Nordstrom revenue beats Street as Nordstrom Rack sales jump 14%

Nordstrom reported a mixed first quarter with a wider than expected loss but sales that topped estimates, driven by the company’s outlet division, Nordstrom Rack.

The department store retailer continues to grow its Rack format, and opened new stores during the quarter. Thirteen additional stores are set to open by fall. (See list of upcoming locations at end of article).   

Nordstrom posted a net loss of $39 million, or $0.39 per share, for the quarter ended May 3, compared to a loss of $205 million in the year-ago quarter. Analysts expected a loss of $0.07 per share.

Total revenue rose 5.1% to $3.34 billion, topping estimates of $3.19 billion. Total comparable sales rose 3.8%, much more than analysts had expected. Active, kids' apparel and women's apparel had strong double-digit growth versus 2023, and beauty increased by high single-digits.

During the quarter, sales at the Nordstrom banner inched up 0.6%; comparable sales increased 1.8%. Net sales for Nordstrom Rack increased 13.8% and comparable sales increased 7.9%.

Digital sales decreased 0.2% compared with the same period last year. Digital represented 34% of total sales during the quarter.

"The positive sales growth we saw across the company in the first quarter is very encouraging, and we're particularly excited about the progress that our Rack banner is making," said CEO Erik Nordstrom. "While we're pleased with our topline growth, profitability fell short of our expectations. Looking ahead, our strong sales performance gives us momentum heading into the rest of the year and the confidence to reaffirm our 2024 guidance." 

Nordstrom ended the first quarter with $1.2 billion in available liquidity, including $428 million in cash. The company strengthened its financial position in April by retiring the $250 million notes that were due using cash on hand.

Nordstrom reaffirmed that it expects earnings of $1.65 to $2.05 for the full fiscal year, with full-year revenue expected to range from a 2% decline to 1% growth.

“We're set up well going forward in regards to the health of our inventory, both in managing levels and providing compelling content with good sell-through," said Pete Nordstrom, president of Nordstrom, Inc. "As we reflect on the legacy that our dad left behind, we've been reminded of his firmly held and consistent values—especially his commitment to serving our customers. Those values have been integral to Nordstrom's growth, and they remain at the core of the decisions we make as a company.”

At the end of the quarter, the company operated 264 Nordstrom Rack stores, 93 Nordstrom stores, six Nordstrom Local service hubs and two Last Chance clearance outlets.

New Store Openings

The company plans to open the following Nordstrom Rack stores in 2024.