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Nordstrom Inc reported better-than-expected results for the holiday quarter on Tuesday, helped by increased e-commerce sales and growth in its non-price business, Rack.
Declining household incomes due to the pandemic and high unemployment rates have resulted in increased demand for affordable clothing, which has boosted Rack’s business for Nordstrom, which has also benefited from a greater shift to purchasing online.
Nordstrom Rack sales were down 23% from a year ago, but were better than the 32% drop in the previous quarter, while digital sales of around $ 2 billion were 54% of the activity of the retailer.
NORDSTROM CLOSES 16 CORONAVIRUS FALLOUT STORES
The retailer said overall trends improved sequentially throughout the quarter, with improvements in both Nordstrom and Rack.
| Teleprinter | security | Latest | Change | Change% |
|---|---|---|---|---|
| JWN | NORDSTROM | 37.58 | -0.39 | -1.03% |
Nordstrom, like other retailers, has invested heavily in e-commerce as consumers turn to online shopping in the wake of the health crisis.
The retailer reiterated its revenue forecast and said it will grow by more than 25% this year, with digital accounting for half of sales and plans to increase the items it offers to over 1.5 million, against around 300,000.
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“There is no denying that their (Nordstrom) Q4 results were impacted as fewer consumers visit offices and official events,” said Hilding Anderson, head of retail strategy at consulting firm Publicis Sapient.
“We expect apparel sales to rebound in the second half of 2021 as the vaccine rollout continues and more consumers begin to travel and resume other events in person.”
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Total revenue fell 19.7% to $ 3.65 billion in the fourth quarter ended Jan. 30. Wall Street had forecast $ 3.60 billion, according to analysts polled by Refinitiv IBES.
Net income fell 83% to $ 33 million, largely affected by higher markdowns and labor and shipping charges induced by COVID-19 during the holiday season.
Per share, it gained 21 cents, well above the estimate of 14 cents.
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