Nordstrom improves sales forecast following better-than-expected holiday season.

• After better-than-expected holiday spending at its website and stores, Nordstrom improved its full-year sales forecast.
• Yet the department store operator stuck by its profit outlook.
• The CEO attributed the company's competitiveness in the promotional market and the robustness of its offerings to its success.

After holiday shopping exceeded its expectations, the department store raised its full-year sales outlook on Friday.

The company stuck by its profit guidance, despite the higher sales guidance.

The retailer, based in Seattle, now anticipates full-year revenue growth of 1.5% to 2.5%, considering the impact of having one fewer fiscal week. This is a change from its previous projection of flat to up 1%.

Despite exceeding Wall Street's expectations for fiscal third-quarter sales, Nordstrom maintained a conservative outlook in late November. It projected full-year revenue to range from flat to up 1%. The retailer said adjusted earnings for the year would range from $1.75 and $2.05 per share. Its revenue includes both retail sales and credit card revenue.

During an earnings call, CEO Erik Nordstrom stated that the company experienced a decline in sales trends towards the end of October, which was taken into account when making the forecast.

In a news release on Friday, he attributed the company's better-than-expected holiday sales to its "competitive promotional efforts and strong product offerings."

During the nine-week holiday period that ended January 4, Nordstrom reported a 4.9% increase in net sales and a 5.8% increase in comparable sales, which exclude the impact of store openings and closures, compared to the year-ago quarter that ended December 30.

During the holiday season, Nordstrom's net sales at its banner increased by 3.7%, while comparable sales rose by 6.5%. Meanwhile, Nordstrom Rack, the company's off-price banner, experienced a 7.4% increase in net sales and a 4.3% increase in comparable sales.

The operator of the department store provides valuable insights for investors tracking the well-being of U.S. consumers and the retail industry during the crucial shopping season. Retail giants such as Walmart, Best Buy, Macy's, and others will release their earnings reports in late February.

The holiday season in the U.S. has shown promising early numbers, with online spending increasing by nearly 9% and retail sales rising by 3.8% year over year.

The Nordstrom family is preparing to take the retailer private with a $6.25 billion buyout deal with El Puerto de Liverpool. The transaction, approved by the board of directors, is expected to close in the first half of 2025.

Nordstrom's shares ended the day at $24.01, a 4% decline from its 52-week high. The company will release its full fourth-quarter and full-year results on March 4.