Nordstrom posted a profit for the third quarter of $114 million compared to posting a loss for the same period one year ago, but the operators of upscale department stores saw a drop in a key sales metric and cut its outlook for profit for the full year.
Stock at Nordstrom fell by up to 7.6% in Thursday afterhours trading after its results were posted. It parred some of the declines and was down 1.3% later that evening. The stock through the end of business on Thursday had dropped 16% in 2017.
The chain, which is based in Seattle, posted earnings per share of 67 cents for the three-month period, compared to a $10 million loss equal to 6 cents a share for the same period one year ago.
The results beat expectations on Wall Street for 63 cents a share.
Sales at department stores have come under heavy pressure as more consumers shop at home online, at off-price brick and mortar retailers or are spending less overall on their clothing, which represents a large part of the business at Nordstrom.
Nordstrom has done well compared to other department stores, though its discount store, known as Nordstrom Rack, has been doing much better than its regular department stores.
Net sales were up 2% ending the quarter at $3.54 billion, while total revenue just eclipsed $3.62 billion.
However, sales at same stores were down 0.9% for the quarter, while analysts were expecting the department store to drop only 0.3%.
Same store sales are a key indicator in retail because it takes out effects of newly opened as well as recently closed stores, and during the second quarter increased by 1.7%.
The drop during the third quarter upset investors who hoped that Nordstrom was beating back the mall malaise.
The negative move in sales at same stores showed that the gain from the previous quarter might have been just fleeting and not a start to a sustained turnaround.
Nordstrom Rack results were more encouraging as sales at same stores improvement by 0.8%.
However, the company did say it is expecting earnings for the full-year of between $2.85 and $2.95 a share, down from its forecast previously of between $2.85 and $3.00.
The results from Nordstrom are the most recent blow for the department store industry, while making it more difficult for the chain to secure financing in its hope for a buyout to go private.