Macy’s Inc. is the latest retailer to post better-than-expected results only to issue a downbeat annual outlook for sales and profit, citing “external uncertainties.”

The largest US department-store operator forecast net sales in the current fiscal year between $21 billion to $21.4 billion, below the average estimate from analysts surveyed by Bloomberg. That guidance includes the decrease in revenue from the closing of more than 60 Macy’s stores last year.

Macy’s also said Thursday it’s expecting sales from e-commerce and stores that have been open for at least a year to fall as much as 2 percent in 2025 versus the prior year. That puts Macy’s behind the plan set by Chief executive officer Tony Spring.

The company’s shares declined about 5 percent in trading before US markets opened. The stock had dropped 21 percent this year through Wednesday, compared to the S&P 500 Index being little changed.

Macy’s joined a group of retailers, spanning Foot Locker Inc. to Abercrombie & Fitch Co. and Walmart Inc., that have reported good fourth quarters and then warned investors about weakness in the year ahead.

Walmart, the world’s largest retailer, kicked off the concerns two weeks ago when it forecast lower-than-expected profit amid uncertainties around “global economic and geopolitical conditions.”

Target Corp. and Best Buy Co. added to the worries earlier this week, saying consumers should expect higher prices as a direct result of the tariffs US President Donald Trump imposed on Mexico, Canada and China.

It’s all painting a picture of a retail sector challenged by sinking US consumer confidence and a volatile global trade war.

Macy’s is taking a “prudent approach” to its guidance for the current fiscal year, the chain said in a presentation, to reflect “the external uncertainties the company and its customers are facing.”

When Spring took the helm last year, he pledged that comparable sales would increase by a low single–digit percentage starting in 2025.

Wall Street has welcomed Spring’s focus on closing down poorly-performing Macy’s stores, while hiring more staff and improving product displays at the 125 stores that he and his team think have greater potential. He’s trying to shrink Macy’s footprint to adjust to the decades-long decline in demand for goods sold at department stores and also make it a more profitable company.

The company said on Thursday it’s expecting “fundamental improvements” in those 125 locations as well as online to be offset by weaker performance at the 225 or so stores where Macy’s hasn’t yet rolled out its new strategy or has planned to close after this year.

Macy’s shuttered 64 stores last year. It expects to close 86 more during the next two years.

While the strategy makes financial sense, analysts have pointed out it’s a hard time to be implementing the changes given economic challenges such as inflation that are facing Macy’s mass-market shoppers.

Macy’s also said on Thursday that it expects adjusted earnings per share between $2.05 and $2.25 in the current fiscal year, below the average estimate from analysts.

Despite the downbeat outlook for the year, Macy’s reported sales in the most recent quarter that were in line with analysts’ forecasts. Revenue at the company’s more upscale chains, Bloomingdale’s and Bluemercury, increased.