Nordstrom’s sales fall 53% as department store chain suffers store closures amid pandemic

Nordstrom mentioned Tuesday its internet sales fell 53% in the course of the second quarter, as its shops took successful from being briefly closed in the course of the coronavirus pandemic, and its on-line enterprise suffered as a result of a shift in timing of its annual Anniversary Sale. 

The firm mentioned its shops, together with its off-price Nordstrom Rack places, had been closed for about 50% of the times within the newest quarter, dragging down general outcomes. Its profitability additionally was damage as it elevated reductions to remain aggressive. 

Nordstrom shares fell about 6% in after-hours buying and selling. 

Here’s how the retailer did throughout its fiscal second quarter, in contrast with what analysts had been anticipating, based mostly on Refinitiv information: 

  • Loss per share: $1.62 vs. a lack of $1.48 anticipated 
  • Revenue: $1.86 billion vs. $2.38 billion anticipated 

For the interval ended Aug. 1, Nordstrom swung to a lack of $255 million, or $1.62 per share, from internet earnings of $141 million, or 90 cents a share, a yr in the past. Analysts had been calling for a lack of $1.48 per share. 

Revenue, which incorporates sales from bank cards, fell to $1.86 billion from $3.87 billion a yr in the past, wanting the $2.38 billion that analysts estimated. Net sales fell 53% to $1.78 billion from $3.78 billion one yr earlier. 

At its full-price shops internet sales had been down 58% from a yr in the past, whereas its off-price enterprise suffered a decline of 43%. 

Online sales fell 5%, due largely to the department store chain shifting its widespread Anniversary Sale that’s sometimes held in July into the third quarter. Excluding this affect, the corporate mentioned digital sales had been up roughly 20% in the course of the interval. 

“We’re confident that we can improve sales trends in the second half of the year and beyond,” President Pete Nordstrom mentioned in an announcement. However, it did not supply an outlook for the rest of the yr. 

Sales from its Anniversary occasion, which kicked off to all prospects on Aug. 19, are monitoring consistent with its inner expectations, “reflecting improvement in underlying trends relative to July.” 

During a convention name with analysts, Chief Financial Officer Anne Bramman mentioned the corporate is planning for “sequential and gradual improvement in sales, earnings and cash flow” within the second half of 2020. 

Looking towards the all-important vacation season, many retailers have mentioned they’re anticipating customers to start procuring sooner than ever this yr amid the uncertainty of the coronavirus pandemic and the potential for shops to  shut down once more within the winter months. 

Pete Nordstrom mentioned Tuesday that the department store chain is ready to inventory its shops with vacation items earlier than Thanksgiving. 

“We’ve had this long-held tradition that we don’t decorate our stores [until] after Thanksgiving … but that doesn’t mean that we shouldn’t be in a position of selling customers what they want, when they want it,” he mentioned. 

Four main department store chains — J.C. Penney, Neiman Marcus, Stage Stores and Lord & Taylor — have filed for chapter in the course of the pandemic, with the class reeling from malls being much less trafficked by customers, and extra customers stocking up at big-box shops like Target and Walmart. Both Target and Walmart have reported spectacular ends in current days, whereas mall-based firms are seen struggling to remain afloat. 

While Nordstrom has fared higher, it’s nonetheless working to regulate the dimensions of its enterprise. Earlier this yr, it announced the closure of 16 department shops, as the Covid-19 disaster took a toll on its enterprise. 

“As we emerge from this disruptive period, our ambition is for Nordstrom to be positioned as a retail winner by gaining market share and driving profitable growth,” Bramman mentioned. 

Nordstrom’s inventory is down about 62% this yr, as of Tuesday’s market shut. The firm has a market cap of $2.four billion. 

Find the complete earnings press launch right here

Source hyperlink

What do you think?

Written by Business Boy


Leave a Reply

Your email address will not be published. Required fields are marked *



Here’s why the U.S. box-office recovery won’t be as swift as China’s

Ex-Google CEO Eric Schmidt says rapid coronavirus tests are needed to get America back to the office