SEATTLE – Nordstrom could not escape the woes bedeviling the apparel retail sector as the company reported first-quarter earnings far below Wall Street expectations.
The Seattle-based company on Thursday reported earnings per share of 26 cents, compared to analysts' expectations of 46 cents per share. The quarter's earnings are 61 percent below the earnings per share of 66 cents a year ago.
The results were "primarily driven by lower than planned sales and higher markdowns to better align inventory to current trends," the company said in a news release.
Nordstrom has stores in Mall of America and Ridgedale Center in Minnetonka, and three Nordstrom Rack stores in the Twin Cities. A Nordstrom Rack store is expected to open at some point in the IDS Center in Minneapolis.
Blake Nordstrom, company co-president, said that in response to lower-than-expected sales, "we have made further adjustments to our inventory and expense plans."
Total sales for the quarter were $3.25 billion, up nearly 1 percent from $3.22 billion this quarter last year. But it was still below analysts' estimate of $3.28 billion.
Nordstrom also lowered its outlook for the year, from last quarter's guidance of $3.10 to $3.55 earnings per share, to $2.50 to $2.70.
The company's shares dropped 17 percent, to $37.50 — a new 52-week low — in after-hours trading following release of the results.
Nordstrom stock already had taken a hit Wednesday, down 7 percent to $45.43 at closing, after Macy's reported grim first-quarter numbers and Gap issued a warning that its quarterly profit and sales would be lower than expected.
Last month, the retailer said it expects to lay off 350 to 400 people, mainly from its corporate headquarters, in a cost-cutting move aimed at making the company more efficient.
