Nordstrom's weak 2024 forecasts overshadow strong holiday-quarter sales
By Ananya Mariam Rajesh
(Reuters) -Nordstrom forecast annual results largely below Wall Street expectations on Tuesday, signaling a slower-than-expected rebound in demand even as consumers see some relief from easing inflationary pressures.
The department store chain's shares were down 10% at $18.83 after the bell.
The company joins peer Macy's (NYSE:M) in signaling weak 2024 sales as retailers brace for another year where spending on non-essential items such as apparel and household equipment is likely to remain pressured.
«We continue to see a cautious consumer that is mindful of discretionary purchases in light of inflation, higher interest rates,» Nordstrom (NYSE:JWN) CFO Cathy Smith said.
The company expects 2024 revenue to be between down 2% and up 1%, while analysts had expected an increase of 0.04%, according to LSEG data.
Nordstrom forecast annual profit per share in a range of $1.65 to $2.05, while analysts had expected $1.98. The company also said it expects first-quarter results to be near break-even to a slight loss.
«The outlook is disappointing… Nordstrom really just hasn't recovered that well from the pandemic,» Morningstar analyst David Swartz said.
The company's fourth-quarter total revenue of $4.42 billion beat estimates of $4.39 billion, mainly driven by strong demand for running shoes and beauty products during the holiday season.
Sales at Nordstrom's discount banner Rack rose 14.6%, while the company's eponymous label recorded a 3% drop in revenue.
The company has been working to bring in trendier products at its Rack stores and is slated to open 26 new stores for this year and spring 2025 in a bid to attract lower-income consumers who have been pressured by elevated costs of living.
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