NEW YORK (AP) — Macy's swung back to a profit in its second quarter but suffered yet another sales decline as inflationary weary shoppers rein in spending, with their focus increasingly on buying the essentials.

The company, which also operates upscale Bloomingdale's stores and cosmetics chain Bluemercury, cut its annual sales forecast given what it called "a more discriminating consumer" and the need to roll out more sales to entice them.

The company reported a profit of $150 million, or 53 cents per share, in the three-months ended Aug. 3, topping Wall Street expectations for per-share earnings of 30 cents, according to a survey by FactSet. It's also a rebound from the loss of $22 million, or 8 cents per share, in the same period a year ago.

Yet sales fell nearly 4% to $4.94 billion, from $5.13 billion last year, and below the $5.06 billion that industry analysts were looking for.

Shares slumped 8% before the opening bell Wednesday.

Comparable sales— those from online channels and from established stores — fell 3.3%, including those from licensed businesses like cosmetics and its third-party marketplace. That was worse than the 0.3% drop in the previous quarter.

Macy's stores had a 3.6% comparable sales drop, while Bloomingdale's had a 1.4% decline. Same-store sales at Bluemercury rose 2%.

Macy's has begun to attract potential buyers of the storied chain, but it cut off monthslong buyout talks with two investment firms a month ago, saying the bid was inadequate and the financing was not certain.

Macy's said the bidders, Arkhouse Management and Brigade Capital Management, failed to provide it with additional information by its June 25 deadline, including the highest price they would be willing to pay.

In April, Macy's named two independent directors to its board backed by Arkhouse, ending a fight to replace most of the board and to acquire the chain.

Macy's said it would manage the effort to turn its performance around. That includes previously disclosed plans to 150 Macy's stores over the next three years and modernizing its remaining 350 stores.

At the first 50 stores that Macy's has overhauled, same store sales have rising for two consecutive quarters, said Tony Spring, who became chairman and CEO this year.

Macy's is also pivoting more to luxury sales, which have held up better overall. Macy's said it will open 15 higher end Bloomingdale's stores and 30 luxury Bluemercury cosmetics locations to cater to customers seeking higher end services and goods.

The company reaffirmed its annual outlook for earnings per share, but said that annual net sales will be anywhere from $22.1 billion to $22.4 billion. That is down from its projections in May of $22.3 billion to $22.9 billion. Analysts were expecting $22.53 billion, according to FactSet.

Macy's also expects that comparable sales, including its licensed businesses and marketplace, will fall anywhere from 2% to 0.5%. That is worse than the previous range projected in May for a 1% drop to up to a 1.5% increase.