(Reuters) -Nordstrom reported a better-than-expected growth in second-quarter sales on Tuesday, buoyed by its crucial Anniversary Sale event, even as consumers remain cautious amid inflationary pressures, sending its shares up 11% in extended trading.
The upmarket department store chain also slightly revised its annual comparable sales forecast, raising the lower end to a range of flat to 2% growth, up from its previous projection of a 1% decline to 2% growth.
While affluent shoppers continue to spend, albeit at a slower pace, benefiting apparel chains such as Abercrombie & Fitch and Gap, middle- and lower-income consumers are feeling the pinch, hurting sales at department store chains such as Macy’s (NYSE:M)..
A slightly earlier start to Nordstrom (NYSE:JWN)’s Anniversary Sale event, which ran from July 15 through Aug. 4 this year, helped drive customers to both physical stores and the company’s website, contributing 100 basis points to net sales compared to 2023.
Nordstrom’s shares have declined approximately 3% over the past month. Analysts cited muted demand during the sale period, with Placer.ai foot traffic data suggesting July was the quarter’s weakest month.
The stock is up about 16% this year compared with a roughly 18% rise in the broader S&P 500 index.
Total revenue at the company rose 3.2% to $3.89 billion in the quarter ended Aug. 3, from $3.77 billion a year earlier, almost in line with analysts’ average expectation of $3.90 billion, according to LSEG data.
The Seattle, Washington-based company also revised its earnings per share projection to between $1.75 and $2.05, up from the previous range of $1.65 to $2.05
On an adjusted basis, the company reported a profit of 96 cents per share, compared to 24 cents loss in the first quarter.
