Is a positive quarter a sign of results to come for Nordstrom?
Shares of Nordstrom’s stock were up in after-hours trading following the department store operator’s report of better-than-expected sales numbers for the second quarter.
Nordstrom’s net sales rose 3.5 percent year-over-year as the company’s Nordstrom Rack and online businesses posted gains. Same-store sales, also driven by Rack and online, were up 1.7 percent for the company. Comps at Nordstrom’s full-line stores have fallen for eight straight quarters.
Nordstrom’s annual anniversary sale boosted numbers for the company’s full-line stores, which still saw a net sales decrease during the quarter. Blake Nordstrom, co-president for Nordstrom, said the sale generates volume that “rivals” what the company does during the Christmas holidays.
This year’s event, Mr. Nordstrom told analysts on yesterday’s earnings call, “outperformed our recent sales trends as customers responded favorably to newness and the ability to shop the way they prefer, in stores, with a mobile device and online.” The company’s buy online, pick up in store business grew by roughly 50 percent during the Anniversary event.
Nordstrom’s online business continues to be a bright spot for the retailer with sales up 20 percent at Nordstrom.com in the second quarter and up 27 percent at NordstromRack.com and HauteLook.
Mr. Nordstrom sees creating seamless shopping experiences as key to Nordstrom’s success.
“We view our business through our Nordstrom and Nordstrom Rack brands rather than through discrete store and online channels,” he said (via Seeking Alpha). “The combination of our physical and digital assets represents a competitive advantage. … Nearly 80 percent of customers who shop with us across multiple channels began in our stores.”
Nordstrom continues to integrate “digital and store functionalities to improve speed and convenience for the customer,” said Mr. Nordstrom. He offered an example in which customers can use Nordstrom’s mobile app to “scan an item in store and buy it online if they want a different color or size.”
Nordstrom’s better-than-expected results follow a recent regulatory filing that indicated the company was exploring taking itself private. Family members, who collectively own about 31 percent of Nordstrom shares, have reportedly reached out to third party investors to gauge the viability of such a move.
- Nordstrom Second Quarter 2017 Earnings Achieved Expectations – Nordstrom, Inc.
- Nordstrom (JWN) Q2 2017 Results (Earnings Call Transcript) – Seeking Alpha
- Nordstrom’s stock pops as retailer delivers same-store sales growth – CNBC
- Would Nordstrom be better off private? – RetailWire
DISCUSSION QUESTIONS: Do you see Nordstrom’s second quarter results as a sign of better things to come for the retailer? How do you see Nordstrom’s business changing over the next five years?