Big boost in internet sales help Nordstrom beat on earnings, raise outlook
Nordstrom Inc. shares soared in the extended session Thursday thanks in part to the retailer’s progress in internet sales, a spot of trouble for primarily brick-and-mortar retailers as Amazon.com Inc. makes more inroads in apparel.
Nordstrom JWN, +0.81% said it earned $162 million, or 95 cents a share, on sales of $4.07 billion in the second quarter. Analysts surveyed by FactSet expected earnings of 86 cents a share on sales of $3.97 billion for the three-month period.
Nordstrom stock rallied more than 13% after the earnings beat, which also came complete with a brighter outlook for the year. The shares ended the regular session up 0.8%.
Nordstrom.com sales rose 50% quarter-on-quarter to $897 million, compared with consensus expectations of $876 million for the quarter, according to FactSet.
Overall digital sales rose by 23% in the second quarter, compared with 20% for the same period last year, Nordstrom said Thursday. Digital sales represented 34% of second-quarter sales, up from 29% a year ago.
What’s more, during the first day of Nordstrom’s anniversary sale in July, the retailer “achieved record digital demand,” surpassing a previous peak by 80%, it said.
Thursday’s second-quarter beat was a respite from a rockier July for the retailer, when Nordstrom shares sank following a 2018 sales guidance that was below consensus.
The beat also came on a day Walmart Inc. shares rallied thanks to a 4.5% jump in second-quarter same-store sales growth, its best in more than 10 years. Walmart, however, reiterated it expects e-commerce losses to be higher this year.
Nordstrom has been beefing up its e-commerce platform, and earlier this month hired a new chief technology officer, Edmond Mesrobian, a year and a half after the departure of the previous CTO.
In March, the company announced deals to buy two retail technology companies, BevyUp and MessageYes, for an undisclosed sum.
Nordstrom stock has gained 10% this year, compared with advances of 6.3% and 3.4%, respectively, for the S&P 500 index SPX, +0.79% and the Dow Jones Industrial Average DJIA, +1.58% .
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