Nordstrom Lowers Guidance After Disappointing Holiday Results
Industry customer Nordstrom reported disappointing holiday results Thursday as sales came in softer than expected and the promotional environment caused the company to take additional markdowns to clear inventory.
For the nine weeks ended Dec. 31, net sales company-wide fell 3.5%.
Sales at the Nordstrom banner declined 1.7%, while Nordstrom Rack’s holiday sales dropped 7.6%.
“The holiday season was highly promotional, and sales were softer than pre-pandemic levels. While we continue to see greater resilience in our higher income customers, it is clear that consumers are being more selective with their spending given the broader macro environment,” Nordstrom CEO Erik Nordstrom said in a statement.
The company will end the fiscal year with inventory levels down double-digits compared to last year, and is implementing conservative buying plans going forward.
As a result of the soft holiday sales and extra discounting of inventory, Nordstrom lowered its guidance for the fiscal year. The company expects revenue growth to come in on the lower end of its prior forecast of 5% to 7%.
EBIT margin should range from 2.8% to 3.1% versus the prior outlook of 4.1% to 4.4%.
Earnings per share are now expected to range from $1.33 to $1.53 versus the previous guidance of $2.13 to $2.43.