TODAY'S PAPER
62° Good Evening
62° Good Evening
Business

J.C. Penney to shut 40 stores and cut 2,250 jobs

The exterior of a J.C. Penney Co. store

The exterior of a J.C. Penney Co. store on May 10, 2006, in Cupertino, Calif. Photo Credit: AP / Paul Sakuma

Two major retailers -- J.C. Penney and Macy's -- Thursday announced separate plans for store closings and thousands of layoffs.

J.C. Penney Co. said it will close about 40 stores this year and cut about 2,250 jobs, as it tries to improve its profitability.

Macy's said it will close 14 stores and also restructure its merchandising and marketing operations to reduce costs.

No Long Island stores will close, the companies said.

Most of the J.C. Penney stores will close by April 4. One store upstate, in Kingston, is on the list to close. The Plano, Texas, company currently runs about 1,060 stores.

J.C. Penney's announcement comes two days after it reported a rise in sales during the critical holiday shopping season, an encouraging sign as the company tries to recover from a botched plan to reinvent itself under former CEO Ron Johnson. It has tapped a new CEO, former Home Depot executive Marvin Ellison, who will replace current CEO Mike Ullman in August. Ullman was rehired as CEO in April 2013 after retiring from the top job in 2011.

Last January, the company announced plans to close about 33 stores and cut about 2,000 jobs. Its shares rose 6 cents to close at $7.95.

Macy's said it will lay off thousands of workers as part if its restructuring, which is in response to changes in the way customers shop in stores and online.

The retailer said it will also close 14 stores but open two new locations, resulting in annual savings of roughly $140 million. Macy's says it plans to reinvest those savings in its business. It says its overall workforce of about 175,000 will remain level as it picks up staffing in other functions.

Separately, Cincinnati-based Macy's said a key sales metric rose 2.7 percent during November and December, in line with its expectations.

The company's stock slid almost 3 percent in after-hours trading.

With Aisha al-Muslim

Comments

We're revamping our Comments section. Learn more and share your input.

More news