Nordstrom Inc. (NASDAQ: JWN) stock declines by 6.80% in the current market trading session. Nordstrom Inc. is a well-known American apparel retailer. Nordstrom, which began as a shoe store in Seattle in 1901, now has 357 locations in the United States and Canada, including 100 Nordstrom shops, 248 Nordstrom Rack shops, two clearance shops, and seven Nordstrom Local service centers.
What is happening?
JWN published first-quarter fiscal 2021 results, with a greater loss per share than expected and revenue above the Zacks Consensus Estimate. While the top and bottom lines increased year over year, indicating a significant recovery from COVID-related constraints, the bottom line contrasted negatively on a sequential basis and from the first quarter of 2019.
Despite this, JWN’s revenues increased sequentially for the third quarter in a row. Furthermore, it stated that consecutive top-line growth patterns remained through fiscal 2021’s second quarter.
- Overall revenue increased 44% year over year to $3,009 million, above the Zacks Consensus Estimate of $2,882 million.
- Net sales grew 44 percent in the first quarter of fiscal 2021 compared to the same time in fiscal 2020 and fell 13% compared to the same period in fiscal 2019, showing a sequential improvement of 720 basis points over the fourth quarter of fiscal 2020.
- Nordstrom increased the implementation of its market strategy to its top 20 markets, which account for around 75 percent of sales, during the quarter.
- In the fiscal first quarter, selling, general, and administrative (SG&A) expenditures as a proportion of sales fell 1,900 basis points year over year to 37 percent.
- The $85 million loss before interest and taxes was down from the $813 million deficit in the previous quarter. Higher sales volume and lower SG&A expenses contributed to the shrinking of the loss.
Erik Nordstrom, chief executive officer of Nordstrom commented:
JWN is encouraged by sales improvements in both their shops and their digital business, which are bolstered by a better consumer environment and excellent execution. Thinking forward to the summer, they’re well able to benefit on pent-up demand, and they’re bolstering their position as they execute on their strategy to win in their most critical areas, expand Nordstrom Rack’s reach, and accelerate their digital velocity.