Nordstrom shares fell nearly 26% in premarket trading

Nordstrom shares fell nearly 26% in premarket trading.Nordstrom on Tuesday reported earnings that fell short of analysts’ expectations as labor costs ate into profits and sales and its Nordstrom Rack business struggled to return to pre-pandemic levels.

Nordstrom said it earned $64 million, or 39 cents a share, in the third quarter, compared with $53 million, or 34 cents a share, in the year-ago period, which included a tax benefit of $19 million related to the CARES Act.

Sales rose 18% to $3.6 billion, but fell 1% in relation to the same quarter in 2019, the company said.

Third-quarter sales included about one week of the retailer’s anniversary sale, which lifted quarterly sales results by about 200 basis points, Nordstrom said.

FactSet consensus called for per-share earnings of 57 cents on sales of $3.5 billion for the quarter.