A Citibike docking station outside the Nordstrom flagship store in New York, US, on Wednesday, Feb. 21, 2024.
Bing Guan | Bloomberg | Getty Images
Nordstrom on Thursday fell short of Wall Street’s quarterly earnings expectations, as its off-price chain Rack outperformed the rest of its stores.
Despite the earnings miss, the Seattle-based department store operator posted sales growth and stuck by its full-year forecast.
Here’s what the retailer reported for its fiscal first quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Loss per share: 24 cents vs. 8 cents expected
- Revenue: $3.34 billion vs. $3.20 billion expected
Nordstrom shares slid about 7% in extended trading.
Nordstrom has leaned on its off-price chain, Nordstrom Rack, to drive growth. It’s been opening more Rack stores, including nine during the quarter. It is on track to open a total of 22 new Rack stores this year.
Yet Rack, which offers brand names at cheaper prices, has lagged behind rivals like TJX-owned T.J. Maxx and Marshalls.
In the quarter, however, the off-price chain showed signs of progress. It outperformed Nordstrom’s flagship brand with comparable sales rising 7.9% year over year. Comparable sales for the company’s flagship brand climbed 1.8%.
The retailer reaffirmed that it expects earnings of $1.65 to $2.05 for the full fiscal year. Nordstrom anticipates full-year revenue will be in a range of a 2 percent decline to 1 percent growth from the prior year.
For its fiscal first quarter, Nordstrom posted a net loss of $39 million, versus a net loss of $205 million in the prior-year period. The company’s total revenue rose to $3.34 billion from $3.18 billion in the previous year.
In the quarter, Nordstrom said active, kids’ and women’s apparel had strong double-digit growth versus the prior year. Beauty sales also increased by high single-digits, the company said.
The results come as the Nordstrom family again considers taking the company private. Last month, it said it formed a special committee to evaluate bids.
The company’s quarterly results Thursday were the first since former chairman Bruce Nordstrom, the father of CEO Erik Nordstrom and President Pete Nordstrom, died earlier this month.
Nordstrom, like its department store rivals, is trying to win over young consumers as it relies on aging customers.