Executive Summary For Nordstrom

Nordstrom operates 356 stores, including 121 full-line stores in the United States, Canada and Puerto Rico and 221 Nordstrom Rack stores. In 2017, the total company net sales increased 3.5 percent and comparable sales increased 1.7 percent, compared with the same quarter last year. Nordstrom continued its progress in executing its customer strategy while maintaining discipline around inventory and expenses. As a result of the Company's ongoing efforts to provide newness and limited-distribution product to customers, Nordstrom proprietary labels represented three of the top five selling brands during the Anniversary Sale.
In executing its digital strategy, the Company delivered online sales growth of 20 percent at Nordstrom.com, reflecting

o Retail EBIT decreased $27 million compared with the same quarter last year, primarily reflecting planned technology, occupancy and supply chain expenses supporting the Company's growth initiatives. o Credit EBIT increased $23 million through the strategic partnership with TD Bank. Credit card revenues increased 30 percent, which included a reduction in amortization expenses of $5 million related to the sale of the credit card portfolio in October 2015.
• Total Company net sales of $3.7 billion for the second quarter increased 3.5 percent compared with net sales of $3.6 billion during the same period in fiscal 2016. Total Company comparable sales for the second quarter increased 1.7 percent compared with the same quarter last

and Canada full-line stores and Nordstrom.com, net sales when combined with Trunk Club, increased 2.4 percent and comparable sales increased 1.4 percent. The top-performing merchandise categories were Women's Apparel and Beauty. The East was the top-ranking U.S. geographic region. o In the Nordstrom Rack brand, which consists of Nordstrom Rack stores and Nordstromrack.com/HauteLook, net sales increased 9.8 percent and comparable sales increased 3.1 percent. The East was the top-ranking geographic region.
• Retail gross profit, as a percentage of net sales, of 34.1 percent decreased 25 basis points compared with the same period in fiscal 2016. This primarily reflected higher occupancy expenses related to new store growth for Nordstrom Rack and Canada in addition to higher loyalty expenses during the Anniversary Sale. This was partially offset by improved merchandise margins, reflecting the continued strength in regular price selling. Net sales growth of 3.5 percent exceeded inventory growth of 2.2 percent.
• Selling, general and administrative expenses, as a percentage of net sales, of 30.3 percent increased 46 basis points compared with the same period in fiscal 2016, reflected planned technology and supply chain expenses associated with the Company's growth