Nordstrom is moving to expand the number of Nordstrom Rack stores this year despite continued struggles at the department store’s discount offering.
(Bloomberg) — Nordstrom is moving to expand the number of Nordstrom Rack stores this year despite continued struggles at the department store’s discount offering.
Despite reporting sales declines at Rack in the fourth quarter, Nordstrom has set a goal of opening 20 new Rack locations by the end of the current year. The off-price store front accounted for 40% of newly acquired customers in 2022, the largest source of new shoppers attracted to offerings that are not usually available at discount retailers, according to the company.
“Our Rack store fleet is underpenetrated,” Chief Executive Officer Erik Nordstrom said in prepared remarks. “We have an opportunity to attract more customers and drive profitable growth through a proven model.”
In other cost-saving moves, the company announced that it will wind down its Canadian business, and those operations “account for less than 3%” of its total sales, according to the remarks.
Overall, sales were $4.32 billion in the fourth quarter, while analysts expected $4.37 billion. Earnings were 74 cents, matching estimates.
Shares were largely unchanged in aftermarket trading. Nordstrom has risen about 19.8% this year through Thursday, far outperforming the S&P 500 Index over that time.
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