Macy’s (M) continues to face questions about its future as it beats muted first quarter earnings estimates on Wednesday morning.

Revenue fell 5.1% year over year to $4.6 billion, but beat analyst estimates of $4.46 billion. Adjusted earnings per share dropped 40.7% to $0.16, compared to expectation of $0.14.

Macy’s same-store sales decreased 1.2% year over year, beating estimates of a 3.85% decline.

In the release, CEO Tony Spring said the results “give us confidence that we have the right strategy and team in place to navigate the current environment.”

At the 125 stores Macy’s recently invested in improving merchandise and service, same store sales fell 0.8%. Same-store sales at its luxury chain Bloomingdale’s and cosmetics retailer Bluemercury are up 3.8% and 1.5%, respectively.

The company reaffirmed its sales guidance, but revised its earnings outlook due to uncertainty surrounding tariffs and consumer sentiments, and the competitive landscape.

It now expects adjusted earnings per share of $1.60 to $2.00. It previously expected $2.05 to $2.25, which already missed consensus estimates of $2.31 and were lower than the $2.64 it clocked in 2024.

It still expects 2025 revenue in the range of $21 billion to $21.4 billion, below last year’s $22.29 billion and missing estimates of $21.66 billion.

It also reiterated that same-store sales are expected to decrease between 0.5% to 2% year over year, compared to the 0.71% increase that Wall Street anticipated.

Here’s what Macy’s reported in its first quarter results, versus Bloomberg consensus estimates:

• Net sales: $4.6 billion, versus $4.46 billion

• Adjusted earnings per share: $0.16, versus $0.14

• Same-store sales growth: -1.2%, versus -3.85%

The retailer is facing multiple macro headwinds as consumer sentiment sags, costs rise with Trump’s tariffs, and trends grow toward e-commerce and direct-to-consumer.

Last July, Macy’s rejected a $6.9 billion bid from activist investor Arkhouse and its partner Brigade Capital. The offer valued the company at $24.80; the stock now trades at $12.

The spotlight will be on management as Spring, now more than a year into the job, opted for his plan for a turnaround. As part of the strategy, Macy’s plans to close 66 unprofitable stores this year and 150 total in the next three years.

Attracting foot traffic, ensuring the right assortment and customer service, and setting the right pricing are three crucial goals for Macy’s, per Coresight Research CEO Deborah Weinswig.

However, Macy’s often requires coupons or store credit cards to get the best deal, making it more difficult for shoppers to see its value. That model will “hurt them in the near and long term,” Weinswig. said.