Still Macy’s does not want to spin off the unit even though it was pushed to review the business following a demand from activist investor Jana Partners in October last year.

Jana had argued the online business could be worth a multiple of Macy’s market capitalization, which is now nearly $8 billion.

“In every scenario we considered, we found the combination of our profitable digital platform with our national footprint will deliver greater value to shareholders than a separation … ,” Chief Executive Jeff Gennette

Jefferies analysts said the decision was not a “big surprise” as the push for a split had eased as the risk ratio was high. Jana earlier this month said it cut its holdings by 84% in the last months of 2021, before which it held a 1.5% stake in Macy’s.

In the holiday quarter, Macy’s also benefited from its plan to hold ample stock of key categories such as jewelry, apparel, fragrances and toys amid supply chain constraints.

Quarterly sales rose to a better-than-expected $8.67 billion and Macy’s earned $2.45 per share, beating analysts’ estimates.

It expects annual sales between $24.46 billion and $24.70 billion, above analysts expectations, betting on sustained demand as wages rise and social events become more frequent.

Executives, however, warned that record levels of inflation could offset some of the gains.