Macy's will close 150 stores, open new Bloomingdale's, Bluemercury

like Messi As it seeks to chase sales growth, the department store operator said Tuesday it will close about 150 of its namesake stores and open more better-located or luxury-focused stores.

The changes reflect a focus on what works at Macy's — upscale department store Bloomingdale's and cosmetics chain Bluemercury — and what doesn't work — its namesake stores, particularly those in struggling malls. In holiday quarter results released Tuesday, the retailer said Macy's stores performed worse than both Bloomingdale's and Bluemercury.

When it announced its earnings, Macy's shared its strategy for the future. The strategic shift comes weeks after former Bloomingdale's CEO Tony Spring was appointed CEO of Macy's earlier this month.

Macy's had already announced in January that it would close five stores under the same name and lay off more than 2,300 people.

In an interview with CNBC on Tuesday, Spring said the company is working to change its store footprint after taking a hard look at which stores are in the right places — and which aren't.

“We have some stores that are underproduced or unprofitable, and we have to address that,” he said. “On the contrary, we have highly productive, highly profitable stores. We have markets, stores and centers where we are not today and where we would like to be.”

Here's a closer look at Macy's key store ads, broken down by store brand.

Sales at its namesake Macy's stores have lagged the most — and those businesses will see the biggest changes.

The company plans to close about 150 stores, including 50 that will close by early 2025. It did not share those locations, but said they are “unproductive.”

The stores that have already said they will close are in Arlington, Virginia; San Leandro, California; Lihue, Hawaii; Simi Valley, California, and Tallahassee, Florida. The stores will close early this year.

Macy's, on the other hand, said it will boost investments in its 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 in 50 of its stores. Last quarter, it added or moved employees to different roles at those locations, such as providing more support in the fitting room and shoe department.

The company is also moving forward with its strategy of opening smaller Macy's stores in suburban malls. Last year, it announced it would open up to 30 stores over the next two years. The locations are about one-fifth the size of 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 those that will remain open. He said the 150 stores that will close represent 25% of Macy's square footage, but less than 10% of its sales.

“They're unproductive and we have to focus on making sure we have the best stores, not the most stores,” he said on the earnings call.

Besides looking at 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 mall.

As of February 4, Macy's had about 500 stores under the same name. Most are typical mall locations, but this total also includes some convenience stores and stand-alone locations for Macy's off-price banner, Backstage.

Bloomingdale's, which has outgrown its namesake Macy's department store, will soon have more stores.

The retailer plans to open about 15 new Bloomingdale's stores over the next three years. She did not announce the specific locations, but said some of them would be in new markets.

Department stores are geared toward high-income and modern shoppers, and carry many popular luxury brands.

As with sister brand Macy's, Bloomingdale's has been testing a smaller-format store called Bloomie's.

At the end of the last fiscal year, Bloomingdale's had 33 locations. There are also three Bloomie's stores and 21 outlets.

Bluemercury was the brightest spot in the retailer's performance: It was the only one of the three brands to record similar sales growth in the fourth quarter.

The beauty chain will get bigger in the next few years as well. Parent company Macy's said it will open at least 30 new Bluemercury stores over the next three years. It will also remodel approximately 30 existing stores during that period. Some of them will be in new markets, the company said.

Bluemercury has been testing a new prototype of the store, which includes more spa services. The concept has been rolled out in two locations: New Canaan, Connecticut and Bronxville, New York

Macy's acquired Bluemercury for $210 million in 2015. As of February 4, the cosmetics chain had 159 locations.