What: For the third quarter ended October 30, 2021, net sales increased 18% versus the same period in fiscal 2020 and decreased 1% versus the same period in fiscal 2019. During the quarter, Nordstrom banner net sales increased 3% versus the third quarter of fiscal 2019. Net sales for Nordstrom Rack decreased 8% versus the third quarter of fiscal 2019. Digital sales decreased 12% compared with the same period in fiscal 2020 and increased 20% compared with the same period in fiscal 2019.

Why it is important: The company is reaffirming its financial expectations for fiscal 2021. Revenue, including retail sales and credit card revenues, is expected to grow more than 35% versus fiscal 2020. EBIT margin is expected to be approximately 3.0 to 3.5% of sales.

Sales in the home, active, designer and beauty categories had the strongest growth compared with the third quarter of 2019. Comparable sales in suburban area stores continued to be stronger than urban stores in the third quarter, with both improving sequentially over the second quarter.

Gross profit increased compared with the same period in fiscal 2020 primarily due to fewer markdowns and leverage from higher net sales. Ending inventory increased 13% compared with the same period in fiscal 2019, versus a 1% decrease in sales. The change in inventory levels versus 2019 was due to the Company's actions to pull forward receipts to support early holiday sales and mitigate continuing supply chain backlogs.

EBIT was USD 127 million in the third quarter of 2021, compared with USD 106 million during the same period in fiscal 2020 primarily due to higher sales volume and improved merchandise margins, partially offset by labour cost pressure. EBIT was USD 66 million lower than the third quarter of fiscal 2019 due to fulfilment and labour cost pressures, partially offset by continued benefit from resetting the cost structure in 2020.

Nordstrom Reports Third Quarter 2021 Earnings