08:15 AM EST, 03/06/2024 (MT Newswires) -- Nordstrom (JWN) shares fell in premarket Wednesday activity as the retailer said consumers were still cautious about making some purchases and warned that revenue could decline this year even after topping analysts' expectations in the fourth quarter amid gains for its Rack off-price chain.

Revenue is seen in a range of a 2% drop to a 1% increase this year, Chief Financial Officer Cathy Smith said on an earnings call with analysts late Tuesday, according to a Capital IQ transcript. In fiscal 2023, total revenue that includes retail sales and credit cards fell 5% to $14.69 billion.

Comparable store sales in the current year are seen down 1% to up 2% and earnings per share are pegged between $1.65 and $2.05. Analysts polled by Capital IQ are looking for same-store sales grown of 0.8% and normalized EPS of $1.85.

"We continue to see a cautious consumer that is mindful of discretionary purchases in light of inflation, higher interest rates and the resumption of student loan payments," Smith said.

Nordstrom's shares were down 9.7% before the opening bell.

Nordstrom reported fiscal fourth quarter EPS of $0.96, up from $0.74 a year earlier and ahead of the Capital IQ consensus of $0.89. Revenue rose 2% to $4.42 billion as the retailer benefited from an extra week in the fiscal year.

Sales in its Rack business were up almost 15% in the three months through Feb. 3, and Nordstrom plans to open 22 more locations as part of its push to drive growth and profitability, Chief Executive Erik Nordstrom told analysts.

"Rack stores continue to be a growth engine for our company as they are our largest source of new customer acquisition, accounting for over 40%," he said on the call. Nordstrom opened 19 Rack sites in fiscal 2023.

The company is also pushing growth in its Nordstrom banner segment, where sales fell 3% in the fourth quarter. "We will focus our Nordstrom banner efforts on digital-led growth supported by our stores," the CEO said. Digital was down 1.7% in the just-ended period, although Smith said there was a quarter-on-quarter sales improvement in the segment.

Price: 18.88, Change: -2.02, Percent Change: -9.68