Nordstrom Defies Retail Slump With Higher Results Forecast, Shares Jump

Nordstrom Inc. raised its annual profit and revenue forecasts on Tuesday as the upscale retailer counts on demand from affluent consumers to help it overcome decades-high inflation.

Shares of the high-end department chain rose about 7 percent in extended trading.

Net sales across Nordstrom banner stores exceeded pre-pandemic levels in the first quarter with a 23.5 pecent jump as Americans returning to offices and social events snapped up designer apparel and footwear.

Earlier in the day, Ralph Lauren also forecast improved full-year margins as demand for luxury apparel stays strong in top markets North America and Europe.

The confident outlook from Nordstrom and Ralph Lauren is in sharp contrast to peer Kohl’s and big-box retailers Walmart Inc and Target Corp, which have taken a beating as runaway inflation squeezes consumer spending.

ALSO READ:  Dubai’s Emaar Malls See Sales Rise 42% in 2021

Nordstrom, which also authorized a new $500 million buyback, projected fiscal 2022 revenue to rise 6 percent to 8 percent, compared with a prior forecast of 5 percent to 7 percent growth. Full-year adjusted profit per share is expected between $3.38 and $3.68, higher than $3.15 to $3.50 earlier.

Meanwhile, its off-price division, Nordstrom Rack, posted a 10.3% increase in quarterly sales.

Total revenue rose 18.7 percent to $3.57 billion in the first quarter, surpassing analysts’ estimates of $3.28 billion, according to Refinitiv IBES.

The retailer said net income for the quarter ended April 30 rose to $20 million, or 13 cents per share, from a loss of $166 million, or $1.05 per share, a year earlier.

The retailer reported a loss of 1 cent per share on an adjusted basis, compared with estimates for a loss of 5 cents.

ALSO READ:  Russia’s Melon Fashion Group Sees Revenue Grow 66%

By Mehr Bedi; Editing by Devika Syamnath

Learn more:

Can Department Stores Win Over Gen-Z?

Department stores are investing in private label brands, e-commerce offerings and product collaborations to capture younger consumers, but it remains to be seen if the strategy is working.

Source link

Follow Us

Follow us on Facebook Follow us on Pinterest