Nordstrom reported a better-than-expected growth in second-quarter sales on Tuesday, buoyed by its crucial Anniversary Sale event, even as consumers remain cautious amid inflationary pressures, sending its shares up 11 percent in extended trading.
The upmarket department store chain also slightly revised its annual comparable sales forecast, raising the lower end to a range of flat to 2 percent growth, up from its previous projection of a 1 percent decline to 2 percent growth.
While affluent shoppers continue to spend, albeit at a slower pace, benefiting apparel chains such as Abercrombie & Fitch and Gap, middle- and lower-income consumers are feeling the pinch, hurting sales at department store chains such as Macy’s.
A slightly earlier start to Nordstrom’s Anniversary Sale event, which ran from July 15 through Aug. 4 this year, helped drive customers to both physical stores and the company’s website, contributing 100 basis points to net sales compared to 2023.
Nordstrom’s shares have declined approximately 3 percent over the past month. Analysts cited muted demand during the sale period, with Placer.ai foot traffic data suggesting July was the quarter’s weakest month.
The stock is up about 16 percent this year compared with a roughly 18 percent rise in the broader S&P 500 index.
Total revenue at the company rose 3.2 percent to $3.89 billion in the quarter ended Aug. 3, from $3.77 billion a year earlier, almost in line with analysts’ average expectation of $3.90 billion, according to LSEG data.
The Seattle, Washington-based company also revised its earnings per share projection to between $1.75 and $2.05, up from the previous range of $1.65 to $2.05
On an adjusted basis, the company reported a profit of 96 cents per share, compared to 24 cents loss in the first quarter.
By Savyata Mishra; Editing by Tasim Zahid
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Nordstrom shares rose 6 percent on the news, giving the company a market value of about $3.3 billion.
