After its department store peers Macy’s Inc. and Kohl’s Corp. reported strong profits but softer sales, Nordstrom Inc. today is following suit.
The Seattle-based department store chain, which posted earnings after the market close, said its fourth-quarter sales gained 2.4 percent year-over-year, to $4.2 billion, but missed forecasts predicting sales of $4.4 billion.
Meanwhile, earnings advanced 10 percent year-over-year, to $201 million, or $1.15 per diluted share. Adjusted earnings per share, at $1.37 handily topped Wall Street’s bet for diluted EPS of $1.15.
The company said its comparable sales slipped 0.9 percent in the quarter. However, comps at its off-price chain, Nordstrom Rack business, increased 4.3 percent, exceeding forecasts and powering the firm ahead.
“Our focus in 2016 was to improve both the customer experience and our productivity,” co-president Blake Nordstrom said during the firm’s conference call. “We’ve been pleased with our team’s efforts to adjust our operating model to meet the changing needs of customers. These efforts, particularly around inventory management and operating efficiencies, have contributed positively to our results.”
Nordstrom is one of several retailers that has implemented a wave of initiatives in recent months aimed at luring digital hungry consumers — the firm announced in April 2016 that it would eliminate 350 to 400 jobs in order to address shifts in consumer shopping habits.
The firm’s full-year sales advanced 3 percent, to $14.5 billion, while net income tumbled 41 percent, to $354 million, or $2.02 per diluted share. Comps slipped 0.4 percent.
“As we look ahead, we are focused on speed, convenience and personalization, culminating to our most important goal of improving service,” Blake Nordstrom said.
Despite ending the trading day down more than 3 percent, as of 6:20 p.m., Nordstrom shares gained more than 3 percent, to $45.26 in after-market trading.