Nordstrom, Inc. has recently released its 10-Q report, providing a detailed insight into the company's financial health and operations. Nordstrom, Inc. is a fashion retailer offering a wide range of products including apparel, shoes, beauty, accessories, and home goods for various demographics. The company operates through multiple channels, including Nordstrom branded stores, online platforms, and clearance stores. Nordstrom, Inc. was founded in 1901 and is headquartered in Seattle, Washington.
In the 10-Q report, Nordstrom discusses critical accounting estimates, highlighting the importance of making estimates, judgments, and assumptions that affect the reported financial figures. The company emphasizes that actual results may differ from these estimates. Nordstrom identifies merchandise inventories as a critical accounting policy, stating that they are valued at the lower of cost or net realizable value using the weighted average cost method. The company also records reserves for excess and obsolete inventory based on specific identification of units with a current retail value below cost, along with an estimate of future markdowns.
Furthermore, the report addresses recent accounting pronouncements, specifically mentioning the SEC's adoption of the final rule under SEC Release No. 33-11275, which pertains to the enhancement and standardization of climate-related disclosures for investors. The rule requires new disclosures regarding a registrant’s climate-related risks that have materially impacted, or are reasonably likely to have a material impact on its business strategy, results of operations, or financial condition. Nordstrom notes that certain disclosures related to severe weather events and other natural conditions will also be required in audited financial statements. The company highlights that while the SEC voluntarily stayed the final rules in April 2024 due to pending legal challenges, the annual disclosure requirements will be effective for Nordstrom in the fourth quarter of 2025, pending resolution of the stay. Nordstrom is in the process of evaluating the impact of this final rule on its disclosures. Today the company's shares have moved 1.3% to a price of $21.5. Check out the company's full 10-Q submission here.
