Department store chain Macy’s is cutting 2,350 jobs and closing five stores, as it aims to streamline its operations, a company spokesperson told Reuters on Thursday.

The layoffs make up 3.5% of the overall workforce across Macy’s. The company operated 722 store locations as of January 2023 and employed 94,570 full- and part-time employees, excluding seasonal hires.

The job cuts come as an investor group consisting of Arkhouse Management and Brigade Capital put pressure to take Macy’s private in a $5.8 billion offer, Reuters reported in December.

Macy’s incoming CEO Tony Spring is also focused on cutting expenses on promotions to boost margins as the company recovers from an inventory glut in 2022. CEO Jeff Gennette is stepping down next month.

Macy’s spokesperson said the layoffs were part of its plan “to deploy a new strategy to meet the needs of an ever-changing consumer and marketplace.”

As the company evaluates the “right mix of on- and off-mall locations,” it intends to close five of its full-line locations this year, the spokesperson added.

The job cuts were first reported by the Wall Street Journal, which, citing a memo sent to employees, said the layoffs would occur on Jan. 26.

In November, the retailer beat analysts’ estimates for quarterly profit on lower inventories and strong demand for beauty products.