Nordstrom reported a larger-than-expected loss on Tuesday, as the COVID-19 pandemic closed stores for about half of the reported quarter and consumers stayed at home without the need for branded clothing.
Shares of the high-end department store chain were trading around 5% after the bell.
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Like many of its peers, Nordstrom suffered from a pandemic-induced months-long shutdown of its stores across the United States, which brought foot traffic to a halt. Shoppers staying at home to curb the spread of the virus haven’t found themselves buying so many high-end clothing and formal workwear.
“We are confident that we can improve sales trends in the second half of the year and beyond,” said Pete Nordstrom, president and CEO of Nordstrom brand.
“Our inventories are current and online, and we are focused on amplifying relevant categories, brands and trends to meet changing customer preferences. ”
The pandemic has radically changed how and where people shop, with many choosing to spend their money on sweatpants or “joggers,” sports bras and basic items.
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Nordstrom’s financial results were also hit after the retailer moved its popular anniversary sale from the second to the third quarter. The move affected its online sales, which fell 5%.
“Digital sales have gone down, which is surprising,” said Sucharita Kodali, retail analyst at Forrester Research. “They (Nordstrom) said the change in the anniversary sale hurt them, but even then dot com sales only grew 20% while others saw 100% growth + electronic commerce. ”
With millions of people still out of work, low-cost “essential” retailers like Walmart and Target are seeing record increases in online sales in most categories, including clothing.
Looking forward to the all-important winter holiday season, Nordstrom executives said the company would join other retailers in “giving away pre-Thanksgiving gifts.”
Nordstrom would continue to refine its marketing strategy and invest in top performing categories like home, active activity and wellness, they told investors on a post-earnings conference call.
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Seattle-based Nordstrom reported a net loss of $ 255 million, or $ 1.62 per share, compared with earnings of $ 141 million, or 90 cents per share, a year earlier.
Analysts had expected a loss of $ 1.48 per share, according to IBES data from Refinitiv.
Total revenue fell 52% to $ 1.86 billion, missing Wall Street estimates of $ 2.38 billion
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