A Citibike stop outside the Nordstrom flagship store in New York, USA, on Wednesday, February 21, 2024.
Guan Bing | Bloomberg | Getty Images
Nordstrom The company’s quarterly profit missed Wall Street expectations on Thursday as its discount chain Rack outperformed other stores.
The Seattle-based department store operator reported sales growth and stuck to its full-year forecast despite lower-than-expected profit.
Here’s how the retailer’s first-quarter earnings compared with Wall Street expectations, according to a survey of analysts by London Stock Exchange Group (LSEG):
- Loss per share: 24 cents vs expected 8 cents
- income: US$3.34 billion, expected US$3.20 billion
Nordstrom shares fell about 7% in after-hours trading.
Nordstrom relies on its discount chain Nordstrom Rack to drive growth. The company is opening more Rack stores, nine this quarter. Twenty-two new Rack stores are expected to open this year.
However, Rack, which offers branded products at cheaper prices, has fallen behind its competitors such as TJ Maxx by TJX and Marshall.
During the current quarter, however, the discount chain showed signs of improvement. It performed better than Nordstrom’s flagship brand, with comparable sales up 7.9% year over year. Comparable sales at the company’s flagship brand grew 1.8%.
The retailer reiterated that it expects profit for the full fiscal year to be $1.65 to $2.05. Nordstrom expects full-year revenue to fall 2% from the previous year to grow 1%.
Nordstrom reported a net loss of $39 million in the first fiscal quarter, compared with a net loss of $205 million in the same period last year. Total company revenue increased to $3.34 billion from $3.18 billion the previous year.
Nordstrom said activewear, children’s and women’s apparel saw strong double-digit growth this season compared with last year. Beauty sales also saw high-single-digit growth, the company said.
The results come as the Nordstrom family again considers taking the company private. Last month, the company said it formed a special committee to evaluate the bids.
The company’s quarterly results, released Thursday, were the first since former chairman Bruce Nordstrom, the father of CEO Eric Nordstrom and President Pete Nordstrom, died earlier this month. first quarterly results since.
Like its department store rivals, Nordstrom is trying to win over younger consumers as it relies on older customers.
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