Nordstrom, Inc. (NYSE: JWN) Took Steps To Match Inventories And Costs With The Shifting Patterns As Client Demand Slowed Down

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Nordstrom, Inc. (NYSE: JWN) plummeted over 9.67% to $20.46 in pre trading session on Wednesday as for the third quarter of 2022 that ended on October 29, it reports a net loss of $20 million and a loss per diluted share of $0.13. A supply chain technology and associated asset impairment charge was not included in the company’s adjusted earnings per diluted share, which came in at $0.20.

In comparison to the third quarter of fiscal 2021, net sales fell by 2.9 percent, while gross merchandise value fell by 2.5 percent. The date of the Anniversary Sale, which was moved by one week from the third quarter to the second quarter, had a negative effect on net sales of about 200 basis points when compared to 2021. The anniversary sale timing had a negative effect on Nordstrom banner net sales during the quarter, which decreased by about 300 basis points, and GMV fell by 2.9 percent. Nordstrom Rack’s net sales fell by 1.9 percent.

The chief executive officer of Nordstrom, Inc. Erik Nordstrom stated that in the third quarter, they improved their strategic skills while delivering results on the top and bottom lines that met their objectives. They took steps to match inventories and costs with the shifting patterns as client demand slowed down in late June, which has helped them to manage the present macroeconomic situation. As they put their attention on initiatives to promote profitable growth and meet their long-term strategic and financial goals, their teams continued to advance their Closer to You strategy and supply chain capabilities this quarter.

As customers continued to shop for occasions, travel, work, and holidays, core categories like men’s and women’s apparel, shoes, and designer experienced the strongest growth in the third quarter compared to 2021.

The president and chief brand officer of Nordstrom, Inc., Pete Nordstrom said, “We are right-sizing our inventory levels and mix, and are on track to end 2022 in a healthy and current position. “Customers continue to respond to newness and fashion in our offering, and we are focused on remaining agile to respond to their changing needs. This holiday season we are delivering a fresh, relevant assortment, which supports our goal of being the go-to destination for gifting, and preparing for the moments that matter most to customers.”

As the firm braces itself for a slump that “impacted all consumer categories, with outsized impact in the lowest income groups,” Chief Executive Erik Nordstrom said Nordstrom was removing surplus stocks to end the year with healthy inventory levels.

He said that sales had increased during the previous two weeks. According to the business, some clients were delaying their purchases until closer to Christmas.

The senior analyst at BMO Capital Markets, Simeon Siegel stated that Nordstrom was aiming to use promotions to use up inventory, much like the rest of the sector.