Macy's Inc. (M) - Get Report posted stronger-than-expected third quarter earnings Thursday but said same store sales fell notably and trimmed its full-year profit guidance as U.S. mall-focused retailers continue to struggle.

Macy's said earnings for the three months ending on November 2 came in at 7 cents per share, down nearly 75% from the same period last year but 7 cents ahead of the Street consensus forecast. Group revenues, Macy's said, fell 4.2% to $5.17 billion, but came in shy of analysts' estimates of a $5.32 billion tally.

Same store sales fell 3.5%, Macy's said, well shy of the 1% decline forecast by analysts that cover the company, and Macy's said it now sees full year earnings in the region of $2.57 to$2.77 per share, down around 30 cents from its prior forecasts. Full-year sales will likely fall by 2.5% from last year's $24.971 billion total, compared to the company's prior forecast of a flat 2019.

"After seven consecutive quarters of comparable sales growth, we experienced a deceleration in our third quarter sales. While we anticipated a negative comp as we were lapping a very strong third quarter last year, the sales deceleration was steeper than we expected," said CEO Jeff Gennette. "However, having cleared the excess inventory we faced earlier in the year, we were able to take a more balanced approach to sales and profit in the quarter, resulting in significantly improved margin compression versus the first half of the year."

"Our third quarter sales were impacted by the late arrival of cold weather, continued soft international tourism and weaker than anticipated performance in lower tier malls," he added. "We also experienced a temporary impact on our e-commerce business due in part to work on the site in preparation for the fourth quarter." 

Macy's shares were marked 3.8% lower in the opening minutes of trading following the earnings release to change hands at $14.56 each, a move that would extend the stock's year-to-date decline to around 50%.

Earlier this week, Macy's rival Kohl's Corp. (KSS) - Get Report  slahsed its full-year profit guidance after weak third quarter numbers, and now sees fiscal 2019 earnings of between $4.75 and $4.95 per share, down from its prior estimate of $5.15 to $5.40 per share.

U.S. retail sales rose just 0.3% last month, but missed economists' forecasts when automobile sales were stripped out and declines in clothing, furniture, electronics, and building materials were computed. Previous readings for August and September were revised to the downside, which, when set against flat wage growth and looming tariffs on the next round of China-made consumer goods set to kick-in on December 15, could bode poorly for the coming Christmas period.

"The 'control' measure (of U.S. retail sales data) which drives the non-durable goods component of overall consumers' spending, is on course to rise at an annualized rate of less than 3% in the fourth quarter, following a solid 6.3% increase in the third," said Ian Shepherdson of Pantheon Macroeconomics.

"This does not guarantee a sluggish performance from aggregate real consumption, because
it tells us nothing about spending on discretionary services or vehicles," he added. "The latter was stronger than we expected in October, but the big picture is unfavorable as financing conditions tighten."