Macy's is benefiting from higher prices.

The department-store chain raised its full-year outlook Thursday, which executives said was partly driven by higher prices on its products. Macy's is bringing in higher-end brands and pricier items like real fur and leather to appeal to its growing base of wealthy consumers.

"We're in the early innings of continuing to better and improve the quality of our assortments," Chief Executive Tony Spring told analysts Thursday.

Macy's average selling price increased 9% in the quarter, driven by the changes to product assortments. Executives said it is getting more business from upper- and middle-income consumers who are willing to spend more, even as low-income shoppers pull back. The company is selling more items from Ralph Lauren and Coach, as well as watches and fine jewelry at its Bloomingdale's brand.

Macy's lifted its full-year net sales outlook to $21.68 billion to $21.83 billion, from its previous outlook in June of $21.5 billion to $21.75 billion. It now expects adjusted earnings per share to be $2.15 to $2.35, up from $2 to $2.20.

Retailers across the industry raised prices over the past year to account for higher costs from tariffs. While some companies are using the recent refunds from tariffs to bring down prices, Macy's said it has an opportunity to keep selling high-end items while it moves into the next phase of its turnaround strategy.

"We can premiumize - or whatever the right word is - our assortments across all three brands." Spring said.

Macy's received $98 million in tariff refunds during the quarter, plus another $18 million after the quarter ended. It plans to use $96 million of the refunds to convert more of its stores to its new "Reimagine" program, an in-store turnaround strategy to improve sales and profitability.

It will reduce prices in only a few select areas, including big-ticket items and fine jewelry, executives said. About $20 million of the total refund proceeds will flow to full-year earnings per share.

Macy's has 200 Reimagine stores, which now account for nearly 75% of its store sales. The company plans to add more next year, with a goal of eventually remaking all its stores.

"These stores represent a clear proof point of our ability to drive growth, and we're confident we can continue to expand these initiatives going forward," Spring said.

Net sales in the second quarter rose 1.1% to $4.87 billion. Analysts surveyed by FactSet forecast sales of $4.81 billion.

Same-store sales rose 2.7%, ahead of the 1% growth analysts were projecting. That was driven by 1.1% same-store sales growth at Macy's core stores, 11.3% growth at Bloomingdale's and 6.2% at Bluemercury.

Bloomingdale's was a bright spot for the company once again, with sales volume hitting its highest second-quarter level in the brand's history.

Profit for the quarter was $169 million, or 62 cents a share, compared with $87 million, or 31 cents a share, a year earlier.

Stripping out certain one-time items, adjusted per-share earnings were 63 cents, ahead of the 37 cents anticipated by analysts, according to FactSet.