Macy’s Inc. (NYSE:M) slumped ahead of the opening bell in US trading after the department store chain posted a 7.5% drop in first quarter sales to US$5.3bn.
Shares fell 9.61% to US$26.50 in pre-market trade.
The company blamed the decline in sales, which missed analysts’ estimates of US$5.4bn, on store closures announced last year.
Earnings per share fell to 24 cents from 37 cents the previous year, well below market expectations of 35.
Like its department store peers, Macy’s has been struggling to keep up with off-price brands and e-commerce rivals such as Amazon.
Chief executive Jeff Gennette, who took over from former boss Terry Lundgren last month, has said he wants to end a two-year streak of poor sales by making Macy’s more of a competitor with off-price chains.
The group has been rolling out Macy's Backstage discount stores into malls over the past two years to rival the likes of Ross Stores and TJ Maxx.
Gennette said Macy’s will open another 30 Backstage-branded shops in Macy's full-price stores by the end of this year.
On the results he said: "Our first quarter sales and earnings results were consistent with our expectations, and we remain on track to meet our 2017 guidance," Jeff Gennette, president and chief executive officer of Macy's, said in a statement.
"We are encouraged by the performance of the pilot programs we tested last year in categories like women's shoes, fine jewelry, and furniture and mattresses. We look forward to expanding these successful initiatives nationally this year and anticipate they will have a measurable impact on our performance starting in the second quarter, building through the fall. Additionally, our digital platforms showed continued strong growth in the first quarter."