Publication date: 16-11-2025
Nordstrom is a U.S. fashion retailer founded in 1901 as a shoe store and still partly owned and controlled by the Nordstrom family, who retain 50 % ownership after the 2025 take-private deal.
Nordstrom’s model combines two different store concepts. Full-price Nordstrom stores focus on premium brands, curated fashion, and customer service for higher-income shoppers. Nordstrom Rack stores are off-price outlets selling discounted branded fashion and shoes, aimed at value-driven customers. Rack accounts for about 35 % of total sales and is growing faster, helped by consumers looking for lower prices. This dual format allows Nordstrom to serve very different shopping budgets under the same brand.
Out of 386 total Nordstrom's stores, 297 sites are leased, and 89 locations are owned, including stores built on leased land.
Nordstrom sells a wide mix of products. Women’s apparel makes up 29 % of sales, shoes 26 %, men’s apparel 15 %, beauty 12 %, accessories 11 %, kids 4 %, and other products 3 %. In 2024, comparable sales grew 3,6 % overall, driven by growth at Nordstrom Rack and stable performance at full-price stores thanks to loyal customer base.
Image: Inside Nordstrom Rack store
The company is now private. In 2025 the Nordstrom family and a large Mexican retailer, El Puerto de Liverpool, completed a joint acquisition. Ownership is split about 50 / 50, and Liverpool is rated BBB with low leverage (around 1,6× net debt / EBITDA). Liverpool has invested long-term capital, not private-equity debt, and Nordstrom already contributes positively to Liverpool’s earnings.
Following the transaction, Nordstrom’s existing bonds, including this one, became secured. The notes have a first-priority claim on most assets except those pledged to a new USD 1,2 bn revolving credit facility (ABL) backed by inventory and receivables. This gives bondholders stronger legal protection than before.
Nordstrom’s financial leverage is moderate. Debt / EBITDA was 3,1× at the end of 2024 and is expected to be around 3,6× just after the deal closed, gradually moving toward 3,4× in 2025 as the company uses its free cash flow to repay debt.
Free cash flow is expected to remain positive, roughly USD 300–600 m per year after capital expenditure and dividends. Nordstrom plans to use most of this cash to repay ABL borrowings and upcoming bond maturities in 2027 and 2028.
Nordstrom continues to invest in online services and supply chain upgrades. The Rack format is expanding by around 20 new stores per year, while full-price stores focus on brand curation and customer service.
The business still faces long-term challenges. Department stores have to respond to lower mall traffic, more online shopping, stronger off-price competition, and changing fashion habits. However, Nordstrom traffic has recently held up better than many peers, and Nordstrom Rack has delivered positive sales growth.
The 6,95 % USD-denominated notes mature in March 2028. The bond is non-callable. The notes are rated Ba2 by Moody’s and BB+ by both S&P and Fitch, which is one notch above Nordstrom’s issuer rating because the bonds are secured by a first-priority claim on most assets.
as of 01.02.2025 USD bn
| Column 1 | Column 2 | Column 3 | Column 4 | Column 5 | Column 6 |
|---|---|---|---|---|---|
| Assets | 9 | EBITDA Margin | 9 % | CFO/Debt | 0,3 |
| Revenue | 15 | Net debt | 3,2 | FCF | 0,8 |
| EBITDA | 1,1 | Rent adjusted Net Debt/EBITDAR | 2,2x | Equity | 1,1 |
| Net Profit | 0,3 | EBIT/Interest | 6x | Debt/Equity | 3,8x |
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