Sluggish sales at Nordstrom Inc. underscore why members of the founding family wanted to take the company private in the first place.
With unseasonable temperatures crimping demand for apparel in the first quarter, comparable sales missed analysts’ estimates. The closely watched measure rose 0.6 percent, the department store chain said Thursday. Analysts were expecting an increase of 1 percent, according to Consensus Metrix.
The results sent shares down in late trading and added to the industry’s mixed bag this earnings season. Macy’s Inc. cited strong consumer demand, but J.C. Penney underwhelmed investors with sales that missed expectations.
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Nordstrom has sought to drive sales at its value-focused Rack chain as a way to insulate the merchandise at its full-price stores from discounts, but the results may cause investors to question that approach. The Seattle-based retailer is also trying new strategies, such as an inventory-free store, after the board ended talks in March with the Nordstrom family to take the company private.
The shares dropped as much as 7.7 percent to $47 in late trading in New York. The stock had gained 7.5 percent this year through Thursday’s close.
Nordstrom posted sales of $3.56 billion in the first quarter, which ended May 5. That topped the $3.45 billion analysts predicted. Profit in the period was 51 cents a share, excluding some items, more than the 44 cents analysts called for.