Nordstrom’s Q4 Earnings vs. Expectations
In Nordstrom’s Q4 earnings report, the retail clothing company generated $3.645 billion in total revenue, falling by nearly $1 billion compared to the same quarter last year. Despite the heavy drop in revenue, the company still comfortably beat out analyst expectations, which had projected the business to only bring in $3.6 billion.
Nordstrom also saw net earnings fall dramatically as well, bringing in only $33 million, or $0.21 per share in comparison to $193 million, or $1.23 per share the year earlier. However, once again, this was still more than enough to beat out analyst projections which had estimated the business would only bring in earnings of $0.14 per share.
While total sales decreased by 20% year-over-year (YOY) in Q4, the bright spots for the company came from online sales. In fact, online sales grew by 24% YOY, as the lack of open retail locations pushed customers to shop online far more often than ever before. At the same time, Nordstrom Rack, the more affordable aspect of the company’s business, saw a 23% decline in sales YOY. However, in comparison to Q3, which had a 32% drop YOY, this figure showed promising signs of moving in the right direction.
Nordstrom’s Future Outlooks and Stock Market Reaction
In the guidance provided by Nordstrom, the company noted that shipping delays will force off-season inventory to be sold through Q1 and will have effects on business early on. However, the company remains incredibly optimistic about the 2021 fiscal year, predicting over 25% growth in total revenues. News of these shipping delays caused anxieties amongst investors, pushing company stock down about 2% in pre-market trading. The company stock is now worth slightly more than $36.50 per share.
In a statement released alongside the Q4 earnings report, CEO of the business, Erik Nordstrom, said, “We’re proud of our team’s efforts to generate another quarter of improved sales trends and positive operating cash flow in what remains an uncertain environment. Heading into 2021, we’re taking steps to improve our inventory position.”
About the Author
Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.