The department store retailer said Wednesday that it will close 68 stores by early spring in an effort to save money as it battles the transition to digital shopping. The company expects its sales this year to be hurt by $575 million as a result of the closures. About 3,900 employees will be let go.
Macy's reiterated that it expects to close 100 stores over the next few years.
"As we've noted, it is essential that we maintain a healthy portfolio of the right stores in the right places," Macy's outgoing Chairman and CEO Terry Lundgren said in a statement. "We are closing locations that are unproductive or are no longer robust shopping destinations due to changes in the local retail shopping landscape, as well as monetizing locations with highly valued real estate."
Although the closures will dent Macy's top line, it will boost its bottom line.
Coupled with a reorganization of its organizational structure, Macy's anticipates saving $550 million in expenses this year.
Shares of Macy's plunged as much as 7% in afterhours trading to $33.30 as it also issued lackluster holiday season sales and profits.