Macy's fourth quarter of 2021 to the quarter that ended earlier this month. The company made this revelation in a securities filing on Monday (November 25).
Macy's has initiated an investigation into the incident and stated that there is no evidence of other parties' involvement or any adverse impact on cash management or payments. Due to the ongoing investigation, the company has postponed the release of its full quarterly results and its earnings conference call to December 11 at the latest.
Despite the setback, Macy's CEO Tony Spring emphasized the company's commitment to ethical conduct.
"While we work diligently to complete the investigation as soon as practicable and ensure this matter is handled appropriately, our colleagues across the company are focused on serving our customers and executing our strategy for a successful holiday season," said Spring.
In the meantime, Macy's released preliminary third-quarter earnings figures on Monday, showing a 2.4% decrease in net sales to $4.742 billion. The company reported growth in sales at its "First 50" locations, Bloomingdale’s, and Bluemercury stores. However, this was offset by weaker performance in other non-First 50 locations, its digital channel, and cold weather categories.