NEW YORK (TheStreet) -- Macy's (M) - Get Report stock is plummeting 13.39% to $31.99 on heavy trading volume this morning after reporting a 7.4% year-over-year decline in first quarter revenue and slashing its full-year same-store sales outlook.
"I can sit here and say this over and over again, but people just don't go to the mall like they did," TheStreet's Jim Cramer said on CNBC's "Squawk on the Street" this morning.
He mentioned that millennials would much rather shop online at Amazon.com (AMZN) than go to a mall.
"Millennials are a whole big part of the population, and they're taking over the earth," he stated.
Their lack of spending at mall-based retailers has hurt Macy's, while their reliance on Apple's (AAPL) iPhones for a clock has hurt Fossil (FOSL) watch sales, Cramer explained.
Consumers used to visit the mall while comparing prices with online retailers using their smartphones, but now customers don't even go to physical stores, Cramer pointed out.
"I feel for these guys because you couldn't game how quickly this business went away," he noted.
"I think that the department stores are in a secular decline in the country," Cramer added in the above video. "It's just not the way people shop anymore."
Macy's 6.1% drop in comparable-store sales during the most recent period demonstrates that the retailer is unable to get ahead of this trend, Cramer contended.
When CNBC co-anchor Carl Quintanilla asked Cramer what happened to omnichannel retail, Cramer said that consumers have changed the channel.
Facebook's (FB) Oculus Rift virtual reality headset will soon enable consumers to take a virtual trip to the mall and "try on" clothes without ever leaving their homes, Cramer said.
"It's insane what's coming, and I don't think these guys realize what's coming," Cramer stated this morning.
Separately, TheStreet Ratings team rates the stock as a "hold" with a ratings score of C+.
Macy's strengths such as its attractive valuation levels, expanding profit margins and notable return on equity are countered by weaknesses including deteriorating net income, generally higher debt management risk and weak operating cash flow.
You can view the full analysis from the report here: M
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.