What: Nordstrom reported a 5.1% increase in net sales for Q1 2024 but missed profit expectations, resulting in a net loss and a drop in share value.

Why it is important: Nordstrom's mixed results highlight the challenges retailers face in balancing sales growth with profitability. The discrepancy between sales gains and profit misses can significantly impact investor confidence and share prices, demonstrating the complexity of navigating economic pressures and consumer behaviour.

Nordstrom's Q1 2024 results showed a 5.1% increase in net sales to $3.22 billion, up from $3.06 billion in Q1 2023. Despite this growth, the company reported a net loss of $39 million, or 24 cents per share, compared to a loss of $205 million, or $1.27 per share, the previous year. Analysts had anticipated a smaller loss of 7 cents per share. The Nordstrom banner's net sales rose 0.6% year-over-year to just over $2 billion, while Nordstrom Rack's sales increased by 13.8% to $1.18 billion. CEO Erik Nordstrom expressed optimism about the sales growth but acknowledged the shortfall in profitability. Despite this, the company reaffirmed its fiscal 2024 outlook, expecting revenue to range between a 2% decline and 1% growth, with earnings per share projected between $1.65 and $2.05. Shares dropped more than 6% in after-market trading following the announcement.

Nordstrom shares dip on profit miss despite reporting sales gains in Q1

Nordstrom Reports First Quarter 2024 Earnings Press Release