Nordstrom shares took a beating in after-hours trading Thursday after the retailer reported lower-than-expected third-quarter earnings and reduced its guidance for the full year.
The stock fell more than 21% to $50.05, well below the 52-week low of $61.06 set Wednesday.
The upscale department store operator had earlier delivered earnings of 57 cents per share on $3.33 billion in revenue. Wall Street had expected earnings per share of 72 cents on $3.37 billion in revenue, according to consensus estimates from Thomson Reuters.
The slowdown was across all categories, regions, and channels, including online, at both its full-priced Nordstrom department stores and its off-priced Rack locations, The Wall Street Journal noted. Same-store sales increased 0.9%, well below analysts’ estimates of 3.6%.
“It’s just a traffic thing,” said Jamie Nordstrom, president of stores. “We’ve got [fewer] people buying clothes this quarter than we expected. And there’s really nothing else to point to.”
Nordstrom doesn’t expect an improvement in the fourth quarter, forecasting a full-year profit of $3.40 to $3.50 a share, less than its previous guidance of a $3.70 to $3.80 per-share increase. Sales growth is now forecast between 7.5% to 8%, down from the previous range of 8.5% to 9.5%.
Nordstrom’s disappointing results follow Macy’s warning Wednesday that it would have to make heavy markdowns to clear unsold goods after sales fell short in its most recent period. The announcement dragged Macy’s stock to a two-year low.
“Apparel retailers are facing a warmer-than-usual holiday season, meaning that fall-season clothes may not sell as early as before, according to analysts,” Business Insider said. “And foot traffic to malls has been declining.”