Nordstrom (JWN) stock rose as much as 6% late Thursday after the company posted a beat on earnings and same-store sales Thursday after market close.
The company reported sales dropped 8.3% compared to the same time period last year, with CEO Erik Nordstrom attributing this decline to the timing of its Anniversary Sale, which pulled one week into the third quarter from the second.
The company also wound down its Canadian operations during the quarter. Without these two impacts, sales would have fallen nearly 4 percent instead.
The company also reiterated its 2023 outlook.
Nordstrom expects retail sales and credit card revenues to drop between 4%-6% compared to last year and adjusted earnings to come in between $1.80-$2.20, excluding charges related to the wind-down of its Canadian business.
The earnings rundown
Here are Nordstrom's Q2 results versus estimates, according to Bloomberg data.
Net sales: $3.66 billion vs. $3.61 billion expected
Adjusted EPS: $0.84 vs. $0.44 expected
Segment revenue:
Nordstrom: $2.49B billion vs. $2.47 billion
Nordstrom Rack: $1.17 billion vs. $1.10 billion
Credit Card: $100 million vs. $107.35 million
Same-store sales: -8.3% vs. -10.34%
Inventories: -17.5% compared to a year ago
What analysts were saying pre-earnings:
"Making progress, but the long-term still remains uncertain. Our checks point to solid sell-thorough at the key Anniversary Sale period, and we think it ended the sale with clean inventory. However, we continue to have near-term concerns about the luxury/upper-income consumer - reinforced by commentary from suppliers and peers - which point to continued pressure. We also still have longer-term secular concerns about the health of the full-line business. Rack is also showing early signs of improved merchandising and off-price is clearly experiencing strong secular tailwinds. At 0.4x 2024 EV/sales, the stock looks reasonable on an SoP basis, with the presumption that longer-term full-line results will be difficult to improve." - Edward Yruma, Piper Sandler
"We think JWN is a share loss and margin compression stock. We model a -29% 5-yr. EPS CAGR. We believe the market has not priced in this weaker earnings outlook, which is why we rate JWN Sell. We see an unfavorable upside/downside skew." - Jay Sole, UBS
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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