Macy’s shares tumbled on Wednesday after a big quarterly earnings miss and a lowered profit outlook fueled doubts about its turnaround efforts.

Under CEO Jeff Gennette, Macy’s has recently been delivering same-store sales growth, with a 0.2% gain reported for the second quarter compared to flat sales a year ago.

But the company’s bottom-line was hit by the heavy markdowns it used during the spring season to clear unsold merchandise. Earnings per share came in at 28 cents, well below analysts’ estimates of 45 cents per share.

Macy’s also forecast full-year earnings of between $2.85 and $3.05 a share, down from an earlier range of $3.05 to $3.25. Its shares closed Wednesday down more than 13% at $16.60 after earlier falling to $15.82, the lowest level since February 2010.

“Macy’s Inc. delivered another quarter of comparable sales growth. That said, we had a slow start to the quarter and finished below our expectations,” Gennette said in a news release, blaming the inventory oversupply on a “fashion miss in our key women’s sportswear private brands, slow sell-through of warm weather apparel and the accelerated decline in international tourism.”

“Taking the markdowns was certainly tough medicine, but it was important that we enter the fall season with aligned inventory and sales plans,” CFO Paula Price told analysts in an earnings call.

Under pressure from online retailers, Macy’s has been trying to refresh its stores and amass more loyal customers through an updated app and membership program. It is also adding stop-in shops to some locations for popular brands.

“Gennette has succeeded in reversing several years of same-store sales declines, creating hope for a broader turnaround in the business,” The Wall Street Journal noted.

But Macy’s is still expecting same-store sales expected to be flat to up 1% for the full year. “Mall traffic’s deteriorating every quarter, every year for about 10 years now, and there’s no sign of it letting up. So it’s a really hard place to fight the battle,” Jan Kniffen, CEO of retail investor consultancy J. Rogers Kniffen, told CNBC.

Photo: Eduardo Munoz Alvarez/VIEWpress/Corbis via Getty Images

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