Macy’s reported adjusted earnings per share of 27 cents for the third quarter, on the strength of digital sales, beating analyst estimates of 14 cents per share, according to Refinitiv. The company reported revenue of $5.40 billion, compared with the $5.41 billion that was expected.

Macy’s also raised its outlook for the full year, saying it expected a strong holiday season and it would continue to make investments in its bricks-and-mortar stores.

CEO Jeff Gennette projects consumers will buy $1 billion in merchandise through Macy’s mobile app this year. Also providing a boost is the ability of shoppers to buy online and pick up items at an actual store.

The earnings announcement comes as the Conference Board’s benchmark consumer confidence index hit 137.9 last month, the highest rate in 18 years.

“While Macy’s has been working to make improvements in its own business, we believe this performance sets an optimistic tone for the sector,” Telsey Advisory Group analyst Dana Telsey said in a research note.

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Macy’s stock has risen nearly 37% this year but fell fell 5% after the earnings release.

“We are ready for the fourth quarter,” Gennette said in an interview on CNBC. “I think the backdrop for consumer spending is good, their confidence is strong, the dotcom business is really humming.”

The company said its gross margin was flat in the third quarter from last year at 40.3%.  Net income was $62 million, up from $30 million a year ago, in part due to asset sales. Same-store sales, meanwhile, were up 3.3%, half a percentage point above analysts’ estimates.

“Our data also show that for the first time in over eight years, the number of people saying they will visit Macy’s to do holiday shopping has risen,” Neil Saunders, managing director of GlobalData Retail, said. “Along with the good sales numbers, these pieces of evidence underline that Macy’s is succeeding in creating a stronger appeal.”

Macy’s projects fiscal 2018 same-store sales (for stores owned and licensed) to rise 2.3% to 2.5%, versus previous guidance for an increase of 2.1% to 2.5%. Sales are now expected to be up 0.3% to 0.7% versus previous sales guidance for flat to 0.7% growth

And adjusted EPS is expected to be $4.10 to $4.30, up from $3.95 to $4.15 previously.

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