Macys products have fallen behind rivals, with the company reporting a loss of $1.1 billion in the fourth quarter and $1 billion for the year.
The company said in a regulatory filing that it had lost $1,664 million for the full year.
That compares to a loss per share of $0.48 per share for the same period last year.
The results are worse than analysts had expected, given the company’s efforts to increase profits and expand its product portfolio.
In a statement, Macys said it had completed a merger of its existing tobacco and tobacco product businesses.
Macys has been under pressure to address the toxicology issue and has said it has not changed its tobacco policies.
Macys said in the filing that revenue from its tobacco products business declined 9% year over year to $921 million.
“We have been making progress in our tobacco portfolio, which is a great example of how we can take a company like Macys tobacco business and turn it into a global leader in tobacco products,” Macys CEO Jim Henson said in an interview.
While Macys did not disclose revenue from the tobacco business, it said it would not disclose its tobacco product revenue.
The drugmaker’s fourth-quarter results were largely driven by its tobacco business.
Its tobacco revenue rose 12% year-over-year to $1 million.
The drugmaker said it was able to expand its tobacco inventory by 12% to $10 million.
Macys also reported its third-quarter net income rose to $0 for the period.
The company said it also earned a $0 profit for the quarter, a far cry from the $1 per share the company reported in the first quarter.
The loss for Macys’ tobacco business was a stark contrast to the $5 billion it made from the drugmaker in the same quarter last year and the $10 billion it generated from its health and beauty products.
The tobacco company said its tobacco revenue dropped 10% year to the end of the year, which it attributed to an increase in tobacco usage in the U.S. and Canada.
The decline was partly due to the launch of the U-23 World Cup in Canada, but the company said the decline was not as steep in the United States, where it made up just 5% of the drugs market.
The drug company said a $2 billion charge related to a legal challenge against its patents was the largest in its history.
Shares of Macys closed down 2.2% to 1,067.92 in New York.
(Reporting by David Ingram; Editing by Cynthia Osterman)