Macy’s slashed its outlook for the entire year with sales weakening sales in the first quarter during an increasingly challenging economic environment, including stubbornly high inflation.

Quarterly profit and sales dropped to open the year as sales began to flag in March, forcing the New York department store to cut prices on clothes and other discretionary items.

Shares tumbled more than 10% before the opening bell Thursday and dragged other retailers down as well.

Macy’s reported net income of $155 billion, or 56 cents per share, far short of the 45 cents Wall Street was looking for, and a significant decline from the $286 million earned during the same period last year.

Sales fell to $5.17 billion, also short of analyst projections, and a decline from $5.56 billion in the first quarter last year.

Comparable sales — sales coming from digital channels and stores opened at least a year — fell 7.2% across all categories including licensed businesses like cosmetics.

“We have moved quickly to take the appropriate actions to meet current consumer demand and manage our expenses,” said CEO Jeff Gennette, in a written statement.

The revised guidance reflected clearance markdowns on spring seasonal merchandise in the second quarter and cuts in inventory to adjust to the consumer slowdown, Gennette said.

The company now expects earnings in the range of $2.70 to $3.20 per share for the year, down from previous guidance of between $3.67 and $4.11 per share. The company anticipates sales to be in the range of $22.8 billion to $23.2 billion this year, down from the previous range of $23.7 billion to $24.2 billion.

Analysts were expecting earnings of $3.69 per share on revenue of $23.73 billion.