(Reuters) – Macy’s Inc topped Wall Street estimates for quarterly same-store sales and profit on Wednesday, benefiting from increased digital sales and higher demand for items sold at its off-price stores.

Macy’s has been pouring money into building up its private label as well as expand its off-price venture, Backstage, by adding 45 more stores this year.

The company in February said it would also invest in categories where Macy’s enjoyed strong market position such as dresses, jewelry, women’s shoes and beauty products.

“Our brick & mortar sales trend improved sequentially in the first quarter, supported by … Backstage,” Chief executive Officer Jeff Gennette said in a statement.

Sales at Macy’s stores open more than 12 months, including sales in department stores licensed to third parties, rose 0.7%, above the average analyst estimate of a 0.3% rise, according to research firm Consensus Metrix.

Last quarter, Macy’s announced a plan focused on cost cuts for 2019 to speed up decision-making and result in an annual savings of $100 million.

Excluding special items, the company earned 44 cents per share, blowing past the average analyst estimate of 33 cents.

Net sales fell to $5.50 billion in the first quarter ended May 4, roughly in line with analysts expectations, according to IBES data from Refinitiv.

Macy’s shares, which have so far lost more than a quarter of its value this year, rose about 3% to $22.50 before the bell.

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