Nordstrom's 3rd-quarter profit rises 15 percent
NEW YORK (AP) — Nordstrom Inc. reported a 15 percent increase in third-quarter net income, fueled by strong demand of men's shoes, men's clothing and children's fashions.
But the upscale retailer's profit results missed Wall Street estimates, as the company invested more money in enhancing its rewards program for shoppers. Investors pushed down shares by 3 percent in after-hour trading, extending the decline in regular trading. The company released its results after regular trading closed Thursday.
Still, Nordstrom's solid quarter is encouraging news as the upscale retailer heads into the holiday season. Sales have rebounded since late 2009 for Nordstrom and other luxury retailers as the affluent have spent more. The question, however, is how Superstorm Sandy, which disrupted businesses and households in the Northeast, will affect consumers' future spending.
Nordstrom closed the books on the quarter two days before Sandy pummeled the densely packed Mid-Atlantic and Northeast region. Many shoppers are dealing with problems ranging from transportation to power outages to more serious issues like property losses.
Nordstrom is also grappling with new demands from shoppers armed with smartphones and tables. That's pushing the high-end merchant, long known for service, to come up with new ways to cater to shoppers.
"We aspire to continually improve the customer experience," Blake Nordstrom, president of Nordstrom, told investors during a conference call. "There's no finish line when it comes to this subject as our customers have access to a growing number of choices with expectations increasingly centered on speed and convenience."
Last year Nordstrom started offering free shipping on all online purchases with no minimum dollar amount. Previously customers had to spend at least $200 to qualify. Return shipping is free too. The company is also giving sales associates devices that let them check out shoppers anywhere in the store.
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