Business

Norwegian Cruise Line Holdings on Tuesday reported its first profitable year since 2019 as fourth-quarter losses narrowed dramatically.
For the full year 2024, the company expects an adjusted profit of about $635 million, or $1.23 per share.
Norwegian shares surged Tuesday, along with shares of Royal Caribbean and Carnival.

The Norwegian Viva is docked at PortMiami’s Terminal B ahead of its christening ceremony in Miami on Nov. 29, 2023.
Richard Tribou | Tribune News Service | Getty Images

Norwegian Cruise Line Holdings on Tuesday reported its first profitable year since 2019 as fourth-quarter losses narrowed dramatically.
The cruise company reported strong growth and ticket demand with an encouraging 2024 forecast. Shares of the company surged nearly 20% following the report.

Here’s how Norwegian performed in the fourth quarter compared with estimates from LSEG, formerly known as Refinitiv:

Loss per share: 18 cents vs. 14 cents expected
Revenue: $1.99 billion vs. $1.97 billion expected

For the last three months of 2023, Norwegian reported a net loss of $106.5 million, an improvement from a loss of $482.5 million in the year-ago period. The company’s loss per share narrowed to 25 cents from $1.14 the prior year. Adjusting for one-time items, Norwegian reported a loss per share of 18 cents.
For the full year, the company generated total revenue of $8.55 billion, a 32% increase from 2019, with a net income of $166.2 million. In 2022, Norwegian lost $2.27 billion.
The company saw 102.9% occupancy for the year. Total revenue per passenger per day increased 17% from pre-pandemic levels.
The company said it received robust demand for most of its cruises except those traveling through the Middle East, which were canceled due to the violence in Gaza. The cancellations only caused a slight dip in occupancy in the fourth quarter to 99.2%, the company said.

“Norwegian Cruise Line Holding experienced a momentous year of growth and achievement in 2023,” CEO Harry Sommer said in a statement. “We successfully took delivery of three new ships, one for each of our brands, representing the most deliveries in a single year in our Company’s 57-year history. This important milestone showcases our dedication to innovation and commitment to providing exceptional vacation experiences for our guests.”
The company said it’s currently at record-high booking levels due to “healthy consumer demand” across the fourth quarter and full year.
For the full year 2024, the company expects an adjusted profit of about $635 million, or $1.23 per share, and an occupancy rate of about 105%. Analysts polled by LSEG had anticipated 2024 earnings per share of $1.21.
Shares of other cruise companies, including Royal Caribbean Cruises and Carnival Corp., also rose Tuesday morning. More

Shares of Viking Therapeutics soared after the company’s experimental weight loss drug showed promising initial results in a mid-stage trial. 
Viking Therapeutics is one of several small obesity drugmakers hoping to enter the budding weight loss drug industry, which analysts say could grow into a $100 billion market by the end of the decade. 
Analysts have suggested that larger pharmaceutical companies could potentially move to acquire a company like Viking Therapeutics. 

Cr | Istock | Getty Images

Shares of Viking Therapeutics closed more than 120% higher on Tuesday after the company’s experimental weight loss drug showed promising initial results in a mid-stage trial. 
Viking Therapeutics is one of several small obesity drugmakers hoping to enter the budding weight loss drug industry, which analysts say could grow into a $100 billion market by the end of the decade. 

But it may not join that space on its own: Analysts have suggested that larger pharmaceutical companies such as Pfizer, which scrapped two of its own weight loss drug candidates last year, could potentially move to partner with or acquire a company like Viking Therapeutics. Tuesday’s share move puts Viking Therapeutics’ market value at roughly $8.5 billion.
The trial followed more than 170 patients with obesity or who are overweight, some of whom received different dose sizes of the injectable drug or a placebo.
Those who received weekly doses of the treatment lost up to 14.7% of their body weight from baseline, or 13.1% when adjusted for placebo, after 13 weeks. 
Up to 88% of patients who received the drug, known as VK2735, achieved at least 10% weight loss, compared with just 4% of those who didn’t receive the treatment. 
Notably, there was no evidence of a plateau in weight reduction at week 13 for any dose of the drug, suggesting that “further weight loss might be achieved” by keeping patients on the treatment longer, Viking CEO Brian Lian said during a call with investors. 

The drug demonstrated “encouraging” safety in patients following the 13-week trial period. Patients also appeared to tolerate the drug well. 
Around 4% of patients who received any dose size of the treatment discontinued the study early compared with approximately 6% of those in the placebo group.

More CNBC health coverage

The majority of adverse events that patients experienced after starting the drug – also known as treatment-emergent adverse events – were mild or moderate in severity. Many of those events were gastrointestinal, which is commonly seen across all weight loss and diabetes treatments.
That includes nausea, vomiting, diarrhea and constipation.
Viking plans to present the full Phase 2 data at medical conferences. The company also said it plans to meet with the Food and Drug Administration to discuss further steps for the development of VK2735.
Separately, the company said it expects to release early stage trial data on an oral version of its weight loss drug.
Viking Therapeutics’ drug targets GLP-1 and another hormone called GIP. Those are the same hormones that Eli Lilly’s weight loss and diabetes drugs, Zepbound and Mounjaro, target.
Deutsche Bank analysts said in a note Tuesday that Viking Therapeutics’ new data shows that the weight loss drug market could eventually be more than a “duopoly” of Novo Nordisk and Eli Lilly, which manufacture the most sought-after treatments.
But the analysts added that manufacturing the treatments “at scale to meet outsized demand has proven to be no easy feat,” so that gives Novo Nordisk and Eli Lilly a “defensive moat.”
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Macy’s will close about 150 of its namesake stores and invest in its roughly 350 remaining locations.
It will also open new locations of its Bloomingdale’s and Bluemercury chains.
The changes, announced as part of the retailer’s new growth strategy, reflect the brands that are performing the best at Macy’s.

People shop at the Macy’s Herald Square store in New York City, Jan. 19, 2024.
Michael M. Santiago | Getty Images News | Getty Images

As Macy’s chases sales growth, the department store operator said Tuesday that it will close about 150 of its namesake stores and open more shops with better locations or that sell luxury goods.
The changes reflect a focus on what’s working at Macy’s — higher-end department store Bloomingdale’s and beauty chain Bluemercury — and what’s not — its namesake stores, particularly the ones at struggling malls. In its holiday quarter results posted Tuesday, the retailer said its Macy’s department stores performed worse than both Bloomingdale’s and Bluemercury.

As it reported earnings, Macy’s shared its strategy for the future. The strategy shift comes weeks after former Bloomingdale’s CEO Tony Spring started as Macy’s CEO on Feb. 4.
Macy’s had already announced in January that it would close five namesake stores and lay off more than 2,300 people.
In a CNBC interview Tuesday, Spring said the company is shaking up its store footprint after taking a hard look at which stores are in the right spots and which are not.
“We have some stores that are just underproductive or not as profitable, and we have to address that,” he said. “Conversely, we have stores that are highly productive and highly profitable. We have markets and stores and centers we’re not in today that we’d like to be in.”
Here’s a closer look at Macy’s major store announcements, broken down by store brand.

Macy’s

A customer exits the Macy’s flagship department store at Herald Square in New York City, Dec. 11, 2023.
Brendan Mcdermid | Reuters

Sales at Macy’s namesake stores have lagged the most — and that business will see the biggest changes.
The company plans to close about 150 stores, including 50 that will close by early 2025. It has not revealed those locations but said they are “unproductive.”
One of the stores Macy’s plans to close is its mammoth 400,000-square foot flagship in the heart of San Francisco’s primary shopping district Union Square when it finds a buyer for the location, Marisa Rodriguez, CEO of the business group Union Square Alliance, told CNBC in a statement. However, Rodriguez noted that the Macy’s may remain open for months and through the holiday season — since its search for a buyer may not happen quickly.
The stores that it had already said would be shuttered are located in Arlington, Virginia; San Leandro, California; Lihue, Hawaii; Simi Valley, California, and Tallahassee, Florida. The stores will close in early 2024.
On the other hand, Macy’s said it will boost investments in the roughly 350 namesake locations that will remain open.
For example, Spring said in an interview with CNBC that the company is testing how it can improve customer service at 50 of its stores. In the most recent quarter, it added or moved employees to different roles in those locations, such as by offering more support in the fitting room and shoe department.
The company is also pressing ahead with its strategy of opening smaller Macy’s stores in suburban strip malls. Last year, it announced it would open up to 30 of the shops over the next two years. The locations are roughly one-fifth the size of its traditional mall stores.
Spring told investors on an earnings call that there is a sharp difference between the Macy’s stores the company is closing and the ones that will remain open. The 150 stores that will shut represent 25% of Macy’s square footage, but less than 10% of its sales, he said.
“They’re underproductive, and we have to focus on making sure that we have the best stores, not the largest number of stores,” he said on the earnings call.
Along with considering the economics, he said a team at Macy’s spent about six or seven months evaluating stores based on other factors, including customer demographics, digital demand and the condition of the store or shopping center.
As of Feb. 4, Macy’s had about 500 namesake stores. Most are its typical mall locations, but that total also includes some of its smaller shops and freestanding locations of Macy’s off-price banner, Backstage.

Bloomingdale’s

Bloomingdale’s, which has outperformed the Macy’s namesake stores, will soon have more shops.
The retailer plans to open about 15 new Bloomingdale’s stores over the next three years. It has not announced the specific locations, but it said some will be in new markets.
The higher-end department stores skew toward higher-income and fashion-forward shoppers, and carry many popular luxury brands.
As with its sister brand Macy’s, Bloomingdale’s has been testing a smaller concept store, called Bloomie’s.
At the end of the most recent fiscal year, Bloomingdale’s had 33 locations. There are also three Bloomie’s shops and 21 outlets.

Bluemercury

Bluemercury has been the brightest spot in the retailer’s performance: It was the only brand of the three to post comparable sales growth in the fourth quarter.
The beauty chain will get bigger in the next few years, too. Parent company Macy’s said it will open at least 30 new Bluemercury stores over the next three years, some in new markets. It will also remodel about 30 existing stores during that time.
Bluemercury has been testing a new store prototype, which includes more spa services. It’s rolled out the concept in two locations: New Canaan, Connecticut, and Bronxville, New York.
Macy’s acquired Bluemercury for $210 million in 2015. As of Feb. 4, the beauty chain has 159 locations.
— CNBC’s Gabrielle Fonrouge contributed to this report.
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Hybrid vehicles led the 2024 top vehicle rankings released Tuesday by influential product testing organization Consumer Reports.
Toyota Motor had the most top picks of any automaker, at four, followed by Subaru at two. Tesla, Ford Motor, Mazda and BMW each had one vehicle on the list.
Plug-in hybrid vehicles are a “dark horse” for the U.S. automotive industry, according to Jake Fisher, senior director of auto testing at Consumer Reports.

Toyota hybrid vehicles for sale at a dealership in Chicago, Feb. 6, 2024.
Scott Olson | Getty Images

Hybrid vehicles led the 2024 top vehicle rankings released Tuesday by influential product testing organization Consumer Reports.
Such “electrified” vehicles, including plug-in hybrid models, represented six of the top 10 picks by the nonprofit consumer organization. The non-hybrid models rounding out the list were the all-electric Tesla Model Y crossover and three gas-powered vehicles with no hybrid variants.

It marks the second consecutive year that seven electrified or fully electric vehicles have been included in Consumer Reports’ top picks, as automakers release numerous models of the vehicles to meet consumer demand as well as tightening federal fuel economy regulations.
Toyota Motor had the most top picks of any automaker, at four, followed by Subaru at two. Tesla, Ford Motor, Mazda and BMW each had one vehicle on the list.
Toyota’s four vehicles in the top 10 rankings were all hybrid or plug-in hybrid vehicles.
“The markets are changing. There’s a lot more powertrain choices today than there have really ever been,” Jake Fisher, senior director of auto testing at Consumer Reports, told CNBC. “When we’re looking at the top vehicles, the top picks, a lot of them turn out to be electrified choices, because they just tend to do the things that people really want from a car.”
Both hybrids and plug-in hybrids have a traditional engine combined with EV technologies. A traditional hybrid such as the Toyota Prius has electrified parts, including a small battery, to provide better fuel economy to assist the engine. Plug-in hybrids typically have a larger battery to provide for all-electric driving for a certain number of miles until an engine is needed to power the vehicle or electric motors.

2024 BMW X5

Fisher said plug-in hybrid vehicles, which bridge the gap between a regular hybrid and an EV, are a “dark horse” for the U.S. automotive industry that many consumers are just beginning to understand.
This year’s Consumer Reports rankings feature three plug-in hybrid vehicles, the most ever for the annual list.
“In terms of surprising and what we’ve learned this year, it’s really been about plug-in hybrids,” Fisher said. “They’re not well understood, but depending on what your situation is, it can be kind of the best of both worlds of electric vehicle and gas.”
Consumer Reports selects top models at a variety of price points and classifications based on its testing of new vehicles. The organization tests about 50 new vehicles each year.
Here’s the full list:

Small car: Mazda 3
Midsize car: Toyota Camry Hybrid
Hybrid/Plug-in hybrid car: Toyota Prius/Prius Prime plug-in hybrid
Subcompact SUV: Subaru Crosstrek
Compact SUV: Subaru Forester
Midsize SUV: Toyota Highlander Hybrid
Luxury SUV: BMW X5/X5 PHEV
Small pickup: Ford Maverick/Maverick Hybrid
Plug-in hybrid SUV: Toyota RAV4 Prime plug-in hybrid
Electric vehicle: Tesla Model Y

The Tesla Model Y dominated in the U.S. and beyond last year. It appears to displace Tesla’s entry-level Model 3 sedan in the top 10 rankings after that model made the list last year.
According to data from Kelley Blue Book, a subsidiary of Cox Automotive, 1.1 million battery-electric vehicles were sold in the U.S. last year. Nearly 655,000 of those vehicles were Tesla EVs, including 394,497 of the Tesla Model Y, sales partly driven by discounts and tax credits domestically.
While battery-electric vehicle sales are still growing, hybrid electrics remain an appealing favorite for many car buyers in the U.S., in part because charging infrastructure is not yet as prevalent or reliable as it is in nations with broader adoption of fully electric cars, such as Norway.
The top picks are factored into Consumer Reports’ annual auto brand report cards, based on its internal testing as well as reliability, safety and overall customer satisfaction according to owner surveys.
BMW topped the overall brand list, followed by Subaru, Porsche, Honda and Lexus to round out the top five brands. At the bottom of the rankings were Rivian, GMC, Jaguar, Land Rover and Jeep.
Here’s the full Consumer Reports report card for each brand and their overall score:

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Walmart announced last week that it plans to acquire smart TV maker Vizio in a $2.3 billion deal.
With the move, the big-box retailer is pushing deeper into the world of advertising.
The company is also uniquely positioned because it is a major seller of Vizio TVs and can link advertisements to customers’ purchases.

A worker walks past televisions, including the Vizio brand, on display in a Walmart Supercenter on February 20, 2024, in Hallandale Beach, Florida. 
Joe Raedle | Getty Images

Walmart is doing some shopping of its own.
The retail giant announced last week that it plans to buy smart TV maker Vizio in a $2.3 billion deal. If the acquisition goes through, the discounter will own a consumer electronics company that already sells many flat-screen TVs and soundbars through Walmart’s website and stores.

Yet the heart of the acquisition is the value of getting in front of millions of people while they stream their favorite TV shows and movies, and being able to link that leisure time to the Walmart purchases they make later.
“It’s not really about the televisions,” Jefferies retail analyst Corey Tarlowe said. “It’s about advertising.”
Here’s a closer look at the major reasons Walmart wants to buy Vizio.

Walmart can capitalize on Vizio’s reach

When shoppers think of Vizio, they likely envision store aisles filled with giant TVs. But the growing, and increasingly lucrative, part of the company’s business is a little harder to see.
In the past few years, the company, based in Irvine, California, has reinvented itself to become more of a software company. Its TVs come with the SmartCast operating system, which allows viewers to pull up and watch streaming apps, such as Netflix and Hulu, without a “plug-in” device such as an Amazon Fire TV stick or Apple TV. It also allows Vizio to sell ads.

Vizio can make money from advertising in three ways using the SmartCast system, said Dan Day, an equity research analyst who covers digital advertising for B. Riley Securities. It can sell ads on SmartCast’s home screen. It can sell them in WatchFree+, Vizio’s own free, ad-supported streaming app. And it gets a small inventory of ads that it can sell as part of agreements with third-party streaming companies.
Vizio’s SmartCast system has 18 million active accounts, according to Walmart.
As Vizio’s owner, not only could Walmart set the price of Vizio TVs on its website and in stores, but it could also expand how many people use SmartCast by adding it to the big-box retailer’s own brand of TVs, Jefferies’ Tarlowe said. Some of Walmart’s rivals, such as Amazon, Best Buy and Target, that carry Vizio TVs could continue to sell Vizio products after the deal, but some retail analysts have raised questions about whether they may downplay their competitor’s items.
Walmart’s in-house TV brand, Onn, currently has a licensing deal with smart TV competitor Roku. The TVs are loaded with Roku’s operating system, which supports the rival company’s advertising revenue.
Tarlowe and other analysts are betting that once that contract ends, SmartCast will become the operating system on Walmart’s private label TVs — putting ads in front of millions more eyeballs.

Walmart will get Vizio’s data

Vizio knows what customers watch. Walmart knows what they buy.
With the acquisition, the two companies can combine that data to make advertisements more personalized and effective.
Vizio TVs include automatic content recognition technology, which allows the company to understand a customer’s streaming preferences, said Kirby Grines, founder of 43Twenty, a digital marketing company that works with tech companies in the video space.
If Vizio knows that a viewer plays Xbox for two hours a day or streams a lot of children’s shows, the company can then decide whether to show an ad for a certain snack or a brand of diapers.
“You’ll know where to insert advertisements for more reach,” Grines said.
Walmart, on the other hand, knows what its shoppers buy in store and online — and has more granular data about customer preferences as it expands Walmart+, its subscription service and answer to Amazon’s Prime.
With the Vizio deal, Walmart can use its shopping insights to give customers more relevant ads, and it will know if they lead to a purchase, said Michael Morton, an analyst who covers Amazon and other internet companies at MoffettNathanson.
He described that as the “holy grail” for brands.
“I’m sure you’ve heard that joke: ‘50% of my advertising spend is wasted. I just don’t know what 50% it is,'” he said. “That’s not the case for these retail media networks. The vendors can measure all of it.”

Ads are much more lucrative than milk, bread and socks

When running a store, Walmart has to keep the lights on, pay employee wages and buy items to stock shelves. With its online business, it has to pick, pack and ship orders.
Advertising, on the other hand, costs a lot less, Morton said.
“It’s incredibly profitable,” he said, especially when comparing the costs of packing and shipping an online order with the costs of tacking a product placement ad onto a webpage.
Operating margin, which measures how much a company makes from each dollar of sales after subtracting costs, is 65% or higher for advertising, according to an estimate by Jefferies’ Tarlowe. That compares with the roughly 4% operating margin Walmart reported in the most recent fiscal year.
Walmart is trying to grow profits faster than sales by using automation and leaning into higher-margin businesses. Tarlowe compared it to building out two separate income statements — one for its legacy retail operations and a second for its newer businesses such as Walmart+, fulfillment services for its third-party marketplace and more.
By combining the two, Walmart becomes a higher-margin company overall.
Plus, Walmart sees how much money its competitor, Amazon, makes from advertising — and wants to run the same play.
Sales in Amazon’s advertising unit grew 27% year over year to nearly $15 billion in its most recently reported fiscal quarter. It sells ads for its website, such as by putting sponsored products at the top when a customer searches for items.
In January, the company began showing ads on Prime Video content, too — an indicator that it sees streaming as a bigger moneymaking opportunity.

Advertising is already a fast-growing Walmart business

With Vizio, Walmart could fuel an already fast-growing part of its business.
The retailer has offered more advertising opportunities at its big-box stores. Those include third-party ads on self-checkout lane screens and TVs in store aisles, advertising spots on the store radio and demo stations where brands can pay to have customers sample their products.
As Walmart expands its third-party marketplace, sellers can buy sponsored ads that put them toward the top of search rankings or promote their product on other parts of Walmart’s homepage.
In the most recent fiscal year, Walmart’s global advertising business grew about 28% to reach $3.4 billion. In the most recent quarter, Walmart Connect, the company’s U.S. ad segment, grew 22% and its global business grew 33%.
With ownership of Vizio, Walmart has another type of advertisement that it can sell: TV spots on streaming services, which it can potentially bundle with other types of ads.
It also will collect a “gatekeeper fee,” since many streaming services share a portion of their advertising revenue with the smart TVs or smart devices that they ride on, 43Twenty’s Grines said.
Walmart leaders shared few details on the company’s recent earnings call about its plans for Vizio, saying they will wait for the deal to close.
Yet in a CNBC interview, Walmart CFO John David Rainey described advertising as “a very exciting part of our business” and the acquisition as “a way for us to complement what we’re already doing organically.”
“We think of this as simply an accelerant to what we’re already doing,” he said.
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Warner Bros. Discovery is no longer pursuing a merger with Paramount Global as its shares trade near a 52-week low, according to people familiar with the matter.
Skydance Media is still doing due diligence on a potential transaction with Paramount Global, the people said.
Comcast isn’t interested in buying any Paramount Global assets but would consider commercial partnerships, like bundling or merging Peacock and Paramount+.

President and C.E.O. of Warner Bros. Discovery David Zaslav speaks during the New York Times annual DealBook summit on November 29, 2023 in New York City.
Michael M. Santiago | Getty Images

Warner Bros. Discovery has gone “pencils down” on a potential acquisition of Paramount Global, halting talks after several months of kicking the tires on merging the media companies, according to people familiar with the matter.
Skydance Media, the film and TV studio run by David Ellison, is still performing due diligence on a potential transaction, two of the people said, who asked to speak anonymously because deal talks are private.

Paramount Global has set up a special committee, which has hired its own financial advisor, to sift through potential bids for the whole company or certain assets. Media mogul Byron Allen offered $14 billion for the company last month, though he has a history of bidding on and not buying large media assets.
Comcast, the owner of CNBC parent NBCUniversal, isn’t interested in acquiring Paramount Global assets, one of the people said. Comcast has been working with house bankers to explore a potential commercial partnership with Paramount Global, according to people familiar with the matter.
That could include bundling or merging streaming services Peacock and Paramount+, as previously reported by The Wall Street Journal, or a different arrangement. Still, it’s unclear if Paramount Global would have interest in this as it explores sale scenarios.
Spokespeople for Comcast, Paramount Global, Skydance Media and Warner Bros. Discovery declined to comment.
Warner Bros. Discovery Chief Executive Officer David Zaslav had a preliminary conversation with Paramount Global CEO Bob Bakish, CNBC reported in December. The companies engaged in more serious merger discussions in January, but talks have cooled off this month.

Warner Bros. Discovery shares fell 10% on Friday after the company missed analyst targets for earnings and revenue. The stock has fallen 47% in the past year and is near a 52-week low.
Paramount Global is also trading close to a 52-week low as it prepares to announce its earnings Wednesday.
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WATCH: The big question facing Warner Bros. Discovery is whether it can grow, says Tom Rogers More

Miami is the most competitive city in the nation for renters, but on a regional level, the Midwest ranks first for competition.
For a one-bedroom apartment nationally, the latest estimated median rent is $1,207; for a two-bedroom it’s $1,359.
While rental supply is rising, demand is sustaining thanks to the short supply of homes for sale in today’s market and rising mortgage rates.

Apartments are seen undergoing construction on February 28, 2023 in Austin, Texas. 
Brandon Bell | Getty Images

The apartment market is finally loosening up. At the same time, competition is heating up in some key markets.
There is an enormous supply of new apartments coming online this year. And rents have fallen for six straight months, now at their lowest levels since March 2022, according to search site Apartment List.

For a one-bedroom apartment nationally, the latest estimated median rent is $1,207; for a two-bedroom it’s $1,359. The nationwide median is down 0.3% in February from January, down 1% year over year and down 4.7% from an all-time high in August 2022, according to Apartment List.
Rents are expected to fall further, with the nationwide multifamily vacancy rate at 6.5% and forecast to rise this year as more units go up for rent.
Still, all real estate is relative, and some apartment markets are hotter than others. A new report from RentCafe, another apartment search site, ranks the most competitive rental markets, with Miami topping the list for 2024.
The rankings are based on five factors: The number of days apartments stayed vacant, the occupancy rate, the number of prospective renters competing for an apartment, the percentage of renters who renewed their leases and the share of new apartments completed recently.
In Miami, apartments now lease within 36 days, according to the report, compared with a 41-day national average. They have 14 prospective renters for each unit compared with the national average of seven, and the city’s occupancy rate is 96.5%, compared with 93% nationally.

Milwaukee comes in second, with apartments renting in 37 days on average and occupancy at 95.1%. Chicago and Grand Rapids, Michigan, are also high on the list, as the Midwest becomes more popular among younger renters due to its relative affordability.
The option of remote work has also sent more people to the region, but the supply of apartments there is dwindling, making it more competitive. The Midwest was the most sought-after region for renting in the report.
“Renting in the Midwest is a good choice for many aspiring homeowners, including longtime residents and newcomers,” according to the RentCafe report. “That’s because this housing arrangement allows them to save up for down payments until they’re able to fulfill the American dream of owning a home.”
While rental supply is rising, demand is sustaining thanks to the short supply of homes for sale in today’s market and rising mortgage rates. Home prices are still high, even with rising mortgage interest rates, making it increasingly difficult for younger Americans to make the transition from renter to homeowner.
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Macy’s said sales fell nearly 2% in the holiday quarter and forecast another year of stagnant sales.
Yet the department store operator unveiled a plan to get back to growth by closing some of Macy’s namesake stores and opening more Bloomingdale’s and Bluemercury stores.
The company’s new CEO Tony Spring took the helm earlier this month.

The Macy’s logo is seen at its store in Herald Square in New York City on Jan. 19, 2024.
Michael M. Santiago | Getty Images

Macy’s on Tuesday said sales fell nearly 2% in the holiday quarter, as the 166-year-old department store operator unveiled its strategy to get back to growth. 
Here’s what Macy’s reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

Earnings per share: $2.45 adjusted vs. $1.96 expected
Revenue: $8.12 billion vs. $8.15 billion expected

The retailer said it expects sales to remain stagnant. It projected net sales of between $22.2 billion to $22.9 billion for this fiscal year, down from $23.09 billion in 2023. It anticipates comparable sales, which take out the impact of store openings and closures, will range from a decline of about 1.5% to a gain of 1.5% compared with the year-ago period on an owned-plus-licensed basis and including third-party marketplace sales.
Yet the company’s new CEO Tony Spring laid out a brighter outlook for the following fiscal year and how Macy’s plans to get there. Spring is the former CEO of Macy’s higher-end department store Bloomingdale’s. He took the helm earlier this month, weeks after Macy’s announced layoffs and as it faced pressure from activist investors.
In an interview with CNBC, he said the company is taking a clear-eyed look at its business — particularly its struggling namesake stores.
“Yes, there are headwinds, certainly on discretionary categories and the middle-income consumer, but we take responsibility for what we control,” he said. “Let’s put better products into our stores. Let’s make sure it’s merchandised appropriately at a decent value. And then we have more opportunity for conversion and more [market] share.”

Macy’s strategy ahead

As part of the retailer’s push to woo shoppers and restore investor confidence, Macy’s said it will make big changes to its store footprint. Macy’s plans to close about 150 unproductive locations and to prioritize investing in about 350 other namesake locations.
It plans to focus more on selling luxury goods by opening about 15 new Bloomingdale’s stores and at least 30 new Bluemercury stores over the next three years. It will also remodel roughly 30 existing stores of the beauty chain during that time. 
Macy’s had already announced five store closures and more than 2,300 layoffs last month. It also said last year that it would open up to 30 smaller versions of its namesake stores in strip malls over the next two years.
In a news release on Tuesday, Macy’s said it will also take a hard look at how to operate more efficiently – such as scrutinizing the network of warehouses used for its e-commerce business.
In the fiscal year that starts in early 2025, Macy’s said it expects low-single digit comparable sales growth on an annual basis, including owned, licensed and marketplace sales. It said it expects capital spending to fall below 2024 levels and free cash flow to drop to pre-pandemic levels. Its outlook does not include any potential impact from a proposed credit card late fee ruling by the federal government. 
Macy’s, which includes its namesake banner, Bloomingdale’s and Bluemercury, has faced scrutiny from activist investors Arkhouse Management and Brigade Capital Management, who made a rejected bid to buy the retailer. Arkhouse recently nominated a slate of nine directors to Macy’s board.

Fourth-quarter sales dip

For the fiscal fourth quarter that ended Feb. 4, Macy’s swung to a loss of $71 billion, or 26 cents per share, from net income of $508 million, or $1.83 per share, a year earlier. The losses included $1 billion of impairment and restructuring costs related to Macy’s plans to close about 150 locations, which are part of its turnaround strategy.
Revenue fell from $8.26 billion in the year-ago period. Digital sales declined 4% compared to the prior-year quarter and brick-and-mortar sales were roughly flat.
Across the company, comparable sales on an owned-plus-licensed basis fell 4.2% from the year-ago period. That was better than the 5.8% decline that analysts expected, according to LSEG.
Macy’s continued to be the weakest store banner – a trend reflected in the company’s plans to close many of its stores. The namesake store’s comparable sales on an owned-plus-licensed basis dropped by 4.7%, as the women’s shoes and cold weather apparel and accessories categories struggled. Beauty and Macy’s off-price business, Backstage, were stronger performers in the quarter. 
Bloomingdale’s and Bluemercury, the two store chains that the parent company plans to expand, both fared better in the holiday quarter. 
At Bloomingdale’s, comparable sales declined 1.6% on an owned-plus-licensed basis, as the men’s and designer handbag businesses came in soft.
Bluemercury’s comparable sales rose 2.3%, as shoppers bought skincare items and color cosmetics. 
Net credit card revenue also took a hit, as Macy’s said it tumbled by 26% from the prior year to $195 million as the company dealt with higher net credit card losses. 
So far this year, shares of Macy’s have fallen about 4%. The company’s stock has underperformed the approximately 6% gains of the S&P 500 during the same period. Shares of Macy’s closed Monday at $19.30, bringing the company’s market value to $5.29 billion.
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