A Nordstrom store location sign inside a shopping mall in Chicago, Illinois, on March 20, 2024.
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Nordstrom The company’s quarterly sales forecast exceeded Wall Street expectations on Tuesday, with consumer spending on apparel, shoes and activewear at the company’s namesake department stores and its discount chain rising about 4% year over year.
However, despite better-than-expected quarterly results, the Seattle-based retailer gave only a slightly optimistic full-year sales forecast — taking a conservative stance as it prepares for the busiest weeks of the holiday season. The company said it now expects full-year revenue, including retail sales and credit card revenue, to be flat to grow 1%. This compares to a decline to 1% from the previous growth rate of 1%. However, the company stuck to its adjusted full-year profit forecast of $1.75 to $2.05 per share.
CEO Erik Nordstorm said in a news release that the company’s results show that efforts to attract selective shoppers are paying off. Sales of women’s clothing and activewear grew by double digits compared with the same period last year. Footwear, men’s clothing and children’s clothing achieved mid-to-high single-digit growth year over year.
Compared with the second quarter, sales of women’s clothing, shoes and men’s clothing also increased in the third fiscal quarter compared with the previous quarter.
“Our customers have many options, and our results encourage us to be on the right path,” he said. “Going forward, we will continue to improve the shopping experience and strive to maintain our positive momentum throughout the year.”
Nordstrom’s performance in the three months ended Nov. 2 compared with Wall Street expectations is as follows, according to a survey of analysts by LSEG:
- Earnings per share: At an adjusted 33 cents, it’s unclear whether it matched analysts’ estimates.
- income: US$3.46 billion, expected US$3.35 billion
Nordstrom’s third-quarter net income was $46 million, or 27 cents a share, compared with $67 million, or 41 cents a share, a year earlier. Revenue increased from US$3.32 billion in the same period last year.
Excluding charges related to accelerated technology depreciation, Nordstrom reported adjusted earnings of 33 cents per share.
Comparable sales at Nordstrom’s two brands, its namesake brand and discount chain Nordstrom Rack, rose 4%. That easily beat analysts’ expectations for comparable sales growth of 0.7%, according to StreetAccount.
Nordstrom’s sales growth, while modest, was notable at a time when sales in the discretionary and luxury categories are under pressure. Retailers such as Walmart, Best Buy and Target have reported over the past week that customers remain picky and more focused on price when buying what they want rather than what they need.
Nordstrom’s sales grew despite changes to anniversary promotions. During the same period last year, sales fell on eight days in the three months, but fell just one day in the quarter this year. This had a negative impact on net sales of approximately 1%.
Macy’s delayed the release of its full financial report. The company said third-quarter sales fell 2.4%, and comparable sales in its own and licensed businesses and online markets fell 1.3%.
Nordstrom relies on its discount chain Nordstrom Rack to drive sales growth and new store locations. In the third quarter, however, the two brands saw comparable sales, with namesake stores up 4% and Nordstrom Rack up 3.9%.
Nordstrom’s latest quarterly update comes two months after Nordstrom’s founding family renewed its offer to take the company private. According to a September filing, Chief Executive Erik Nordstrom, President Peter Nordstrom and Mexican retailer El Puerto de Liverpool sent a non-binding letter asking to form an entity to sell shares at 23 per share. The chain was acquired for US$.
Since then, the company’s share price has soared Reuters report in March Nordstrom’s founding family wants to take the company private. The company’s shares are up 32% year to date as of Tuesday’s close, outpacing the S&P 500’s 26% gain.
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