Nordstrom Stock Plunges Despite Raising FY21 Revenue Growth Outlook

Nordstrom Inc JWN reported second-quarter FY21 revenue growth of 96.4% year-on-year, to $3.66 billion, beating the analyst consensus of $3.31 billion.
Net sales increased 101% Y/Y and decreased 6% from the same period in FY19.
Nordstrom net sales increased 127% Y/Y and decreased 5% versus Q2 FY19.
Nordstrom Rack net sales rose 61% Y/Y and decreased 8% compared to Q2 FY19.
Digital sales increased 30% Y/Y and increased 24% compared to Q2 FY19.
EPS of $0.49 beat the analyst consensus of $0.28.
The gross margin jumped 1370 basis points Y/Y to 34.6%, primarily due to leverage from higher net sales and lower markdowns. The gross margin was flat versus Q2 FY19.
Adjusted EBITDA for the six months was $347 million compared to $(746) million last year.
Net cash provided by operating activities for the six months totaled $545 million with a free cash flow of $334 million.
Nordstrom’s debt as of July 31, 2021, amounted to $2.8 billion.
Nordstrom held $487 million in cash and equivalents as of July 31, 2021.
Outlook: Nordstrom expects FY21 revenue growth, including retail sales and credit card revenues, of more than 35% (prior over 25%).
Price Action: JWN shares are trading lower by 10.9% at $33.69 in premarket on the last check Wednesday.

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