Nordstrom
Annual Report 2024

Table of Contents            

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended February 1, 2025

or

For the transition period from ___________ to___________

Commission file number 001-15059

Nordstrom, Inc.

(Exact name of registrant as specified in its charter)

Washington
State or other jurisdiction of incorporation or organization

91-0515058
(I.R.S. Employer Identification No.)

1617 Sixth Avenue, Seattle, Washington 98101

(Address of principal executive offices)

Registrant’s telephone number, including area code (206) 628-2111

Securities registered pursuant to Section 12(b) of the Act: 

Title of each class
Common stock, without par value
Common stock purchase rights

Trading Symbol
JWN

Name of each exchange on which registered
New York Stock Exchange
New York Stock Exchange

Securities registered pursuant to section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to
Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and
“emerging growth company” in Rule 12b-2 of the Exchange Act.

☑ Large accelerated filer
☐ Non-accelerated filer

☐ Accelerated filer
☐ Smaller reporting company
☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public
accounting firm that prepared or issued its audit report. ☑

Nordstrom, Inc. and subsidiaries 1

 
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If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑

As of August 2, 2024, the aggregate market value of the Registrant’s voting and non-voting stock held by non-affiliates of the Registrant was
approximately $2.7 billion using the closing sales price on that day of $21.13. On March 14, 2025, 166,898,470 shares of common stock
were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

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TABLE OF CONTENTS

Forward-Looking Statements
Definitions of Commonly Used Terms

PART I

Business.

Item 1.
Item 1A. Risk Factors.
Item 1B. Unresolved Staff Comments.
Item 1C. Cybersecurity.
Item 2.
Item 3.
Item 4. Mine Safety Disclosures.

Properties.
Legal Proceedings.

PART II

[Reserved]

Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities.
Item 6.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Financial Statements and Supplementary Data.
Item 8.
Item 9.
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
Item 9A. Controls and Procedures.
Item 9B. Other Information.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

PART III

Item 10. Directors, Executive Officers and Corporate Governance.
Item 11. Executive Compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Item 14. Principal Accountant Fees and Services.

PART IV

Item 15. Exhibit and Financial Statement Schedules.

Exhibit Index
Signatures
Consent of Independent Registered Public Accounting Firm

Page
4
7

8
12
21
22
23
25
25

26
28
28
42
43
73
73
75
75

75
79
105
108
109

110

111
114
115

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FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements are statements regarding matters that are not historical facts and are based on our management’s beliefs
and assumptions and on information currently available to our management. A forward-looking statement is neither a prediction nor a
guarantee of future events or circumstances, and those future events or circumstances may not occur. In some cases, forward-looking
statements can be identified by terms such as “may,” “will,” “should,” “could,” “goal,” “would,” “expect,” “plan,” “anticipate,” “believe,”
“estimate,” “project,” “predict,” “potential,” “pursue,” “going forward” and similar expressions intended to identify forward-looking statements.
These statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance, time
frames or achievements to be materially different from any future results, performance, time frames or achievements expressed or implied by
the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, trends in our operations and the
following:

Strategic and Operational

• successful execution of our customer strategy to provide customers superior service, products and experiences, online, through our

fulfillment capabilities and in stores,

• timely and effective implementation and execution of our evolving business model, including:

◦ winning at our market strategy by providing a differentiated and seamless experience, which consists of the integration of our digital

and physical assets, development of supply chain capabilities and timely delivery of products,

◦ broadening the reach of Nordstrom Rack, including delivering great brands at great prices and leveraging our digital and physical

assets,

◦ enhancing our platforms and processes to deliver core capabilities to drive customer, employee and partner experiences both

digitally and in stores,

• our ability to effectively manage our merchandise strategy, including our ability to offer compelling assortments and optimize our

inventory to ensure we have the right product mix and quantity in each of our channels and locations, allowing us to get closer to our
customers,

• our ability to effectively allocate and scale our marketing strategies and resources, as well as realize the expected benefits of Nordstrom

Media Network, The Nordy Club, advertising and promotional campaigns,

• our ability to respond to the evolving retail environment, including new fashion trends, environmental considerations and our customers’
changing expectations of service and experience in stores and online, and our development and outcome of new market strategies and
customer offerings,

• our ability to mitigate the effects of any disruptions in the global supply chain, including factory closures, transportation challenges or

stoppages of certain imports, and rising prices of raw materials and freight expenses,

• our ability to control costs through effective inventory management and supply chain processes and systems,

• the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement or the failure

to satisfy the conditions to the completion of the Merger, including the failure to obtain the Requisite Shareholder Approvals or the
occurrence of a Below Investment Grade Rating Event (as defined in the Merger Agreement),

• the potential impacts of the Merger Agreement and the pendency of the Merger on our business, results of operations, financial condition
and stock price, including the potential impact on our relationships with customers, vendors, suppliers, landlords, service providers, other
business partners, and the diversion of management’s attention from ongoing business operations,

• while the Merger Agreement is in effect, we are subject to restrictions on our business activities,

• litigation related to the Merger could prevent or delay completion of the Merger or otherwise negatively affect our business and

operations,

• the Merger may not be completed in the time frame expected by the parties or at all, and significant delay or the failure to complete the

Merger could adversely affect our business,

• the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events, and may result in

unanticipated difficulties or expenditures relating to the proposed transaction,

• the Merger might not be completed if the Parent Parties fail to obtain the financing to complete the proposed transaction or if we do not

have a sufficient amount of cash on hand to complete the proposed transaction,

• the Merger may adversely affect our ability to retain or recruit key employees,

• the Merger may adversely affect our ability to compete effectively in our industry and markets, and investor and consumer confidence in

our business could decline,

• our ability to acquire, develop and retain qualified and diverse talent by providing appropriate training, compelling work environments and
competitive compensation and benefits, especially in areas with increased market compensation, all in the context of any labor shortage
and competition for talent,

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• our ability to realize expected benefits, anticipate and respond to potential risks and appropriately manage costs associated with our

credit card revenue sharing program and to manage risks associated with our transition of the servicing functions under that program,

• potential goodwill impairment charges, future impairment charges and fluctuations in the fair values of reporting units or of assets in the

event projected financial results are not achieved within expected time frames or if our strategic direction changes,

Data, Cybersecurity and Information Technology

• successful execution of our information technology strategy, including engagement with third-party service providers,

• the impact of any system or network failures, cybersecurity and/or security breaches, including any security breach of our systems or

those of a third-party provider that results in the theft, transfer or unauthorized disclosure of customer, employee or Company
information, or that results in the interruption of business processes or causes financial loss, and our compliance with information
security and privacy laws and regulations, as well as third-party contractual obligations in the event of such an incident,

Reputation and Relationships

• our ability to maintain our reputation and relationships with our customers, employees, vendors, landlords and third-party partners,

• our ability to act responsibly and with transparency with respect to our environmental, social and governance practices and initiatives,

meet any communicated targets, goals or milestones and adapt to evolving reporting requirements and stakeholder sentiment,

• our ability to market our brand and distribute our products through a variety of third-party publisher or platform channels, as well as

access mobile operating system and website identifiers for personalized delivery of targeted advertising,

• the impact of a concentration of stock ownership on our shareholders’ ability to influence corporate matters,

Investment and Capital

• efficient and proper allocation of our capital resources,

• our ability to properly balance our investments in technology, Supply Chain Network facilities and existing and new store locations,

including the expansion of our market strategy,

• our ability to maintain or expand our presence, including timely completion of construction associated with Supply Chain Network

facilities and new, relocated and remodeled stores, as well as any potential store closures, all of which may be impacted by third parties,
consumer demand and other natural or man-made disruptions, and government responses to any such disruptions,

• market fluctuations, increases in operating costs, exit costs and overall liabilities and losses associated with owning and leasing real

estate,

• compliance with debt and operating covenants, availability and cost of credit, changes in our credit ratings and changes in interest rates,

• the actual timing, price, manner and amounts of future share repurchases, dividend payments or share issuances, if any, subject to the

discretion of our Board of Directors, contractual commitments, market and economic conditions and applicable SEC rules,

Economic and External

• the length and severity of epidemics or pandemics, or other catastrophic events, and the related impact on customer behavior, store and
online operations and supply chain functions, as well as our future consolidated financial position, results of operations and cash flows,

• the impact of the seasonal nature of our business and cyclical customer spending,

• the impact of economic and market conditions, including inflation and measures to control inflation, and resulting changes to customer

purchasing behavior, unemployment and bankruptcy rates, and the resulting impact on consumer spending and credit patterns,

• the impact of economic, environmental or political conditions,

• the impact of changing consumer traffic patterns at shopping centers and malls,

• financial insecurity or potential insolvency experienced by our vendors, suppliers, developers, landlords, competitors or customers,

• weather conditions, natural disasters, climate change, national security concerns, global conflicts, civil unrest, other market and supply

chain disruptions, the effects of tariffs, or the prospects of such events, and the resulting impact any of these events may have on
business operations, consumer spending patterns or information technology systems and communications,

Legal and Regulatory

• our, and the third parties’ we do business with, compliance with applicable domestic and international laws, regulations and ethical

standards, minimum wage, employment and tax, information security and privacy, consumer credit and environmental regulations and
the outcome of any claims, litigation and regulatory investigations and resolution of such matters,

• the impact of changes in policy or laws relating to consumer credit, the current regulatory environment, the financial system and tax

reforms,

• the impact of accounting rule and regulation changes, or our interpretation of those changes, or changes in underlying assumptions,

estimates or judgments.

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These and other factors, including those factors we discuss in Part I, Item 1A. Risk Factors, could affect our financial results and cause our
actual results to differ materially from any forward-looking information we may provide. Given these risks, uncertainties and other factors,
undue reliance should not be placed on these forward-looking statements. Also, these forward-looking statements represent our estimates
and assumptions only as of the date of this filing, and these estimates and assumptions may prove to be incorrect. This Annual Report on
Form 10-K should be read completely and with the understanding that our actual future results may be materially different from what we
expect. We hereby qualify our forward-looking statements by these cautionary statements. Except as required by law, we assume no
obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those
anticipated in these forward-looking statements, even if new information becomes available in the future.

All references to “we,” “us,” “our,” or the “Company” mean Nordstrom, Inc. and its subsidiaries. On March 2, 2023, Nordstrom Canada
commenced a wind-down of its business operations (see Note 2: Canada Wind-down in Item 8) and as of this date, Nordstrom Canada was
deconsolidated from Nordstrom, Inc.’s financial statements. Nordstrom Canada results prior to March 2, 2023 are included in the Company’s
Consolidated Financial Statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are
based upon information available to us as of the filing date of this Annual Report on Form 10-K, and while we believe such information forms
a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate
that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently
uncertain and investors are cautioned not to unduly rely upon these statements.

The content of any websites and materials named, hyperlinked or otherwise referenced in this Annual Report on Form 10-K are not
incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references
to such websites and materials are intended to be inactive textual references only. The information on these websites is not part of this
Annual Report on Form 10-K.

6

DEFINITIONS OF COMMONLY USED TERMS
Term
2024 Annual Report Annual Report on Form 10-K filed on March 21, 2025
Adjusted EPS

Definition

Table of Contents

Adjusted ROIC

AFC

ASU
CCAA
CEO
CGNC

CPCC

CTIO
Digital sales

EBIT
EBIT margin

EBITDA

EBITDAR

EIP
EMBP
EPS
ESPP
Exchange Act
Family Group

FASB
Fiscal year 2025
Fiscal year 2024
Fiscal year 2023
Fiscal year 2022
GAAP
GMV
Gross profit

HSR Act

IRC
Leverage Ratio

Adjusted earnings (loss) per diluted share (a non-
GAAP financial measure)
Adjusted return on invested capital (a non-GAAP
financial measure)
Audit and Finance Committee of the Board of
Directors
Accounting Standards Update
Companies’ Creditors Arrangement Act
Chief Executive Officer
Corporate Governance and Nominating Committee of
the Board of Directors
Compensation, People and Culture Committee of the
Board of Directors
Chief Technology and Information Officer
Sales conducted through a digital platform such as
our websites or mobile apps. Digital sales may be
self-guided by the customer, as in a traditional online
order, or facilitated by a salesperson using a virtual
styling or selling tool. Digital sales may be delivered
to the customer or picked up in our Nordstrom stores,
Nordstrom Rack stores or Nordstrom Local service
hubs. Digital sales also includes a reserve for
estimated returns.
Earnings (loss) before interest and income taxes
Earnings (loss) before interest and income taxes as a
percent of net sales
Earnings (loss) before interest, income taxes,
depreciation and amortization
Earnings (loss) before interest, income taxes,
depreciation, amortization and rent, as defined by our
Revolver covenant
2019 Equity Incentive Plan
Executive Management Bonus Plan
Earnings (loss) per share
Employee Stock Purchase Plan
Securities Exchange Act of 1934, as amended
Certain members of the Nordstrom family
including Erik Nordstrom, Peter Nordstrom, James
Nordstrom and other members of the Nordstrom
family, and related trusts and investment vehicles
Financial Accounting Standards Board
52 fiscal weeks ending January 31, 2026
52 fiscal weeks ending February 1, 2025
53 fiscal weeks ending February 3, 2024
52 fiscal weeks ending January 28, 2023
U.S. generally accepted accounting principles
Gross merchandise value
Net sales less cost of sales and related buying and
occupancy costs
Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended
Internal Revenue Code
The sum of our funded debt and operating lease
liabilities divided by the preceding twelve months of
Adjusted EBITDAR as defined by our Revolver
covenant

Term
Liverpool
LTI
Merger

Definition
El Puerto de Liverpool, S.A.B. de C.V.
Long-Term Incentives
The Company merging with and into Navy Acquisition
Co., Inc., with the Company continuing as the
surviving corporation in the merger and becoming a
wholly owned subsidiary of Norse Holdings, Inc.

Merger Agreement The Agreement and Plan of Merger the Company

MD&A

NAV
NDCP
NEO
NMN

Nordstrom

entered into with Norse Holdings, Inc. and Navy
Acquisition Co., Inc. on December 22, 2024
Management’s Discussion and Analysis of Financial
Condition and Results of Operations
Net asset value
Nordstrom Deferred Compensation Plan
Named Executive Officer
Nordstrom Media Network, where we use our first-
party data and marketing infrastructure to drive
cooperative marketing with vendors across both
offsite and onsite marketing platforms
Nordstrom.com, Nordstrom U.S. stores and
Nordstrom Local. Nordstrom also included Canada
operations prior to March 2, 2023, inclusive of
Nordstrom.ca, Nordstrom Canadian stores and
Nordstrom Rack Canadian stores, and ASOS |
Nordstrom prior to December 2023.

Nordstrom Rack

Nordstrom Local

Nordstrom Canada Nordstrom Canada Retail, Inc., Nordstrom Canada
Holdings, LLC and Nordstrom Canada Holdings II,
LLC
Nordstrom Local service hubs, which offer order
pickups, returns, alterations and other services
NordstromRack.com, Nordstrom Rack U.S. stores
and Last Chance clearance stores
Our customer loyalty program
New York Stock Exchange
Fixed rent expense, including fixed common area
maintenance expense, net of developer
reimbursement amortization
The Family Group and Liverpool
Public Company Accounting Oversight Board (United
States)

The Nordy Club
NYSE
Operating Lease
Cost

Parent Parties
PCAOB

Property incentives Developer and vendor reimbursements
PSU
Revolver
Rights Plan

Performance share unit
Senior revolving credit facility
Our limited-duration Shareholder Rights Agreement
adopted by the Board of Directors
Operating lease right-of-use asset
Restricted stock unit
Securities and Exchange Commission
Unfunded defined benefit Supplemental Executive
Retirement Plan
Selling, general and administrative expenses
Fulfillment centers that primarily process and ship
orders to our customers, distribution centers that
primarily process and ship merchandise to our stores
and other facilities and omni-channel centers that
both fulfill customer orders and ship merchandise to
our stores
Toronto-Dominion Bank, N.A.

ROU asset
RSU
SEC
SERP

SG&A
Supply Chain
Network

TD

Nordstrom, Inc. and subsidiaries 7

 
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Item 1. Business.

DESCRIPTION OF BUSINESS

PART I

Overview
The Company was founded in 1901 as a retail shoe business in Seattle, Washington, under the guiding principle that success would come by
offering customers the very best service, selection, quality and value. We aspire to be the best fashion retailer in a digitally connected world
by leveraging the strength of the Nordstrom and Nordstrom Rack banners, our digital and physical properties and our interconnected
business model. We offer an extensive selection of high-quality third-party and private-brand merchandise for women, men, young adults and
children, with a focus on apparel, shoes, beauty, accessories and home goods. No matter how customers choose to shop, we are committed
to delivering superior service, products and experiences — including alterations, order pickup, dining and styling — to make shopping fun,
personalized and convenient. We have one reportable segment, which aggregates our two operating segments, Nordstrom and Nordstrom
Rack.

Nordstrom is a leading destination for a breadth of products across brands, styles and prices, complemented by unmatched services and
experiences. As of February 1, 2025, Nordstrom includes the following physical and digital properties:

• 92 Nordstrom stores

• Nordstrom.com website and mobile application

• six Nordstrom Locals

Beginning in April 2024, Nordstrom launched our digital Marketplace, an expansion of our online assortment using unowned inventory
models, which allows us to offer greater selection of products, brands and sizes. On March 2, 2023, Nordstrom Canada commenced a wind-
down of its business operations. See Note 2: Canada Wind-down in Item 8 for more information.

Nordstrom Rack is a premier off-price destination with an industry-leading digital presence, offering great brands at great prices. Nordstrom
Rack purchases merchandise from many of the same brands carried at Nordstrom and also serves as an outlet for clearance merchandise
from the Nordstrom banner. As of February 1, 2025, Nordstrom Rack includes the following physical and digital properties:

• 277 Nordstrom Rack stores

• NordstromRack.com website and mobile application

• two Last Chance clearance stores

We continue to expand Nordstrom Rack’s physical footprint — we opened 23 new Nordstrom Rack stores across the U.S. in 2024 and
expect to open a similar number of stores in 2025. Nordstrom Rack stores serve as our primary source of new customers, who often migrate
to the Nordstrom banner over time.

We believe one of our key advantages lies in our ability to leverage an integrated network of physical and digital assets across both
Nordstrom and Nordstrom Rack banners. This creates flexibility and convenience for our customers, no matter how they choose to shop —
online or in stores. In 2024, we launched store fulfillment of Rack digital orders and the ability to buy online and pick up in stores in over 100
Nordstrom Rack stores. We are well positioned to support our customers with a scalable platform that has been built to support continued
growth.

Our omni-channel platform positions us closer to the customer and allows us to drive customer engagement through better service and
greater access to product. In addition, our fleet of stores helps us engage with customers by offering unique events and services such as
personal styling, order pickup, returns and alterations at convenient locations. Our interconnected model is proving that it works — the
average customer who shops across both banners, in both stores and online, spends over twelve times more than a customer shopping a
single channel or banner.

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Proposed Merger
In April 2024, we announced that our Board of Directors had established a special committee of independent and disinterested directors (the
“Special Committee”) in response to interest expressed by Erik B. Nordstrom, our Chief Executive Officer, and Peter E. Nordstrom, our
President and Chief Brand Officer, in pursuing a potential transaction in which Nordstrom, Inc. would become a private company in
conjunction with the Board’s exploration of possible avenues to enhance shareholder value. On September 4, 2024, the Special Committee
confirmed receipt of a proposal from Erik and Peter Nordstrom, certain other members of the Nordstrom family and Liverpool to acquire all of
the outstanding shares of the Company, other than shares held by them. On December 22, 2024, the Company entered into an Agreement
and Plan of Merger (the “Merger Agreement”) with Norse Holdings, Inc., a Delaware corporation (“Parent”), and Navy Acquisition Co. Inc., a
Washington corporation and a direct, wholly-owned subsidiary of Parent (“Acquisition Sub”). The Merger Agreement provides that, on the
terms and subject to the conditions of the Merger Agreement, Acquisition Sub will merge with and into Nordstrom, Inc., with Nordstrom, Inc.
continuing as the surviving corporation and becoming a wholly-owned subsidiary of Parent. This transaction is expected to close in the first
half of 2025, subject to certain approvals and conditions, including, among others, approval of the Merger Agreement by our shareholders.
Under the terms of the Merger Agreement, upon the closing of the transaction, our shareholders will receive $24.25 in cash for each share of
common stock they hold on the transaction closing date, without interest and less any required tax withholdings. In addition, prior to and
contingent upon the closing, Nordstrom, Inc. may declare a special dividend of up to $0.25 per share (based on the amount of available cash
on hand of Nordstrom, Inc. and its subsidiaries). Upon completion of the Merger, our shares of common stock will be delisted on the NYSE,
and Nordstrom, Inc. will become a private company.

For a summary of the transaction, please refer to our Form 8-K filed with the SEC on December 23, 2024.

Products
In order to offer merchandise that our customers want, we purchase from a wide variety of high-quality domestic and foreign suppliers.
Additionally, we utilize unowned inventory models that go beyond traditional wholesale arrangements and provide a broader and deeper
assortment across our categories. We also have arrangements with agents and contract manufacturers to produce our private-brand
merchandise.

Nordstrom Rack invests in pack and hold inventory, which involves the strategic purchase of merchandise from some of our top brands in
advance of the upcoming selling seasons or to minimize inventory gaps from supply chain disruptions. This allows us to buy larger quantities
of relevant items when available, then hold a portion to deploy in periods with high demand, tight supply, new store openings or system
constraints. This inventory is typically held for six months on average.

Return Policy
We have a fair and reasonable approach to returns, handling them on a case-by-case basis with the ultimate objective of customer
satisfaction. Almost all merchandise can be returned by mail or at any store location. Our goal is to take care of our customers, which
includes making returns and exchanges easy, whether in stores or online. At our Nordstrom banner, where we offer free shipping on
purchases and returns, we have no formal policy on how long we accept returns for purchases made. Purchases made from Marketplace
have specific return windows designated by the vendors. We generally accept returns of apparel, footwear, accessories and home products
with the original price tag and sales receipt up to 30 days from the date of purchase at Nordstrom Rack stores and up to 40 days from the
date of order at NordstromRack.com.

Loyalty Program
The Nordy Club is our customer loyalty program that incorporates a traditional point and benefit system, while providing customers exclusive
access to products and events, enhanced services, personalized experiences and more convenient ways to shop. Customers accumulate
points based on their level of spending and type of participation. Upon reaching certain point thresholds, customers receive Nordstrom Notes,
which can be redeemed for goods or services across Nordstrom, including Marketplace, and Nordstrom Rack. The Nordy Club benefits vary
based on the level of customer spend, and include bonus points days and shopping and fashion events.

We offer customers access to a variety of payment products and services, including a selection of Nordstrom-branded Visa® credit cards, as
well as a Nordstrom-branded private-label credit card for Nordstrom purchases. When customers use a Nordstrom-branded credit or debit
card, they also participate in The Nordy Club and receive additional benefits, which can vary depending on the level of spend, including early
access to the Anniversary Sale, enhanced alterations and stylist benefits and incremental accumulation of points toward Nordstrom Notes.

Although the primary purpose of offering our credit cards is to foster greater customer loyalty and drive more sales, we also receive credit
card revenue through our program agreement with TD. Under that agreement, which was amended in October 2024 and now runs through
March 2032, TD is the exclusive issuer of Nordstrom-branded consumer credit cards. Credit card revenues, net include our portion of the
ongoing credit card revenue, net of credit losses, pursuant to our program agreement with TD.

Nordstrom, Inc. and subsidiaries 9

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Supply Chain Network
We are continually optimizing and enhancing our Supply Chain Network facilities and inventory management systems to support our omni-
channel capabilities and provide greater access to merchandise selection and faster delivery. As of February 1, 2025, our Supply Chain
Network consists of:

• two fulfillment centers that primarily process and ship orders to our customers

• six distribution centers that primarily process and ship merchandise to our stores and other facilities

• one omni-channel center that both fulfills customer orders and ships merchandise to our stores

In addition, our existing fleet of Nordstrom and Nordstrom Rack stores enables pickup and returns of online orders and facilitates a broader
assortment to our digital customers. We select locations and customize inventory allocations to enable merchandise to flow more efficiently
and quickly to our customers. Nordstrom online purchases are primarily shipped to our customers from our fulfillment centers but may also
be shipped from our Nordstrom stores, distribution centers or omni-channel center. Nordstrom in-store purchases are primarily fulfilled from
that store’s inventory, but when inventory is unavailable at that store, it may also be shipped to our customers from our fulfillment centers,
distribution centers, omni-channel center or from other Nordstrom stores. Nordstrom Rack online purchases are shipped to our customers
from our fulfillment centers, distribution centers or over 100 Nordstrom Rack stores. Both Nordstrom and Nordstrom Rack selectively use
vendor dropship to supplement online offerings, which are then shipped directly from the vendor to the end customer, or can be bought online
and picked up in store.

In the future, we plan to add Nordstrom Rack inventory and fulfillment to our first large-scale omni-channel center in Riverside, California,
which currently supports our Nordstrom customers in the West Coast region. Our smaller local omni-channel hub in Torrance, California
ceased operations in the third quarter of 2022 as we scaled our Riverside location to support demand in that region. In 2024, we relocated
our San Bernardino, California fulfillment center operations to our West Coast omni-channel center.

EMPLOYEES
We believe that creating a best-in-class customer experience begins with creating an environment that celebrates and supports all our
employees. As we strive to attract and retain the best talent in the industry, we are committed to cultivating a workplace culture where our
employees feel included, supported and confident bringing their full selves to work.

As of February 1, 2025, we employed approximately 55,000 employees. Approximately 80% of employees support our stores and
approximately 10% support our Supply Chain Network. Due to the seasonal nature of our business, the number of temporary employees may
vary, and peaks during our Anniversary Sale and holiday seasons. In connection with these peak shopping seasons, our employee count
may increase by over 5% to meet the needs of the business.

Inclusion and Belonging
We are committed to fostering a welcoming and inclusive environment for everyone, with an emphasis on creating fair and consistent
practices and policies that benefit our people, our customers and our brand partners. Our purpose is simple: to help customers feel good and
look their best. We have learned from generations of experience that building diverse teams representing all our customers is the most
effective way to fulfill this purpose and grow a successful business.

Our efforts to create a fair, consistent and inclusive workplace for everyone are supported by a dedicated team within human resources that
collaborates with business leaders to develop and implement strategies and practices that benefit all employees. In addition, this work is
supported by consistent reviews with Erik Nordstrom, our Chief Executive Officer, and Lisa Price, our Chief Human Resources Officer.
Progress toward our ambitions is tracked and reviewed regularly by our executive team and Board of Directors.

We have several internal initiatives designed to facilitate belonging and connection among our teams. One way we foster a culture of
inclusion is through our employee-led, company-sponsored Employee Resource Groups. In 2024, eight groups served our employees,
providing company-wide programming to advance understanding and celebrate voices from across our organization. All employees are
welcome to join any Employee Resource Group.

We strive to attract and retain the best talent in the industry, which is why we continue to partner with organizations that invest in improved
pathways for fashion, design and retail talent for everyone. Investments in 2024 include the Fashion Scholarship Fund, the National Retail
Federation Foundation’s Student Program and Harlem’s Fashion Row and their nonprofit ICON360’s annual HBCU Professor Retreat, which
facilitates discussions on talent pipelines, teaching methods and industry opportunities.

To learn more about our efforts and initiatives, please refer to our 2023 Impact Report and other information available on our website at
NordstromCares.com. The information contained or referred to on our website is not deemed to be incorporated by reference into this 2024
Annual Report unless otherwise expressly noted.

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Employee Safety and Well-being
The health and safety of our customers, employees and communities are a responsibility we take very seriously. We continue to offer a
variety of mental, emotional and physical wellness resources to support our employees, including mental health support and free counseling
services through our Employee Assistance Programs.

We seek to listen to and learn from employees across our organization through our open-door policy, conducting regular listening sessions
and utilizing our annual Voice of the Employee survey. We regularly review survey results against industry benchmarks to hold ourselves
accountable as we continue to improve and evolve our workplace environment.

We remain committed to creating a culture where employees feel they can bring their whole selves to work and achieve their career goals
through ongoing growth and development opportunities and fair and transparent performance management and promotion processes.

Total Rewards
To support our goals to retain and attract talented employees, we review our benefits and compensation approach annually.

•

•

Benefits: We offer a range of benefits to all employees upon meeting eligibility requirements, including health care, wellness
programs, financial and retirement plans and time away. In addition, we increased our focus on total well-being through a multi-year
strategy to bring our people new resources and tools, including mental health support.

Compensation: We are committed to providing our employees with a great place to grow meaningful careers. We regularly review
our pay in the markets in which we operate to ensure we are competitive, and we make updates accordingly throughout the year.

To ensure we offer a rewards package that aligns with the wants and needs of our employees, we routinely ask employees for their feedback
in surveys throughout the year. We use the feedback to improve the overall experience of our employees.

CORPORATE SOCIAL RESPONSIBILITY
We believe we have a responsibility to support the communities where we operate and to support the health, safety and human rights of
people in our supply chain.

Our Corporate Social Responsibility strategy focuses on environmental sustainability, product sustainability, human rights and corporate
philanthropy. In 2024, we made meaningful progress in these areas. Specific highlights include:

•

•

Environmental Sustainability: Through our beauty packaging takeback and recycling program, BEAUTYCYCLE, we aim to take
back 100 tons of beauty packaging waste by 2025. As of 2024, we have collected more than 90 tons of beauty packaging, nearing
our goal. We are working to reduce our emissions in line with our science-based targets.

Human Rights: We are committed to creating safe and fair workplaces for the people who make our products and we conduct due
diligence to help support human rights and responsible sourcing. Our Human Rights and Responsible Sourcing program is based on
international standards, upholding our Partner Code of Conduct and using third-party assessments to engage our suppliers on
relevant policies and programs. We strengthened our policies and programs during the year and assess them cyclically.

• Gender Equity: Promoting gender equity is part of our commitment to human rights, creating safe and fair workplaces for all workers
in factories where we produce. By the end of 2025, we expect 90% or more of our Nordstrom Made product volume to be produced
in facilities that invest in gender equity programs, and we are actively expanding production in factories that made this commitment.
We are more than halfway to that goal.

•

Charitable Giving: In our 14th year partnering with Shoes That Fit, we raised more than $1 million and donated more than 50,000
pairs of shoes to kids in our local communities. We launched our holiday giving campaign with our partners Big Brothers Big Sisters
and Operation Warm, raising funds with our customers to foster mentoring relationships and to donate coats to kids who need them
most. In total, our employees donated over $1.6 million to the causes they care about and volunteered over 34,000 hours.

To learn more about our corporate social responsibility efforts, see our 2023 Impact Report and other information available on
NordstromCares.com. The information contained or referred to on our website is not deemed to be incorporated by reference into this 2024
Annual Report unless otherwise expressly noted.

TRADEMARKS
Our most notable trademarks include Nordstrom, Nordstrom Rack, Zella, Z by Zella, BP., Open Edit, Chelsea28, Caslon, Halogen, Tucker +
Tate, Treasure & Bond, 14th & Union, Leith, Abound, Harper Canyon and Melrose and Market. Each of our trademarks is renewable
indefinitely, provided it is still used in commerce at the time of the renewal.

SEASONALITY
Our business, like that of other retailers, is subject to seasonal fluctuations and cyclical trends in consumer spending. Our sales are typically
higher in our second quarter, which usually includes most of our Anniversary Sale, and in the fourth quarter due to the holidays. One week of
our Anniversary Sale shifted to the second quarter in 2024 from the third quarter in 2023.

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Results for any one quarter are not indicative of the results that may be achieved for a full fiscal year. We plan our merchandise purchases
and receipts to coincide with expected sales trends. For instance, our merchandise purchases and receipts increase prior to the Anniversary
Sale and in the fall as we prepare for the holiday shopping season (typically from November through December). Consistent with our
seasonal fluctuations, our working capital requirements have historically increased during the months leading up to the Anniversary Sale and
the holidays as we purchase inventory in anticipation of increased sales.

COMPETITIVE CONDITIONS
We operate in a highly competitive business environment. We regularly compete with other international, national, regional and local
retailers, including internet-based businesses, omni-channel department stores, online marketplaces, brands selling direct to consumers
online and in-stores, specialty stores, off-price stores and boutiques, which carry similar lines of merchandise. Our specific competitors vary
from market to market. We believe the keys to competing in our industry are what will always matter most to our customers: providing
compelling product and outstanding service, both digitally and in stores, backed by people who care. This includes serving customers on
their terms by providing a seamless digital and physical experience, offering compelling, curated and quality products across a range of price
points, and strategically partnering with relevant and limited-distribution brands, all in top markets.

AVAILABLE INFORMATION
We file annual, quarterly and current reports, proxy statements and other documents with the SEC. The SEC maintains a website at SEC.gov
that contains reports, proxy and information statements, and other information regarding issuers that file with the SEC.

Our website addresses are Nordstrom.com and NordstromRack.com. Our annual and quarterly reports on Form 10-K and Form 10-Q,
current reports on Form 8-K, proxy statements, our executives’ statements of changes in beneficial ownership of securities on Form 4 and
amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available for free on or through
our website as soon as reasonably practicable after we electronically file the report with or furnish it to the SEC. Interested parties may also
access webcasts of quarterly earnings conference calls when held and other financial events through our website at investor.nordstrom.com.

We have a long-standing commitment to uphold a high level of ethical standards. In addition, we have adopted Codes of Business Conduct
and Ethics for our employees, officers and directors and Corporate Governance Guidelines, which comply with the listing standards of the
NYSE and SEC requirements. Our Codes of Business Conduct and Ethics, Corporate Governance Guidelines and Committee Charters for
the following Board of Director Committees are available through our website:

•

•

•

Audit and Finance

Compensation, People and Culture

Corporate Governance and Nominating

Any amendments to these documents, or waivers of the requirements they contain, will also be available on our website.

For printed versions of these items or any other inquiries, please contact:

Nordstrom Investor Relations
1617 Sixth Avenue
Seattle, Washington 98101
InvRelations@Nordstrom.com

Item 1A. Risk Factors.
Our business faces many risks. We believe the risks described below outline the items of most concern to us. In evaluating our Company,
you should carefully consider the following factors, in addition to the other information in this 2024 Annual Report. Before you buy our
common stock or invest in our debt, you should know that making such an investment involves risks including, but not limited to, the risks
described below. Any one of the following risks could harm our business, financial condition, results of operations or reputation, each of
which could cause our stock price to decline or a default on our debt payments, and you may lose all or a part of your investment. Additional
risks, trends and uncertainties not presently known to us or that we currently believe are immaterial may also harm our business, financial
condition, results of operations or reputation.

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STRATEGIC AND OPERATIONAL RISKS

If we are unable to successfully execute our customer strategy, grow our customer base or evolve our business model, it could
negatively impact our business and future profitability and growth.
We believe our omni-channel market strategy is a powerful enabler for the business which allows us to better serve customers and provide
greater access to product by leveraging all of our assets of people, product and place at the market level. As our business evolves, we must
continue to scale our market strategy and focus on better serving our customers through winning in our most important markets, broadening
the reach of Nordstrom Rack and increasing our digital velocity. Our market strategy focuses on our customers by seeking to provide a
differentiated and seamless experience in a digital world by bringing all of our assets together in each market to serve customers when,
where and how they want to shop. We aim to balance our assortment, increase the breadth of selection and continue to leverage our digital
and physical assets to increase selection and improve profitability in our Nordstrom Rack banner. We are working to expand our inventory
flexibility through unowned inventory models, including dropship, concession, marketplace and other strategies. Additionally, we are working
to scale our NMN, which allows our brand partners to directly connect with our customers through on- and off-site media campaigns to drive
traffic, sales and engagement.

Our customer focus requires us to build new supply chain capabilities and enhance existing ones, develop applications for electronic devices,
improve customer-facing technology, deliver purchased products timely, enhance inventory management systems and allow greater and
more fluid inventory availability between digital and retail locations through our market strategy. In addition, these strategies will require
further expansion of and reliance on data science and analytics. This business model has a highly variable cost structure and will continue to
require investments in cross-channel operations and supporting technologies. There are also inherent risks associated with the investment in
new technologies, such as generative artificial intelligence, and such operational and supporting technologies can be subject to failure,
disruption or unavailability and increased vulnerability to cyberattacks and other cyber incidents.

If we do not successfully implement our customer strategy, including thoroughly understanding and delivering on our customers’ needs and
wants, effectively integrating our digital operations and stores and scaling our market strategy, strengthening our brand awareness,
expanding our supply chain initiatives and efficiently getting product to our customers, we may fall short of our customers’ expectations,
which would impact our brand, reputation, profitability and growth. Also, if customers shift between shopping at our store and digital
channels, or between our Nordstrom and Nordstrom Rack banners, at a different pace than we anticipate, we may need to quickly modify
initiatives and investments. If we do not have or devote the resources necessary to execute upon these strategies, our business could be
negatively impacted.

Our business could suffer if we do not appropriately assess and react to competitive market forces and changes in customer
behavior.
The retail environment is rapidly evolving. Customer shopping preferences continue to shift, including increasing expectations for faster
delivery of product. In addition, the retail environment is under significant pressure from non-traditional retailers, including online
marketplaces and rental and recommerce companies. We regularly compete with other international, national, regional and local retailers,
including internet-based businesses, omni-channel department stores, online marketplaces, brands selling direct to consumers online and in-
stores, specialty stores, off-price stores and boutiques, which carry similar lines of merchandise. Digital channels continue to facilitate
comparison shopping, intensifying competition in the retail market, and marketing digitally is controlled by a few key platforms. If we fail to
adequately anticipate or respond to customer behavior and expectations, or changing market dynamics, we may lose market share or our
ability to remain competitive, causing our sales and profitability to suffer, and may potentially impact the valuation of our goodwill and result in
a non-cash impairment charge. If the efficiency and allocation of loyalty marketing, advertising and promotional campaigns that attract
customers through various programs and media, including digital media and print, is unsuccessful in influencing consumer behavior in our
digital channels and stores, or if our competitors are more effective with their programs than we are, our growth and profitability could suffer.
We also may not gather accurate and relevant data or effectively utilize that data, which may impact our strategic planning, marketing and
loyalty programs and our overall decision making.

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Our customer relationships and sales may be negatively impacted if we do not anticipate and respond to consumer preferences
and fashion trends or manage inventory levels appropriately.
Our ability to predict or respond to constantly changing fashion trends, demographics, consumer preferences and spending patterns
significantly impacts our sales and operating results. We must effectively manage our merchandise mix to curate an assortment that offers
newness and greater selection at various price points. Some merchandise may take several months from the time we place a purchase order
to the time it is received, and our ability to accelerate or modify that timeline or purchase order contents may be limited. If we do not identify
and respond to emerging trends in consumer spending and preferences quickly enough, identify the right partners that align with our
customer strategy, broaden or expand our category offering fast enough or in the right areas or develop, evolve and retain our team’s talent,
mindset and technical skills to support changing operating models, we may harm our ability to retain our existing customers or attract new
customers. We also store a certain level of pack-and-hold inventory to deploy in periods with high demand, tight supply or system
constraints. As a result, we are vulnerable to shifts in consumer demand and misjudgments in the assortment and timing of merchandise
purchases, which may impact our ability to sell through this inventory in future periods. Ensuring we optimize our inventory and improve the
planning and management of inventory through use of data and analytics is critical to serving the customer, driving growth and maximizing
profitability. If we purchase too much inventory, we may be forced to sell our merchandise at lower average margins by taking significant
markdowns, which could harm our business. Conversely, if we fail to purchase enough merchandise, or inventory does not arrive fast enough
or as expected, we may lose opportunities for additional sales and potentially harm relationships with our customers.

Any inability to mitigate global labor and merchandise pricing pressures or disruptions may negatively impact our profitability.
Our profitability depends in part on our ability to anticipate and react to operating volatility, including the cost and availability of labor and
merchandise. Increases in product and/or delivery costs, including changes in tariffs and the price of raw materials to us and our vendors that
are directly or indirectly related to the production and distribution of our products or increases in energy, labor or fuel and transportation
costs, may translate to higher sales prices, which may then impact customer demand. In the near term, we are focused on improving our
internal network and processes by diversifying our carrier capacity, gaining better end-to-end visibility of inventory and increasing velocity and
throughput in our Supply Chain Network. If we are unable to respond effectively to ongoing pricing pressures or labor shortages, or offset
such costs, there could be a material adverse impact on our business and financial results.

Our employees are key to supporting our business and operations effectively, and increased labor costs put pressure on our operating
expenses. When wage rates or benefit levels increase in particular markets, increasing our wages or benefits has negatively impacted and
may continue to negatively impact our earnings. Conversely, failing to offer competitive wages or benefits could adversely affect our ability to
attract or retain sufficient or quality employees, causing increased turnover and our customer service to suffer. Excessive turnover may result
in higher costs associated with finding, hiring and training new employees.

Any impediment to our inventory optimization may impact our ability to drive growth and meet customer demand, affecting future results and
profitability. Shortages in certain materials and increasing pricing pressures in the highly competitive retail environment have contributed, and
may in the future continue to contribute, to fluctuations in the quality, availability and price of our merchandise. The availability of raw
materials or inventory to the U.S. may hinder our ability to meet customer demand. Our vendors and other suppliers may experience similar
fluctuations or restrictions, which may subject us to the effects of their price increases. Additionally, if we do not gather complete, accurate
and timely competitive pricing data, or adequately utilize this data to implement an effective pricing strategy, our ability to successfully
compete could be negatively impacted, causing our sales, profitability and results of operations to suffer.

Improvements to our processes and systems for our Supply Chain Network, inventory, buying, vendor payment and accounting
could adversely affect our business if not successfully executed.
Our business depends on accuracy throughout our product flow process. We are making investments to streamline and standardize our
Supply Chain Network, inventory, buying, vendor payments and accounting capabilities through changes in technology, such as the utilization
of generative artificial intelligence-enabled methodologies and processes. If we encounter challenges associated with change management,
inventory integrity and implementation of associated information technology or adoption of new processes, features or capabilities, our ability
to continue to successfully execute or evolve our strategy with changes in the retail environment could be adversely affected. Or, if we are
unable to maintain accurate, reliable and effective inventory tracking systems, such as our use of radio frequency identification technology,
which are critical to our integrated omni-channel business strategy, it may adversely impact our sales and profitability and may result in
canceled orders and increased costs relative to our current expectations.

If we do not effectively attract, retain, train and develop talent and future leaders, our business may suffer.
We rely on the experience of our senior management, who have specific knowledge relating to us and our industry that is difficult to replace,
to execute our business strategies and objectives. We have succession plans in place and our Board of Directors reviews these succession
plans. If our succession plans do not adequately cover significant and unanticipated turnover, the loss of the services of any of these
individuals, or any resulting negative perceptions or reactions, could damage our reputation and our business.

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Additionally, our success depends on the talents and abilities of our workforce in all areas of our business, especially personnel that can
adapt to complexities and grow their skillsets across the changing environment. Our ability to successfully execute our customer strategy
depends on attracting, developing and retaining qualified talent with diverse sets of skills, especially functional and technology specialists
that directly support our strategies. We have a large workforce, and our ability to meet our labor needs is subject to various external factors
such as regional minimum wage and benefits requirements, market pressures, prevailing wage rates, benefit mix, unemployment levels,
changing demographics, economic conditions and a dynamic regulatory environment.

We have experienced, and may continue to experience, increased employee attrition due to an intense competition for talent, a competitive
wage environment and labor shortages. In the Seattle metropolitan area, where our corporate headquarters are located, we regularly
compete for talent with many larger technology-focused companies, which may increase market compensation, especially for certain
employee groups. If we are unable to sustain employee satisfaction or offer competitive compensation and benefits, appropriate training and
development or a compelling work environment, our culture may be adversely affected, our reputation may be damaged and we may incur
costs related to turnover.

If earnings from our Nordstrom-branded credit cards decline, our financial and operational results may be negatively impacted.
The program agreement with TD was originally consummated on terms that allow us to maintain customer-facing activities, while TD
facilitates issuance of Nordstrom-branded payment methods and provides payment processing services. In October 2024, we amended our
program agreement to transition customer-facing activities to TD. If we do not successfully respond to potential risks and appropriately
manage potential costs associated with the program agreement with TD, including risks relating to the transition of servicing functions to TD,
or if this transition negatively impacts the customer service associated with our cards, resulting in harm to our business reputation and
competitive position, our operations, cash flows and earnings could be adversely affected.

The Merger Agreement and the pendency of the Merger could have a material adverse effect on our business, results of
operations, financial condition and stock price.
On December 22, 2024, the Company entered into the Merger Agreement with Parent and Acquisition Sub. The Merger Agreement provides
that, on the terms and subject to the conditions of the Merger Agreement, Acquisition Sub will merge with and into the Company (the
“Merger”), with the Company continuing as the surviving corporation in the merger and becoming a wholly owned subsidiary of Parent. At the
effective time of the Merger closing, each outstanding share of Company common stock owned immediately prior to the effective time of the
Merger (other than shares owned by the Company, Parent, or their respective wholly owned subsidiaries, the shares to be contributed to
Parent by Liverpool and the Family Group, and shares held by shareholders who have complied with all the provisions of the Washington
Business Corporation Act concerning dissenters’ rights), will be canceled and converted into the right to receive $24.25 per share of our
Company’s common stock in cash, without interest and less any required tax withholdings. The Merger Agreement is subject to certain
conditions, including, among others, approval of the Merger Agreement by our shareholders.

During the period between the signing of the Merger Agreement and the closing of the Merger, our business is exposed to certain inherent
risks due to the announcement or pendency of the Merger which may impact our business relationships, financial condition and operating
results. Some of these risk factors include:

• difficulties maintaining relationships with customers, vendors, suppliers, landlords, service providers and other business partners, who

may defer decisions about working with us or seek to delay or change existing business relationships with us,

• distraction of our current employees as a result of the Merger, which could result in a decline in their productivity or cause distractions in

the workplace,

• our inability to attract new employees or retain current employees may be exacerbated due to the Merger and uncertainties related to the

Merger,

• diversion of significant management time and resources related to the Merger and transactions related to the Merger,

• impact of costs related to the completion of the Merger and the transactions related to the Merger,

• unanticipated difficulties or expenditures relating to the proposed transaction,

• our inability to solicit other acquisition proposals, pursue alternative business opportunities, make strategic changes to our business and

other restrictions on our ability to conduct our business pursuant to the Merger Agreement, and

• other developments beyond our control, including, but not limited to, changes in domestic or global economic conditions that may affect

the timing or success of the Merger.

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While the Merger Agreement is in effect, we are subject to restrictions on our business activities.
While the Merger Agreement is in effect, we are generally required to conduct our business in the ordinary course. However, we are
restricted from taking certain actions without Parent’s consent. These limitations include, among other things, restrictions on our ability to
amend our organizational documents, acquire other businesses and assets, dispose of our assets, make investments, repurchase, reclassify
or issue securities, make loans, incur indebtedness, make capital expenditures, enter into, amend or terminate certain contracts, change
accounting policies or procedures, initiate or settle certain litigation, change tax classifications and elections, or take certain actions relating
to intellectual property. These restrictions, although subject to certain limited exceptions, could prevent us from pursuing strategic business
opportunities and taking extraordinary actions with respect to our business during this period.

Litigation related to the Merger could prevent or delay completion of the Merger or otherwise negatively affect our business and
operations.
Putative shareholder complaints, including shareholder class action complaints, and other complaints or actions may be filed against us, our
Board of Directors, and others in connection with the transactions contemplated by the Merger Agreement. The outcome of litigation is
uncertain, and we may not be successful in defending against such future claims. Lawsuits may be filed against us, our Board of Directors,
the other parties to the Merger Agreement, or others, which could delay or prevent the Merger and otherwise adversely affect our business,
results of operations and financial condition.

The Merger may not be completed within the expected timeframe, or at all, and significant delay or the failure to complete the
Merger could adversely affect our business.
We cannot assure that our business, our relationships or our financial condition will not be adversely affected if the Merger is not
consummated within the expected timeframe, or at all. The consummation of the Merger is subject to certain conditions, including obtaining
the Requisite Shareholder Approvals and the absence of a Below Investment Grade Rating Event (as defined in the Merger Agreement). In
addition, each party is entitled to certain rights to terminate the Merger Agreement, including that we or Parent may terminate the Merger
Agreement if the Merger is not consummated on or before September 22, 2025 (which date may be automatically extended in certain
circumstances pursuant to the terms of the Merger Agreement).

While it is currently anticipated that the Merger will be consummated in the first half of 2025, we cannot assure you that these conditions will
be satisfied in a timely manner or at all, that an effect, event, development, or change will not transpire that could delay or prevent these
conditions from being satisfied, or that we or Parent will not terminate the Merger Agreement if entitled to do so. For instance, the Merger
might not be completed if the Parent Parties fail to obtain the financing to complete the proposed transaction or if we do not have a sufficient
amount of cash on hand to complete the proposed transaction.

Failure to complete the Merger within the expected timeframe, or at all, could adversely affect our business and the market price of our
common stock in several ways, including the following:

• to the extent that the current market price of our stock reflects an assumption that the Merger will be completed, it may be negatively

impacted because of a failure to complete the Merger within the expected timeframe or at all,

• investor and consumer confidence in our business could decline, litigation could be brought against us, relationships with vendors,

service providers, investors, landlords, and other business partners may be adversely impacted, and we may be unable to retain key
personnel,

• we have incurred, and will continue to incur, significant costs, expenses and fees for professional services and other costs in connection

with the Merger and the transactions contemplated by the Merger for which we may receive little or no benefit if the Merger is not
completed. Many of these fees and costs will be payable by us even if the Merger is not completed and may relate to activities that we
would not have undertaken other than to complete the Merger,

• failure to complete the Merger may result in negative publicity and a negative impression of us in the investment and vendor community,

and

• if the Merger Agreement is terminated in certain circumstances, we must pay a termination fee to the Parent Parties.

The occurrence of any of these events individually or in combination could materially and adversely affect our business, results of operations,
financial condition and the price of our common stock.

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DATA, CYBERSECURITY AND INFORMATION TECHNOLOGY RISKS

Even if we take appropriate measures to safeguard our information, network and environment from security breaches or
unauthorized disclosures, our customers, employees and business could still be exposed to risk.
We and our third-party providers access, collect, store and transmit sensitive and confidential Company, customer and employee data and
information, including consumer preferences and credit card information, all of which are subject to demanding and continuously evolving
privacy and security laws and regulations. A number of jurisdictions where we do business have enacted or are considering new privacy and
data protection laws, which impact our responsibilities with respect to this data, including California, Colorado, Connecticut, Utah and
Virginia. In addition, advances in artificial intelligence technologies, which attackers may use, increase vulnerability to cyberattacks, cyber
incidents or privacy incidents.

We have taken measures to help prevent a breach of our networks and environments and comply with cybersecurity and privacy
requirements by implementing safeguards and procedures designed to protect the security, confidentiality and integrity of such information. In
addition, we have strengthened our contracts to require, where possible, our third-party providers to implement administrative, physical and
technical safeguards and procedures aligned to industry best practices.

Despite the fact that we have implemented measures to prevent intentional or inadvertent information security breaches and requested our
third-party providers to do the same, these measures cannot completely eliminate cybersecurity risk. Like many companies, we, as well as
several of our vendors, have suffered breaches of our cybersecurity in the past and are at risk for such breaches in the future. Security
breaches and cyber incidents, whether at our Company, our third-party suppliers and service providers or other retailers, could expose us to
loss, unauthorized release or disclosure of customer, employee or Company confidential information, litigation, investigation, regulatory
enforcement action, penalties and fines, orders to stop any alleged noncompliant activity, information technology system failures or network
disruptions, increased cyber-protection and remediation costs, financial losses, potential liability, or loss of customers’, employees’ or third-
party providers’ trust and business, any of which could adversely impact our reputation, competitiveness and financial performance.
Concerns about our data management practices, including the collection, use, retention, security or disclosure of personal information or
other privacy-related matters, even if unfounded, could subject the Company to regulatory inquiries and damage our reputation, adversely
affecting our operating results.

Our business may be impacted by information technology system failures or network disruptions.
Our ability to transact with customers and operate our business depends on the efficient operation of various internal and third-party
information technology systems, including cloud computing, data centers, hardware, software and applications, to manage certain aspects of
our Company, including online and in store transactions, logistics and communication, inventory and reporting systems. We seek to build
resilient and secure systems, select reputable system vendors and implement procedures intended to enable us to protect our systems when
we modify them. We test our systems to address vulnerabilities and train our employees regarding practices to protect the safety of our
technology systems.

There are risks associated with developing, modifying or replacing information technology systems, including accurately capturing and
maintaining data, realizing the expected benefit of the change and managing the potential disruption of the operation of the systems as the
changes are implemented. Potential issues associated with implementing technology initiatives and the time and resources required to
optimize the benefits of new elements of our systems and infrastructure could reduce the efficiency of our operations in the short term.

If we encounter an interruption or deterioration in critical systems or processes or experience the loss of critical data, which may result from
security or cybersecurity threats or attacks, natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or
war, computer viruses, physical or electronic break-ins or third-party or other disruptions, our business could be harmed both in the short-
term and over a longer period. Depending on the severity of the failure, our disaster recovery plans may be inadequate or ineffective. These
events could also damage our reputation, result in increased costs or loss of sales and require significant time and expense to remedy.

REPUTATION AND RELATIONSHIP RISKS

Our customer, employee, vendor, third-party partner, landlord and other stakeholder relationships could be negatively affected if
we fail to maintain our corporate culture and reputation.
We have a well-recognized culture and reputation that consumers may associate with a high level of integrity, customer service and quality
merchandise, and it is one of the reasons customers shop with us and employees choose us as a place of employment. We must continue to
preserve our reputation, which is largely based on public perceptions. Any significant damage to our reputation, including damages arising
from noncompliant business, data privacy, information security, diversity, environmental or social responsibility practices, news about our
Company or factors outside our control or on social media, could diminish customer trust and result in changes in customer behavior, weaken
our vendor relationships, reduce employee morale and productivity and lead to difficulties in recruiting and retaining qualified employees.
Additionally, management may not accurately assess the impact of significant legislative changes, including those that relate to data privacy
and security, employment matters, labor issues, environmental compliance and health care, impacting our relationship with our customers or
our workforce and adversely affecting our sales and operations.

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There is also increased focus from both internal and external stakeholders on corporate social responsibility and sustainability matters. If we
do not, or are perceived not to, act responsibly with respect to our practices and initiatives, meet any communicated targets, goals or
milestones or lack transparency with our initiatives, our reputation could be damaged. We may also incur additional costs as we invest in new
ways to operate to better support our communities and our customers or to report our outcomes and results.

In addition, the long-term reputational impact from winding down business operations in Canada, including the impact to our customers,
employees, vendors and third-party partners and landlords, is unknown, and we may need to take actions that could increase our expenses
and adversely affect the results of our operations.

Any of these risks individually or in combination could materially and adversely affect our business, results of operations, financial condition
and the price of our Company common stock.

Our business depends on third parties for the production, supply and delivery of goods and/or services, and a disruption could
result in lost sales or increased costs.

Supply Chain
Timely receipt of quality merchandise from third parties is critical to our business, as the majority of the goods we sell are produced by
vendors in factories overseas. Our process to identify qualified vendors and access quality products in an efficient manner on acceptable
terms and cost can be complex. Vendors and factors may also be subject to credit capacity limits that restrict shipments. In addition, we rely
on a limited number of carriers to deliver our product to customers. Ongoing disruptions in the global supply chain, including factory closures,
transportation challenges, rising freight expenses, violations of law or global standards with respect to human rights, quality and safety by
any of our importers, manufacturers or distributors, or parties upstream within their respective supply chains, could result in delays in
shipments and receipt of goods. These third parties may experience supply chain or port disruptions, stoppages of certain imports or other
difficulties due to economic, business, political, environmental or epidemic conditions, or may shift their business models away from prior
practice. Additionally, the countries in which merchandise is manufactured could become subject to new trade restrictions, including
increased taxation on imported goods, customs restrictions, tariffs or quotas.

Any disruption, delay or change in our or our vendors’ supply chain, including increased transit times or costs, could negatively impact our
inventory levels, delivery timelines and our ability to meet customer demand, which in turn may have a material adverse effect on our
reputation, results of operations and liquidity. Our corporate social responsibility and sustainability goals, such as our goal to decrease
greenhouse gas emissions in our operations and supply chain, may also be adversely impacted by these disruptions.

Other
We are party to contracts, transactions and business relationships with various third parties, including vendors, suppliers, service providers,
landlords and lenders, who may have performance, payment and other obligations to us. If any of the third parties with whom we do business
change the terms and conditions that govern their relationships with us due to changes in their business strategy, or become subject to
bankruptcy, receivership or similar insolvency proceedings, our rights and benefits in relation to our contracts, transactions and business
relationships with such third parties could be terminated, modified in a manner adverse to us or otherwise impaired, and we may be unable to
arrange for alternate or replacement contracts, transactions or business relationships on terms as favorable as our existing contracts,
transactions or business relationships, if at all. In such circumstance, our cash flows, financial condition and results of operations may be
negatively impacted.

Our ability to effectively market our brands, sell product through third-party platforms and make our own apps available for
customers relies heavily on a variety of third-party publishers, platforms and distribution channels. If the regulatory environment
or these third parties limit or change the terms of marketing, distribution or use of data, it could adversely affect our results of
operations.
We market our brands, sell product through third-party platforms, and make our own apps available to customers through a variety of third-
party publisher and platform channels and our ability to market on any given platform or channel is subject to the policies of that party and
regulatory requirements. Our dependency on the interoperability of our products with popular mobile operating systems, such as Android or
iOS, websites, networks, technologies, products and standards that we do not control, coupled with their unilateral control of the terms of
service and ongoing regulatory scrutiny associated with targeted advertising, could reduce or eliminate our ability to update our apps or sell
product on these platforms. Any changes, bugs or technical issues in such systems or websites may limit our ability to effectively deliver our
products, or to target or measure the effectiveness of our ads. If we do not pick the platforms relevant to our customers, if the platforms give
preferential treatment to competitors, limit our ability to deliver, target or measure the effectiveness of ads, or if there is a sudden shift in
platform preference, our ability to market our brand effectively could be negatively impacted. Furthermore, to the extent platform users do not
opt-in to certain data collection and sharing practices, our ability to deliver, target or measure the effectiveness of ads or drive usage on our
apps is impacted.

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The concentration of stock ownership in a small number of our shareholders may limit a shareholder’s ability to influence
corporate matters and impact the price of our shares.
The Parent Parties hold aggregate beneficial ownership of approximately 43% of our common stock. As a result, these persons may be able
to exercise considerable influence over matters requiring shareholder approval, including the election of directors or other matters impacting
our management or corporate governance.

The corporate law of the State of Washington, where we are incorporated, provides that approval of a merger or similar significant corporate
transaction requires the affirmative vote of two-thirds of a company’s outstanding shares. The interests of the Parent Parties may differ from
the interest of our shareholders as a whole. The beneficial ownership of the Parent Parties may have the effect of discouraging offers to
acquire us (including competing offers to the Merger from third parties), delaying or otherwise preventing a significant corporate transaction
because the consummation of any such transaction would likely require their approval. As a result of these factors, the market price of our
common stock may be affected.

INVESTMENT AND CAPITAL RISKS

If we fail to appropriately manage our capital, we may negatively impact our operations and shareholder return.
We utilize working capital to finance our operations, pay for capital expenditures, acquisitions and investments, manage our debt levels and
return value to our shareholders through dividends and share repurchases. Sufficient cash and liquidity are necessary to fund our business.
Changes in the credit and capital markets, including market disruptions, limited liquidity and interest rate fluctuations, may increase the cost
of financing or restrict access to a potential source of liquidity. A deterioration in our capital structure or the quality and stability of our
earnings could result in noncompliance with our debt covenants or a downgrade of our credit rating, constraining the financing available to us
or limiting our ability to issue dividends or repurchase shares. In 2024, the three major rating agencies downgraded the Company’s credit
rating. Any future reductions in our credit ratings could result in restricted access to financing and increased borrowing costs and could
adversely impact our operations and financial condition. In addition, if we do not properly allocate our capital to maximize returns or we do
not maintain financial flexibility, our operations, cash flows and returns to shareholders could be adversely affected.

Owning and leasing real estate exposes us to possible liabilities and losses.
We own or lease the land, buildings and equipment for all of our Supply Chain Network facilities, stores and corporate locations and are
therefore subject to all of the risks associated with owning and leasing real estate. In particular, the value of the assets could decrease, their
operating costs could increase or facilities or stores may not be opened as planned due to changes in the real estate market, demographic
trends, site competition, dependence on third-party performance or overall economic environment. We are also potentially subject to liability
for environmental conditions, exit costs associated with disposal of a store and commitments to pay base rent for the entire lease term or to
operate a store for the duration of an operating covenant. In addition, the invalidity of, or default or termination under, any of our leases may
accelerate required cash payments or interfere with our ability to use and operate all or a portion of certain of our facilities, which may have
an adverse impact on our operations and results.

The investment in existing and new locations may not achieve our expected returns.
The locations of our Supply Chain Network facilities and existing stores, planned store openings and relocations are assessed based upon
desirability, demographics and retail environment. In particular, we have expanded our omni-channel market strategy, where we leverage and
connect our digital and physical assets within discrete geographic markets to seamlessly serve our customers within those markets and
create synergies between our digital assets, Supply Chain Network and stores. Our expansion of this market strategy has allowed us to
execute against one of our top priorities of improving Nordstrom Rack performance through the opening of new Nordstrom Rack stores. We
must equip our locations with the proper processes, technology and tools for timely and accurate fulfillment and inventory replenishment.
This involves certain risks, including properly balancing our capital investments between fulfillment capabilities, technology, digital channels,
new stores, relocations and remodels, assessing the suitability of locations in new domestic and international markets and constructing,
furnishing and supplying a facility or store in a timely and cost-effective manner, which may be affected by the actions of third parties,
including, but not limited to, private entities and local, state or federal regulatory agencies.

Customers’ expectations regarding speed of delivery are evolving. If we do not effectively integrate our digital and physical assets as part of
our market strategy, or select locations to optimize our market strategy, we could incur significantly higher costs and shipping times that do
not meet customer expectations, which in turn could have a material adverse effect on our business. Sales through our digital channels or at
our stores may not meet projections as we balance trends between digital and brick-and-mortar shopping channels, which could adversely
affect our return on investment. If we do not properly allocate capital expenditures between locations, ensure timely completion of
construction projects associated with Supply Chain Network facilities and new, relocated and remodeled stores or properly maintain any of
our properties, customer expectations may not be met, we may lose sales and may incur additional expenses.

Nordstrom, Inc. and subsidiaries 19

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ECONOMIC AND EXTERNAL MARKET RISKS

Our revenues and operating results are affected by the seasonal nature of our business and cyclical trends in consumer spending.
Our business, like that of other retailers, is subject to seasonal fluctuations and cyclical trends in consumer spending. Our sales are typically
higher in our second quarter, which usually includes most of our Anniversary Sale, and in the fourth quarter due to the holidays. One week of
our Anniversary Sale shifted to the second quarter in 2024 from the third quarter in 2023. Any factor that negatively impacts these selling
seasons could have an adverse and disproportionate effect on our results of operations for the entire year.

Additionally, factors such as changes in sales and operating income, changes in our market valuations, performance results for the general
retail industry, news or announcements by us or our industry competitors or changes in analysts’ recommendations may cause volatility in
the price of our common stock and our shareholder returns.

A downturn in economic conditions, currency fluctuations, inflation, unemployment and bankruptcy rates, changes in fiscal
stimulus or interest rates and other external market factors have had and could have a significant adverse effect on our business
and stock price.
During economic downturns or inflationary periods, fewer customers may shop, as these purchases may be seen as discretionary, and those
who do shop may limit the amount of their purchases. Any reduced demand or changes in customer purchasing behavior may lead to lower
sales, higher markdowns and an overly promotional environment or increased marketing and promotional spending.

Our stores located in shopping centers and malls have been and may be affected by consumer traffic at shopping centers and
malls.
The majority of our stores are located within shopping centers and malls and may benefit from the abilities that we and other anchor tenants
have to generate consumer traffic. A decline in shopping center traffic in favor of e-commerce, the development of new shopping centers and
malls, the lack of availability of favorable locations within existing or new shopping centers and malls, the success of individual shopping
centers and malls and the success or failure of other anchor tenants have impacted and may impact our ability in the future to maintain or
grow our business, as well as our ability to open new stores, which could have an adverse effect on our financial condition or results of
operations.

Like other retailers, our stores have been impacted by changing levels of theft or vandalism, which may affect consumer traffic in our stores
and cause inventory shrinkage. Risk of loss or theft of assets, including inventory shrinkage, is inherent in the retail business. Loss or theft
may be caused by error or misconduct of employees, customers, vendors or other third parties through organized retail crime and
professional theft. If we experience higher rates of inventory shrinkage at stores located in shopping centers and malls, or if we are unable to
effectively reduce the impact of loss or theft of assets, our operating results could be adversely affected. The severity or quantity of incidents,
including perceptions and reactions, may result in reputational damage or loss of customer trust.

The results from our credit card operations could be adversely affected by changes in market conditions or laws.
Revenues earned under our program agreement with TD are indirectly subject to economic and market conditions that are beyond our
control, including, but not limited to, interest rates, consumer credit availability, demand for credit, consumer debt levels, payment patterns,
delinquency rates, frequency of fee waivers, frequency or volume of governmental stimulus, personal bankruptcy rates, employment trends,
laws and other factors. Additionally, changes in net sales partially translate to program agreement revenues. Changes in economic, market or
regulatory conditions, customer behavior or our mix of sales and program agreement revenues could impact our revenues and profitability.

Our business and operations could be materially and adversely affected by severe weather patterns, climate change, natural
disasters, widespread pandemics, epidemics, civil unrest and other natural or man-made economic, political or environmental
disruptions.
Disruptions, and government responses, could cause, among other things, decreases in consumer spending that could negatively impact our
sales, declines in traffic in urban centers, staffing shortages in our Supply Chain Network facilities, stores or corporate offices, interruptions in
the flow of merchandise to our stores, disruptions in the operations of our merchandise vendors or property developers, increased costs and
a negative impact on our reputation and long-term growth plans, which could vary based on the length and severity of the disruption. Health
pandemics and epidemics, have in the past and may in the future, impact consumer and government responses, which may have an adverse
impact on global economic conditions and our business, results of operations and financial condition. We also have a significant amount of
our total sales, stores and square footage on the West Coast of the United States, particularly in California, where we have experienced
earthquakes, wildfires, flooding and power outages and shortages that increase our exposure to any market-disrupting conditions in this
region.

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LEGAL AND REGULATORY RISKS

We are subject to certain laws, litigation, regulatory matters and ethical standards, and compliance or failure to comply with or
adequately address developments as they arise could adversely affect our reputation and operations.
Our policies, procedures and practices and the technology we implement are intended to address applicable federal, state, local and foreign
laws, tariffs, rules and regulations, as well as responsible business, social and environmental practices, all of which may change from time to
time. If we, or the third parties we do business with, fail to comply with these requirements and/or changes to them, our business could be
adversely impacted. In addition, noncompliance with applicable laws and regulations or failure to implement responsible business, social,
environmental and supply chain practices could result in reputational damage, class action lawsuits, regulatory investigations, legal costs and
penalties, charges and payments, civil and criminal liability, increased cost of regulatory compliance, loss of our ability to offer or accept
credit and debit card payments from our customers, restatements of our financial statements, disruption of our business, loss of customers
and loss of customer trust. Changes to existing and new privacy and data protection laws may increase compliance expenses and limit
business opportunities and strategic initiatives, including customer engagement. Any required changes to our employment practices could
result in the loss of employees, reduced sales, increased employment costs, low employee morale and harm to our business and results of
operations. In addition, political and economic factors could lead to unfavorable changes in federal, state and foreign tax laws, which may
affect our tax assets or liabilities and adversely affect our results of operations. We are also regularly involved in various litigation matters that
arise in the ordinary course of business. Litigation or regulatory developments could adversely affect our business and financial condition.

Compliance with Section 404 of the Sarbanes-Oxley Act of 2002 requires management assessments of the effectiveness of our internal
controls over financial reporting through documenting, testing, monitoring and enhancement of internal control over financial reporting. If we
fail to implement or maintain adequate internal controls, we may not produce reliable financial reports or fail to prevent or detect financial
fraud, which may adversely affect our financial position, investor confidence or our stock price.

Changes to accounting rules and regulations could affect our financial results or financial condition.
Accounting principles and related pronouncements, implementation guidelines and interpretations with regard to a wide variety of accounting
matters that are relevant to our business, including, but not limited to, revenue recognition, inventory valuation, long-lived asset recoverability,
income taxes and contingent liabilities, are highly complex and involve subjective assumptions, estimates and judgments. Changes in these
rules and regulations, changes in our interpretation or our misapplication of the rules or regulations, changes in accounting policies or
changes in underlying assumptions, estimates or judgments could adversely affect our financial performance or financial position.

Item 1B. Unresolved Staff Comments.
None.

Nordstrom, Inc. and subsidiaries 21

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Item 1C. Cybersecurity.
Nordstrom understands that establishing, executing and sustaining effective cybersecurity measures to secure our information systems and
preserve the confidentiality, integrity and availability of our data is critical to the success of the business.

Management of Material Risks and Integrated Overall Risk Management
Our comprehensive risk management framework is intended to strategically incorporate cybersecurity risk management across the company,
with the objective of ensuring that cybersecurity considerations underpin the decision-making processes at all organizational levels. Our risk
management team collaborates closely across various Enterprise-wide business units to continually assess and address identified
cybersecurity risks in alignment with business objectives. The CTIO regularly updates the Chief Financial Officer and Chief Executive Officer
on material cybersecurity risks and events.

Engagement with Third Parties on Management of Cybersecurity Risk
Recognizing the dynamic nature of cybersecurity threats, Nordstrom collaborates with external experts, including assessors, consultants and
examiners, to evaluate and test our cybersecurity risk preparedness. Regular exams, threat assessments and consultation on security
enhancements with these third parties ensure that our cybersecurity strategies align with industry best practices.

Oversight of Third-party Risk
In the course of our business, we regularly exchange data and information with certain third parties in various ways, exposing us to risk
related to the cybersecurity posture of and information management practices of those third parties. To try to mitigate this risk, we have
implemented processes that may, depending upon the nature of the relationship with the third party, require security assessments and data
integration design reviews prior to allowing our systems to connect with theirs. In addition, we seek to require these third parties to adhere to
pre-established cybersecurity standards. Where applicable, we try to obtain contractual commitments with those third parties to ensure these
security requirements are met.

Risks from Cybersecurity Threats
Nordstrom has not experienced any cybersecurity incident that has materially impacted, or that is reasonably likely to materially impact, our
operations, financial condition or cash flows.

Cybersecurity Risk Management Personnel
Primary responsibility for assessing, monitoring, mitigating and managing our cybersecurity risks rests with our information security
organization, currently led by our CTIO. The CTIO has over 25 years of experience leading technology teams in retail and in many highly
regulated industries including Healthcare, Pharmaceuticals and Financial Services. Our CTIO supports a skilled information security
organization that brings expertise in vulnerability management, incident response, penetration testing, regulatory compliance and other
critical information security domains. Our information security team maintains certifications from recognized external security authorities such
as ISC2, CompTIA, ISACA, GIAC, SANS, PCI and OffSec. The security program is assessed annually by a reputable third party to provide
guidance for continuous improvement.

Monitoring and Responding to Cybersecurity Incidents
The security organization stays informed about the latest developments in cybersecurity, implements processes for regular monitoring of
information systems and deploys relevant security measures. In the event of a cybersecurity incident, a formal incident response plan is in
place for immediate actions and long-term strategies.

Board of Directors Oversight
The Board of Directors has oversight responsibilities regarding cybersecurity risk. At regularly scheduled meetings (at least quarterly), in
addition to such additional interactions as may be necessary in specific circumstances, our Chief Executive Officer and CTIO update the
Board on emerging cybersecurity risks and developments impacting Nordstrom.

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Item 2. Properties.
(Square footage amounts in thousands)

Square footage is the total floor area of a building, measured from the exterior of the building walls. The following table summarizes the
Supply Chain Network and retail locations we own or lease and the total square footage by category as of February 1, 2025:

Leased buildings on leased land
Owned buildings on leased land
Owned buildings on owned land
Partly owned and partly leased
Total

Supply Chain Network
1 
— 
8 
— 
9 

Number of Locations
Nordstrom
18
54
24
2
98 

Nordstrom Rack Total Square Footage
13,139 
9,919 
8,250 
544 
31,852 

278 
— 
1 
— 
279 

The following table summarizes our Supply Chain Network and retail store count and square footage activity:

Count

Square Footage

Fiscal year
Total, beginning of year
Openings:

Nordstrom
Nordstrom Rack

Relocations, remodels or changes
Closures
Total, end of year

2024
369 

— 
23 
— 
(6)
386 

2023
368 

— 
19 
— 
(18)
369 

2024
32,381 

— 
648 
— 
(1,177)
31,852 

2023
33,693 

— 
531 
(8)
(1,835)
32,381 

Nordstrom, Inc. and subsidiaries 23

 
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The following table lists our Supply Chain Network and retail store count and square footage by state as of February 1, 2025:

Alabama
Alaska
Arizona
California
Colorado
Connecticut
Delaware
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Missouri
Nebraska
Nevada
New Jersey
New Mexico
New York
North Carolina
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
Tennessee
Texas
Utah
Virginia
Washington
Washington D.C.
Wisconsin

Total

Supply Chain Network
Count
— 
— 
— 
3 
— 
— 
— 
1 
— 
— 
— 
— 
— 
2 
— 
— 
— 
— 
1 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
1 
1 
— 
— 
— 
— 
— 
— 
— 
— 
— 
9 

Square Footage
— 
— 
— 
1,671 
— 
— 
— 
221 
— 
— 
— 
— 
— 
1,529 
— 
— 
— 
— 
451 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
— 
374 
976 
— 
— 
— 
— 
— 
— 
— 
— 
— 
5,222 

Nordstrom

Nordstrom Rack

Total

Count
— 
— 
1 
26 
2 
2 
1 
6 
2 
1 
— 
4 
1 
— 
1 
— 
— 
— 
3 
3 
2 
2 
2 
— 
1 
4 
— 
5 
2 
3 
— 
2 
2 
— 
— 
1 
8 
2 
2 
6 
— 
1 
98 

Square Footage
— 
— 
235 
3,669 
387 
341 
127 
1,031 
383 
195 
— 
947 
134 
— 
219 
— 
— 
— 
603 
452 
430 
380 
342 
— 
207 
817 
— 
838 
300 
549 
— 
363 
381 
— 
— 
145 
1,413 
277 
452 
1,270 
— 
150 
17,037 

Count
1 
1 
11 
68 
8 
1 
1 
19 
6 
2 
1 
17 
3 
1 
3 
1 
3 
1 
6 
7 
5 
4 
2 
1 
4 
8 
1 
7 
4 
8 
2 
7 
7 
1 
3 
4 
23 
4 
7 
12 
2 
2 
279 

Square Footage
27 
35 
365 
2,349 
268 
36 
32 
621 
214 
78 
37 
623 
85 
35 
90 
33 
90 
30 
219 
266 
178 
134 
69 
30 
132 
284 
34 
244 
134 
282 
67 
243 
240 
38 
101 
117 
760 
130 
268 
442 
66 
67 
9,593 

Count
1 
1 
12 
97 
10 
3 
2 
26 
8 
3 
1 
21 
4 
3 
4 
1 
3 
1 
10 
10 
7 
6 
4 
1 
5 
12 
1 
12 
6 
11 
2 
10 
10 
1 
3 
5 
31 
6 
9 
18 
2 
3 
386 

Square Footage
27 
35 
600 
7,689 
655 
377 
159 
1,873 
597 
273 
37 
1,570 
219 
1,564 
309 
33 
90 
30 
1,273 
718 
608 
514 
411 
30 
339 
1,101 
34 
1,082 
434 
831 
67 
980 
1,597 
38 
101 
262 
2,173 
407 
720 
1,712 
66 
217 
31,852 

Our headquarters are located in Seattle, Washington, where our offices consist of both leased and owned space.

As of March 21, 2025, we have announced 20 Nordstrom Rack store openings and one Nordstrom store closure in 2025 and one Nordstrom
Rack store opening in 2026. Additionally, subsequent to year-end, we closed one Nordstrom Local service hub and plan to reopen it as a
storefront dedicated to personal styling.

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Item 3. Legal Proceedings.
We are subject from time to time to various claims and lawsuits arising in the ordinary course of business, including lawsuits alleging
violations of state and/or federal wage and hour and other employment laws, privacy and other consumer-based claims. Some of these
lawsuits may include certified classes of litigants, or purport or may be determined to be class or collective actions and seek substantial
damages or injunctive relief, or both, and some may remain unresolved for several years. We believe the recorded accruals in our
Consolidated Financial Statements are adequate in light of the probable and estimable liabilities.

On March 2, 2023, Nordstrom Canada commenced a wind-down of its business operations pursuant to a CCAA proceeding overseen by the
Ontario Superior Court of Justice. See Note 2: Canada Wind-down in Part II for more information.

As of the date of this report, we do not believe any other currently identified claim, proceeding or litigation, either alone or in the aggregate,
will have a material impact on our results of operations, financial position or cash flows. Since these matters are subject to inherent
uncertainties, our view of them may change in the future.

Item 4. Mine Safety Disclosures.
None.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity
Securities.
(Dollar and share amounts in millions, except per share amounts and where otherwise noted)

MARKET AND SHAREHOLDER INFORMATION
Our common stock, without par value, is traded on the NYSE under the symbol “JWN.” The approximate number of record holders of
common stock as of March 14, 2025 was 4,286. On this date, we had 166,898,470 shares of common stock outstanding.

DIVIDENDS
The following table summarizes our historical dividends declared and paid per share:
Fiscal year
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Full Year

2024
$0.19 
0.19 
0.19 
0.19 
$0.76 

2023
$0.19 
0.19 
0.19 
0.19 
$0.76 

Any future determination to pay cash dividends and the amount of dividends will be at the discretion of the Board of Directors and will be
dependent upon our financial condition, operating results, capital requirements, contractual commitments and such other factors as the
Board of Directors deems relevant (see Liquidity in Item 7 and Note 11: Shareholders’ Equity in Item 8).

SHARE REPURCHASES
We repurchased no shares of common stock during the fourth quarter of 2024 and we had $438 remaining in share repurchase capacity as
of February 1, 2025.

See Note 11: Shareholders’ Equity in Item 8 for more information about our August 2018 and May 2022 share repurchase programs. While
the Merger Agreement is in effect, we are prohibited from repurchasing shares of our common stock, including under the May 2022 program,
without the prior written consent of Parent. The actual timing, price, manner and amounts of future share repurchases, if any, will be subject
to the discretion of the Board of Directors, contractual commitments, market and economic conditions and applicable SEC rules.

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STOCK PRICE PERFORMANCE
The following graph compares the cumulative total return of Nordstrom common stock, Standard & Poor’s Retail Index (“S&P Retail”),
Standard & Poor’s 500 Index (“S&P 500”) and Nordstrom’s peer group for each of the last five fiscal years ended February 1, 2025. S&P
Retail is composed of 15 retail companies representing an industry group of the S&P 500. Our peer group is consistent with the retail peer
group that we include in the Compensation Discussion and Analysis section of Item 11 in Part III and is weighted by the market capitalization
of each component. The following graph assumes an initial investment of $100 each in Nordstrom common stock, S&P Retail, S&P 500 and
Nordstrom’s peer group on February 1, 2020 and assumes reinvestment of dividends.

1
End of fiscal year
Nordstrom common stock
S&P Retail
S&P 500
Nordstrom’s peer group

1 

Dollar amounts are in ones.

2019
$100
$100
$100
$100

2020
$98
$141
$117
$112

2021
$61
$150
$142
$122

2022
$53
$124
$132
$130

2023
$54
$174
$164
$144

2024
$75
$228
$202
$175

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Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(Dollar and share amounts in millions, except per share amounts and where otherwise noted)

The following MD&A provides a narrative of our financial performance and is intended to promote understanding of our results of operations
and financial condition. MD&A is provided as a supplement to, and should be read in conjunction with, Item 8: Financial Statements and
Supplementary Data and generally discusses the results of operations for fiscal year 2024 compared with 2023. For our comparison and
discussion of 2023 and 2022, see Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II
of our 2023 Annual Report. For our discussion of market risk information for 2023, see Item 7A: Quantitative and Qualitative Disclosures
About Market Risk in Part II of our 2023 Annual Report. The following discussion and analysis contains forward-looking statements and
should also be read in conjunction with Item 1A: Risk Factors in Part I, as well as other cautionary statements and risks described elsewhere
in this 2024 Annual Report, before deciding to purchase, hold or sell shares of our common stock.

Overview
Results of Operations
Liquidity
Capital Resources
Critical Accounting Estimates
Recent Accounting Pronouncements

28

29
30
35
38
40
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OVERVIEW
In 2024, we reported net earnings of $294, or 2.0% of net sales, $1.74 per diluted share and EBIT of $495, or 3.4% of net sales. Excluding
charges related primarily to a supply chain asset impairment in the second quarter, accelerated technology depreciation in the third and
fourth quarters, and privatization fees in the fourth quarter, adjusted EBIT was $593 or 4.1% of net sales, and adjusted EPS was $2.17 for
2024.

Total Company net sales increased 2.4% compared with 2023, including a negative impact of approximately $190, or 130 basis points, from
the 53rd week in 2023, and total Company comparable sales increased 3.6%. In 2024, women’s apparel, active, men’s apparel, kids and
shoes had the strongest growth compared with 2023.

We remain committed to delivering profitable growth while improving the customer experience. Our results reflect our focus throughout 2024
on our three priorities: driving Nordstrom banner growth, operational optimization and building on momentum at Nordstrom Rack.

Driving Nordstrom banner growth – We are committed to driving growth at the Nordstrom banner, with a focus on digital-led growth
supported by stores, aiming to further enable our customers to shop when and where they want. In our Nordstrom stores, we continued our
efforts to provide a more consistent offering of the brands that matter most to our customers across our entire store fleet. This includes
ensuring that we have the newness, relevance and depth of merchandise that our customers value, including our Nordstrom private brands,
which were relaunched earlier this year. Our efforts to drive Nordstrom banner growth are taking hold, resulting in comparable sales growth
of 3% in 2024 and over 5% in the fourth quarter as we had investments during the year to improve the offering of our customers’ favorite
brands. For our customers that prefer to shop online, we aim to make the experience seamless and engaging through technology. In the first
quarter of 2024, we launched our digital Marketplace on Nordstrom.com, which allows customers to shop more products and sizes from their
favorite brands while providing more access to new and emerging labels. We currently have over 400 sellers offering a wide selection to our
customers and we expect to continue to scale our Marketplace business in 2025.

Operational optimization – We are focused on optimizing our operations, including in our supply chain, to drive improvements in customer
experience through faster delivery and moving product efficiently through our network to provide relevance and freshness. We continued to
make progress against our supply chain initiatives during 2024, lowering our per unit costs and strengthening our inventory integrity while
delivering a better experience to our customers through a consistent flow of fresh merchandise. We also expanded the penetration of our
RFID technology across our locations, which increased our real time visibility into our inventory health and integrity while enhancing the
customer experience through improved inventory accuracy, and our inventory shrinkage improved over last year.

Building on momentum at Nordstrom Rack – We continued to expand our reach and convenience for customers by opening 23 new
Nordstrom Rack stores in 2024 and expect to open a similar number of stores in 2025. We believe new Rack stores are a great investment,
with returns that exceed our cost of capital and have a short payback period. Expanding our network of stores also brings our omni-channel
services closer to the customer, giving them more reasons and opportunities to engage with us. In 2024, we launched store fulfillment of
Rack digital orders and the ability to buy online and pick up in over 100 Nordstrom Rack stores. Our Rack business continues to be a
differentiator in off-price retail, enabling our customers to shop when and how they want. Our strategy and focus on great brands at great
prices continued to deliver results with increases in traffic, conversion and customers during the fourth quarter of 2024.

We maintained the momentum we built throughout the year, which resulted in full-year sales and profitability coming in at the high end of our
expectations. We are proud of the efforts that we undertook in 2024, as well as the outcomes that enhanced the customer experience and
drove improved financial results. We are committed to delivering profitable growth while improving the customer experience, and we expect
2025 to be a year of continued momentum toward the long-term strength and durability of our business.

Pending Merger
In December 2024, Nordstrom, Inc. announced that it had reached an agreement with members of the Nordstrom family and Liverpool to
acquire all of the outstanding common shares of Nordstrom, Inc. not already beneficially owned by the Nordstrom family and Liverpool. The
transaction is expected to close in the first half of 2025, subject to certain conditions, including approval by shareholders. Upon completion,
the Company’s common stock will be delisted on the NYSE, and Nordstrom, Inc. will become a private Company. See Note 1: Nature of
Operations and Summary of Significant Accounting Policies in Item 8 for additional information.

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RESULTS OF OPERATIONS
In our ongoing effort to enhance the customer experience, we are focused on providing a seamless retail experience across our Company.
We continue to invest in integrating our operations, merchandising and technology across our stores and online in both our Nordstrom and
Nordstrom Rack banners. By connecting our digital and physical assets across Nordstrom and Nordstrom Rack, we are able to better serve
customers when, where and how they want to shop. We have one Retail reportable segment and analyze our results on a total Company
basis, using customer, market share, operational and net sales metrics.

We operate on a 52/53-week fiscal year ending on the Saturday closest to January 31st. References to 2024 and any other year included
within this document are based on a 52-week fiscal year, except for fiscal year 2023, which was a 53-week fiscal year.

We monitor a number of key operating metrics to evaluate our performance. In addition to net sales, net earnings and other results under
GAAP, other key operating metrics we use are GMV, comparable sales and inventory turnover rate.

• GMV: calculated as the total dollar value of owned and unowned inventory sold through our digital platforms and stores, including the

impact of estimated future customer returns and deferred revenue from The Nordy Club points and Notes. We use GMV as an
indicator of the scale and growth of our operations and the impact of our unowned inventory models.

•

•

Comparable Sales: calculated as the total dollar value of owned and unowned inventory sold through our digital platforms and
stores, which are added to the comparable sales base after they have been open for 13 full months or more, and removed in the
month of their closure. Comparable sales are net of actual returns. Due to the 53rd week in 2023, we calculate our 2024 comparable
sales growth using a realigned 2023 52-week period. We use comparable sales to evaluate the performance of our business without
the impact of recently opened or closed stores.

Inventory Turnover Rate: calculated as the trailing four-quarter merchandise cost of sales divided by the trailing 13-month average
inventory. Inventory turnover rate is an indicator of our success in optimizing inventory volumes in accordance with customer
demand. Merchandise inventories prior to February 4, 2024 were calculated under the retail inventory method. Effective February 4,
2024, we changed our accounting method to the weighted average cost method, and recorded the cumulative effect of this change in
accounting principle in beginning accumulated deficit on our Consolidated Balance Sheet as of February 4, 2024 (see Note 1: Nature
of Operations and Summary of Significant Accounting Policies in Item 8).

Additionally, we use Operational GMV, calculated as the total dollar value of owned and unowned inventory sold through our digital platforms
and stores, excluding the impact of estimated future customer returns and deferred revenue from The Nordy Club points and Notes, to
measure incentive compensation. Refer to Item 11. Executive Compensation in Part III for additional information.

Net Sales
The following table summarizes net sales: 
Fiscal year
Net sales:
Nordstrom
Nordstrom Rack
Total net sales

Net sales increase (decrease):
Nordstrom
Nordstrom Rack
Total Company

Digital sales:
As a % of total net sales
Digital sales increase (decrease)

GMV increase (decrease):
Nordstrom
Total Company

2024 

$9,390 
5,167 
$14,557 

(0.5 %)
8.0 %
2.4 %

36 %
2.3 %

0.6 %
3.1 %

2023 

$9,436 
4,783 
$14,219 

(8.2 %)
(0.6 %)
(5.8 %)

36 %
(10.5 %)

(8.5 %)
(6.1 %)

Total Company net sales and GMV increased for fiscal year 2024, compared with 2023. Full fiscal year 2023 results included approximately
130 basis point positive impact and approximately $190 in additional net sales related to the 53rd week. Women’s apparel, active and men’s
apparel had the strongest growth compared with 2023. Total Company digital sales increased for fiscal year 2024, compared with 2023.
Comparable sales increased 3.6% in 2024 compared with 2023.

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Nordstrom net sales decreased and GMV increased compared with 2023, which reflected a decrease in the number of items sold, while the
average selling price per item sold remained flat. Full fiscal year 2023 results included an approximately 120 basis point positive impact
related to the 53rd week. Nordstrom comparable sales increased 3.0% in 2024 compared with 2023.

Nordstrom Rack net sales increased compared with 2023, which reflected an increase in both the number of items sold and the average
selling price per item sold. Full fiscal year 2023 results included an approximately 150 basis point positive impact related to the 53rd week.
Nordstrom Rack comparable sales increased 4.7% in 2024 compared with 2023.

See Note 3: Revenue in Item 8 for information about disaggregated revenues.

Credit Card Revenues, Net
Credit card revenues, net decreased $15 compared with 2023, primarily due to higher credit losses, partially offset by an increase in finance
charges from higher outstanding balances.

Gross Profit
The following table summarizes gross profit:
Fiscal year
Gross profit
Gross profit as a % of net sales
Inventory turnover rate

2024 
$5,161 

35.5 %
3.51 

2023 
$4,916 

34.6 %
3.58 

In 2024, gross profit increased $245 and 90 basis points as a rate of net sales compared with 2023, primarily due to higher sales and
merchandise margin expansion driven by increased inventory productivity and improved shrinkage, partially offset by higher labor costs.

Ending inventory as of February 1, 2025 increased 11%, compared with February 3, 2024, versus a 2% decrease in sales in the fourth
quarter of 2024, compared with 2023. The increase in inventory levels compared with 2023 was driven primarily by growth in the top brands
at both banners and higher in-transit inventory late in the fourth quarter.

Selling, General and Administrative Expenses
SG&A is summarized in the following table:
Fiscal year
SG&A
SG&A as a % of net sales

2024 
$5,125 

35.2 %

2023 
$4,855 

34.2 %

SG&A increased $270 and 105 basis points as a rate of net sales in 2024 compared with 2023, primarily due to higher labor costs and
charges related to a supply chain asset impairment, accelerated technology depreciation and privatization fees. These charges are included
in unallocated Corporate/Other expenses within Note 15: Segment Reporting in Item 8. In addition, the change in SG&A rate was partially
offset by leverage on higher sales.

Canada Wind-down Costs
We recognized charges associated with the wind-down of Nordstrom Canada of $284 in the year ended February 3, 2024 (see Note 2:
Canada Wind-down in Item 8).

Earnings Before Interest and Income Taxes
EBIT is summarized in the following table:
Fiscal year
EBIT
EBIT margin

2024 
$495 

3.4 %

2023 
$251 

1.8 %

EBIT increased $244 and 165 basis points as a rate of net sales in 2024 compared with 2023. The increase was primarily due to $284 of
expenses associated with the wind-down of Canadian operations in 2023 and higher sales in 2024, partially offset by higher labor costs and
charges related to a supply chain asset impairment, accelerated technology depreciation and privatization fees.

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Interest Expense, Net
Interest expense, net is summarized in the following table:
Fiscal year
Interest on long-term debt and short-term borrowings
Interest income
Capitalized interest
Interest expense, net

2024
$143 
(33)
(8)
$102 

2023 
$150 
(33)
(13)
$104 

Interest expense, net decreased $2 in 2024 compared with 2023, primarily due to the retirement of our 2.30% senior notes in April 2024,
partially offset by a decrease in capitalized interest.

Income Tax Expense
Income tax expense is summarized in the following table:
Fiscal year
Income tax expense
Effective tax rate

The following table illustrates the components of our effective tax rate:
Fiscal year
Statutory rate
State and local income taxes, net of federal income taxes
Federal credits
Non-deductible expenses
Stock-based compensation
Valuation allowance
Taxes on foreign operations
Excess tax over book loss on Canada wind-down
Resolution of prior period tax matters
Other, net
Effective tax rate

2024

$99 
25.3 %

2024
21.0 %
3.9 %
(1.8 %)
1.4 %
1.1 %
— 
1.2 %
(2.0 %)
— 
0.5 %
25.3 %

2023

$13 
8.6 %

2023
21.0 %
4.0 %
(4.7 %)
2.9 %
5.1 %
6.6 %
1.5 %
(18.2 %)
(11.2 %)
1.6 %
8.6 %

The increase in the effective tax rate for 2024, compared with 2023, was primarily due to additional tax benefits related to the wind-down of
Canadian operations and the favorable resolution of certain tax matters recorded in 2023.

Earnings Per Share
EPS is as follows:
Fiscal year
Basic
Diluted

2024 
$1.79 
$1.74 

2023 
$0.83 
$0.82 

Diluted EPS increased $0.92 in 2024 compared with 2023, primarily due to higher sales in fiscal year 2024. Charges related to a supply
chain asset impairment, accelerated technology depreciation and privatization fees decreased EPS by $0.43 per diluted share for fiscal year
2024. Charges related to the wind-down of Canadian operations and a supply chain asset impairment and related charge decreased EPS by
$1.30 per diluted share for fiscal year 2023.

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Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Margin and Adjusted EPS (Non-GAAP Financial Measures)
The following are key financial metrics and, when used in conjunction with GAAP measures, we believe they provide useful information to
evaluate our core business performance and enable comparison of financial results across periods. They also allow for greater transparency
with respect to key metrics used by management for financial and operational decision-making. Adjusted EBIT, Adjusted EBITDA, Adjusted
EBIT margin and Adjusted EPS exclude certain items that we do not consider representative of our core operating performance. The
financial measure calculated under GAAP which is most directly comparable to Adjusted EBIT and Adjusted EBITDA is net earnings. The
financial measure calculated under GAAP which is most directly comparable to Adjusted EBIT margin is net earnings as a percent of net
sales. The financial measure calculated under GAAP which is most directly comparable to Adjusted EPS is diluted EPS.

Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT margin and Adjusted EPS are not measures of financial performance under GAAP and
should be considered in addition to, and not as a substitute for, net earnings, net earnings as a percent of net sales, operating cash flows,
earnings per share, earnings per diluted share or other financial measures performed in accordance with GAAP. Our method of determining
non-GAAP financial measures may differ from other companies’ financial measures and therefore may not be comparable to methods used
by other companies.

The following is a reconciliation of net earnings to Adjusted EBIT and Adjusted EBITDA and net earnings as a percent of net sales to
Adjusted EBIT margin:
Fiscal year
Net earnings
Income tax expense
Interest expense, net
Earnings before interest and income taxes
1
Privatization fees
2
Accelerated technology depreciation
Supply chain asset impairment and other
Canada wind-down costs
Adjusted EBIT
Depreciation and amortization expenses
Amortization of developer reimbursements
Adjusted EBITDA

$294 
99 
102 
495 
18 
26 
54 
— 
593 
573 
(57)
$1,109 

2024

$134 
13 
104 
251 
— 
— 
32 
284 
567 
586 
(69)
$1,084 

2023

Net sales
Net earnings as a % of net sales
EBIT margin
Adjusted EBIT margin

$14,557
2.0 %
3.4 %
4.1 %

$14,219
0.9 %
1.8 %
4.0 %

1 

Privatization fees include transaction-related expenses incurred in connection with the Merger. These fees are included in SG&A on the Consolidated Statement of Earnings.
2
As a result of a strategic decision, we recognized a charge related to incremental accelerated depreciation for a technology asset. The charge is included in SG&A on the
Consolidated Statement of Earnings, unallocated Corporate/Other expenses in Note 15: Segment Reporting and depreciation and amortization expenses on the Consolidated
Statement of Cash Flows.

The following is a reconciliation of diluted EPS to Adjusted EPS:
Fiscal year
Diluted EPS
Privatization fees
Accelerated technology depreciation
Supply chain asset impairment and other
Canada wind-down costs
1
Income tax impact on adjustments
Adjusted EPS

1 

The income tax impact of non-GAAP adjustments is calculated using the estimated tax rate for the respective non-GAAP adjustment.

2024
$1.74 
0.11 
0.16 
0.32 
— 
(0.16)
$2.17 

2023
$0.82 
— 
— 
0.19 
1.74 
(0.63)
$2.12 

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Adjusted ROIC (Non-GAAP Financial Measure)
We believe that Adjusted ROIC is a useful financial measure for investors in evaluating the efficiency and effectiveness of the capital we have
invested in our business to generate returns over time. Our Adjusted ROIC calculation excludes certain items that we do not consider
representative of our core operating performance.

Adjusted ROIC is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for,
return on assets, net earnings, total assets or other GAAP financial measures. Our method of calculating a non-GAAP financial measure may
differ from other companies’ methods and therefore may not be comparable to those used by other companies. The financial measure
calculated under GAAP which is most directly comparable to Adjusted ROIC is return on assets. The following shows the components to
reconcile the return on assets calculation to Adjusted ROIC:

Fiscal year
Net earnings
Income tax expense
Interest expense
Earnings before interest and income tax expense

1

Operating lease interest
2
Non-operating related adjustments
Adjusted net operating profit
3
Adjusted estimated income tax expense
Adjusted net operating profit after tax

Average total assets
4
Average noncurrent deferred property incentives in excess of ROU assets
Average non-interest bearing current liabilities
5
Non-operating related adjustments
Adjusted average invested capital

2024

2023

$294 
99 
135 
528 

92 
98 
718 
(183)
$535 

$8,770 
(120)
(2,915)
40 
$5,775 

$134 
13 
137 
284 

86 
316 
686 
(172)
$514 

$8,766 
(157)
(2,954)
394 
$6,049 

Return on assets
Adjusted ROIC

3.3 %
9.3 %

1.5 %
8.5 %

1 

2 

3 

4 

5 

Operating lease interest is a component of operating lease cost recorded in occupancy costs. We add back operating lease interest for purposes of calculating adjusted net
operating profit for consistency with the treatment of interest expense on our debt.
See the Adjusted EBIT and Adjusted EBITDA section for detailed information on certain non-operating related adjustments.
Adjusted estimated income tax expense is calculated by multiplying the adjusted net operating profit by the adjusted effective tax rate (which removes the impact of non-
operating related adjustments) for the trailing twelve-month periods ended February 1, 2025 and February 3, 2024. The adjusted effective tax rate is calculated by dividing
adjusted income tax expense by adjusted earnings before income taxes for the same trailing twelve-month periods.
For leases with property incentives that exceed the ROU assets, we reclassify the amount from assets to other current liabilities and other liabilities on the Consolidated
Balance Sheets. The current and noncurrent amounts are used to reduce average total assets above, as this better reflects how we manage our business.
Non-operating related adjustments primarily included supply chain impairment charges and accelerated technology depreciation for the trailing twelve-month period ended
February 1, 2025 and the wind-down of our Canadian operations for the trailing twelve-month period ended February 3, 2024.

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LIQUIDITY
We strive to maintain a level of liquidity sufficient to allow us to cover our seasonal cash needs and appropriate levels of short-term borrowing
capacity. In the short term, our ongoing working capital and capital expenditure requirements, and any dividend payments or share
repurchases, are generally funded through cash flows generated from operations. In addition, we have access to the commercial paper
market and can draw on our Revolver for working capital, capital expenditures and general corporate purposes. Over the long term, we
manage our cash and capital structure to maximize shareholder return, maintain our financial position, manage refinancing risk and allow
flexibility for strategic initiatives. We regularly assess our debt and leverage levels, capital expenditure requirements, debt service payments,
dividend payouts, share repurchases and other future investments.

We ended fiscal year 2024 with $1,035 in cash and cash equivalents and $771 of additional liquidity available on our Revolver. Cash and
cash equivalents as of February 1, 2025, increased from $628 in 2023, driven by changes in working capital primarily driven by our amended
2024 TD program agreement and changes in compensation, partially offset by payments for capital expenditures and principal payments on
long-term debt.

During the first quarter of 2024, we retired our 2.30% senior notes that were due in April 2024 using cash on hand (see Note 6: Debt and
Credit Facilities in Item 8). We believe that our cash flows from operations are sufficient to meet our cash requirements for the next 12
months and beyond. Our cash requirements are subject to change as business conditions warrant and opportunities arise, and we may elect
to raise additional funds in the future through the issuance of either debt or equity. Our operating cash flows could be impacted due to
expected transaction costs related to the pending Merger. We do not believe that the Merger Agreement will prevent us from meeting our
debt obligations, ongoing costs of operations, working capital needs or capital expenditure requirements.

The following is a summary of our cash flows by activity:
Fiscal year
Net cash provided by operating activities
Net cash used in investing activities
Net cash used in financing activities

2024
$1,267 
(488)
(372)

2023
$621 
(571)
(109)

Operating Activities
The majority of our operating cash inflows are derived from revenues. We also receive cash payments for property incentives from
developers and vendors. Our operating cash outflows generally consist of payments to our merchandise vendors (net of vendor allowances)
and shipping carriers, payments to our employees for wages, salaries and other employee benefits and payments to our landlords for rent.
Operating cash outflows also include payments for income taxes and interest payments on our short-term and long-term borrowings.

Net cash provided by operating activities increased $646 between 2024 and 2023, due to changes in working capital primarily driven by our
amended 2024 TD program agreement and changes in compensation in addition to higher net earnings.

Investing Activities
Our investing cash outflows include payments for capital expenditures, including technology, stores and supply chain improvements. Our
investing cash inflows are generally from proceeds from sales of property and equipment. Activity also includes the purchase and sale of
financial interests of certain private companies and venture capital funds, and return of investments.

Net cash used in investing activities decreased $83 between 2024 and 2023, primarily due to decreased capital expenditures and the
decrease in cash and cash equivalents resulting from the deconsolidation of Canada in 2023 (see Note 2: Canada Wind-down in Item 8).

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Capital Expenditures
Our capital expenditures, net are summarized as follows:
Fiscal year
Capital expenditures
1
Deferred property incentives
Capital expenditures, net

Capital expenditures, net category allocation:

Technology
New stores, relocations, remodels and other
Supply chain

Total

2024

$516 
(10)
$506 

56 %
36 %
8 %
100 %

2023

$569 
(35)
$534 

59 %
31 %
10 %
100 %

1 

Deferred property incentives are included in our net cash provided by operating activities in our Consolidated Statements of Cash Flows in Item 8. We operationally view the
property incentives we receive from our developers and vendors as an offset to our capital expenditures.

Fiscal year
Capital expenditures as a % of net
sales

1
 Rate represents amounts forecasted in 2025.

1
2025

2024 

2023 

2022 

2021 

2020 

2.5%-3.5%

3.6 %

4.0 %

3.1 %

3.5 %

3.7 %

Capital expenditures as a percentage of net sales in 2024 were in the range of our outlook, and decreased compared with 2023, primarily
due to decreases in technology expenditures and cost efficiencies for Nordstrom Rack store openings. Going forward, we expect capital
expenditure requirements on average to range from 2.5% to 3.5% of net sales and primarily support investments in technology and stores.
We are committed to paying approximately $25 of capital expenditures as of the end of the year, which is included within our purchase
obligation commitments in Note 13: Commitments and Contingencies in Item 8, which we expect to impact our liquidity in the next year.

Financing Activities
The majority of our financing activities include long-term debt or Revolver proceeds and/or payments, dividend payments and repurchases of
common stock.

Net cash used in financing activities increased $263 between 2024 and 2023, primarily due to the retirement of our 2.30% senior notes due
April 2024 using cash on hand (see Note 6: Debt and Credit Facilities in Item 8).

Share Repurchases
While the Merger Agreement is in effect, we are prohibited from repurchasing shares of our common stock, including under the stock
repurchase program, without the prior written consent of Parent. At any other time, we determine the size and timing of share repurchases by
analyzing a number of different factors, including our liquidity position, current market and economic conditions and alternative uses of
capital, including those used to offset anticipated dilution from equity incentive plans. Share repurchases are made as conditions warrant in
the open market and are then retired. We repurchased no shares of our common stock in 2024, compared with 0.03 shares repurchased for
$1 in 2023, and had $438 remaining in share repurchase capacity as of February 1, 2025. The actual timing, price, manner and amounts of
future share repurchases, if any, will be subject to the discretion of the Board of Directors, contractual commitments, market and economic
conditions and applicable SEC rules (see Note 11: Shareholders’ Equity in Item 8).

Dividends
In determining the dividends to pay, we analyze our dividend payout ratio and dividend yield, while taking into consideration our current and
projected operating performance and liquidity, subject to our Revolver covenants (see Note 6: Debt and Credit Facilities in Item 8). In 2024,
we paid dividends of $124, or $0.76 per share, compared with $123, or $0.76 per share, in 2023 (see Note 11: Shareholders’ Equity in Item
8). While the Merger Agreement is in effect, we are prohibited from declaring dividends on our common stock other than regular quarterly
dividends not to exceed $0.19 per share, a stub period dividend contingent upon the closing of the Merger, and a special dividend prior to
and contingent upon the closing of the Merger. We expect a continuation of our 2024 dividend payment levels into 2025 pending the
completion of the Merger, which is expected to close in the first half of 2025.

In February 2025, subsequent to year-end, we declared a quarterly dividend of $0.19 per share, which will be paid on March 26, 2025 to
shareholders of record as of March 11, 2025.

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Cash Requirements
We have various commitments and other executory contracts that are disclosed in the following Notes to Consolidated Financial Statements
in Item 8:

•

•

•

•

•

•

•

Note 2: Canada Wind-down

Note 5: Leases

Note 6: Debt and Credit Facilities

Note 8: Self-Insurance

Note 9: Supplemental Executive Retirement Plan

Note 12: Income Taxes

Note 13: Commitments and Contingencies

Other commitments include $63 for deferred compensation and other accrued benefits, $10 of which is payable within one year.

Off-Balance Sheet Arrangements
In connection with our workers’ compensation programs, we have a standby letter of credit issued on our behalf with $13 available and $2
outstanding as of February 1, 2025 (see Note 8: Self-Insurance in Item 8). In addition, as of February 1, 2025 we have an outstanding
standby letter of credit of $29 reducing our short-term borrowing capacity on our Revolver (see Note 6: Debt and Credit Facilities in Item 8).
In management’s opinion, we have no off-balance sheet arrangements that have a material current or future effect on our financial condition
or financial statements.

Free Cash Flow (Non-GAAP Financial Measure)
Free Cash Flow is one of our key liquidity measures and, when used in conjunction with GAAP measures, we believe it provides investors
with a meaningful analysis of our ability to generate cash from our business.

Free Cash Flow is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for,
operating cash flows or other financial measures prepared in accordance with GAAP. Our method of calculating a non-GAAP financial
measure may differ from other companies’ methods and therefore may not be comparable to those used by other companies. The financial
measure calculated under GAAP which is most directly comparable to Free Cash Flow is net cash provided by operating activities. The
following is a reconciliation of net cash provided by operating activities to Free Cash Flow:
Fiscal year
Net cash provided by operating activities
Capital expenditures
Change in cash book overdrafts
Free Cash Flow

2024
$1,267 
(516)
(4)
$747 

2023
$621 
(569)
2 
$54 

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CAPITAL RESOURCES

Borrowing Capacity and Activity
As of February 1, 2025, we had no outstanding borrowings under the Revolver and a $29 outstanding standby letter of credit resulting in
available short-term borrowing capacity of $771. As of February 1, 2025, we had no issuances outstanding under our commercial paper
program. For more information about our credit facilities, see Note 6: Debt and Credit Facilities in Item 8.

Impact of Credit Ratings and Revolver Covenants
Changes in our credit ratings may impact our costs to borrow and whether our personal property secures our Revolver.

For our Revolver, the interest rate applicable to any borrowings we may enter into depends upon the type of borrowing incurred plus an
applicable margin, which is determined based on our credit ratings. At the time of this report, our credit ratings and outlook were as follows:

Moody’s
S&P Global Ratings
Fitch Ratings

Credit Ratings
Ba2
BB
BB

Outlook
Stable
Stable
Stable

Should the ratings assigned to our long-term debt improve, the applicable margin associated with any borrowings under the Revolver may
decrease, resulting in a lower borrowing cost under this facility. Conversely, should the ratings assigned to our long-term debt worsen, the
applicable margin associated with any borrowings under the Revolver may increase, resulting in a higher borrowing cost under this facility.

As of February 1, 2025, we were in compliance with all covenants. We have certain limitations with respect to the payment of dividends and
share repurchases under our Revolver. For more information about our Revolver covenants, see Note 6: Debt and Credit Facilities in Item 8.

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Adjusted Debt to EBITDAR (Non-GAAP Financial Measure)
Adjusted debt to EBITDAR is one of our key financial metrics and we believe that our debt levels are best analyzed using this measure, as it
provides a reflection of our creditworthiness, which could impact our credit ratings and borrowing costs. This metric is calculated in
accordance with our Revolver covenant and is a key component in assessing whether our revolving credit facility is secured or unsecured, as
well as our ability to make dividend payments and share repurchases. For more information regarding our Revolver, see Note 6: Debt and
Credit Facilities in Item 8.

Adjusted debt to EBITDAR is not a measure of financial performance under GAAP and should be considered in addition to, and not as a
substitute for, debt to net earnings, net earnings, debt or other GAAP financial measures. Our method of calculating a non-GAAP financial
measure may differ from other companies’ methods and therefore may not be comparable to those used by other companies. The financial
measure calculated under GAAP which is most directly comparable to Adjusted debt to EBITDAR is debt to net earnings. The following
shows the components to reconcile the debt to net earnings calculation to Adjusted debt to EBITDAR: 

Debt
Operating lease liabilities
Adjusted debt

Net earnings
Income tax expense
Interest expense, net
Earnings before interest and income taxes

Depreciation and amortization expenses
Operating Lease Cost
1
Amortization of developer reimbursements
Other Revolver covenant adjustments
Adjusted EBITDAR

2

Debt to Net Earnings
Adjusted debt to EBITDAR

February 1, 2025
$2,618 
1,665 
$4,283 

Four Quarters Ended February 1, 2025
$294 
99 
102 
495 

573 
291 
57 
125 
$1,541 

8.9 
2.8 

1 

2 

Amortization of developer reimbursements is a non-cash reduction of Operating Lease Cost and is therefore added back to Operating Lease Cost for purposes of our Revolver
covenant calculation.
Other adjusting items to reconcile net earnings to Adjusted EBITDAR as defined by our Revolver covenant include interest income, certain non-cash charges and other gains
and losses where relevant. For the four quarters ended February 1, 2025, other Revolver covenant adjustments primarily included supply chain impairment charges, interest
income and accelerated technology depreciation. See the Adjusted EBIT and Adjusted EBITDA section for detailed information on certain non-operating related adjustments.

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CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements in conformity with GAAP requires that we make estimates, judgments and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities during the reporting period.
Uncertainties regarding such estimates and assumptions are inherent in the preparation of financial statements. Actual results may differ
from these estimates and assumptions. The following discussion highlights the estimates we believe are critical and should be read in
conjunction with the Notes to Consolidated Financial Statements in Item 8. Our management has discussed the development and selection
of these critical accounting estimates with the Audit and Finance Committee of our Board of Directors, and the Audit and Finance Committee
has reviewed our disclosures that follow.

Revenue

Sales Return Reserve
We reduce sales and cost of sales by an estimate of future customer merchandise returns, which is calculated based on historical and
expected return patterns, and record a sales return reserve and an estimated returns asset. We record the impact of the sales return reserve
separately in both our Nordstrom and Nordstrom Rack banners. The majority of our returns from both digital and physical sales come through
our stores. Estimating future returns requires substantial judgment based on current and historical trends, and actual returns may vary from
our estimates. A 10% change in the sales return reserve, net of the estimated returns asset, would impact our EBIT by approximately $18 for
the year ended February 1, 2025.

The Nordy Club Loyalty Program and Gift Cards
We record breakage revenue for The Nordy Club, including unused points and unredeemed Nordstrom Notes, and gift cards based on
historical and expected redemption trends. We have experienced an increase in redemption rates, leading to decreased breakage rates for
The Nordy Club. A one percentage point change in our gift card breakage rate would impact our EBIT by approximately $44 for the year
ended February 1, 2025.

Merchandise Inventories
Effective February 4, 2024, we changed our method of accounting for merchandise inventories from the retail inventory method to the
weighted average cost method. Under this new method, merchandise inventories are stated at the lower of cost or net realizable value using
the weighted average cost method. Under this method, the weighted average purchase price is calculated and applied to owned inventory
units. We record reserves for excess and obsolete inventory based on specific identification of units with a current retail value below cost,
plus an estimate of future markdowns below cost, which considers the age of inventory and historical trends. A 10% change in the excess
and obsolete inventory reserve would impact our EBIT by approximately $13 for the year ended February 1, 2025.

We take physical inventory counts at our stores and Supply Chain Network locations and adjust for differences between recorded and
counted amounts. Following each physical inventory cycle and using the most recent physical inventory count and historical results, we
record an estimate for shrinkage as a percentage of weighted average cost until the next physical inventory count.

Impairment of Long-Lived Assets
When facts and circumstances indicate the carrying values of buildings, equipment and ROU assets may be impaired, we compare the
carrying value to the related projected future cash flows, among other quantitative and qualitative analyses. Cash flow analysis requires
judgment regarding many factors, such as revenues, growth rates, expenses, capital expenditures and sublease income.

These projections are inherently subject to uncertainties. While we believe the inputs and assumptions utilized in our future cash flows are
reasonable, our estimates may change in the near term based on our current and future performance.

Income Taxes
We pay income taxes based on the tax statutes, regulations and case law of the various jurisdictions in which we operate. Our income tax
expense and deferred tax assets and liabilities reflect our best estimate of current and future taxes to be paid. Income tax expense may be
affected by numerous items, such as changes in tax law, changes in business operations, the results of tax audits and changes to our
forecasts of income and loss due to economic and other conditions. Significant judgments and estimates are required in determining
consolidated income tax expense.

Deferred tax assets and liabilities arise from differences between the financial reporting and tax basis of assets and liabilities and for
operating loss and tax credit carryforwards. The deferred tax assets and liabilities are calculated using the enacted tax rates and laws
expected to be in effect when the differences are expected to reverse. In evaluating the likelihood of realizing the benefit of our deferred tax
assets, we consider all available evidence, including historical results and projected future taxable income. The assumptions about future
taxable income require the use of significant judgment and are consistent with the plans and estimates we are using to manage the
underlying business.

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The benefits of uncertain tax positions are recorded in our financial statements only after determining it is more likely than not the uncertain
tax positions would sustain challenge by taxing authorities. We are periodically audited by federal, state and foreign tax authorities related to
our tax-filing positions. Although we believe our liabilities for uncertain tax positions are reasonable, because of the complexity of some of
these uncertainties, the ultimate resolution may result in an outcome that is materially different from our current estimated liability.
Furthermore, we are unable to reasonably estimate the timing of related future cash payments. Any differences will be reflected as increases
or decreases to income tax expense in the period of resolution.

RECENT ACCOUNTING PRONOUNCEMENTS
For information about recent accounting pronouncements, see Note 1: Nature of Operations and Summary of Significant Accounting Policies
in Item 8.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
(Dollars in millions)

INTEREST RATE RISK
For our long-term debt of $2,618, our exposure to interest rate risk is primarily limited to changes in fair value. As our debt is primarily fixed-
rate, changes in interest rates do not materially impact our cash flows. However, changes in interest rates increase or decrease the fair value
of our debt, depending on whether market rates are lower or higher than our fixed rates. As of February 1, 2025, the fair value of our long-
term debt was $2,324 (see Note 6: Debt and Credit Facilities and Note 7: Fair Value Measurements in Item 8).

We are exposed to interest rate risk primarily from changes in short-term interest rates. Interest rate fluctuations can affect our interest
income and interest expense. As of February 1, 2025, we had cash and cash equivalents of $1,035, which generate interest income at
variable rates and no borrowings outstanding under our Revolver, for which we pay interest at a variable rate.

FOREIGN CURRENCY EXCHANGE RISK
The majority of our revenues, expenses and capital expenditures are transacted in U.S. Dollars. Our U.S. operations periodically enter into
merchandise purchase orders denominated in British Pounds or Euros. From time to time, we may use forward contracts to hedge against
fluctuations in foreign currency prices. As of February 1, 2025, our outstanding forward contracts did not have a material impact on our
Consolidated Financial Statements.

As of February 1, 2025, activities associated with foreign currency exchange risk have not had a material impact on our Consolidated
Financial Statements (see Note 1: Nature of Operations and Summary of Significant Accounting Policies in Item 8).

There have been no material changes in our primary risk exposures or management of market risks since the prior year.

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Item 8: Financial Statements and Supplementary Data.

Report of Independent Registered Public Accounting Firm
Consolidated Statements of Earnings
Consolidated Statements of Comprehensive Earnings
Consolidated Balance Sheets
Consolidated Statements of Shareholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements

Note 1: Nature of Operations and Summary of Significant Accounting Policies
Note 2: Canada Wind-down
Note 3: Revenue
Note 4: Land, Property and Equipment
Note 5: Leases
Note 6: Debt and Credit Facilities
Note 7: Fair Value Measurements
Note 8: Self-Insurance
Note 9: Supplemental Executive Retirement Plan
Note 10: Stock-based Compensation
Note 11: Shareholders’ Equity
Note 12: Income Taxes
Note 13: Commitments and Contingencies
Note 14: Earnings Per Share
Note 15: Segment Reporting

44
46
46
47
48
49

50
57
59
60
60
61
63
63
64
65
68
69
71
71
71

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Nordstrom, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Nordstrom, Inc. and subsidiaries (the “Company”) as of February 1, 2025
and February 3, 2024 and the related consolidated statements of earnings, comprehensive earnings, shareholders’ equity, and cash flows,
for each of the three years in the period ended February 1, 2025, and the related notes (collectively referred to as the “financial statements”).
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of February 1, 2025,
and February 3, 2024, and the results of its operations and its cash flows for each of the three years in the period ended February 1, 2025, in
conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
Company’s internal control over financial reporting as of February 1, 2025, based on criteria established in Internal Control—Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 21,
2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 1 to the financial statements, effective February 4, 2024, the Company changed its method of accounting for
merchandise inventories from the retail inventory method to the weighted average cost method.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the
Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be
independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the
Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud,
and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was
communicated or required to be communicated to the Audit and Finance Committee and that (1) relates to accounts or disclosures that are
material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of
critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating
the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Merchandise Inventories—Refer to Note 1 to the financial statements

Critical Audit Matter Description

The Company values its inventory at the lower of cost or net realizable value using the weighted average cost method. The Company
records reserves for excess and obsolete inventory based on the specific identification of units with a current retail value below cost, plus an
estimate of future markdowns below cost, which considers the age of inventory and historical trends.

Evaluation of the estimates required a high degree of auditor judgment and an increased extent of effort when (1) performing audit
procedures to evaluate the reasonableness of the markdown rates used to estimate future markdowns below cost, and (2) performing audit
testing of historical markdown rates utilized within the reserve calculation, to evaluate whether the reserve for merchandise inventory was
appropriately recorded as of February 1, 2025.

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How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the reserves for excess and obsolete inventory, included the following, among others:

• We tested the effectiveness of controls over the review of excess and obsolete inventory and the required reserves to value

inventory at the lower of cost or net realizable value.

• We evaluated the appropriateness of the markdown rates utilized in management’s analysis, which included analytical procedures

over the aging of inventory balances and historical trends of markdowns recorded below cost.

• We compared actual inventory sold below cost in the current fiscal year to the inventory valuation reserve estimated by the Company

in the prior year to evaluate management’s ability to accurately estimate the valuation reserve for inventory.

• We evaluated management’s calculation of the valuation reserve by testing the mathematical accuracy of the reserve calculation.

/s/ Deloitte & Touche LLP
Seattle, Washington
March 21, 2025

We have served as the Company’s auditor since 1970.

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Nordstrom, Inc.
Consolidated Statements of Earnings
(Amounts in millions except per share amounts)
Fiscal year
Net sales
Credit card revenues, net
Total revenues
Cost of sales and related buying and occupancy costs
Selling, general and administrative expenses
Canada wind-down costs
Earnings before interest and income taxes
Interest expense, net
Earnings before income taxes
Income tax expense
Net earnings

Earnings per share:

Basic
Diluted

Weighted-average shares outstanding:

Basic
Diluted

2024
$14,557 
459 
15,016 
(9,396)
(5,125)
— 
495 
(102)
393 
(99)
$294 

$1.79 
$1.74 

164.3 
168.9 

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

Nordstrom, Inc.
Consolidated Statements of Comprehensive Earnings
(Amounts in millions)
Fiscal year
Net earnings
Postretirement plan adjustments, net of tax of ($2), ($2) and ($12)
Foreign currency translation adjustment
Comprehensive net earnings

2024
$294 
5 
— 
$299 

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

46

2023
$14,219 
474 
14,693 
(9,303)
(4,855)
(284)
251 
(104)
147 
(13)
$134 

$0.83 
$0.82 

161.8 
163.4 

2023
$134 
5 
(4)
$135 

2022
$15,092 
438 
15,530 
(10,019)
(5,046)
— 
465 
(128)
337 
(92)
$245 

$1.53 
$1.51 

160.1 
162.1 

2022
$245 
32 
(8)
$269 

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Nordstrom, Inc.
Consolidated Balance Sheets
(Amounts in millions)

Assets
Current assets:

Cash and cash equivalents
Accounts receivable, net
Merchandise inventories
Prepaid expenses and other current assets

Total current assets

Land, property and equipment, net
Operating lease right-of-use assets
Goodwill
Other assets
Total assets

Liabilities and Shareholders’ Equity
Current liabilities:

Accounts payable
Accrued salaries, wages and related benefits
Current portion of operating lease liabilities
Other current liabilities
Current portion of long-term debt

Total current liabilities

Long-term debt, net
Noncurrent operating lease liabilities
Other liabilities

Commitments and contingencies (Note 13)

Shareholders’ equity:
Common stock, no par value: 1,000 shares authorized; 165.2 and 162.4 shares issued and outstanding

Accumulated deficit
Accumulated other comprehensive gain

Total shareholders’ equity
Total liabilities and shareholders’ equity

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

February 1, 2025

February 3, 2024

$1,035 
245 
2,104 
305 
3,689 

3,039 
1,419 
249 
570 
$8,966 

$1,288 
424 
244 
1,132 
— 
3,088 

2,618 
1,421 
699 

3,496 
(2,369)
13 
1,140 
$8,966 

$628 
334 
1,888 
286 
3,136 

3,177 
1,359 
249 
523 
$8,444 

$1,236 
244 
240 
1,102 
250 
3,072 

2,612 
1,377 
535 

3,418 
(2,578)
8 
848 
$8,444 

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Nordstrom, Inc.
Consolidated Statements of Shareholders’ Equity
(Amounts in millions except per share amounts)

Fiscal year ended
Common stock
Balance, beginning of year
Issuance of common stock under stock compensation plans
Stock-based compensation
Balance, end of year

Accumulated deficit
Balance, beginning of year
Cumulative effect of change in accounting principle, net of tax
Net earnings
Dividends
Repurchase of common stock
Balance, end of year

Accumulated other comprehensive gain (loss)
Balance, beginning of year
Accumulated translation loss reclassified to earnings
Other comprehensive earnings
Balance, end of year

Total

Dividends per share

February 1, 2025

February 3, 2024

January 28, 2023

$3,418 
20 
58 
$3,496 

($2,578)
39 
294 
(124)
— 
($2,369)

$8 
— 
5 
$13 

$1,140 

$0.76 

$3,353 
20 
45 
$3,418 

($2,588)
— 
134 
(123)
(1)
($2,578)

($26)
33 
1 
$8 

$848 

$0.76 

$3,283 
29 
41 
$3,353 

($2,652)
— 
245 
(119)
(62)
($2,588)

($50)
— 
24 
($26)

$739 

$0.76 

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

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Nordstrom, Inc.
Consolidated Statements of Cash Flows
(Amounts in millions)
Fiscal year
Operating Activities
Net earnings
Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization expenses
Canada wind-down costs
Asset impairment
Right-of-use asset amortization
Deferred income taxes, net
Stock-based compensation expense
Other, net
Change in operating assets and liabilities:

Accounts receivables, net
Merchandise inventories
Prepaid expenses and other assets
Accounts payable
Accrued salaries, wages and related benefits
Other current liabilities
Lease liabilities
Other liabilities

Net cash provided by operating activities

Investing Activities

Capital expenditures
Decrease in cash and cash equivalents resulting from Canada deconsolidation
Proceeds from the sale of assets and other, net

Net cash used in investing activities

Financing Activities

Proceeds from revolving line of credit
Payments on revolving line of credit
Principal payments on long-term debt
Change in cash book overdrafts
Cash dividends paid
Payments for repurchase of common stock
Proceeds from issuances under stock compensation plans
Other, net

Net cash used in financing activities

Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

Supplemental Cash Flow Information

Income taxes paid, net of refunds received
Interest paid, net of capitalized interest

2024

$294 

603 
— 
51 
187 
(100)
72 
(25)

78 
(115)
19 
(16)
180 
73 
(266)
232 
1,267 

(516)
— 
28 
(488)

— 
— 
(250)
(4)
(124)
— 
20 
(14)
(372)

— 
407 
628 
$1,035 

$149 
126 

2023

$134 

586 
207 
30 
184 
(60)
52 
(71)

(53)
(61)
14 
40 
(42)
(73)
(272)
6 
621 

(569)
(33)
31 
(571)

— 
— 
— 
2 
(123)
(1)
20 
(7)
(109)

— 
(59)
687 
$628 

$53 
143 

2022

$245 

604 
— 
80 
185 
(83)
59 
(46)

23 
265 
(24)
(190)
(94)
44 
(269)
147 
946 

(473)
— 
80 
(393)

100 
(100)
— 
(14)
(119)
(62)
29 
(20)
(186)

(2)
365 
322 
$687 

$211 
136 

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company
Founded in 1901 as a retail shoe business in Seattle, Washington, our Company is a leading fashion retailer that offers an extensive
selection of high-quality third-party and private-brand merchandise for women, men, young adults and children, with a focus on apparel,
shoes, beauty, accessories and home goods. This breadth of merchandise allows us to serve a wide range of customers who appreciate
quality fashion and a superior shopping experience, across our digital and physical assets and in both our Nordstrom and Nordstrom Rack
banners. Our facilities and stores are located in 41 states in the U.S.

As of February 1, 2025, Nordstrom includes:

• 92 Nordstrom stores

• Nordstrom.com website and mobile application

• six Nordstrom Locals

As of February 1, 2025, Nordstrom Rack includes:

• 277 Nordstrom Rack stores

• NordstromRack.com website and mobile application

• two Last Chance clearance stores

Fiscal Year
We operate on a 52/53-week fiscal year ending on the Saturday closest to January 31st. References to 2024 and any other year included
within this document are based on a 52-week fiscal year, except for fiscal year 2023, which was a 53-week fiscal year.

Principles of Consolidation
The Consolidated Financial Statements include the balances of Nordstrom, Inc. and its subsidiaries and are presented in U.S. dollars. All
intercompany transactions and balances are eliminated in consolidation and reflect all adjustments of a normal recurring nature that are, in
management’s opinion, necessary for the fair presentation of the results of operations, financial position and cash flows for the periods
presented.

On March 2, 2023, Nordstrom Canada commenced a wind-down of its business operations (see Note 2: Canada Wind-down) and as of this
date, Nordstrom Canada was deconsolidated from Nordstrom, Inc.’s financial statements. Nordstrom Canada results prior to March 2, 2023
are included in the Company’s Consolidated Financial Statements for the periods ended February 3, 2024 and prior.

Use of Estimates
The preparation of financial statements in conformity with GAAP requires that we make estimates, judgments and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities during the reporting period.
Uncertainties regarding such estimates and assumptions are inherent in the preparation of financial statements. Actual results may differ
from these estimates and assumptions. Our most significant accounting judgments and estimates include revenue recognition, inventory
valuation, long-lived asset recoverability, income taxes and contingent liabilities.

Revenue

Net Sales
We recognize sales revenue net of estimated returns and excluding sales taxes. Revenue from sales shipped to customers from our Supply
Chain Network facilities, stores and directly from our vendors, which includes shipping revenue when applicable, is recognized at shipping
point, the point in time where control has transferred to the customer. Costs to ship orders to customers are expensed as a fulfillment activity
at shipping point, commissions from sales at our Nordstrom stores are expensed at the point of sale and both are recorded in SG&A
expenses. Sales revenue from Marketplace is recorded on a net basis, representing the commission fee earned.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

We reduce sales and cost of sales by an estimate of future customer merchandise returns, which is calculated based on historical and
expected return patterns, and record a sales return reserve and an estimated returns asset. Our sales return reserve is classified in other
current liabilities and our estimated returns asset, calculated based on the cost of merchandise sold, is classified in prepaid expenses and
other on the Consolidated Balance Sheets. As of February 1, 2025 and February 3, 2024, our sales return reserve was $379 and $377, and
our estimated returns asset was $190 and $164. Due to the seasonality of our business, these balances typically increase when higher sales
occur in the last month of a period, such as during the Anniversary Sale, which usually occurs at the end of the second quarter, and decrease
in the following period. We record the impact of the sales return reserve separately in both our Nordstrom and Nordstrom Rack banners. The
majority of our returns from both digital and physical sales come through our stores.

Loyalty Program
The Nordy Club is our customer loyalty program that incorporates a traditional point and benefit system, while providing customers exclusive
access to products and events, enhanced services, personalized experiences and more convenient ways to shop. Customers accumulate
points based on their level of spending and type of participation. Upon reaching certain point thresholds, customers receive Nordstrom Notes,
which can be redeemed for goods or services across Nordstrom, including Marketplace, and Nordstrom Rack. The Nordy Club benefits vary
based on the level of customer spend, and include bonus points days and shopping and fashion events.

We offer customers access to a variety of payment products and services, including a selection of Nordstrom-branded Visa® credit cards, as
well as a Nordstrom-branded private-label credit card for Nordstrom purchases. When customers use a Nordstrom-branded credit or debit
card, they also participate in The Nordy Club and receive additional benefits, which can vary depending on the level of spend, including early
access to the Anniversary Sale, enhanced alterations and stylist benefits and incremental accumulation of points toward Nordstrom Notes.

As our customers earn points and Nordstrom Notes in The Nordy Club, a portion of underlying sales revenue is deferred based on an
estimated standalone selling price of points, Nordstrom Notes and other loyalty benefits, such as alterations. As Nordstrom Notes expire one
year from issuance, we recognize the revenue and related cost of sale when the Nordstrom Notes are ultimately redeemed and reduce our
contract liability. We include the deferred revenue in other current liabilities on the Consolidated Balance Sheets. We record breakage
revenue of unused points and unredeemed Nordstrom Notes based on expected customer redemption. We estimate, based on historical and
expected usage, that approximately 7% of Nordstrom Notes and points will be unredeemed. Estimating future breakage rates requires
judgment based on current and historical trends, and actual breakage rates may vary from our estimates. Other benefits of the loyalty
program, including shopping and fashion events, are recorded in SG&A as these are not a material right of the program.

As of February 1, 2025 and February 3, 2024, our outstanding performance obligation for The Nordy Club, which consists primarily of
unredeemed points and Nordstrom Notes at retail value, was $109 and $115. Almost all Nordstrom Notes redemptions occur within eleven
months of issuance.

Gift Cards
We record deferred revenue from the sale of gift cards at the time of purchase. As gift cards are redeemed, we recognize revenue and
reduce our contract liability. Although our gift cards do not have an expiration date, we include this deferred revenue in other current liabilities
on the Consolidated Balance Sheets as customers can redeem gift cards at any time. We record breakage revenue on unused gift cards
based on expected customer redemption. We estimate, based on historical usage, that 4% of gift cards will be unredeemed and recognized
as revenue. Estimating future breakage rates requires judgment based on current and historical trends, and actual breakage rates may vary
from our estimates. Breakage income was $54, $52 and $40 in 2024, 2023 and 2022.

As of February 1, 2025 and February 3, 2024, our outstanding performance obligation for unredeemed gift cards was $327 and $343. Almost
all gift card redemptions occur within two years of issuance.

Credit Card Revenues, net
Although the primary purpose of offering our credit cards is to foster greater customer loyalty and drive more sales, we also receive credit
card revenue through our program agreement with TD. Under that agreement, which was amended in October 2024 and now runs through
March 2032, TD is the exclusive issuer of Nordstrom-branded consumer credit cards. Credit card revenues, net include our portion of the
ongoing credit card revenue, net of credit losses, pursuant to our program agreement with TD. In connection with the amendment, we
recorded deferred revenue, which will be combined with the remaining deferred revenue recorded as part of our 2022 amendment and
recognized in full over the term of the agreement. Our outstanding performance obligation for the TD agreement is included in other current
liabilities and other liabilities on our Consolidated Balance Sheets and the amortization is included in other operating, net on the Consolidated
Statements of Cash Flows.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Cost of Sales
Cost of sales primarily includes the purchase and manufacturing costs of inventory sold, net of vendor allowances, and in-bound freight and
duty expense.

Buying and Occupancy Costs
Buying costs consist primarily of compensation and other costs incurred by our merchandising and product development groups. Occupancy
costs include rent, depreciation, property taxes and facility operating costs of our stores, office facilities and Supply Chain Network facilities.

Selling, General and Administrative Expenses
SG&A consists primarily of compensation and benefits, marketing, outbound supply chain and technology costs.

Shipping and Fulfillment Costs
Our shipping and fulfillment costs include payments to third-party shippers and costs to hold, move and prepare merchandise for shipment.
These costs do not include in-bound freight to our Supply Chain Network facilities, which we include in the cost of our inventory. Shipping and
fulfillment costs of $758, $712 and $885 in 2024, 2023 and 2022 were included in SG&A.

Advertising
Advertising production costs for internet and print advertising, store events and other media are expensed the first time the advertisement is
run. Online marketing costs are expensed when incurred. Total advertising expenses, net of vendor allowances, of $318, $313 and $309 in
2024, 2023 and 2022 were included in SG&A.

Vendor Allowances
We receive allowances from merchandise vendors for beauty expenses, purchase price adjustments, advertising programs and various other
expenses. Allowances for beauty expenses, advertising programs and other expenses are recorded in SG&A as a reduction of the related
costs when incurred. Purchase price adjustments are recorded as a reduction of cost of sales at the point they have been earned and the
related merchandise has been marked down or sold. Advertising includes NMN, where vendors pay a fee for certain benefits, such as the
use of our first-party data. Funds received from vendors are recorded as a reduction of the campaign cost in SG&A to the extent of the
advertising costs incurred, with the excess treated as a reduction of cost of sales.

Vendor allowances earned are as follows:
Fiscal year
Beauty expenses
Purchase price adjustments
1
Advertising
Other
Total vendor allowances

2024
$114 
105 
97 
8 
$324 

2023
$114 
94 
87 
6 
$301 

2022
$111 
120 
112 
2 
$345 

1 

Excludes advertising allowances in excess of costs incurred of $60, $40 and $24 in 2024, 2023 and 2022, which are recorded as a reduction of cost of sales.

401(k) Plan
We provide a 401(k) plan for our employees that allows for employee elective contributions and our matching contributions. Employee
elective contributions are funded through voluntary payroll deductions. Total expenses related to Company contributions were $76 in 2024
and $71 in 2023 and 2022, and were included in both buying and occupancy costs and SG&A on our Consolidated Statements of Earnings.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Stock-Based Compensation
The EIP authorizes the grant of stock options, PSUs, RSUs, stock appreciation rights and both restricted and unrestricted shares of common
stock to employees and nonemployee directors. We grant stock-based awards under our EIP and employees may purchase our stock at a
discount under our ESPP. We predominantly recognize stock-based compensation expense related to stock-based awards at their estimated
grant date fair value, recorded on a straight-line basis over the requisite service period. Compensation expense for certain award holders is
accelerated based upon age and years of service. Compensation expense for PSUs is adjusted based on the payout percentage of the PSU
grant subject to achieving specific performance measures. The total compensation expense is reduced by actual forfeitures as they occur.

We primarily estimate the grant date fair value of stock options using the Binomial Lattice-based valuation model, but for our price-hurdle
grants in 2021, we estimate the grant date fair value using the Monte Carlo simulation valuation model. The grant date fair value of RSUs
and PSUs is determined based on the number of RSUs or PSUs granted and the quoted price of our common stock on the date of grant, less
the estimated present value of dividends over the vesting period. PSUs granted are classified as equity.

Amounts included on the following line items of our Consolidated Statements of Shareholders’ Equity and our Consolidated Statements of
Cash Flows are as follows:

•

•

Issuance of common stock under stock compensation plans — includes common stock option exercises and purchases of shares
under the ESPP

Stock-based compensation — primarily includes stock-based compensation expense for our common stock options, RSUs and
PSUs, partially offset by shares withheld for taxes on RSUs and PSUs

New Store Opening Costs
Certain expenses associated with opening new stores, including marketing expenses, relocation expenses and occupancy costs, are not
capitalized and are charged to expense as incurred. These costs are included in both buying and occupancy costs and SG&A, according to
their nature as disclosed above.

Income Taxes
We use the asset and liability method of accounting for income taxes. Using this method, deferred tax assets and liabilities are recorded
based on differences between the financial reporting and tax basis of assets and liabilities and for operating loss and tax credit carryforwards.
The deferred tax assets and liabilities are calculated using the enacted tax rates and laws that are expected to be in effect when the
differences are expected to reverse. We routinely evaluate the likelihood of realizing the benefit of our deferred tax assets and may record a
valuation allowance if, based on all available evidence, it is determined that some portion of the tax benefit will not be realized.

We regularly evaluate the likelihood of realizing the benefit for income tax positions we have taken in various federal, state and foreign filings
by considering all relevant facts, circumstances and information available. If we believe it is more likely than not that our position will be
sustained, we recognize a benefit at the largest amount we believe is cumulatively greater than 50% likely to be realized. Interest and
penalties related to income tax matters are classified as a component of income tax expense.

Income taxes require significant management judgment regarding applicable statutes and their related interpretation, the status of various
income tax audits and our particular facts and circumstances. Also, as audits are completed or statutes of limitations lapse, it may be
necessary to record adjustments to our taxes payable, deferred taxes, tax reserves or income tax expense.

Earnings Per Share
Earnings per basic share is computed using the weighted-average number of common shares outstanding during the year. Earnings per
diluted share uses the weighted-average number of common shares outstanding during the year plus dilutive common stock equivalents,
primarily RSUs and stock options. Dilutive common stock is calculated using the treasury stock method and includes outstanding RSUs and
options that would reduce the amount of earnings for which each share is entitled. Anti-dilutive shares (including stock options and other
shares) are excluded from the calculation of diluted shares and earnings per diluted share because their impact could increase earnings per
diluted share.

Comprehensive Net Earnings
Comprehensive net earnings consist of net earnings and other gains and losses affecting equity that are excluded from net earnings. These
consist of postretirement plan adjustments, net of related income tax effects, and foreign currency translation adjustments.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Cash Equivalents
Cash equivalents are short-term investments with an original maturity of three months or less from the date of purchase and are carried at
cost, which approximates fair value. At the end of 2024 and 2023, checks not yet presented for payment drawn in excess of our bank deposit
balances were $58 and $62. Amounts are included in accounts payable on our Consolidated Balance Sheets and in change in cash book
overdrafts as a financing activity in our Consolidated Statements of Cash Flows.

Accounts Receivable
Accounts receivable, net primarily includes receivables from TD related to our program agreement, non-Nordstrom-branded credit and debit
cards and developer reimbursements. As of February 1, 2025 and February 3, 2024, accounts receivable, net also includes the amount we
believe probable of receipt as part of the claims process related to the wind-down of Canada (see Note 2: Canada Wind-down).

Merchandise Inventories and Change in Accounting Principle
Effective February 4, 2024, we changed our method of accounting for merchandise inventories from the retail inventory method to the
weighted average cost method. Under this new method, merchandise inventories are stated at the lower of cost or net realizable value using
the weighted average cost method. Under this method, the weighted average purchase price is calculated and applied to owned inventory
units. We record reserves for excess and obsolete inventory based on specific identification of units with a current retail value below cost,
plus an estimate of future markdowns below cost, which considers the age of inventory and historical trends.

We believe using the weighted average cost method is preferable to the retail inventory method and consistent with our overall strategy
because it provides more precise data and enhances visibility into item-level profitability, which drives faster decisions and better outcomes.
We determined that retrospective application for periods prior to fiscal year 2024 was impracticable due to lack of available information. We
recorded the cumulative effect of this change in accounting principle as of February 4, 2024, resulting in a decrease to accumulated deficit of
$39, net of tax of $14.

We take physical inventory counts at our stores and Supply Chain Network locations and adjust for differences between recorded and
counted amounts. Following each physical inventory cycle and using the most recent physical inventory count and historical results, we
record an estimate for shrinkage as a percentage of weighted average cost until the next physical inventory count.

Leases
We lease the land, buildings, or land and buildings for many of our stores, office facilities and Supply Chain Network facilities and record
leases, which consist primarily of operating leases, on the Consolidated Balance Sheets as operating lease ROU assets and operating lease
liabilities, both of which include current and noncurrent portions. Operating lease liabilities are initially recognized based on the net present
value of the fixed portion of our lease and common area maintenance payments from lease commencement through the lease term. To
calculate the net present value, we apply an incremental borrowing rate. The incremental borrowing rate is determined using a portfolio
approach based on the rate of interest we would pay to borrow an amount equal to the lease payments on a collateralized basis over a
similar term. We use quoted interest rates obtained from financial institutions as an input to derive our incremental borrowing rate as the
discount rate for the lease. We recognize ROU assets based on operating lease liabilities reduced by property incentives received from
landlords. We test ROU assets for impairment in the same manner as long-lived assets and exclude the related operating lease liability and
operating lease payments in our analysis.

Land, Property and Equipment
Land is recorded at historical cost, while property and equipment are recorded at cost less accumulated depreciation and amortization.
Capitalized software includes the costs of developing or obtaining internal-use software, including external direct costs of materials and
services and internal payroll costs related to the software project.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

We capitalize interest on construction in progress and software projects during the period in which expenditures have been made, activities
are in progress to prepare the asset for its intended use and actual interest costs are being incurred. Depreciation and amortization are
computed using the straight-line method over the asset’s estimated useful life, which is determined by asset category as follows:
Asset
Buildings and improvements
Store fixtures and equipment
Leasehold improvements
Capitalized software

Life (in years)
5 – 40
3 – 15
5 – 40
2 – 7

Leasehold improvements and leased property and equipment that are purchased at the inception of the lease, or during the lease term, are
amortized over the shorter of the lease term or the asset life. Lease terms include the fixed, non-cancelable term of a lease, plus any renewal
periods determined to be reasonably assured.

Long-Lived Assets
When facts and circumstances indicate the carrying values of buildings, equipment and ROU assets may be impaired, we compare the
carrying value to the related projected future cash flows, among other quantitative and qualitative analyses. Cash flow analysis requires
judgment regarding many factors, such as revenues, growth rates, expenses, capital expenditures and sublease income. These projections
are inherently subject to uncertainties. While we believe the inputs and assumptions utilized in our future cash flows are reasonable, our
estimates may change in the near term based on our current and future performance. Land, property and equipment are grouped at the
lowest level at which there are identifiable cash flows when assessing impairment, while cash flows for our retail store assets are identified at
the individual store level.

The following table provides details related to asset impairment charges for each fiscal year:

1
Long-lived asset impairment
1
Operating lease ROU asset impairment
Asset impairment

2024

2023

2
2022

$27 
24 
$51 

$9 
21 
$30 

$68 
12 
$80 

1 

2 

After impairment, the carrying values of the remaining long-lived tangible and ROU assets were not material.
Amounts include impairment charges of $70 related to supply chain and $10 related to the wind-down of Trunk Club.

Supply Chain Impairments
During the second quarter of 2024, fourth quarter of 2023 and the third quarter of 2022, as part of our various supply chain optimization
initiatives, we incurred non-cash impairment charges to adjust the carrying values to their estimated fair values for certain supply chain
assets. These charges are included in SG&A on the Consolidated Statement of Earnings, unallocated Corporate/Other expenses in Note 15:
Segment Reporting and in asset impairment on the Consolidated Statement of Cash Flows. We evaluated the assets for impairment by
comparing the carrying values to the related projected future cash flows, among other quantitative and qualitative analyses.

Trunk Club Wind-down
During the first quarter of 2022, in conjunction with the decision to sunset the Trunk Club brand, we incurred a non-cash impairment charge
of $10 related to a Trunk Club property to adjust the carrying values to their estimated fair value. These charges are included in our Retail
segment SG&A on the Consolidated Statement of Earnings and in asset impairment on the Consolidated Statement of Cash Flows.

During the second quarter of 2022, we also incurred additional costs of $8 associated with the wind-down of Trunk Club. These expenses are
primarily included in our Retail segment cost of sales and related buying and occupancy costs on the Consolidated Statement of Earnings.
All charges are classified as operating on the Consolidated Statement of Cash Flows.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Goodwill
Goodwill represents the excess of acquisition cost over the fair value of the related net assets acquired and is not subject to amortization. We
review our goodwill annually for impairment, as of the first day of the fourth quarter, or when circumstances indicate that the carrying value
may exceed the fair value. We perform this evaluation at the reporting unit level, all in our Retail segment. Our goodwill is allocated to two
reporting units, Nordstrom and NordstromRack.com. When evaluating these assets for impairment, we may first perform a qualitative
assessment to determine whether it is more likely than not that a reporting unit is impaired. If we determine that it is more likely than not that
the carrying value exceeds the fair value of the reporting unit, we perform a quantitative fair value test. We may also choose to bypass this
qualitative assessment and perform the quantitative assessment.

As of February 1, 2025 and February 3, 2024, we had goodwill of $249. To determine fair value, we compare the carrying value of the
reporting unit to its estimated fair value, which is based on the expected present value of future cash flows (income approach), comparable
public companies (market approach) or a combination of both. Determining fair value using these approaches requires management
assumptions, estimations and judgments regarding factors like overall economic conditions, prospective financial information, growth rates,
terminal value, discount rates and market multiples. If fair value is lower than the carrying value, an impairment charge is recognized in an
amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Based on the results of our evaluations,
we had no goodwill impairment in 2024, 2023 or 2022.

Investments
From time to time, we invest in financial interests of certain private companies and venture capital funds that align with our business and
omni-channel strategies, which are recorded in other assets in the Consolidated Balance Sheets and proceeds from the sale of assets and
other, net on the Consolidated Statements of Cash Flows.

As of February 1, 2025 and February 3, 2024, we held $40 and $41 of equity interests in certain venture capital funds, which are recorded at
fair value using the practical expedient estimate of NAV or its equivalent.

During the first quarter of 2022, in connection with the sale of a limited partnership interest in a corporate office building, we recognized a
gain of $51 included in SG&A in the Consolidated Statement of Earnings and unallocated Corporate/Other expenses in Note 15: Segment
Reporting, and recognized $73 in proceeds from the sale of assets and other, net on the Consolidated Statement of Cash Flows.

Self-Insurance
We retain a portion of the risk for certain losses related to employee health and welfare, workers’ compensation and other liability claims.
Liabilities associated with these losses include undiscounted estimates of both losses reported and losses incurred but not yet reported. We
estimate our ultimate cost using an actuarially-based analysis of claims experience, regulatory changes and other relevant factors.

Foreign Currency
On March 2, 2023, Nordstrom Canada commenced a wind-down of its business operations. The functional currency of our Canadian
operations was the Canadian Dollar. Prior to deconsolidation, we translated assets and liabilities into U.S. Dollars using the exchange rate in
effect at the balance sheet date, while we translated revenues and expenses using an average exchange rate for the period. We recorded
these translation adjustments as a component of accumulated other comprehensive loss on the Consolidated Balance Sheets. In the first
quarter of 2023, we recognized a charge of $33 related to the derecognition of the accumulated comprehensive loss on foreign currency
translation (see Note 2: Canada Wind-down).

Proposed Merger
On December 22, 2024, Nordstrom, Inc. entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Norse Holdings, Inc.,
a Delaware corporation (“Parent”), and Navy Acquisition Co. Inc., a Washington corporation and a direct, wholly owned subsidiary of Parent
(“Acquisition Sub”). The Merger Agreement provides that, on the terms and subject to the conditions of the Merger Agreement, Acquisition
Sub will merge with and into Nordstrom, Inc., with Nordstrom, Inc. continuing as the surviving corporation and becoming a wholly-owned
subsidiary of Parent.

Under the terms of the Merger Agreement, upon the closing of the Merger, our shareholders will receive $24.25 per share in cash, without
interest and less any required tax withholdings, for each share of common stock they hold on the transaction closing date, without interest
and less any required tax withholdings. In addition, prior to and contingent upon closing, Nordstrom, Inc. may declare a special dividend of up
to $0.25 per share (based on the amount of available cash on hand of Nordstrom, Inc. and its subsidiaries). Upon completion of the Merger,
our shares of common stock will be delisted on the NYSE, and Nordstrom, Inc. will become a private company.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

The consummation of the Merger is subject to certain closing conditions, including: (i) the approval of the Merger Agreement by two-thirds of
the outstanding shares of our Company common stock and a majority of the outstanding shares of our Company common stock other than
shares owned by Parent, Acquisition Sub, Liverpool, the Family Group, or their respective affiliates or by any director or Section 16 officer of
the Company (together, the “Requisite Shareholder Approvals”); (ii) the expiration or termination of the applicable waiting period under the
HSR Act or the grant of early termination thereof; (iii) the absence of any then effective order issued by any court of competent jurisdiction in
the United States that prohibits, enjoins, or makes illegal the Merger; and (iv) the absence of a Below Investment Grade Rating Event (as
defined in the Merger Agreement) that has occurred and is continuing. On February 13, 2025, the HSR waiting period expired.

The Merger Agreement contains certain termination rights for the Company and Parent. Under the terms of the Merger Agreement,
Nordstrom, Inc. may be required to pay Parent a termination fee of $85 if the Merger Agreement is terminated due to a change or withdrawal
of the Company Board of Director’s recommendation in favor of the Merger or a termination fee of $42.5 under certain other specified
circumstances. The Merger Agreement additionally provides that Parent may be required to pay to the Company a termination fee equal to
$170 if the Merger Agreement is validly terminated by the Company due to Parent materially breaching its representations, warranties or
covenants or $100 if the Merger Agreement is validly terminated by either the Company or Parent due to a Below Investment Grade Rating
Event (as defined in the Merger Agreement).

In the fourth quarter of 2024, we recognized privatization fees of $18 in connection with the Merger Agreement, which are included in SG&A
on the Consolidated Statement of Earnings and unallocated Corporate/Other expenses in Note 15: Segment Reporting.

Reclassification
We reclassified amounts in our fiscal 2023 and 2022 Consolidated Statements of Cash Flows to conform with current period presentation. As
a result, we disaggregated:

•

Accounts receivable, net and prepaid expenses and other assets

• Other current liabilities and other liabilities

These reclassifications had no impact on cash flows from operations, cash flows from investing or cash flows from financing.

Recent Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires
disclosure of additional income tax information, primarily related to the rate reconciliation and income taxes paid. Annual disclosure
requirements will be effective for us for the fourth quarter of 2025, with early adoption permitted. We are currently evaluating the impact of
this ASU on our disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation
Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure about specific expense
categories included in the income statement. Annual disclosure requirements will be effective for us for the fourth quarter of 2027, and
quarterly disclosure requirements will be effective for us in the first quarter of 2028, with early adoption permitted. We are currently evaluating
the impact of this ASU on our disclosures.

NOTE 2: CANADA WIND-DOWN

Background
On March 2, 2023, as part of our initiatives to drive long-term profitable growth and enhance shareholder value, and after careful
consideration of all reasonably available options, we announced the decision to discontinue support for Nordstrom Canada’s operations.
Accordingly, Nordstrom Canada commenced a wind-down of its business operations, obtaining an Initial Order from the Ontario Superior
Court of Justice under the CCAA on March 2, 2023 to facilitate the wind-down in an orderly fashion. Nordstrom Canada’s e-commerce
platform ceased operations on March 2, 2023 and the closure of six Nordstrom and seven Nordstrom Rack stores was completed in June
2023.

The Ontario Superior Court of Justice appointed a monitor to oversee the wind-down process. Subsequent to the CCAA filing, Nordstrom has
been providing limited support to Nordstrom Canada for the purpose of supporting an orderly wind-down, including providing shared services
and temporary use of intellectual property.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Wind-down Charges and Deconsolidation of Nordstrom Canada
The following table details the pre-tax charges recorded in 2023 associated with the wind-down of operations in Canada:

Fiscal year
1
Loss on Canada write-off
1
Accumulated translation loss reclassified to earnings
Contingent liabilities
2
Other exit costs
Total pre-tax charges

2023
$176 
33 
70 
5 
$284 

 Non-cash charges are included in Canada wind-down costs on the Consolidated Statement of Cash Flows.
1
2
 Other exit costs include funding an employee trust, net of expected recoveries, and professional fees.

These charges recorded in 2023 are primarily included within unallocated Corporate/Other expenses in Note 15: Segment Reporting. The
decrease in cash due to the deconsolidation of Nordstrom Canada is included in investing activities on the Consolidated Statement of Cash
Flows and all other impacts are included in operating cash flows.

Loss on Canada Write-off and Accumulated Translation Loss
While Nordstrom continues to own 100% of the shares of Nordstrom Canada, as of March 2, 2023, the date of the CCAA filing, we no longer
have a controlling interest under GAAP and have deconsolidated Nordstrom Canada. We hold a variable interest in the Nordstrom Canada
entities, which are considered variable interest entities, but are not consolidated, as we are no longer the primary beneficiary.

For the year ended February 3, 2024, we recorded a pre-tax loss on Canada write-off of $176 that included the derecognition of Nordstrom
Canada’s assets and liabilities and the write-down of both our Nordstrom Canada investment and related-party receivables to estimated fair
value. In addition, we recognized a charge of $33 in 2023 related to the derecognition of the accumulated comprehensive loss on foreign
currency translation.

To assess the estimated fair value of our Nordstrom Canada investment and our related-party receivables, we estimated the assets available
for distribution in relation to expected claims. At the time of filing for CCAA protection on March 2, 2023, the estimated amount of Nordstrom
Canada’s liabilities exceeded the estimated fair value of assets available for distribution to creditors, and we believed we would not recover a
significant portion of our receivables. As a result, our fair value was recorded as zero in our Condensed Consolidated Balance Sheets as of
April 29, 2023. As of February 3, 2024, we adjusted our receivables by an immaterial amount based on currently available information.

Prior to deconsolidation, Nordstrom made loans to the Canadian subsidiaries and incurred liabilities related to certain intercompany charges.
These were considered intercompany transactions and were eliminated in consolidation of Nordstrom. Subsequent to deconsolidation, these
liabilities and receivables were no longer eliminated through consolidation, are considered related-party transactions and are recorded in our
Consolidated Balance Sheets at estimated fair value. As of February 3, 2024, Nordstrom had a net outstanding liability to Nordstrom Canada
of $52 related to certain intercompany charges incurred prior to deconsolidation. As of February 1, 2025, Nordstrom had no outstanding
liability to Nordstrom Canada.

Contingent Liabilities and Guarantees
In the third quarter of 2023, Nordstrom, Inc. reached a settlement with former landlords related to guarantees of certain lease obligations of
Nordstrom Canada. As part of the agreements, we made cash payments to the former landlords in exchange for a release of substantially all
our guarantee obligations, as well as the right to these landlords’ distributions from Nordstrom Canada as part of the CCAA proceedings.

Receivables
As of February 1, 2025 and February 3, 2024, we recorded $11 and $71 in accounts receivable, net on the Consolidated Balance Sheets to
reflect the estimated amounts we expect to receive in the claims process. This includes receipts related to the rights to the former landlords’
distributions, reimbursement of employee trust contributions and other receivables existing at the time of deconsolidation. On March 1, 2024,
creditors approved a plan of arrangement, which was sanctioned by the Ontario Superior Court of Justice on March 20, 2024 and
implemented by Nordstrom Canada on April 25, 2024. Initial distributions pursuant to the plan of arrangement occurred in May 2024.

Employee Trust
In connection with the filing, Nordstrom contributed $11 in 2023 to establish an employee trust to fund termination and severance payments
to employees of Nordstrom Canada. As of February 3, 2024, the trust was terminated.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Debtor-in-Possession Financing
If needed, Nordstrom agreed to provide Nordstrom Canada debtor-in-possession financing up to $11. However, Nordstrom Canada had
sufficient liquidity to sustain operations through the wind-down period and did not borrow any amounts from Nordstrom.

Income Taxes
For the year ended February 3, 2024, we recognized net tax benefits of $95 primarily related to the write-off of our investment in Canada, net
of tax expense related to an increase in valuation allowance for Canada deferred tax assets.

NOTE 3: REVENUE

Contract Liabilities
Contract liabilities represent our obligation to transfer goods or services to customers and include deferred revenue for The Nordy Club
(including unused points and unredeemed Nordstrom Notes), gift cards and our TD program agreement. Our contract liabilities are classified
on the Consolidated Balance Sheets as follows:

Balance as of January 28, 2023
Balance as of February 3, 2024
Balance as of February 1, 2025

Other current liabilities
$536 
508 
502 

Other liabilities
$136 
85 
295 

Revenues recognized from our beginning contract liability balance were $309 and $316 for the years ended February 1, 2025 and
February 3, 2024.

In 2024, we amended our program agreement with TD, which will be combined with the deferred revenue from the prior amendment and
recognized in full over the term of the agreement as services are rendered. This recognition over time aligns with the satisfaction of the
performance obligations in the contract and our determination that the likelihood of a significant revenue reversal is not probable. The
transaction price is allocated to our performance obligations, which include the issuance rights and services associated with the transition of
servicing functions to TD, on a relative standalone selling price basis. The balance of deferred revenue of $361 as of February 1, 2025 is
included in other current liabilities and other liabilities on our Consolidated Balance Sheet. Agreement amortization is included in other
operating, net on the Consolidated Statements of Cash Flows.

Disaggregation of Revenue
The following table summarizes our disaggregated net sales:
Fiscal year
Nordstrom
Nordstrom Rack
Total net sales

2024
$9,390
5,167
$14,557

2023
$9,436
4,783
$14,219

Digital sales as a % of total net sales

36%

36%

The following table summarizes the percent of net sales by merchandise category:
Fiscal year
Women’s Apparel
Shoes
Men’s Apparel
Beauty
Accessories
Kids’ Apparel
Other
Total net sales

2024
29%
26%
15%
12%
11%
4%
3%
100 %

2023
27%
26%
15%
13%
12%
4%
3%
100 %

2022
$10,279
4,813
$15,092

38%

2022
28%
26%
15%
12%
13%
3%
3%
100 %

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Table of Contents

Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 4: LAND, PROPERTY AND EQUIPMENT
Land, property and equipment consist of the following:

Land and land improvements
Buildings and building improvements
Leasehold improvements
Store fixtures and equipment
Capitalized software
Construction in progress
Land, property and equipment
Accumulated depreciation and amortization
Land, property and equipment, net

February 1, 2025
$286 
1,383 
3,173 
4,076 
2,579 
289 
11,786 
(8,747)
$3,039 

February 3, 2024
$283 
1,365 
3,103 
3,873 
2,439 
365 
11,428 
(8,251)
$3,177 

NOTE 5: LEASES
We lease the land, buildings, or land and buildings for many of our stores, office facilities and Supply Chain Network facilities, as well as
equipment. The following table summarizes the majority of our fixed, non-cancelable lease terms:
Property Type
Nordstrom stores
Nordstrom Rack stores
Office and Supply Chain Network facilities

Lease Term (in years)
15 – 30
Approximately 10
5 – 20

Many of our leases include options that allow us to extend the lease term beyond the initial commitment period. At the commencement of a
lease, we generally include only the initial lease term as we have determined that options to extend are not reasonably certain to occur. The
exercise of lease renewal options is generally at our sole discretion. At the renewal of an expiring lease, we reassess our options in the
agreement and include all reasonably certain extensions in the measurement of our lease term.

Most of our leases also require us to pay certain expenses, such as common area maintenance charges, real estate taxes and other
executory costs, the fixed portion of which is included in Operating Lease Cost, as we combine lease and non-lease components. We
recognize Operating Lease Cost, which is primarily included in occupancy costs, on a straight-line basis over the lease term. Variable lease
cost includes payments for variable common area maintenance charges and additional payments based on a percentage of sales, which are
recognized when probable. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The following table summarizes the components of lease cost:
Fiscal year
Operating Lease Cost
Variable lease cost
Sublease income
Total lease cost, net

1

1
 Variable lease cost includes short-term lease cost, which was immaterial in 2024, 2023 and 2022.

2024
$291 
97 
(16)
$372 

2023
$278 
93 
(25)
$346 

2022
$280 
97 
(19)
$358 

60

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

The following table summarizes future lease payments as of February 1, 2025:
Fiscal year
2025
2026
2027
2028
2029
Thereafter
1
Total lease payments
Amount representing interest
2
Present value of net lease payments

1 

Total lease payments do not include payments for variable lease costs that are required by most of our lease agreements.
2
 Net lease payments exclude $123 of lease payments for operating leases that were signed but not yet commenced as of February 1, 2025.

Operating Leases
$332 
336 
286 
241 
205 
691 
2,091 
(426)
$1,665 

The following table includes supplemental information:
Fiscal year
Cash paid related to operating lease liabilities
Operating lease interest
Operating lease liabilities arising from lease agreements

Weighted-average remaining lease term
Weighted-average discount rate

NOTE 6: DEBT AND CREDIT FACILITIES

Debt
A summary of our long-term debt is as follows:

Long-term debt, net of unamortized discount:

Senior notes, 2.30%, due April 2024
Senior notes, 4.00%, due March 2027
Senior debentures, 6.95%, due March 2028
Senior notes, 4.375%, due April 2030
Senior notes, 4.25%, due August 2031
Senior notes, 7.00%, due January 2038
1
Senior notes, 5.00%, due January 2044

Deferred bond issuance costs
Total long-term debt
Current portion of debt
Total due beyond one year

1
 The unamortized discount on these notes was $54 and $57 as of February 1, 2025 and February 3, 2024.

2024
$364 
92 
317 

2023

$358 
86 
242 

2022

$354 
85 
260 

February 1, 2025
8 years
5.8 %

February 3, 2024
8 years
5.5 %

February 1, 2025

February 3, 2024

$— 
350 
300 
500 
425 
147 
912 
(16)
$2,618 
— 
$2,618 

$250 
349 
300 
500 
425 
147 
909 
(18)
$2,862 
(250)
$2,612 

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Required principal payments on long-term debt are as follows:
1
Fiscal year
2025
2026
2027
2028
2029
Thereafter

1
 Required principal payments exclude estimated future interest payments of $1,381 as of February 1, 2025, with $135 payable within one year.

During the first quarter of 2024, we retired our 2.30% senior notes due in April 2024 using cash on hand.

Interest Expense
The components of interest expense, net are as follows:
Fiscal year
Interest on long-term debt and short-term borrowings
Interest income
Capitalized interest
Interest expense, net

2024
$143 
(33)
(8)
$102 

2023
$150 
(33)
(13)
$104 

$— 
— 
350 
300 
— 
2,039 

2022
$150 
(10)
(12)
$128 

Credit Facilities
As of February 1, 2025 and February 3, 2024, we had no outstanding borrowings under the Revolver that expires in May 2027. As of
February 1, 2025, we have an outstanding standby letter of credit of $29 resulting in available short-term borrowing capacity of $771. This
letter of credit is not reflected in our Consolidated Balance Sheets. Provided that we obtain written consent from the lenders, we have the
option to increase the Revolver by up to $200, to a total of $1,000, and two options to extend the Revolver for additional one-year terms.

Any outstanding borrowings under the Revolver are secured by substantially all our personal and intellectual property assets and are
guaranteed by certain of our subsidiaries. Under the Revolver, our obligation to secure any outstanding borrowings will be eliminated if no
default exists and we either have an unsecured investment-grade debt rating from two of three specified ratings agencies, or we have one
investment-grade rating and achieve two consecutive fiscal quarters with a Leverage Ratio of less than 2.5 times.

Under the Revolver, we have two financial covenant tests that need to be met on a quarterly basis: a Leverage Ratio that is less than or
equal to 4 times and a fixed charge coverage ratio that is greater than or equal to 1.25 times. As of February 1, 2025, we were in compliance
with all covenants.

The Revolver contains customary representations, warranties, covenants and terms, including paying a variable rate of interest and a facility
fee based on our debt rating, and is available for working capital, capital expenditures and general corporate purposes. The Revolver allows
us to issue dividends and repurchase shares provided we are not in default and no default would arise as a result of such payments. If the
pro-forma Leverage Ratio after such payments is less than 3 times, then such payments are unlimited. If the pro-forma Leverage Ratio is
greater than or equal to 3 times but less than 3.5 times, then we are limited to $100 per fiscal quarter and if the pro-forma Leverage Ratio is
greater than or equal to 3.5 times, then the limit is $60 per fiscal quarter.

Our $800 commercial paper program allows us to use the proceeds to fund operating cash requirements. Under the terms of the commercial
paper agreement, we pay a rate of interest based on, among other factors, the maturity of the issuance and market conditions. The issuance
of commercial paper has the effect of reducing available liquidity under the Revolver by an amount equal to the principal amount of
commercial paper outstanding. Conversely, borrowings under our Revolver have the effect of reducing the available capacity of our
commercial paper program by an amount equal to the amount outstanding. As of February 1, 2025 and February 3, 2024, we had no
issuances outstanding under our commercial paper program.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 7: FAIR VALUE MEASUREMENTS
We disclose our financial assets and liabilities that are measured at fair value in our Consolidated Balance Sheets by level within the fair
value hierarchy as defined by applicable accounting standards:

Level 1: Quoted market prices in active markets for identical assets or liabilities
Level 2: Other observable market-based inputs or unobservable inputs that are corroborated by market data
Level 3: Unobservable inputs that cannot be corroborated by market data that reflect the reporting entity’s own assumptions

Financial instruments measured at carrying value on a recurring basis include cash and cash equivalents, accounts receivable, accounts
payable and our Revolver, which approximate fair value due to their short-term nature.

Long-term debt is recorded at carrying value. If long-term debt was measured at fair value, we would use quoted market prices of the same
or similar issues, which is considered a Level 2 fair value measurement. The following table summarizes the carrying value and fair value
estimate of our long-term debt, including current maturities:

Carrying value of long-term debt
Fair value of long-term debt

February 1, 2025
$2,618 
2,324 

February 3, 2024
$2,862 
2,441 

We measure certain items at fair value on a nonrecurring basis, primarily goodwill and long-lived tangible and ROU assets, in connection with
periodic evaluations for potential impairment. For more information regarding long-lived tangible asset impairment charges, see Note 1:
Nature of Operations and Summary of Significant Accounting Policies. We estimate the fair value of these assets using primarily
unobservable inputs and, as such, these are considered Level 3 fair value measurements. In the first quarter of 2023, we measured our
investment in Nordstrom Canada, our related-party receivables and related lease guarantees at fair value (see Note 2: Canada Wind-down).

Investments Measured at NAV
We have certain investments that are measured at fair value using the NAV per share, or its equivalent, as a practical expedient. This class
of investments consists of partnership interests that mainly invest in venture capital strategies with a focus on privately held consumer and
technology companies. The NAV is based on the fair value of the underlying net assets owned by the fund and the relative interest of each
participating investor in the fair value of the underlying assets. Our interest in these partnerships is generally not redeemable and is subject
to significant restrictions regarding transfers. Distributions from each fund will be received as the underlying assets of the funds are
liquidated. Liquidation is triggered by clauses within the partnership agreements or at the funds’ stated end date. The contractual terms of the
partnership interests range from six to ten years. For more information regarding investments measured at NAV, see Note 1: Nature of
Operations and Summary of Significant Accounting Policies.

NOTE 8: SELF-INSURANCE
Our self-insurance reserves are summarized as follows:

Workers’ compensation
Employee health and welfare
Other liability
Total self-insurance reserves

February 1, 2025
$70 
27 
21 
$118 

February 3, 2024
$73 
28 
18 
$119 

We are self-insured for the majority of our workers’ compensation programs, employee health and welfare coverage and other liability.
Our workers’ compensation policies have a retention per claim of $1 or less and no policy limits. Approximately 30% of our workers’
compensation obligations are payable within one year. In connection with our workers’ compensation programs, we have a standby letter of
credit issued on our behalf with $13 available and $2 outstanding as of February 1, 2025. This letter of credit is not reflected in our
Consolidated Balance Sheets.

Our employee health and welfare programs do not use stop-loss coverage and participants contribute to the cost of their coverage through
premiums and out-of-pocket expenses for deductibles, copays and coinsurance.

Other liability primarily includes commercial general liability obligations. Our commercial general liability policy, with a limit up to $111, has a
retention per claim of $1 or less. Approximately 60% of our other liability reserve obligations are payable within one year.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 9: SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
We have a SERP, which provides retirement benefits to certain officers and select employees. The SERP has different benefit levels
depending on the participant’s role. At the end of 2024, we had 57 participants in the plan, including five officers and select employees
eligible for SERP benefits, 44 retirees and eight beneficiaries. This plan is nonqualified and does not have a minimum funding requirement.
We selected the measurement date of January 31, the calendar month end closest to our fiscal year end, to value our SERP.

Benefit Obligation and Funded Status
Our benefit obligation and funded status is as follows:

Change in benefit obligation:

Benefit obligation at beginning of year

Participant service cost
Interest cost
Benefits paid
Actuarial gain

Benefit obligation at end of year

Change in plan assets:

Fair value of plan assets at beginning of year

Employer contribution
Benefits paid

Fair value of plan assets at end of year
Underfunded status at end of year

February 1, 2025

February 3, 2024

$168 
1 
8 
(11)
(8)
158 

— 
11 
(11)
— 
($158)

$176 
1 
9 
(11)
(7)
168 

— 
11 
(11)
— 
($168)

The accumulated benefit obligation, which is the present value of benefits, assuming no future compensation changes, was $158 and $168
at the end of 2024 and 2023. Amounts recognized as liabilities in the Consolidated Balance Sheets consist of the following:

Accrued salaries, wages and related benefits
Other liabilities (noncurrent)
Net amount recognized

February 1, 2025
$12 
146 
$158 

February 3, 2024
$12 
156 
$168 

Components of SERP Expense
The components of SERP expense recognized in SG&A on the Consolidated Statements of Earnings are as follows:
Fiscal year
Participant service cost
Interest cost
Amortization of net loss and other
Total SERP expense

2024
$1 
8 
— 
$9 

2023
$1 
9 
— 
$10 

Accumulated Other Comprehensive Gain (Loss)
Amounts recognized in accumulated other comprehensive gain (loss) (pre-tax) consist of the following:
Fiscal year
Actuarial gain
Amortization of net loss and other
Amounts recognized in accumulated other comprehensive gain (loss)

2024
$8 
— 
$8 

2023
$7 
— 
$7 

64

2022
$2 
6 
4 
$12 

2022
$34 
4 
$38 

Table of Contents

Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Assumptions
Weighted-average assumptions used to determine our benefit obligation and SERP expense are as follows:
Fiscal year
Assumptions used to determine benefit obligation:

2024

Discount rate
Rate of compensation increase

Assumptions used to determine SERP expense:

Discount rate
Rate of compensation increase

5.66 %
2.50 %

5.27 %
2.50 %

2023

5.27 %
2.50 %

4.95 %
2.50 %

Future Benefit Payments and Contributions
As of February 1, 2025, the expected future benefit payments based upon the assumptions described above and including benefits
attributable to estimated future employee service are as follows:
Fiscal year
2025
2026
2027
2028
2029
2030 – 2034
Thereafter

2022

4.95 %
2.50 %

3.19 %
2.50 %

$12 
12 
13 
13 
12 
61 
35 

NOTE 10: STOCK-BASED COMPENSATION
Under our stock-based compensation and deferred compensation plan arrangements, we issued 2.8, 2.4 and 3.4 shares of common stock in
2024, 2023 and 2022. Under the EIP, the aggregate number of shares authorized to be issued may not exceed 39.5 plus any shares
currently outstanding under the 2010 Equity Incentive Plan that are forfeited or expire during the term of the EIP. As of February 1, 2025, we
had 15.4 shares issued and outstanding and 16.5 shares remaining available for future grants under the EIP. Upon completion of the Merger,
unvested RSUs, stock options and PSUs would be converted to cash-based awards and vest on the same schedule. Unvested and vested
options would be canceled if their exercise price is equal to or greater than the merger consideration plus the amount of the special dividend,
and vested options would be paid in cash if their exercise price is less than the merger consideration plus the amount of the special dividend.
The amount of the cash payment would be based on the number of shares subject to the vested option and the difference of the merger
consideration, plus the amount of the special dividend, and the exercise price.

Under the ESPP, employees may make payroll deductions of up to 15% of their base compensation for the purchase of Nordstrom common
stock. At the end of each six-month offering period, participants apply their accumulated payroll deductions toward the purchase of shares of
our common stock at 90% of the fair market value on the last day of the offer period. As part of the Merger Agreement, the ESPP will
continue to operate with certain changes, including (i) the current offering period that began on November 1, 2024 will be the final offering
period, (ii) current participants will not be permitted to increase their payroll deduction election or contribution rate and (iii) no new participants
will be allowed to participate in the ESPP. As of February 1, 2025, we had 19.6 shares authorized and 4.1 shares remaining available for
issuance under the ESPP. We issued 0.7, 1.0 and 0.9 shares under the ESPP during 2024, 2023 and 2022. As of February 1, 2025 and
February 3, 2024, we had current liabilities of $5 for future purchases of shares under the ESPP.

Nordstrom, Inc. and subsidiaries 65

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

The following table summarizes our stock-based compensation expense:
Fiscal year
RSUs
Stock options
1
Other
Total stock-based compensation expense, before income tax benefit
Income tax benefit
Total stock-based compensation expense, net of income tax benefit

1
 Other stock-based compensation expense includes PSUs, nonemployee director stock awards and ESPP.

2024
$59 
2 
11 
72 
(18)
$54 

2023
$40 
6 
6 
52 
(13)
$39 

The stock-based compensation expense before income tax benefit was recorded in our Consolidated Statements of Earnings as follows:
Fiscal year
Cost of sales and related buying and occupancy costs
SG&A
Total stock-based compensation expense, before income tax benefit

2023
$10 
42 
$52 

2024
$12 
60 
$72 

2022
$41 
11 
7 
59 
(15)
$44 

2022
$9 
50 
$59 

Restricted Stock Units
Our CPCC approves grants of restricted stock units to employees. The number of units granted to an individual are determined based upon
award amounts and the fair value of the restricted stock units at the time of grant. Restricted stock units typically vest and convert to shares
over either three or four years.

A summary of restricted stock unit activity for 2024 is presented below:
Fiscal year

Outstanding, beginning of year
Granted
Vested
Forfeited or canceled
Outstanding, end of year

2024

Weighted-average
grant date fair value
per unit
$19 
16 
21 
17 
$17 

Shares
6.2 
4.7 
(2.3)
(1.0)
7.6 

The aggregate fair value of restricted stock units vested during 2024, 2023 and 2022 was $47, $33 and $62. As of February 1, 2025, the total
unrecognized stock-based compensation expense related to nonvested restricted stock units was $66, which is expected to be recognized
over a weighted-average period of 17 months.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Stock Options
Our CPCC approves grants of nonqualified stock options to employees. The number of awards granted to an individual are determined
based upon award amounts and the fair value of stock options at the time of grant. Our options primarily vest equally over a four-year period
or at the end of two years, and expire ten years after the date of grant. We did not grant options in 2024. We used the following assumptions
to estimate the fair value for stock options at each grant date:
Fiscal year
Assumptions

2023

2022

1

Risk-free interest rate
2
Weighted-average volatility
3
Weighted-average expected dividend yield
4
Expected life in years

Grant Date Information
Date of grant
Weighted-average fair value per option
Exercise price per option

3.98% – 5.05%
52.3 %
3.8 %
8.2

1.18% – 1.95%
52.4 %
3.4 %
8.3

March 6, 2023

March 3, 2022

$8 
$20 

$10 
$26 

1 

Represents the yield on U.S. Treasury securities that mature over the 10-year life of the stock options.
2
 Based on a combination of the historical volatility of our common stock and the implied volatility of exchange-traded options for our common stock.
3
 Our forecasted dividend yield for the next 10 years.
4
 Derived from the output of the Binomial Lattice-based valuation model and represents the estimated period of time until option exercise. The expected term of options granted
is based on our historical exercise behavior, taking into consideration the contractual term of the option and our employees’ expected exercise and post-vesting employment
termination behavior.

A summary of stock option activity for 2024 is presented below:
Fiscal year

Outstanding, beginning of year
Granted
Exercised
Forfeited or canceled
Outstanding, end of year
Exercisable, end of year

Fiscal year
1
Aggregate intrinsic value of options exercised
Fair value of stock options vested

2024

Weighted-
average
exercise price per
option
$35   
— 
17 
54 
$33 
$37 

Shares
7.6 
— 
(0.3)
(0.9)
6.4 
4.0 

2024
$2 
$4 

Weighted-average
remaining 
contractual
life (years)

Aggregate 
intrinsic 
1
value  

4
4

2023
$1 
$4 

$17 
$13 

2022
$4 
$27 

The aggregate intrinsic value represents the amount realized if all in-the-money options were exercised on the final business day before February 1, 2025.
1 

As of February 1, 2025, the total unrecognized stock-based compensation expense related to nonvested stock options was $3, which is
expected to be recognized over a weighted-average period of 5 months.

Nordstrom, Inc. and subsidiaries 67

 
 
 
 
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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 11: SHAREHOLDERS’ EQUITY
We have certain limitations with respect to the payment of dividends and share repurchases under our Revolver agreement (see Note 6:
Debt and Credit Facilities). While the Merger Agreement is in effect, we are prohibited from repurchasing shares of our common stock,
including under the stock repurchase program.

Changes in the number of issued and outstanding shares of our common stock in 2024, 2023 and 2022 are the result of compensation plan
issuances (see Note 10: Stock-based Compensation) and share repurchases.

Share Repurchases
In May 2022, our Board of Directors authorized a new program to repurchase up to $500 of our outstanding common stock, with no
expiration date, which replaced the August 2018 program. While the Merger Agreement is in effect, we are prohibited from repurchasing
shares of our common stock, including under the stock repurchase program, without the prior written consent of Parent. The following is a
summary of the activity related to our share repurchase programs:

Capacity at January 29, 2022
August 2018 program termination
May 2022 program authorization (no expiration)
Shares repurchased
Capacity at January 28, 2023
1
Shares repurchased
1
Capacity at February 3, 2024
Shares repurchased
Capacity at February 1, 2025

Shares

Average price
per share

2.8 

0.03 

— 

$22 

$19 

$— 

Amount
$707 
(707)
500 
(62)
438 
(1)
438 
— 
$438 

1
 Subtotal of ending share repurchase capacity may not foot due to rounding.

Dividends
We paid dividends of $0.76 per share in 2024, 2023 and 2022. In February 2025, subsequent to year end, we declared a quarterly dividend
of $0.19 per share, which will be paid on March 26, 2025 to shareholders of record as of March 11, 2025. While the Merger Agreement is in
effect, we are prohibited from, without the prior written consent of Parent, declaring dividends on our common stock other than regular
quarterly dividends not to exceed $0.19 per share, a stub period dividend contingent upon the closing of the Merger, and a special dividend
prior to and contingent upon the closing of the Merger.

Rights Plan
In September 2022, our Board of Directors approved the Shareholder Rights Agreement and declared a dividend of one right for each
outstanding share of Nordstrom common stock to shareholders of record on September 30, 2022. In June 2023, shareholders approved an
advisory vote on the extension of our Rights Plan at our 2023 Annual Meeting of Shareholders, and in August 2023, the Board of Directors
extended the expiration date to September 19, 2025, unless redeemed, exchanged or terminated earlier by our Board of Directors. Each right
entitles holders to purchase one newly issued share of Nordstrom common stock at an exercise price of $94 per right, subject to adjustment.
Initially, the rights are not exercisable and trade with our shares of common stock.

In general, the rights become exercisable following a public announcement that a person acquires 10% or more of the outstanding shares of
Nordstrom common stock. If the rights are exercised, each holder (except the acquiring person) will have the right to receive common stock
equal to two times the exercise price of the right. The Company may redeem the rights for $0.001 per right anytime prior to the rights
becoming exercisable. The agreement also provides for exceptions and additional terms for other certain situations and circumstances.
There is currently no impact to our Consolidated Financial Statements.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

In September 2024, we entered into a Second Amendment to the Shareholder Rights Agreement, which provides that the Family Group and
Liverpool shall be an exempt person under the Shareholder Rights Agreement until the earlier of (i) April 17, 2025 and (ii) the date that such
group increases their aggregate beneficial ownership of shares of the Company’s common stock to an amount greater than its beneficial
ownership on the date of the Amendment plus 0.1% of the then-outstanding shares of common stock (subject to specified exclusions). In
December 2024, we entered into a Third Amendment to the Shareholder Rights Agreement, which superseded the exemption of the Second
Amendment, provides that (i) the Parent Parties shall be an exempt person under the Shareholder Rights Agreement until five business days
following the valid termination of the Merger Agreement and (ii) a group composed of certain members of the Family Group who are
guaranteeing the performance and payment of certain of Parent’s obligations under the Merger Agreement shall be an exempt person under
the Shareholder Rights Agreement until five business days following the valid termination of the related limited guaranty.

NOTE 12: INCOME TAXES
U.S. and foreign components of earnings before income taxes were as follows:
Fiscal year
U.S.
Foreign
Earnings before income taxes

Income tax expense consists of the following:
Fiscal year
Current income taxes:

Federal
State and local
Foreign

Total current income tax expense
Deferred income taxes:

Federal
State and local
Foreign

Total deferred income tax benefit
Total income tax expense

2024
$393
—
$393

2024 

$170 
29 
— 
199 

(90)
(10)
— 
(100)
$99 

2023
$143
4
$147

2023 

$55 
18 
— 
73 

(59)
(10)
9 
(60)
$13 

A reconciliation of the statutory federal income tax rate to the effective tax rate on earnings before income taxes is as follows:
Fiscal year
Statutory rate
State and local income taxes, net of federal income taxes
Federal credits
Non-deductible expenses
Stock-based compensation
Valuation allowance
Taxes on foreign operations
Excess tax over book loss on Canada wind-down
Resolution of prior period tax matters
Other, net
Effective tax rate

2023 
21.0 %
4.0 %
(4.7 %)
2.9 %
5.1 %
6.6 %
1.5 %
(18.2 %)
(11.2 %)
1.6 %
8.6 %

2024 
21.0 %
3.9 %
(1.8 %)
1.4 %
1.1 %
— 
1.2 %
(2.0 %)
— 
0.5 %
25.3 %

2022
$316
21
$337

2022 

$149 
27 
(1)
175 

(86)
(2)
5 
(83)
$92 

2022 
21.0 %
5.9 %
(3.8 %)
1.2 %
1.8 %
0.4 %
1.6 %
— 
— 
(0.9 %)
27.2 %

Nordstrom, Inc. and subsidiaries 69

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

The components of deferred tax assets and liabilities are as follows:

February 1, 2025

February 3, 2024

Deferred tax assets:
Lease liabilities
Compensation and benefits accruals
Sales return reserve
Accrued expenses
Merchandise inventories
Gift cards
The Nordy Club loyalty program
Net operating losses
Other

Total deferred tax assets
Valuation allowance
Total deferred tax assets, net of valuation allowance
Deferred tax liabilities:

ROU assets
Land, property and equipment
Debt exchange premium
Total deferred tax liabilities
Net deferred tax assets

$440 
101 
49 
35 
33 
36 
7 
38 
35 
774 
(1)
773 

(336)
(61)
(11)
(408)
$365 

$425 
104 
56 
31 
36 
39 
2 
38 
36 
767 
(1)
766 

(310)
(164)
(11)
(485)
$281 

As of February 1, 2025 and February 3, 2024, state net operating loss carryforwards for income tax purposes was approximately $583 and
$621. The net operating loss carryforwards are subject to certain statutory limitations of applicable state laws. If not utilized, a portion of our
state net operating loss carryforwards will begin to expire in 2026.

As of February 1, 2025 and February 3, 2024, the valuation allowance for deferred tax assets was $1 for state net operating loss
carryforwards that will not be realized in the foreseeable future. As a result of the wind-down of our Canada operations in 2023, the valuation
allowance for foreign deferred tax assets increased $9 and upon deconsolidation was written off to zero. The write-off of the deferred tax
assets and corresponding valuation allowance for Canada was included in the Canada wind-down costs.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Fiscal year
Unrecognized tax benefit at beginning of year
Gross increase to tax positions in prior periods
Gross decrease to tax positions in prior periods
Gross increase to tax positions in current period
Settlements
Unrecognized tax benefit at end of year

2024
$24 
2 
(1)
5 
— 
$30 

2023
$48 
1 
(4)
6 
(27)
$24 

2022
$47 
1 
(6)
7 
(1)
$48 

At the end of 2024 and 2023, $27 and $22 of the ending gross unrecognized tax benefit related to items which, if recognized, would affect the
effective tax rate.

There was no material expense for interest and penalties in 2024, 2023 and 2022. At the end of 2024 and 2023, our liability for interest and
penalties was $5 and $3.

We file income tax returns in the U.S. With few exceptions, we are no longer subject to federal or state and local income tax examinations for
years before 2016. As of February 1, 2025, we believe it is reasonably possible unrecognized tax benefits related to federal, state and local
tax positions may decrease $11 by January 31, 2026, due to the completion of examinations and the expiration of various statutes of
limitations.

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

NOTE 13: COMMITMENTS AND CONTINGENCIES
Our estimated total purchase obligations, which primarily consist of inventory purchase orders, were $1,954 as of February 1, 2025. These
purchase obligations are primarily payable within one year.

NOTE 14: EARNINGS PER SHARE
The computation of EPS is as follows:
Fiscal year
Net earnings

Basic weighted-average shares outstanding
Dilutive shares
Diluted weighted-average shares outstanding

Basic EPS
Diluted EPS

Anti-dilutive shares

NOTE 15: SEGMENT REPORTING

2024
$294 

164.3 
4.6 
168.9 

$1.79 
$1.74 

6.1 

2023
$134 

161.8 
1.6 
163.4 

$0.83 
$0.82 

8.4 

2022
$245 

160.1 
2.0 
162.1 

$1.53 
$1.51 

8.7 

Segments
During the fourth quarter of 2024, we adopted ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment
Disclosures. As a result, all reporting periods are presented under the new standard and prior period segment disclosures have been
reclassified to conform to the current period presentation.

We have one reportable “Retail” segment to align with how management operates and evaluates the results of our operations. Our chief
executive officer, who is our chief operating decision maker, reviews results on a consolidated basis, accompanied by information about our
two operating segments, Nordstrom and Nordstrom Rack. The CODM uses EBIT for the purpose of allocating resources and evaluating
financial performance, primarily by monitoring actual results versus the annual plans, and making strategic decisions.

Our Retail reportable segment aggregates our two operating segments, Nordstrom and Nordstrom Rack. As of February 1, 2025, Nordstrom
consists of Nordstrom.com, Nordstrom U.S. stores and Nordstrom Local. Nordstrom also included Canada operations prior to March 2, 2023,
inclusive of Nordstrom.ca, Nordstrom Canadian stores and Nordstrom Rack Canadian stores, and ASOS | Nordstrom prior to December
2023. Nordstrom Rack consists of NordstromRack.com, Nordstrom Rack U.S. stores and Last Chance clearance stores.

Our Nordstrom and Nordstrom Rack operating segments both generate revenue by offering customers an extensive selection of high-quality
third-party and private-brand merchandise for women, men, young adults and children, with a focus on apparel, shoes, beauty, accessories
and home goods. We continue to focus on omni-channel initiatives by integrating the operations, merchandising and technology necessary to
be consistent with our customers’ expectations of a seamless shopping experience regardless of channel or business. Nordstrom and
Nordstrom Rack have historically had similar economic characteristics and financial performance over the long-term, which we expect to
continue in the future. They also have other similar qualitative characteristics, including suppliers, method of distribution, type of customer
and regulatory environment. Due to their similar qualitative and economic characteristics, we have aggregated our Nordstrom and Nordstrom
Rack operating segments into a single reportable segment.

Amounts in variable SG&A primarily relate to variable shipping and fulfillment, direct selling, customer service, marketing, loyalty and gift
cards. Our variable SG&A expenses are dependent on our sales volume and our channel mix. Amounts in fixed SG&A include expenses
primarily related to information technology, employee benefits, loss prevention, non-variable supply chain, selling and store costs, other
general overhead and fixed expenses and certain allocated corporate expenses. Allocated corporate expenses are comprised of certain
overhead expenses incurred by the Company which are not directly incurred by our Nordstrom and Nordstrom Rack operating segments as a
part of their normal operations and primarily include finance, accounting, HR and other administrative expenses.

Nordstrom, Inc. and subsidiaries 71

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Nordstrom, Inc.
Notes to Consolidated Financial Statements
(Dollar and share amounts in millions except per share, per option and per unit amounts)

Amounts in the Unallocated Corporate/Other column include unallocated corporate expenses and assets (including unallocated assets in
corporate headquarters, consisting primarily of cash, land, buildings, equipment and deferred tax assets), inter-segment eliminations and
other adjustments to segment results necessary for the presentation of consolidated financial results in accordance with GAAP. We do not
allocate interest expense, net, income taxes or unusual and infrequent items to our Retail segment.

Accounting Policy
We present our segment results in the way that management views our results internally and the accounting policies of the operating
segments are the same as those described in Note 1: Nature of Operations and Summary of Significant Accounting Policies.

The following table sets forth information about our reported segment revenues and significant expense categories included within EBIT:
Fiscal year
Net sales
Less:

2024
$14,557 

2023
$14,219 

2022
$15,092 

Cost of sales and services
Buying and occupancy costs
Variable SG&A
1
Fixed SG&A

Retail segment EBIT
2
Unallocated corporate and other expenses
Earnings before interest and income taxes

(8,241)
(1,148)
(2,633)
(1,663)
872 
(377)
$495 

(8,176)
(1,114)
(2,575)
(1,499)
855 
(604)
$251 

(8,786)
(1,184)
(2,872)
(1,531)
719 
(254)
$465 

1 

2 

Includes credit card revenues, net and expenses associated with our credit card program as we present our credit card operation EBIT within Fixed SG&A in the Retail
Segment to align with how management views the business.
Canada wind-down costs are included within unallocated corporate and other expenses for 2023.

The following table sets forth other information for our reportable segment:

Retail Segment

Unallocated
Corporate/Other

Fiscal year 2024
Net sales
Credit card revenues, net
Depreciation and amortization
Interest expense, net
Capital expenditures
Assets

1

Fiscal year 2023
Net sales
Credit card revenues, net
Depreciation and amortization
Interest expense, net
Capital expenditures
Assets

1

Fiscal year 2022
Net sales
Credit card revenues, net
Depreciation and amortization
Interest expense, net
Capital expenditures
Assets

1

$14,557 
459 
(249)
— 
(215)
5,922 

$14,219 
474 
(263)
— 
(244)
5,622 

$15,092 
438 
(316)
— 
(154)
5,968 

$— 
— 
(354)
(102)
(301)
3,044 

$— 
— 
(323)
(104)
(325)
2,822 

$— 
— 
(288)
(128)
(319)
2,777 

1 

The amounts of depreciation and amortization are included within the other segment expense captions, such as buying and occupancy and SG&A.

For information about disaggregated revenues, see Note 3: Revenue.

72

Total

$14,557 
459 
(603)
(102)
(516)
8,966 

$14,219 
474 
(586)
(104)
(569)
8,444 

$15,092 
438 
(604)
(128)
(473)
8,745 

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Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
None.

Item 9A. Controls and Procedures.

DISCLOSURE CONTROLS AND PROCEDURES
On March 4, 2025, we filed an 8-K announcing the departure of Catherine R. Smith as an officer, employee and the Company’s principal
financial officer for the purposes of the Exchange Act. Her last day with us will be on or about March 21, 2025. We do not believe that the
announcement of Ms. Smith’s resignation has materially affected, or is reasonably likely to materially affect, our internal control over financial
reporting. Our Chief Executive Officer, Erik B. Nordstrom, serves as our principal executive officer for purposes of the Exchange Act.

Under the supervision and with the participation of management, including our principal executive officer and principal financial officer, we
have performed an evaluation of the design and effectiveness of our disclosure controls and procedures as of the last day of the period
covered by this report.

Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and
procedures were effective. Disclosure controls and procedures are defined by Rules 13a-15(e) and 15d-15(e) under the Exchange Act as
controls and other procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under
the Exchange Act is recorded, processed, summarized and reported within the time periods specified within the SEC’s rules and forms.
Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be
disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our
principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) of the Exchange Act)
during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as is defined in the
Exchange Act. These internal controls are designed to provide reasonable assurance that the reported financial information is presented
fairly, that disclosures are adequate and that the judgments inherent in the preparation of financial statements are reasonable. There are
inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and overriding of controls.
Consequently, an effective internal control system can only provide reasonable, not absolute, assurance with respect to reporting financial
information.

Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework and criteria
established in Internal Control – Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as
of February 1, 2025.

Deloitte & Touche LLP, an independent registered public accounting firm, was retained to audit our Consolidated Financial Statements and
the effectiveness of our internal control over financial reporting. They have issued an attestation report on our internal control over financial
reporting as of February 1, 2025, which is included herein.

Nordstrom, Inc. and subsidiaries 73

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Nordstrom, Inc.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Nordstrom, Inc. and subsidiaries (the “Company”) as of February 1, 2025,
based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial
reporting as of February 1, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
consolidated financial statements as of and for the year ended February 1, 2025, of the Company and our report dated March 21, 2025,
expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over
Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance
with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our
audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists,
testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP
Seattle, Washington
March 21, 2025

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Item 9B. Other Information.
During the fiscal quarter ended February 1, 2025, no director or officer of the Company adopted, modified or terminated a “Rule 10b5-1
trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of the SEC’s Regulation S-K. For
more information on our insider trading policies and procedures, as required by Item 408(b) of the SEC’s Regulation S-K, see the Exhibit
Index.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance.
The certifications of our Chief Executive Officer and Chief Financial Officer required pursuant to Sections 302 and 906 of the Sarbanes-Oxley
Act of 2002 are included as exhibits to this 2024 Annual Report and were included as exhibits to each of our quarterly reports on Form 10-Q.
Our Chief Executive Officer certified to the NYSE on June 4, 2024, pursuant to Section 303A.12(a) of the NYSE’s listing standards, that he
was not aware of any violation by the Company of the NYSE’s corporate governance listing standards as of that date.

INFORMATION REGARDING THE BOARD OF DIRECTORS
Under the Company’s Bylaws, the Board of Directors consists of between ten and twelve directors, with the exact number to be set by
resolution of the Board of Directors. Currently, the Board of Directors is comprised of eleven directors. Directors are elected annually, with
each seat on the Board of Directors subject to re-election at the Company’s Annual Meeting of Shareholders.

INFORMATION REGARDING THE DIRECTORS

James L. Donald, age 71, joined the Board of Directors in 2020. Mr. Donald brings over 45 years of experience in leadership roles at
consumer-facing businesses ranging from hospitality to retail. Mr. Donald has a wealth of knowledge and expertise in navigating the fast-
paced and dynamic environment facing the Company today. In addition, his proven track record of leading large companies through complex
and challenging environments makes him an invaluable resource to the Board. From 2019 to the present, Mr. Donald has served as the Co-
Chairman of the Board for Albertsons Companies, one of the largest food and drug retailers in the United States. He served as Chief
Executive Officer of Albertsons Companies in 2019, and President and Chief Operating Officer of Albertsons Companies in 2018. From 2013
to 2015, Mr. Donald served as Chief Executive Officer of Extended Stay America, Inc., one of the largest integrated hotel owner/operators in
the United States. Prior to 2013, Mr. Donald served as the Chief Executive Officer of Haggen, Inc. and the Chief Executive Officer of
Starbucks. Since 2019, Mr. Donald has been a director of Albertsons Companies. Mr. Donald is the Chair of the CPCC and serves as a
member of the AFC.

Kirsten A. Green, age 53, joined the Board of Directors in 2019. Ms. Green brings extensive experience in consumer and digital commerce
focused businesses and provides unique insights with respect to the challenges and opportunities of today’s rapidly evolving digital
commerce landscape. Ms. Green has deep domain expertise and an understanding of consumer behaviors, brand building and products.
From 2010 to the present, Ms. Green has served as the Founder and Managing Partner of Forerunner Ventures, a venture capital firm. In her
role with Forerunner Ventures, Ms. Green has served on the boards of numerous private companies since 2013. Prior to 2010, Ms. Green
served as an Equity Research Analyst at Banc of America Securities as well as a Senior Associate at Deloitte & Touche LLP. From 2021 to
2023, Ms. Green Served as a director of Northern Star Investment Corp. II and Northern Star Investment Corp. IV. From 2020 to 2023, Ms.
Green served as a director of Hims and Hers Health, Inc. Ms. Green serves as a member of the AFC and the CGNC.

Glenda G. McNeal, age 64, joined the Board of Directors in 2019. Ms. McNeal brings extensive experience in business development,
innovation and customer relationship management, as well as financial, accounting and senior leadership skills. Ms. McNeal provides unique
insights on strategic planning, risk oversight and operational matters. Ms. McNeal’s service on public company boards provides her
experience with corporate governance matters and key skills in working with directors, understanding board processes and functions, and
assessing risk and overseeing management. From 2024 to the present, Ms. McNeal has served as the Chief Partner Officer of American
Express, a globally integrated payments company. She served as President of Enterprise Strategic Partnerships at American Express from
2017 to 2024, and as Executive Vice President and General Manager of the Global Client Group of American Express from 2011 to 2017,
having held positions of increasing authority at American Express from 1989 to 2011. From 2011 to 2022, Ms. McNeal served on the board of
directors of RLJ Lodging Trust. Ms. McNeal is the Chair of the CGNC and serves as a member of the CPCC.

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Erik B. Nordstrom, age 61, joined the Board of Directors in 2006. Mr. Nordstrom has spent more than 40 years with the Company, holding
positions of increasing responsibility that have spanned all aspects of the retail business. Through roles in buying, regional management, and
digital and store operations, he has gained a deep understanding of the customer and the foresight needed to navigate an evolving industry.
Throughout his tenure, he has driven critical investments in new capabilities to blend the digital and physical experiences, bringing Nordstrom
closer to customers and serving them how, where and when they want to shop. In 2021, Mr. Nordstrom joined the board of directors for The
Jim Pattison Group, a diversified holding company and one of Canada’s largest privately held companies. From 2020 to the present, Mr.
Nordstrom has served as Chief Executive Officer of the Company. From 2015 to 2020, Mr. Nordstrom served as Co-President, and from
2014 to 2015 he served as Executive Vice President and President, Nordstrom.com. From 2006 to 2014, Mr. Nordstrom served as Executive
Vice President and President, Stores, having previously served as Executive Vice President, Full-Line Stores from 2000 to 2006.

Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James Nordstrom,
Jr., Chief Merchandising Officer for the Company.

Nordstrom Canada Retail, Inc., Nordstrom Canada Holdings, LLC and Nordstrom Canada Holdings II, LLC have commenced a wind-down of
their business operations, obtaining an Initial Order from the Ontario Superior Court of Justice under the Companies’ Creditor Arrangement
Act on March 2, 2023 to facilitate the wind-down in an orderly fashion. Mr. Nordstrom served as a director and/or officer of such entities.

Peter E. Nordstrom, age 63, joined the Board of Directors in 2006. Mr. Nordstrom has spent more than 40 years with the Company, holding
positions of increasing responsibility that have spanned all aspects of the retail business. Throughout his career, he has helped Nordstrom
innovate the customer shopping experience and redefine the role fashion plays in customers’ lives through bold investments in emerging
categories and partnerships with both established and new brands and designers. He has led major strategic initiatives that have
strengthened Nordstrom’s reputation in the fashion industry and kept the brand relevant, such as building the designer offering, evolving
Nordstrom’s mix of brands and categories and bringing in limited distribution brands as exclusive partners. He also hosts The Nordy Pod,
Nordstrom’s first podcast, which he launched in 2022. From 2020 to the present, Mr. Nordstrom has served as the President and Chief Brand
Officer of the Company, having previously served as Co-President from 2015 to 2020. From 2006 to 2015, he served as Executive Vice
President and President, Merchandising, and from 2000 to 2006 he served as Executive Vice President, Full-Line Stores.

Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James Nordstrom,
Jr., Chief Merchandising Officer for the Company.

Amie Thuener O’Toole, age 50, joined the Board of Directors in 2022. Ms. Thuener O’Toole brings more than 25 years of finance and
accounting experience. Her experience in a variety of senior leadership roles at some of the world’s most innovative companies brings
valuable perspectives in finance and accounting matters, including financial planning and reporting, risk assessment, incentive compensation
plans and financial advice and support for all mergers and acquisitions activities. She brings to the Board a wealth of knowledge and
expertise regarding strategic finance in the context of a rapidly growing and quickly changing business. From 2018 to the present, Ms.
Thuener O’Toole has served as Vice President and Chief Accounting Officer of Alphabet, Inc., one of the world’s leading technology
conglomerate holding companies, having previously served from 2013 to 2018 as the company’s Vice President and Chief Accountant. From
1996 to 2012, Ms. Thuener O’Toole served as Managing Director, Transaction Services, of PricewaterhouseCoopers. Ms. Thuener O'Toole is
the Chair of the AFC and serves as a member of the CGNC.

Guy B. Persaud, age 54, joined the Board of Directors in 2023. Mr. Persaud brings more than 15 years of leadership experience in the
consumer retail industry and a track record of identifying and operating high-growth and value-creation business opportunities outside of
Procter & Gamble’s traditional business units. He has a unique track record of delivering outstanding shareholder return and driving large-
scale transformations in a wide range of business and cultural contexts, successfully leading businesses in key global markets such as the
United States, China, Europe and Latin America. He has significant experience in marketing and brand management, as well as operational
expertise in key functions that include research and development, sales, supply chain, manufacturing, acquisitions, product innovation and e-
commerce. From 2021 to the present, Mr. Persaud has served as President of New Business Unit of Procter & Gamble, a global consumer
goods company. From 2015 to 2021, he served as Senior Vice President and General Manager of Procter & Gamble Latin America, having
previously held various roles of increasing responsibility at Procter & Gamble from 1995 to 2015. Mr. Persaud serves as a member of the
AFC and the CGNC.

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Eric D. Sprunk, age 60, joined the Board of Directors in 2023. Mr. Sprunk brings more than 25 years of leadership experience in the
consumer retail industry and a track record of driving financial performance and large-scale transformations within a complex global
business. He has significant experience in marketing, finance and accounting, as well as operational expertise in key functions that include
manufacturing, sourcing, sales and procurement, and product development. His service on public company boards provides additional
experience with corporate governance matters, assessing risk and overseeing management. From 2013 to 2020, Mr. Sprunk served as the
Chief Operating Officer of Nike, Inc., a global apparel company, having previously served from 2008 to 2015 as the company’s Executive
Vice President of Global Product and Merchandising and from 2001 to 2008 as the company’s Executive Vice President of Global Footwear.
Since 2015, Mr. Sprunk has been a member of the board of directors of General Mills, Inc., served on the board of directors of Bombardier,
Inc. from 2021 to 2024, and he has been a member of the board of directors of Universal Music Group N.V. from 2024 to the present. Mr.
Sprunk serves as a member of the AFC and the CPCC.

Bradley D. Tilden, age 64, joined the Board of Directors in 2016 and currently serves as Chairman of the Board. Mr. Tilden brings executive,
operational, strategic planning and financial experience, as well as insights with respect to customer rewards programs in the consumer
services industry. Mr. Tilden’s public company board service provides him with experience with corporate governance matters and key skills
in working with directors, understanding board processes and functions, assessing risk and overseeing management. From 2021 to 2022,
Mr. Tilden served as Chairman of Alaska Air Group, Inc., an airline holding company comprised of Alaska Airlines, Inc. and Horizon Air, Inc.
From 2014 to 2021, he served as Chairman and Chief Executive Officer of Alaska Air Group, Inc., having previously served as its President
and Chief Executive Officer from 2012 to 2014. From 2008 to 2012, Mr. Tilden served as President of Alaska Air Group, Inc., as the
company’s Executive Vice President of Finance and Planning from 2002 to 2008 and as the company’s Chief Financial Officer from 2000 to
2008. Since 2024, Mr. Tilden has been a director of Matson, Inc. and previously served as a director of Alaska Air Group, Inc. from 2010 to
2022. In addition to his role as Chairman of the Board, Mr. Tilden serves as a member of the CGNC.

Mark J. Tritton, age 61, joined the Board of Directors in 2020. Mr. Tritton brings over 30 years of experience in retail and apparel
businesses, providing him deep insights into consumer behavior, brand building and operational matters which are key to the Company’s
business. In addition, as a former CEO of a public company retailer, Mr. Tritton has unique insights into the challenges facing the Company
and its industry. From 2019 to 2022, Mr. Tritton served as President and Chief Executive Officer of Bed Bath & Beyond Inc., an omni-channel
retailer selling a wide assortment of domestic merchandise and home furnishings online and through several brand retail storefronts. From
2016 through 2019, he served as Executive Vice President and Chief Merchandising Officer of Target Corporation, an omni-channel retailer
selling everyday essentials and fashionable, differentiated merchandise at discounted prices online and through several brand retail
storefronts. In addition, from 2009 to 2016, Mr. Tritton served as Executive Vice President and Division President of the Nordstrom Product
Group of Nordstrom, Inc. Mr. Tritton serves as a member of the CPCC and the CGNC.

Mr. Tritton served on the board of directors of Bed Bath & Beyond Inc. from 2019 to 2022. On April 23, 2023, Bed Bath & Beyond Inc. filed a
voluntary Chapter 11 petition with the United States Bankruptcy Court for the District of New Jersey.

Atticus N. Tysen, age 59 joined the Board of Directors in 2023. Mr. Tysen brings more than three decades of engineering and information
security experience. Mr. Tysen also has a wealth of knowledge and expertise regarding technology, cybersecurity and fraud prevention in the
context of a rapidly-growing and quickly-changing business. His background adds to the diversity of experience represented across the
Board and helps us hone an increasingly important area of focus for the retail industry. From 2021 to the present, Mr. Tysen has served as
Senior Vice President Product Development, Chief Information Security and Fraud Prevention Officer of Intuit Inc., a global provider of
business and financial management solutions. Previously, he served as Senior Vice President, Chief Information Security Officer, Chief Fraud
Prevention Officer and Chief Information of Officer of Intuit Inc., from 2020 to 2021, and Senior Vice President and Chief Information Officer
of Intuit Inc., from 2013 to 2020. Mr. Tysen serves as a member of the AFC and the CPCC.

INFORMATION REGARDING THE EXECUTIVE OFFICERS

The Executive Officers of the Company are appointed annually by the Board of Directors following each year’s Annual Meeting of
Shareholders and serve at the discretion of the Board of Directors. In addition to Erik and Peter Nordstrom, whose biographical information is
provided under Information Regarding the Directors, the following are the other Executive Officers of the Company as of the date of this 2024
Annual Report.

Fanya Chandler, age 53, joined the Company in 1991 and has served as President, Nordstrom Stores since September 2023. Previously,
she served as Senior Vice President, Southwest Regional Manager from 2015 to 2019, and again from 2020 until 2023. From 2019 to 2020,
she served as Senior Vice President, President, Trunk Club. Ms. Chandler has held several leadership positions across the organization
during her more than 30 years with Nordstrom.

Alexis DePree, age 46, joined the Company in 2020 and has served as Chief Operating Officer since 2024. From January 2020 to 2024, Ms.
DePree served as Chief Supply Chain Officer. Ms. DePree previously served as Vice President of Americas Sort Centers and Planning at
Amazon.com, Inc. from 2018 to 2020, and as Amazon’s Vice President of Global Supply Chain Operations from 2016 to 2018. From 2007 to
2016, she held positions of increasing responsibility at Target Corporation, prior to which she was employed at Dell Technologies Inc. in
various leadership positions from 2001 to 2005. Ms. DePree currently serves as a director at Arhaus, Inc.

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Gemma Lionello, age 59, joined the Company in 1988 and has served as President, Nordstrom Rack since September 2023. Previously,
Ms. Lionello served as Senior Vice President and Regional Manager for the Northeast Region for Nordstrom and Nordstrom Rack from 2020
to 2023. Throughout her over 35-year tenure with the Company, Ms. Lionello has held various leadership roles, including multiple regional
manager roles for both Nordstrom and Nordstrom Rack and nearly a decade successfully leading Nordstrom’s Beauty and Accessories
teams as General Merchandise Manager.

Jason Morris, age 49, joined the Company in 2023 and has served as Chief Technology and Information Officer since his arrival. Prior to
Nordstrom, Mr. Morris served as Senior Vice President, Enterprise Business Services for Walmart Global Tech from January 2021 to April
2023. From 2016 to 2021, Mr. Morris served as Vice President of Retail Technology for Walmart Inc. From 2000 to 2016, he held positions
with increasing responsibility at Walmart Inc.

James F. Nordstrom, Jr., age 52, joined the Company in 1986 and has served as Chief Merchandising Officer since September 2023.
Previously, Mr. Nordstrom served as Chief Stores Officer from April 2022 until September 2023, and President, Stores from May 2014 to April
2022. From 2005 to 2014, Mr. Nordstrom Served as Executive Vice President and President, Nordstrom.com. He previously served as
Corporate Merchandise Manager, Children’s Shoes, from May 2002 to February 2005, and as a project manager for the design and
implementation of the Company’s inventory management system from 1999 to May 2022. Mr. Nordstrom is the second cousin of Erik and
Peter Nordstrom and a great-grandson of the Company’s founder.

Lisa Price, age 52, joined the Company in 2023 and has served as the Company’s Chief Human Resources Officer since her arrival.
Previously, Ms. Price served as Executive Vice President and Chief Human Resources Officer of Domino’s Pizza, Inc. from August 2019 to
November 2023. Prior to Domino’s, Ms. Price served as a member of the human resources team at Nordstrom from 2015 to 2019, most
recently as Senior Vice President of Human Resources. Before Nordstrom, Ms. Price spent more than 20 years at Starbucks, supporting the
company’s rapid growth and global expansion in a variety of human resources roles, last serving there as Vice President of Partner
Resources.

Catherine R. Smith, age 61, joined the Company in 2023 and has served as the Company’s Chief Financial Officer since her arrival. Ms.
Smith has more than 30 years of financial leadership experience across multiple industries and organizations. Most recently, she served as
Chief Financial Officer and Chief Administrative Officer for Bright Health Group from 2020 to 2023. Prior to Bright Health, she served as
Target Corporation’s Chief Financial Officer from 2015 to 2020. Throughout her distinguished career, Ms. Smith has also held Chief Financial
Officer roles at several other companies, including Express Scripts, Walmart International, GameStop, Centex, Kennametal, Textron and
Raytheon. Ms. Smith currently serves as a director at PPG Industries and Baxter International. Previously, she served as a director for
DICK’S Sporting Goods. As previously disclosed, Ms. Smith has indicated her intention to resign from her position with the Company
following the filing of this 2024 Annual Report.

Ann Munson Steines, age 59, joined the Company in 2019 and has served as Chief Legal Officer, General Counsel and Corporate
Secretary since April 2022. From 2019 to 2022, Ms. Steines served as the Company’s General Counsel and Corporate Secretary. Previously,
she was Senior Vice President, Deputy General Counsel and Assistant Secretary for Macy’s Inc. for approximately ten years. Ms. Steines
joined Macy’s Inc., in 1998 as Assistant Counsel, Employment Law, and rose through positions of increasing responsibility until her
appointment as Deputy General Counsel and Assistant Secretary. Prior to Macy’s, Ms. Steines was a Senior Attorney with the Overnite
Transportation Company, a subsidiary of Union Pacific Corporation. Ms. Steines began her legal career with Dinsmore & Shohl in Cincinnati,
Ohio in 1990 and then practiced with the law firm of Michael Best & Friedrich in Milwaukee, Wisconsin. Ms. Steines currently serves on the
board of directors of United Way of King County.

Kenneth J. Worzel, age 60, joined the Company in 2010 and has served as Chief Customer Officer since April 2022. Previously, Mr. Worzel
served as Chief Operating Officer from August 2019 to April 2022. From 2018 to 2019, Mr. Worzel served as Chief Digital Officer, from 2016
to 2019 as President of Nordstrom.com, and from 2010 to 2016 as Executive Vice President, Strategy and Development. Prior to joining the
Company, he was a partner with McKinsey & Company, a global management consulting firm, from 2009 to 2010. While at McKinsey, he
provided the Company and other clients with management strategy and organizational services. Prior to joining McKinsey, he was a
Managing Partner at Marakon Associates, an international strategy consulting firm, from 1992 to 2008. As a Partner at Marakon Associates,
he provided consulting services to the Company from 1997 to 2008. Mr. Worzel currently serves as a director of State Farm Mutual
Automobile Insurance Company.

DELINQUENT SECTION 16(a) REPORTS
Based upon a review of reports filed with the SEC and written representations that no other reports were required, the Company believes that
during the fiscal year ended February 1, 2025, all of our Directors, Executive Officers and owners of in excess of 10% of our common stock
complied with the filing requirements of Section 16(a) of the Exchange Act except for one missed Form 4 for Erik Nordstrom with respect to
an inadvertent quarterly automatic investment re-balancing within his 401(k) Plan which resulted in a transfer of the issuer's securities out of
the Nordstrom stock fund within the 401(k) Plan, which was corrected on March 19, 2025.

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CODE OF CONDUCT & ETHICS AND CODE OF BUSINESS CONDUCT AND ETHICS
We have adopted a Code of Conduct & Ethics that applies to all of our employees, including our principal executive officer, principal financial
officer, principal accounting officer, controller and persons performing similar functions. We have also adopted a Directors’ Code of Business
Conduct and Ethics that applies to all of our non-employee Directors. Copies of each of these codes are posted on our Investor Relations
Website. A grant of a waiver to a Director or Executive Officer from a provision of the codes requiring disclosure under applicable law, if any,
will be disclosed on our Investor Relations Website.

AUDIT AND FINANCE COMMITTEE
The Board of Directors maintains a standing AFC. The AFC currently consists of six directors — Amie Thuener O’Toole, James L. Donald,
Kirsten A. Green, Guy B. Persaud, Eric D. Sprunk and Atticus N. Tysen — each of whom has been determined by the Board of Directors to
meet the heightened independence requirements under SEC and NYSE Listed Company Rules. In addition, the Board of Directors have
determined that the following members of the committee are “audit committee financial experts” under SEC rules: Amie Thuener O’Toole,
James L. Donald and Kirsten A. Green. As more fully described in its charter, the primary responsibilities of the AFC are to assist the Board
of Directors in fulfilling its oversight responsibility by:

•

•

reviewing the Company’s financial statements and ensuring the integrity of those statements,

evaluating the accounting, auditing and financial reporting processes of the Company,

• managing business and financial risk and the internal controls environment,

•

•

assessing the Company’s compliance with legal and regulatory requirements and ethics programs as established by management
and the Board of Directors, in conjunction with any recommendation by the CGNC with respect to corporate governance matters, and

reviewing reports resulting from the performance of audits by the independent auditor and the internal audit team.

In addition, the AFC provides financial oversight by:

•

•

•

•

•

evaluating the qualifications, independence and performance of the Company’s independent auditors,

assessing the performance of the Company’s internal audit team,

advising on the Company’s capital structure, financial policies, capital investments, business and financial planning and related
matters,

reviewing the Company’s tax strategies and the implications of actual or proposed tax law changes,

overseeing the Company’s dividend payment and share repurchase strategies, banking relationships, borrowing facilities and cash
management, and

• monitoring the Company’s compliance with covenants under its outstanding indebtedness and borrowing facilities.

The AFC regularly reviews enterprise-level risks (including commercial, supply chain and cybersecurity risks) and compliance with laws and
regulations. The AFC also meets privately and separately with the independent registered public accounting firm, the Chief Financial Officer,
and the Vice President, Internal Audit.

INSIDER TRADING POLICIES
The Company has adopted an Amended and Restated Insider Trading Policy and associated procedures which govern the purchase, sale,
and/or other dispositions of the Company’s securities by directors, officers and employees, and other covered persons, and the Company
itself, which are reasonably designed to promote compliance with insider trading laws, rules and regulations, and the listing standards of the
NYSE. A copy of the Company’s Amended and Restated Insider Trading Policy is filed in the Exhibit Index as Exhibit 19.1.

Item 11. Executive Compensation.
(Dollar and share amounts in ones, except where otherwise noted)

COMPENSATION, PEOPLE AND CULTURE COMMITTEE REPORT
The CPCC has reviewed and discussed with management the Compensation Discussion and Analysis included in this filing. The CPCC
believes the Compensation Discussion and Analysis represents the intent and actions of the CPCC with regard to executive compensation
and has recommended to the Board of Directors that it be included in this filing with the SEC.

Compensation, People and Culture Committee
James L. Donald, Chair
Glenda G. McNeal
Eric D. Sprunk
Mark J. Tritton
Atticus N. Tysen

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COMPENSATION DISCUSSION AND ANALYSIS

Table of Contents

80
81
86

Executive Summary
Framework for Executive Compensation
Compensation Governance

This section describes our executive compensation program and the compensation decisions made for our fiscal year 2024 NEOs.

Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Executive Summary

Chief Executive Officer
Chief Financial Officer
President & Chief Brand Officer
Chief Customer Officer
Chief Technology and Information Officer

Shareholders Support Our Compensation Program
Our shareholders approved our Board of Director’s recommendation to hold executive compensation advisory votes on an annual basis so
that they may frequently and openly express their views about the compensation of our NEOs. Each year since 2011, more than 90% of the
votes cast have been supportive of our compensation programs. The CPCC took shareholders’ sustained support into account as it
continued to implement similar compensation policies and programs in fiscal year 2024.

We Emphasize Variable Pay and Balance Short- and Long-Term Incentive Values
In accordance with our pay-for-performance philosophy, the compensation program for our NEOs is straightforward in design and includes
four primary elements: base salary, performance-based bonus, LTIs and benefits. Within these pay elements, we emphasize variable pay
over fixed pay, with 85% of the CEO and President & Chief Brand Officer's target compensation, and at least 77% of the other NEOs' target
compensation, tied to our financial or market performance. The program also balances the importance of these executives achieving both
critical short-term objectives and strategic long-term priorities.

Effective Corporate Governance Reinforces Our Compensation Program
Our compensation philosophy for our executive team, including our NEOs, is reflected in governance practices that support the needs of our
business, drive performance and align with our shareholders’ interests. Below is a summary of what we do and do not do in that regard.

WHAT WE DON’T DO

Provide employment agreements.

Offer separation benefits to our NEOs who are Nordstrom
family members.

Offer special perquisites to our NEOs.

Reprice underwater stock options.

Issue grants below 100% fair market value.

Pay dividends on any unearned or unvested equity
awards.

Permit hedging or short-sale transactions.

Count pledged shares toward stock ownership targets.

WHAT WE DO

 Pay-for-performance:  Our  compensation  program 

for  NEOs
emphasizes  variable  pay  over  fixed  pay,  with  85%  of  the  CEO  and
President  &  Chief  Brand  Officer's  target  compensation,  and  at  least
77%  of  the  other  NEOs'  target  compensation,  tied  to  our  financial  or
market performance.

 Retain  meaningful  stock  ownership  guidelines:  Our  expectations

for  ownership  align  executives’ 
shareholders, and each NEO has exceeded his or her target.

interests  with 

those  of  our

 Mitigate undue risk:  We  have  caps  on  potential  performance-based

bonus  payments,  a  Clawback  Policy  on  performance-based
compensation  and  active  and  engaged  oversight  and 
risk
management systems, including those related to compensation-related
risk.

 Engage  an  independent  compensation  consulting  firm:  The

CPCC’s  consultant  does  not  provide  any  other  services  to  the
Company.

provisions.

 Apply  conservative  post-employment  and  change  in  control
 Limit  accelerated  vesting:  Our  equity  plan  provides  for  accelerated

vesting of equity awards after a change in control only if an executive
is involuntarily terminated by the Company without cause or resigns for
good reason, a provision referred to as a “double trigger.”

clearance requirements and restrictions.

 Restrict pledging activity:  All  Executive  Officers  are  subject  to  pre-
 Receive  strong  shareholder  support:  Each  year  since  2011,  more

than 90% of the votes cast have been supportive of our compensation
programs.

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Framework for Executive Compensation

Our Pay and Benefits Philosophy

• We believe that if our customers win, our employees and shareholders win – our interests are aligned.

• We pay for performance by investing in talent that delivers results and demonstrates the behaviors that drive our success, while not

encouraging excessive risk taking.

• We deliver competitive pay and benefits for all jobs and differentiate pay for critical jobs that directly impact our ability to deliver

on our strategy.

• We use objective market data to design flexible pay and benefits programs to help attract, retain, motivate and reward our

employees and meet the needs of specific talent groups.

• We provide equal pay and promotion opportunities for all employees and give them the information they need to clearly

understand their pay and effectively manage their careers.

Each Element of Compensation Has Its Own Purpose
Our compensation program for NEOs is made up of four primary elements outlined on the following table. Each element has its own purpose
based on our fundamental premise of pay-for-performance and our pay and benefits philosophy, as previously described. Additional
information is provided on the following pages.
Compensation Element
Base Salary
(Page 81)
Performance-Based Annual
Cash Bonus
(Page 82)
LTIs
(Page 83)
Benefits
(Page 85)

Promote alignment of executive decisions with Company goals and shareholder interests where value varies with
Company stock performance.
Provide meaningful and competitive broad-based and executive benefits that support healthy lifestyles and contribute
to financial security.

Motivate and reward contributions to annual operating performance and long-term business strategy with cash that
varies based on results.

Reflect scope of the role and individual performance through base-line cash compensation.

Purpose

Pay Changes for 2024
On an annual basis, the CPCC reviews base salary, performance-based bonus target opportunity and LTI target annual grant value for each
of the executives in consideration of the upcoming fiscal year. The CPCC’s decisions for fiscal year 2024 targets for the NEOs are
summarized in this section and shown as a year-over-year comparison.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Base Salary
($)
FYE 2023
758,500 
875,000 
758,500 
895,000 
830,000 

FYE 2024
885,000 
875,000 
885,000 
895,000 
830,000 

Performance-Based
Annual Cash Bonus Target
(Target Opportunity 
as a % of Base Salary)
FYE 2023
200
125
200
125
80

FYE 2024
200
125
200
125
80

LTI
Annual Grant Target
(Target Grant Value
1
as a % of Base Salary)

FYE 2023
350
250
350
250
175

FYE 2024
350
250
350
250
250

1 

In 2024, actual LTI Annual Grant value varied from target for Kenneth Worzel. See page 83 to learn more about the LTI pay elements for 2024.

Base Salary
The CPCC begins its annual review of base salary for the NEOs through discussion with the CEO and President & Chief Brand Officer on the
expectations and achievements of each executive during the previous year, as well as their pay history and pay equity with other internal
roles. The CPCC then references similar roles in peer companies to ensure they are within a competitive range of the peer group median.
NEOs do not necessarily receive increases in base salary every year. When they do, the changes are generally effective in March.

In 2024, the CPCC determined to increase the base salaries for Erik Nordstrom and Peter Nordstrom from $758,500 to $885,000 each,
effective March 3, 2024 to maintain relative market competitiveness, given that the most recent increases were made in 2016. The base
salaries of all other NEOs remained unchanged.

Nordstrom, Inc. and subsidiaries 81

 
 
 
 
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Performance-Based Annual Cash Bonus
The opportunity for annual performance-based cash awards under our shareholder-approved Nordstrom, Inc. EMBP is designed to focus the
NEOs on the alignment between annual operating performance and long-term business strategy.

In determining the target bonus opportunities, the CPCC takes into account the mix of pay elements, market pay information for similar roles
within our peer group and the internal relationship between roles within the Company.

In support of our pay-for-performance philosophy, the maximum bonus payout, which is associated with superior performance, is 250% of an
executive’s target bonus opportunity. This maximum is higher than is common among our retail peers because we believe it is important to
continue encouraging and paying rewards when we achieve truly superior results. Under our approach, truly superior results are rarely
achieved. In the past ten years, and excluding individual differentiation for extraordinary contributions, we have not paid out bonuses in
excess of 150% of target.

For fiscal year 2024, the CPCC modified the bonus opportunity for all NEOs to reflect a Company-wide focus on top-line and bottom-line
growth with Incentive Adjusted EBIT weighted 75% and Operational Gross Merchandise Value (Operational GMV) weighted 25% and subject
to achieving the threshold for the Incentive Adjusted EBIT measure. Refer to the Results Of Operations in Item 7 of Part II for further detail on
the calculation of Operational GMV. Incentive Adjusted EBIT may differ from EBIT and net earnings, as reported in this 2024 Annual Report,
and excludes certain performance-based compensation elements in order to be more reflective of business performance. Incentive Adjusted
EBIT is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for, net
earnings or other financial measures performed in accordance with GAAP. Our method of determining non-GAAP financial measures may
differ from other companies’ financial measures and therefore may not be comparable to methods used by other companies. The following is
a reconciliation of net earnings to Incentive Adjusted EBIT: 
Fiscal year
Net earnings
Income tax expense
Interest expense, net
Earnings before interest and income taxes
1
Privatization fees
2
Accelerated technology depreciation
Supply chain asset impairment and other
Adjusted EBIT
Performance-based cash compensation
Incentive Adjusted EBIT

2024
$294 M
99 M
102 M
495 M
18 M
26 M
54 M
593 M
221 M
$814 M

1 

Privatization fees include transaction-related expenses incurred in connection with the Merger. These fees are included in SG&A on the Consolidated Statement of Earnings.
2
As a result of a strategic decision, we recognized a charge related to incremental accelerated depreciation for a technology asset. The charge is included in SG&A on the
Consolidated Statement of Earnings, unallocated Corporate/Other expenses within Note 15: Segment Reporting in Item 8 of Part II and depreciation and amortization
expenses on the Consolidated Statement of Cash Flows.

The Incentive Adjusted ROIC measure was eliminated as it has historically tracked closely to Incentive Adjusted EBIT. For all NEOs except
Erik Nordstrom and Peter Nordstrom, the CPCC determined to re-introduce the opportunity for individual differentiation of +/-25% based on
execution against objective individual goals, and applied after the calculation of Company outcomes, but in no event can the total payout,
after application of the individual differentiation, exceed 250% of an executive’s target bonus opportunity.

All NEOs

•
•

75% Incentive Adjusted EBIT
25% Operational Gross Merchandise Value (Operational GMV) subject to achievement of the Incentive Adjusted EBIT
threshold

Measure and Weighting

The CPCC defines financial milestones for Incentive Adjusted EBIT and Operational GMV as a range that relate to varying percentages of
bonus payout. The difficulty level in achieving the milestones reflects the CPCC’s belief that there should be a balance between executive
pay opportunity, reinvestment in the Company and return to shareholders.

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2024 Bonus Measure Outcomes and Payouts
Our Incentive Adjusted EBIT achievement was $814M resulting in a 131% bonus payout on the EBIT measure, which was weighted 75% for
all NEOs. Our Operational GMV achievement was $14,865M resulting in a 147% bonus payout on the Operational GMV measure, which was
weighted 25% for all NEOs. The total payout was 135%, before differentiation. The bonus payout for Kenneth Worzel was differentiated
+15% to recognize his performance against objective individual goals that significantly contributed to business results during the fiscal year,
resulting in an overall payout of 155%. No other NEOs were differentiated.

The performance-based annual cash bonus results for the EMBP are summarized in the following table:

Erik B.
Nordstrom

Catherine R.
Smith

Peter E.
Nordstrom

Kenneth J.
Worzel

Jason Morris

Bonus Measure
Incentive Adjusted EBIT
1
Operational GMV
Total % of Target
% Individual Differentiation
Total Payout %
Incentive Adjusted EBIT
1
Operational GMV
Total % of Target
% Individual Differentiation
Total Payout %
Incentive Adjusted EBIT
1
Operational GMV
Total % of Target
% Individual Differentiation
Total Payout %
Incentive Adjusted EBIT
1
Operational GMV
Total % of Target
% Individual Differentiation
Total Payout %
Incentive Adjusted EBIT
1
Operational GMV
Total % of Target
% Individual Differentiation
Total Payout %

Threshold
25%
$458M
$13,869M

Milestones

Target
100%
$734M
$14,623M

Weight
75 %
25 %

Superior
250%
$1,113M
$15,391M

Actual
$814M
$14,865M

75 %
25 %

$458M
$13,869M

$734M
$14,623M

$1,113M
$15,391M

$814M
$14,865M

75 %
25 %

$458M
$13,869M

$734M
$14,623M

$1,113M
$15,391M

$814M
$14,865M

75 %
25 %

$458M
$13,869M

$734M
$14,623M

$1,113M
$15,391M

$814M
$14,865M

75 %
25 %

$458M
$13,869M

$734M
$14,623M

$1,113M
$15,391M

$814M
$14,865M

Actual % of
Target
131 %
147 %
135 %
N/A
135 %
131 %
147 %
135 %
— 
135 %
131 %
147 %
135 %
N/A
135 %
131 %
147 %
135 %
15 %
155 %
131 %
147 %
135 %
— 
135 %

1
 For more information about Operational GMV, see Results Of Operations in Item 7 of Part II.

Retention Bonuses
In January 2025, the Company entered into retention bonus arrangements with Catherine Smith, Kenneth Worzel and Jason Morris in the
amounts of $1,750,000, $1,790,000 and $1,660,000, respectively and will be paid as follows, contingent on continuous employment through
each payment date: (i) 25% of the retention bonus will be paid following the earlier of the date of the closing of the Merger and December 15,
2025, and (ii) subject to the occurrence of the closing of the Merger, 25% of the retention bonus will be paid following the first anniversary of
the Merger closing date and 50% will be paid following the second anniversary of the Merger closing date. Catherine Smith forfeited her
retention bonus opportunity upon her resignation.

LTIs
Annual grants of LTIs under our shareholder-approved EIP are intended to provide the NEOs with additional incentive to create shareholder
value. In establishing the LTI annual grant value for each NEO, the CPCC considers the mix of pay elements, market pay information for
similar roles within our peer group, our annual share usage and dilution, performance and internal equity of grant size by role. The CPCC
considers annual equity-based awards at its annual February meeting, which is typically held approximately three weeks after fiscal year-
end, and approves such awards either at that meeting or in the days shortly following. The February meeting occurs after performance
results for the prior year are known, which allows the CPCC to align compensation elements with our performance and business goals.

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Table of Contents

In 2024, the CPCC approved the following:

•

•

•

•

•

Adjust the LTI annual grant mix to 50% PSUs and 50% RSUs for all NEOs.

The RSUs will vest equally over three years.

The 2024 PSU goals are set at the beginning of each year over three years. Goals for the 2024 performance period are aligned with
the Company’s plan. The minimum percentage of PSUs that can be earned at the end of the three-year performance cycle is 0% and
the maximum is 175%. The fiscal year 2024 goals were based on cumulative sales and Adjusted EBIT margin percent, subject to
meeting an Incentive Adjusted EBIT threshold. See below for achievement of the goals for the 2024 fiscal year. Adjusted EBIT
margin percent and Incentive Adjusted EBIT may differ from EBIT margin percent, EBIT or Net Earnings, as reported in this 2024
Annual Report, and exclude certain elements in order to be more reflective of business performance. Incentive Adjusted EBIT is not
a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for, net earnings or
other financial measures performed in accordance with GAAP. Our method of determining non-GAAP financial measures may differ
from other companies’ financial measures and therefore may not be comparable to methods used by other companies. Refer to the
Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Margin and Adjusted EPS (Non-GAAP Financial Measures) section in Item 7 of
Part II for a reconciliation of net earnings as a percent of net sales to Adjusted EBIT margin. See page 82 for a reconciliation of net
earnings to Incentive Adjusted EBIT.

Use its discretion to modify the 2024 LTI Annual Grant for Kenneth Worzel from 250% to 325% of base salary to recognize his
leadership and ongoing contributions to our digital strategy.

Increase the LTI Annual Grant Target for Jason Morris from 175% to 250% to maintain relative market competitiveness.

2022 PSUs Paid Out at 75%
Payout of the 2022 PSUs was based on the extent to which achievement was met for certain cumulative sales goals (with a threshold of $46
billion and a maximum of $51.6 billion) and Adjusted EBIT margin percent goals (with a threshold of 6% and a maximum of 7.4%) over a
three-year performance period ending on February 1, 2025. The minimum percentage of PSUs that could be earned at the end of the three-
year performance cycle was 75% and the maximum was 150%. During the three-year performance period, cumulative sales was $43.8 billion
and Adjusted EBIT margin percent was 3.8%, resulting in a payout at 75% of target.

2023 PSUs Are Still in Process
The extent to which the 2023 PSUs will pay out is based on the cumulative sales and Adjusted EBIT margin percent over the three-year
performance period ending on January 31, 2026. Goals for the PSUs are aligned with the Company’s long-range plan. The CPCC believes
that these measures reflect the Company’s key areas of strategic focus over the three-year period. The minimum percentage of the 2023
PSUs that can be earned at the end of the three-year performance cycle is 75% and the maximum is 150%.

One-Third of the 2024 PSUs Achieved 135% Performance
The 2024 PSU goals are set at the beginning of each year over three years. The fiscal year 2024 goals were based on the cumulative sales
and Adjusted EBIT margin percent, subject to meeting an Incentive Adjusted EBIT threshold. The minimum percentage of PSUs that can be
earned at the end of the three-year performance cycle is 0% and the maximum is 175%. The fiscal year 2024 performance period ended on
February 1, 2025, resulting in 135% achievement. Payout for the achievement of each one-year performance period within the term of the
award will occur shortly following the certification of the third year results.

Cumulative Net Sales $
(weighted 50%)
Adjusted EBIT Margin % of Sales
1
(weighted 50%)

Incentive Adjusted EBIT $
Threshold
1
(applies to both measures)

Milestones

Threshold
25%

Target
100%

Maximum
175%

Actual

Actual % of Target  Total % of Target

$13,595M

$14,334M

$14,710M

$14,557M

3.1 %

4.0 %

4.3 %

4.1 %

144 %

126 %

135 %

$458M

$814M

1
 Adjusted EBIT Margin percent and Incentive Adjusted EBIT are non-GAAP financial measures. Refer to the Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Margin and
Adjusted EPS (Non-GAAP Financial Measures) section in Item 7 of Part II for a reconciliation of net earnings as a percent of net sales to Adjusted EBIT margin. See page 82
for a reconciliation of net earnings to Incentive Adjusted EBIT.

Stock Ownership Guidelines Align Executives and Shareholders
To align our executives’ interests with those of our shareholders and to ensure that our executives own meaningful levels of Company stock
throughout their tenures with the Company, our stock ownership guidelines were formally established in 2004. Ownership shares are made
up of all forms of common stock, as well as vested PSUs that are deferred, unvested PSUs with a minimum payout of more than zero and
unvested RSUs. Ownership shares do not include unvested or vested stock options, unvested PSUs with a minimum payout of zero or
pledged shares.

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The NEOs and other Executive Officers have a share target defined as base salary on April 1st multiplied by their ownership multiple of base
salary divided by a 52-week average closing stock price. The ownership multiples of base salary depend on the executive’s role in the
Company and are as shown in the following table for the NEOs. The CPCC has assigned these particular multiples to match or exceed
market practice, and to represent a significant portion of the overall compensation package to reinforce the alignment of management’s
decision-making with shareholder interests. Executives will be deemed to be in compliance with the stock ownership guidelines once their
ownership shares meet or exceed the threshold, and will remain in compliance, unless and until the executive sells shares.

Under our guidelines, NEOs and other Executive Officers are permitted to conduct any open market transactions in common stock only in
accordance with an approved SEC Rule 10b5-1 trading plan or with pre-clearance from the Chief Legal Officer during an open trading
window. Transactions pursuant to SEC Rule 10b5-1 trading plans predetermine the timing, number of shares and price at which an Executive
Officer may buy or sell Company shares. The Executive Officers must also achieve and retain a minimum holding of 100% of their ownership
targets before they may sell or otherwise dispose of Company shares. Executive Officers have five years to achieve their target.
The CPCC regularly reviews stock ownership status for the Executive Officers. Each NEO has exceeded his or her target.

Position
Chief Executive Officer
Chief Financial Officer
President & Chief Brand Officer
Chief Customer Officer
Chief Technology and Information Officer

Multiple of Base Salary Used to Establish Ownership Target
10x
4x
10x
4x
3x

Benefits
The Company offers the NEOs a comprehensive program of benefits which enhance total compensation with meaningful and competitive
offerings that support healthy lifestyles and contribute to financial security. These benefits are regularly reviewed for consistency with our pay
and benefits philosophy, organizational culture and market practices.

Additional information on 2024 benefits is provided in the following table.

Broad-Based
(including
Executives)

Executive
Benefits

Benefit
•

•

Company contribution to medical, dental and vision
coverage
401(k): Company matching contributions are made each pay
period an employee contributes to the 401(k) Plan, equal to a
dollar for dollar match up to 1% of eligible pay, then $0.50
per dollar on the next 6% of eligible pay, up to a maximum of
4% of eligible pay and IRC limits
Short- and long-term disability
•
Life insurance
•
•
Relocation assistance
• Merchandise discount
•
•
•
•
•
•

NDCP, including Company match for eligible participants
Paid parental leave and adoption assistance
Paid time away
Health savings account and flexible spending accounts
ESPP
Retiree Health: This program closed to new entrants in
2013; Erik Nordstrom, Peter Nordstrom and Kenneth
Worzel are participants as they were eligible prior to the
closure to new entrants
Executive Severance Plan
SERP: This program closed to new entrants in 2012 and
the annual benefit is capped for current participants; Erik
Nordstrom, Peter Nordstrom and Kenneth Worzel are
participants as they were eligible prior to the closure to
new entrants

•
•

Where to Learn More

•

•

•

•

For 401(k), long-term disability and life insurance,
relocation assistance, tax reimbursement in connection
with relocation and merchandise discount, see All Other
Compensation in Fiscal Year 2024, footnotes (a), (b),
(c), (d) and (e) respectively on page 90.
For NDCP, see Nonqualified Deferred Compensation
beginning on page 96.

For Retiree Health and Executive Severance, see
Potential Payments Upon Termination or Change in
Control at Fiscal Year End 2024, footnote (d) and (e)
respectively starting on page 101.
For SERP, see Pension Benefits beginning on page 95.

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Compensation Governance

Our Roles in Determining Compensation Are Well Defined

Compensation, People and Culture Committee
Our CPCC oversees the development and delivery of our pay and benefits philosophy and compensation plans for the NEOs and other
executives as described in the CPCC charter. As part of that oversight, the CPCC ensures the NEOs’ aggregate compensation aligns with
shareholder interests by reviewing analyses that include:

•

•

Cash alignment to evaluate the short-term incentive payouts relative to our financial performance.

Relative pay and performance to compare the percentile rankings of our CEO’s total direct compensation (base salary +
performance-based bonus + LTIs) and our Company’s financial performance metrics within our peer group. The total direct
compensation of our NEOs within our peer group is also considered.

CPCC Consultant
The CPCC has retained Semler Brossy. A consultant from the firm attends CPCC meetings and, in support of the CPCC’s role, provides
independent expertise on market practices, compensation program design and related subjects as described on page 87. Semler Brossy
provides such services only as directed by the CPCC. During fiscal year 2024, Semler Brossy’s services included a review of executive and
Director pay programs, a review of the compensation peer group and other pay-related matters specific to the CPCC’s charter. With respect
to Director pay, Semler Brossy provides its services to the CGNC.

Management
Our CEO and the President & Chief Brand Officer provide input to the CPCC on the level and design of compensation elements for the NEOs
and other Executive Officers, excluding themselves. Our Chief Human Resources Officer attends CPCC meetings to provide perspective and
expertise relevant to the agenda. Management supports the CPCC’s activity by providing analyses and recommendations developed
internally. NEOs are not present for discussions of their own pay.

Market Data Provides a Reference Point for Compensation
The CPCC believes that knowledge of market practices, particularly those of our peers listed below, is helpful in assessing the design and
targeted level of our executive compensation package. In reviewing peer group information, the CPCC uses survey data provided by external
consultants, monitors general market movement for executive pay and references proxy statements for specific roles.

While the CPCC considers the 50th percentile (median) of our peer group as a reference, there is no specific percentage of target total direct
compensation targeted by the CPCC other than to remain generally competitive with similarly situated peer companies. Target opportunities
for individual pay elements vary by executive role based on scope of responsibilities and expected contributions.

Target total direct compensation for 2024 for Erik Nordstrom was below our peer group median, as it has been in previous years. Based on
the CPCC’s review of relevant market data and internal pay equity, the CPCC believes the target total direct compensation for the other
NEOs was within a competitive range of the peer group median. Actual pay for the NEOs can exceed our established targets or peer group
actual pay through the variable compensation elements when pre-determined performance milestones established by the CPCC are
achieved.

Peer Group Companies Represent Our Business
Each year, the CPCC reviews the appropriateness of our peer group for comparison on pay and related practices. Collectively, the peer
group companies represent our primary business areas, including our Nordstrom, Nordstrom Rack, in-store and online businesses and
private label products. The peer group companies generally meet the following selection criteria:

fall within the Consumer Discretionary sector,

fall within a reasonable range of our size, defined as one-third to three times our revenue and one-fourth to four times our market
capitalization,

share similar talent, operational and/or business characteristics, including a retail-focused business model,

have a similar or related product focus and place a high value on customer experience,

are part of our industry group as defined by institutional shareholders and shareholder service organizations, and

are a public company subject to similar market pressures.

•

•

•

•

•

•

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Our peer group used for evaluating compensation for fiscal year 2024 was comprised of the following retail companies:

American Eagle Outfitters, Inc. (AEO)
Burlington Stores, Inc. (BURL)
Capri Holdings Limited (CPRI)
Dillard’s, Inc. (DDS)
DICK’S Sporting Goods, Inc. (DKS)
Foot Locker, Inc. (FL)

The Gap, Inc. (GAP)
Kohl’s Corporation (KSS)
Macy’s, Inc. (M)
Ralph Lauren Corporation (RL)
Ross Stores, Inc. (ROST)

Tapestry, Inc. (TPR)
The TJX Companies, Inc. (TJX)
Ulta Beauty, Inc. (ULTA)
V.F. Corporation (VFC)
Victoria’s Secret & Co. (VSCO)

During 2024, as part of its annual review of peer companies to be used for compensation comparison purposes, the CPCC made no changes
to the peer group.

Compensation Risk Assessment Supports Integrity of Our Pay Practices
The CPCC oversees an extensive review of the Company’s pay-for-performance philosophy, the composition and balance of elements in the
compensation package and the alignment of plans with shareholder interests to ensure these practices do not pose a material adverse risk to
the organization. The review is conducted every other year, as underlying programs and practices are generally consistent over time. The
last review, for fiscal year 2024, concluded with the following perspectives:

•

The goals of the Company’s compensation programs are to attract and retain the best talent and to motivate and reward our people
in ways that are aligned with the interests of our shareholders. This has been a long-standing objective of our pay-for-performance
philosophy. We believe that the strong alignment of our employee compensation plans with performance has well-served our
stakeholders, and our shareholders in particular. The strength of this alignment is regularly reviewed and monitored by the CPCC.

• We have systems in place to identify, monitor and control risks, making it difficult for a single individual or a group of individuals to

expose the Company to material compensation risk.

• Our compensation program rewards both short- and long-term performance. Performance measures are predominantly team-

oriented rather than individually focused, and tied to measurable factors that are both transparent to shareholders and drivers of
shareholder return.

•

•

•

The compensation program balances the importance of achieving critical short-term objectives with a focus on realizing long-term
strategic priorities. Strong stock ownership guidelines are in place for Company leaders, and mechanisms, such as our Clawback
Policy, exist to address inappropriate rewards.

The CPCC is actively engaged in establishing compensation plans, monitoring these plans during the year and using discretion in
making rewards, as necessary.

The Company has active and engaged oversight systems in place. The AFC and the full Board of Directors closely monitor and
certify the performance that drives employee rewards through detailed and transparent financial reporting, which is in place to
provide strong, timely insight into the performance of the Company.

Based on this review, the CPCC believes the Company’s compensation plans do not encourage risk taking that is reasonably likely to have a
material adverse effect on the Company.

Clawback Policy Applies to Performance-Based Pay
Our Clawback Policy provides for the mandatory recovery of erroneously awarded incentive-based compensation from current and former
executive officers of the Company in the event that the Company is required to restate its financial results due to the Company’s material
noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct
an error in previously filed financial statements with the SEC that (i) is material to the previously filed financial statements, or (ii) would result
in a material misstatement if the error were corrected in the current period or left uncorrected in the current period. Under our Clawback
Policy, recovery of any such compensation is required regardless of whether the officer who received erroneously awarded compensation
engaged in misconduct or otherwise caused or contributed to the requirement of an accounting restatement.

LTI Grants Are Effective On the First Day of the Open Trading Window
The CPCC considers annual equity-based awards at its annual February meeting, which is typically held approximately three weeks after
fiscal year-end, and approves such awards either at that meeting or in the days shortly following. Annual grants are customarily effective on
the first day of the Company’s next open trading window following CPCC approval. The CPCC may approve one-time equity-based grants to
executives on other dates for reasons such as newly hired executives or for retention purposes. Such grants are generally effective on the
first day of the Company’s next open trading window following approval by the CPCC.

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Termination and Change in Control Provisions Are CPCC-Directed
Under the Nordstrom, Inc. Executive Severance Plan, eligible Executive Officers, including certain NEOs, are entitled to receive severance
benefits upon involuntary termination of employment by the Company to assist in the transition from active employment. To be eligible to
participate in the plan upon involuntary termination, the NEO must have signed a non-competition and non-solicitation agreement. Erik
Nordstrom and Peter Nordstrom are not eligible for separation benefits under the plan. Separation benefits are described in the Potential
Payments Upon Termination or Change in Control section beginning on page 97.

As described in the same section, the NEOs are generally not entitled to any payment or accelerated benefit in connection with a change in
control of the Company. However, the NEOs are entitled to accelerated vesting of equity if they experience a qualifying termination
(termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control.
Notwithstanding, if the successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the cancellation of
the vested portion of any such award in exchange for either an amount of cash (or stock, other securities or other property) and provide for
the cancellation of the unvested portion of the award, if any, without payment of consideration.

On December 22, 2024, Nordstrom, Inc. announced that it had reached an agreement with members of the Nordstrom family and Liverpool
to acquire all of the outstanding common shares of Nordstrom, Inc. not already beneficially owned by the Nordstrom family and Liverpool.
Upon completion of the Merger, unvested RSUs, stock options and PSUs would be converted to cash-based awards and vest on the same
schedule. Unvested and vested options would be canceled if their exercise price is equal to or greater than the merger consideration plus the
amount of the special dividend, and vested options would be paid in cash if their exercise price is less than the merger consideration plus the
amount of the special dividend. The amount of the cash payment would be based on the number of shares subject to the vested option and
the difference of the merger consideration, plus the amount of the special dividend, and the exercise price.

Tax and Accounting Considerations Underlie the Compensation Elements
The CPCC recognizes the tax and regulatory factors that can influence the structure of executive compensation programs, including:

•

•

•

Section 162(m) of the IRC, which disallows a tax deduction to public companies for annual compensation over $1 million paid to
“covered employees,” which generally include NEOs. Certain performance-based compensation under arrangements in place as of
November 2, 2017 are not subject to the limitation. Therefore, compensation in excess of $1 million paid to our NEOs is generally
expected to be nondeductible by the Company.

FASB ASC 718 – Stock Compensation, where stock options, PSUs and RSUs are accounted for based on their grant date fair
value (see Note 10: Stock-based Compensation in Item 8 of Part II). The CPCC regularly considers the accounting implications of
our equity-based awards.

Section 409A of the IRC, the limitations of which primarily relate to the deferral and payment of benefits under the NDCP and
SERP. The CPCC continues to consider the impact of Section 409A and, in general, the evolving tax and regulatory landscape in
which its compensation decisions are made.

SUMMARY COMPENSATION TABLE
The following table summarizes the total compensation paid or accrued by the Company for services provided by the NEOs for fiscal years
ended February 1, 2025, February 3, 2024 and January 28, 2023. Neither Catherine Smith nor Jason Morris were NEOs in fiscal year 2022,
so no amounts are shown in that year. On February 27, 2025, Catherine Smith informed the Company of her intention to step down from her
role. Her last day will be on or about March 21, 2025. Refer to the Potential Payments Upon Termination or Change in Control at Fiscal Year
End 2024 section on page 97 for details on how different compensation plans are handled upon separation.

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Table of Contents

Name and Principal
Position
Erik B. Nordstrom
Chief Executive Officer

Catherine R. Smith
Chief Financial Officer

Peter E. Nordstrom
President & Chief Brand
Officer

Kenneth J. Worzel
Chief Customer Officer

Jason Morris
Chief Technology and
Information Officer

Fiscal
Year
2024
2023
2022
2024
2023 

2024
2023
2022
2024
2023
2022
2024
2023 

Salary
($)(a)
875,269 
773,087 
758,500 
875,000 
605,769 

Bonus
($)(b)
— 
— 
— 
— 
550,000 

— 
875,269 
— 
773,087 
— 
758,500 
150,000 
895,000 
— 
912,212 
— 
895,000 
830,000 
415,000 
638,462  1,170,000 

Option
Stock
Awards
Awards
($)(d)
($)(c)
— 
2,064,982 
1,592,845  1,061,901 
1,592,844  1,061,890 
— 
1,458,322 
— 
6,499,973 

2,064,982 
— 
1,592,845  1,061,901 
1,592,844  1,061,890 
— 
1,939,150 
894,999 
1,342,496 
894,992 
1,342,500 
— 
1,383,314 
— 
3,999,972 

Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
($)(f)
— 
— 
— 
— 
— 

Non-Equity
Incentive Plan
Compensation
($)(e)
2,363,227 
1,061,900 
— 
1,476,563 
787,500 

All Other
Compensation
($)(g)
63,538 
50,629 
57,748 
128,339 
73,184 

2,363,227 
1,061,900 
— 
1,736,859 
592,938 
— 
896,400 
478,080 

— 
— 
— 
1,832,072 
465,523 
— 
— 
— 

52,195 
71,974 
64,534 
34,972 
26,795 
32,053 
44,599 
190,774 

Total
($)
5,367,016 
4,540,362 
3,470,982 
3,938,224 
8,516,426 

5,355,673 
4,561,707 
3,477,768 
6,588,053 
4,234,963 
3,164,545 
3,569,313 
6,477,288 

(a) Salary
The amounts shown represent base salary earned during the fiscal year. The numbers shown for all fiscal years vary somewhat from annual
base salaries due to the fact that our fiscal year ends on the Saturday nearest to January 31st and salary increases are generally effective in
March. Also, as a result of our 4-5-4 retail reporting calendar, fiscal year 2023 included an extra week (the 53rd week). The 2023 base
salaries shown for Catherine Smith and Jason Morris reflect a partial year of base salary, as they joined the Company on May 29, 2023 and
May 1, 2023, respectively. The 2024 base salaries are described on page 81.

(b) Bonus
This column refers to one-time payments not made under the EMBP. Jason Morris received a cash sign-on payment paid in three
installments as a consideration for value forfeited by joining the Company. The first installment of $1,170,000 was paid in fiscal year 2023,
the second installment of $415,000 was paid in fiscal year 2024 and the third installment of $415,000 will be paid in fiscal year 2025,
contingent upon continued service with the Company. Catherine Smith received a one-time lump sum cash sign-on payment of $550,000 in
fiscal year 2023 as a consideration for value forfeited by joining the Company. Kenneth Worzel received a one-time payment, approved by
the CPCC, in the amount of $150,000 which was intended to compensate him for losses incurred as a result of an administrative error under
the NDCP.

(c) Stock Awards
The amounts reported reflect the grant date fair value of PSUs and RSUs granted during the fiscal year under the EIP. The amounts reported
are not the value actually received.

The value the NEOs will ultimately receive from their PSUs will depend on the performance requirements and the market price of our
common stock on the vesting date. The amounts reported were calculated in accordance with ASC 718 – Stock Compensation. The PSUs
granted in fiscal year 2024 had a three-year performance period, with one-third of the shares allocated to each of three one-year
performance cycles. The CPCC establishes the performance goals for each one-year performance cycle on an annual basis. Consistent with
the applicable accounting rules, the amounts reported for the 2024 PSUs reflects the grant date fair value for only the first performance cycle,
consisting of one-third of the total shares subject to the award because in 2024 the CPCC had established performance goals under the
award for only that first performance cycle. The grant date fair value for one-third of the PSUs awarded in fiscal year 2024, as reflected in the
table, at the maximum payout percentage of 175% is as follows: Erik Nordstrom: $903,418, Catherine Smith: $638,006, Peter Nordstrom:
$903,418, Kenneth Worzel: $848,375 and Jason Morris: $605,192. See column (c) of the Grants of Plan-Based Awards in Fiscal Year 2024
table on page 92 for the target number of PSUs granted in fiscal year 2024. The grant date fair value for the PSUs awarded in fiscal year
2023 at the maximum payout of 150% is as follows: Erik Nordstrom: $2,389,268, Peter Nordstrom: $2,389,268 and Kenneth Worzel:
$2,013,744. The grant date fair value for the PSUs awarded in fiscal year 2022 at the maximum payout of 150% is as follows: Erik
Nordstrom: $2,389,266, Peter Nordstrom: $2,389,266 and Kenneth Worzel: $2,013,750. As discussed starting on page 83, the performance
period for the 2022 PSU grant ended on February 1, 2025, resulting in a payout of 75%.

Nordstrom, Inc. and subsidiaries 89

 
 
 
 
 
 
 
 
 
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The value the NEOs may receive from their RSUs will depend on whether the time-based vesting requirement is met and the market price of
our common stock on the vesting date. The amounts reported were calculated in accordance with ASC 718 – Stock Compensation. See
column (d) of the Grants of Plan-Based Awards in Fiscal Year 2024 table on page 92 for the number of RSUs granted in fiscal year 2024.

(d) Option Awards
The amounts reported reflect the grant date fair value of stock options granted during fiscal years 2023 and 2022 under the EIP. This is not
the value received. The NEOs will only realize value from stock options if the market price of our common stock is higher than the exercise
price of the stock options at the time of exercise. The amounts reported were calculated in accordance with ASC 718 – Stock Compensation.
No stock options were granted to NEOs in fiscal year 2024.

Assumptions used in the calculation of these amounts are included in Note 10: Stock-based Compensation in Item 8 of Part II.

(e) Non-Equity Incentive Plan Compensation
The amounts reported reflect the annual performance-based cash awards under the EMBP, as described on page 82.

Kenneth Worzel elected to defer 25% of his bonus earned in 2023 and paid in March 2024 into the NDCP, resulting in $148,235 attributed to
fiscal year 2024 deferrals as reported in the Fiscal Year 2024 Nonqualified Deferred Compensation Table on page 96.

Each of the NEOs contributed a portion of their base salary earned during fiscal year 2024 to the 401(k) Plan.

(f) Change in Pension Value and Nonqualified Deferred Compensation Earnings
The amounts reported are the increases in actuarial present value from each fiscal year end for each of the eligible NEO’s benefit under the
SERP. The present value of the benefit is affected by current earnings, credited years of service, the executive’s age and time until normal
retirement eligibility, the age of the executive’s spouse or life partner as the potential beneficiary, actuarial assumptions (discount rate and
mortality table used to determine the present value of the benefit), and the annual SERP benefit cap of $700,000.

The present value of Erik Nordstrom’s and Peter Nordstrom’s benefit decreased from 2023 fiscal year end by $543,760 and $549,570,
respectively. The decreases were primarily the result of an increase in the discount rate used to determine the present value of the benefits.
The interest rate used is the same as the discount rate used for financial reporting purposes for the SERP, which changed from 5.27% to
5.66%. Negative values are not reported in the table, so no amounts are shown for Erik Nordstrom and Peter Nordstrom. The present value
of Kenneth Worzel’s benefit increased by $1,832,072, primarily due to an increase to service, which more than offset any decrease due to the
change in the discount rate. Amounts are not reported for the other NEOs, as they are not eligible for the SERP benefit.

The amounts were calculated using the same discount rate assumptions as those used in the Company’s financial statements to calculate
the Company’s obligations under the SERP. Assumptions used in the calculation of these amounts are included in Note 9: Supplemental
Executive Retirement Plan in Item 8 of Part II.

Kenneth Worzel had an account balance in the NDCP in fiscal year 2024, as shown on page 97. He did not receive above-market-rate or
preferential earnings on his deferred compensation, so no amounts for these types of earnings are included in the table.

(g) All Other Compensation
Each component of all other compensation paid to the NEOs is shown in the following table.

All Other Compensation in Fiscal Year 2024
The following table shows each component of “All Other Compensation” for fiscal year 2024, reported in column (g) of the Summary
Compensation Table on page 88, calculated at the aggregate incremental cost to the Company.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

401(k) Plan Company
Match
($)(a)
7,240 
14,305 
12,936 
13,800 
13,256 

Premium on
Insurance
($)(b)
2,162 
2,176 
2,162 
2,202 
2,117 

Expenses in
Connection with
Relocation ($)(c)
— 
62,518 
— 
— 
— 

Tax Reimbursement in
Connection with Relocation
($)(d)
— 
41,557 
— 
— 
— 

Other Benefits
($)(e)
54,136 
7,783 
37,097 
18,970 
29,226 

Total
($)
63,538 
128,339 
52,195 
34,972 
44,599 

(a) 401(k) Plan Company Match
The Company offers a matching contribution on employee 401(k) contributions under the 401(k) Plan to all eligible employees, including the
NEOs. The NEOs and all other Company employees may defer up to 50% of their eligible pay (i.e., base salary, performance-based bonus
and other taxable wages) into the 401(k) Plan, subject to IRC limits.

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Company matching contributions are made each pay period an employee contributes to the 401(k) Plan, equal to a dollar for dollar match up
to 1% of eligible pay, then $0.50 per dollar on the next 6% of eligible pay, up to a maximum of 4% of eligible pay and IRC limits. The total
Company matching contribution each of the NEOs received, as shown in the table, reflects this matching formula for fiscal year 2024.
Contributions under the 401(k) Plan may be directed to custom target retirement date funds or to any of nine individual investment
alternatives, including our common stock. The Plan also offers a self-directed brokerage option.

(b) Premium on Insurance
The Company provides life insurance to the NEOs in an amount equal to approximately two times their base salary and additional disability
insurance. The amounts reported are the annual Company-paid premiums.

(c) Expenses in Connection with Relocation
The Company provides relocation assistance to eligible employees who have changed their place of residence to accept a position with
Nordstrom. The type and amount of assistance varies by leadership level. Catherine Smith received relocation benefits under our guidelines
for an executive at her level relocating to the Company’s headquarters in Seattle. The amount reported is the cost incurred by the Company
for relocation expenses.

(d) Tax Reimbursement in Connection with Relocation
The Company provides reimbursement of all taxes incurred on taxable moving expenses to employees who have changed their place of
residence to accept a position with Nordstrom. The amount reported is the grossed-up tax reimbursement received by Catherine Smith in
fiscal year 2024.

(e) Other Benefits
The amounts reported include the total discount the NEOs received on their Nordstrom purchases during fiscal year 2024. The merchandise
discount provided to the NEOs is the same as for all other eligible management and high-performing non-management employees of the
Company, and its Board of Directors, as described on page 103.

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GRANTS OF PLAN-BASED AWARDS IN FISCAL YEAR 2024
The following table discloses:

•

•

•

non-equity incentive plan awards granted in fiscal year 2024 and the potential range of payouts. These awards are performance-
based cash bonuses granted under the EMBP, as described on page 82;

the number and grant date fair value of PSUs granted under the EIP in fiscal year 2024 and the potential range of payouts, as
described on page 83;

the number and grant date fair value of RSUs granted under the EIP in fiscal year 2024, as described on page 83.

Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards
(b)

Estimated Future Payouts Under
Equity Incentive
Plan Awards 
(c)

Grant Date 
(a)

Approval

Date Threshold ($)

Target 

($) Maximum ($)

Threshold (#) Target (#) Maximum (#)

All Other
Stock
Awards:
Number of
Shares
of Stock or
Units (#)(d)

All Other
Option
Awards:
Number of
Securities
Underlying
Options 
(#)

Exercise
or Base
Price of
Option
Awards
($/Sh)

Grant
Date Fair
Value of
Stock and
Option
Awards ($)
(e)

3/7/2024
3/7/2024

3/4/2024
3/4/2024

3/7/2024
3/7/2024

3/4/2024
3/4/2024

3/7/2024
3/7/2024

3/4/2024
3/4/2024

3/7/2024
3/7/2024

3/6/2024
3/6/2024

3/7/2024
3/7/2024

3/4/2024
3/4/2024

442,500  1,770,000  4,425,000 

9,430  37,718 

66,007 

205,078  1,093,750  2,734,375 

6,659  26,637 

46,615 

442,500  1,770,000  4,425,000 

9,430  37,718 

66,007 

209,766  1,118,750  2,796,875 

8,855  35,420 

61,985 

124,500 

664,000  1,660,000 

6,317  25,267 

44,217 

103,760 

73,277 

103,760 

97,437 

69,508 

516,239 
1,548,743 

364,575 
1,093,747 

516,239 
1,548,743 

484,786 
1,454,364 

345,824 
1,037,490 

Name and
Award
Erik B.
Nordstrom
EMBP
PSU
RSU

Catherine
R. Smith
EMBP
PSU
RSU
Peter E.
Nordstrom
EMBP
PSU
RSU

Kenneth J.
Worzel
EMBP
PSU
RSU
Jason
Morris
EMBP
PSU
RSU

(a) Grant Date
The grant date is the first business day of the open trading window that falls on or after the CPCC approval of the grant.

(b) Estimated Future Payouts Under Non-Equity Incentive Plan Awards
Although the column heading refers to future payouts, fiscal year 2024 performance-based bonuses resulted in payouts to the eligible NEOs,
as reported in the Summary Compensation Table on page 88 in column (e) “Non-Equity Incentive Plan Compensation.” For there to be any
payout, minimum performance milestones or achievements must be met and a NEO must be an active employee on the last day of the fiscal
year, with the exception of retirement, death and disability, in which case a prorated amount may be earned. The amounts shown in the
“Threshold”, “Target” and “Maximum” columns reflect the payout opportunity based on base salary and bonus target percentages. These
amounts correspond to specific performance or achievement levels and include the potential for differentiation, as applicable, which is
discussed on page 82.

(c) Estimated Future Payouts Under Equity Incentive Plan Awards
The amounts shown report only one-third of the full number of shares subject to the 2024 PSU grant for which financial performance goals
were established in 2024. Payouts are shown in units of 25%, 100% and 175%.

92

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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(d) All Other Stock Awards: Number of Shares of Stock or Units
The numbers shown report the number of RSUs granted to the NEOs in fiscal year 2024 under the EIP. The RSUs vest 33% on March 10,
2025, 33% on March 10, 2026 and 34% on March 10, 2027.

(e) Grant Date Fair Value of Stock and Option Awards
The grant date fair value of PSUs and RSUs were calculated in accordance with ASC 718 – Stock Compensation.

For the PSUs, the amounts reported are based on the grant date fair value of one-third of the full number of shares subject to the 2024 PSU
grant for which financial performance goals were established in 2024. The fair value of the PSUs on the date of grant of March 7, 2024 was
$13.69. This is not the value received. The actual value the NEOs may receive will depend on performance requirements at the end of the
three-year performance cycle and the market price of our common stock at vest.

The reported value for RSUs was calculated by multiplying the number of RSUs awarded by the fair value of a RSU on the date of grant. The
fair value of the RSUs on the grant date of March 7, 2024 was $14.92 The actual value the NEOs may receive will depend on whether the
time-based vesting requirement is met and the market price of our common stock at the time of any vesting.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END 2024
The following table provides information on the current holdings of stock options and stock awards by NEOs as of the fiscal year ended
February 1, 2025. The table includes vested but unexercised stock options, unvested stock options, unvested RSUs and unvested PSUs.
The vesting schedules for outstanding stock options and RSUs are provided on page 94. Information about the amount of Company common
stock beneficially owned by the NEOs is provided in the Beneficial Ownership Table on page 105. On February 27, 2025, Catherine Smith
informed the Company of her intention to step down from her role. Her last day will be on or about March 21, 2025. See the Potential
Payments Upon Termination or Change in Control section on page 97, for treatment of equity upon separation.

Option Awards

Stock Awards

Equity
Incentive Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested 
(#)

Equity
Incentive Plan
Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested ($)

Number of
Shares or
Units of Stock
That Have Not
Vested 
(#)

Market Value
of Shares or
Units of Stock
That Have Not
Vested 
($)

Equity
Incentive
Plan
Awards: 
Number of
Securities
Underlying
Unexer-
cised
Unearned
Options
(#)

Option
Exercise
Price 
($)
75.23 
51.32 
40.50 
46.66 
45.33 
26.79 
14.79 
35.52 
25.68 
19.63 

Option
Expiration
Date
2/24/2025
2/28/2026
6/7/2026
2/28/2027
3/5/2029
3/9/2030
8/27/2030
3/10/2025
3/3/2032
3/6/2033

Number of Securities
Underlying
Unexercised Options 
(#)

Exer-
cisable
45,996 
82,141 
10,838 
38,653 
73,069 
147,407 
245,829 
— 
— 
— 

Unexer-
cisable
— 
— 
— 
— 
— 
— 
— 
(1)

297,619
102,506
130,194

(2)

(3)

45,996
82,141
10,838
38,653

—
—
—
—

75.23
51.32
40.50
46.66

2/24/2025
2/28/2026
6/7/2026
2/28/2027

(11)

50,919
99,889
113,861
169,367
35,959
70,518

(9)

(5)

(6)

(11)

(9)

1,232,240
2,417,314 
2,755,436
4,098,681
870,208
1,706,536

71,537
132,016

(10)

(12)

1,731,195
3,194,787

(13)

(13)

93,231

(12)

2,256,190

(13)

Nordstrom, Inc. and subsidiaries 93

Name
Erik B.
Nordstrom

Catherine
R. Smith

Peter E.
Nordstrom

Grant Date
2/24/2015
2/29/2016
6/7/2016
2/28/2017
3/5/2019
3/9/2020
8/27/2020
3/4/2021
3/3/2022
3/6/2023
3/6/2023
3/7/2024
3/7/2024
6/2/2023
6/2/2023
3/7/2024
3/7/2024
2/24/2015
2/29/2016
6/7/2016
2/28/2017

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Table of Contents

Name

Kenneth J.
Worzel

Jason
Morris

Grant Date
3/5/2019
3/9/2020
8/27/2020
3/4/2021
3/3/2022
3/6/2023
3/6/2023
3/7/2024
3/7/2024
2/24/2015
2/29/2016
6/7/2016
2/28/2017
3/5/2019
8/27/2020
3/4/2021
3/4/2021
3/3/2022
3/6/2023
3/6/2023
3/7/2024
3/7/2024
6/2/2023
6/2/2023
3/7/2024
3/7/2024

Option Awards

Stock Awards

Number of Securities
Underlying
Unexercised Options 
(#)

Exer-
cisable
73,069
147,407
245,829

Unexer-
cisable
—
—
—
(1)

— 297,619
— 102,506
— 130,194

(2)

(3)

20,585 
38,057 
23,433
16,464
159,425
341,540
34,457

—
—
—
—
—
—
(1)

34,458

— 86,395
— 109,731

(2)

(3)

Equity
Incentive
Plan
Awards: 
Number of
Securities
Underlying
Unexer-
cised
Unearned
Options
(#)

Option
Exercise
Price 
($)
45.33
26.79
14.79
35.52
25.68
19.63

Option
Expiration
Date
3/5/2029
3/9/2030
8/27/2030
3/10/2025
3/3/2032
3/6/2033

75.23
51.32
40.50
46.66
45.33
14.79
35.52

25.68
19.63

2/24/2025
2/28/2026
6/7/2026
2/28/2027
3/5/2029
8/27/2030
3/4/2031

3/3/2032
3/6/2033

Equity
Incentive Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested 
(#)

Equity
Incentive Plan
Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested ($)

Number of
Shares or
Units of Stock
That Have Not
Vested 
(#)

Market Value
of Shares or
Units of Stock
That Have Not
Vested 
($)

50,919
99,889

(11)

(9)

71,537
132,016

(10)

(12)

1,731,195
3,194,787

(13)

(13)

1,232,240
2,417,314

10,546

(4)

255,213

(11)

47,817
94,501
140,911
55,668
34,110
69,508

(9)

(7)

(8)

(11)

(9)

60,403
123,971

(10)

(12)

1,461,753
3,000,098

(13)

(13)

88,436

(12)

2,140,151

(13)

1,157,171
2,286,924
3,410,046
1,347,166
825,462
1,682,094

(1) Stock options awarded on 3/4/2021 to Erik Nordstrom and Peter Nordstrom vest 50% on 3/10/2024 and 50% on 3/10/2025 subject to the
condition that the average daily closing price of our common stock meets or exceeds $45 per share for any twenty consecutive trading
day period prior to 3/10/2025. This price condition was not achieved, and the stock option grants to Erik Nordstrom and Peter Nordstrom
were forfeited on 3/10/2025. On 3/4/2021 Kenneth Worzel also received a stock option grant that vests 50% on 3/10/2024 and 50% on
3/10/2025, and is not subject to a price condition for vesting.

(2) Stock options awarded on 3/3/2022 and vest 50% on 3/10/2025 and 50% on 3/10/2026.
(3) Stock options awarded on 3/6/2023 and vest 50% on 3/10/2026 and 50% on 3/10/2027.
(4) RSUs awarded on 3/4/2021 and vest 25% per year with a remaining vesting date on 3/10/2025.
(5) RSUs awarded on 6/2/2023 and vest 55% on 6/10/2024, 25% on 6/10/2025 and 20% on 6/10/2026.
(6) RSUs awarded on 6/2/2023 and vest 50% on 6/10/2025 and 50% on 6/10/2026.
(7) RSUs awarded on 6/2/2023 and vest 33% on 6/10/2024, 33% on 6/10/2025 and 34% on 6/10/2026.
(8) RSUs awarded on 6/2/2023 and vest 50% on 6/10/2026 and 50% on 6/10/2027.
(9) RSUs awarded on 3/7/2024 and vest 33% on 3/10/2025, 33% on 3/10/2026 and 34% on 3/10/2027.
(10) PSUs awarded on 3/6/2023 and reflect performance at 75% achievement.
(11) PSUs awarded on 3/7/2024 and reflect one-third of the total 2024 PSUs awarded, based on a 135% achievement at the end of the first-

year performance cycle, which concluded on February 1, 2025. Payouts for each one-year performance period will be made at the end of
the third year, with the payout amounts determined by the results of each individual year within the performance period.

(12) PSUs awarded on 3/7/2024 and reflect two-thirds of the PSUs under the award which performance goals are established in fiscal years

2025 and 2026, at 175% achievement. See discussion of PSUs on page 84.

94

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Table of Contents

(13) The amounts reported relate to outstanding PSUs granted in 2023 and two-thirds of the PSUs granted in 2024. The amounts reported

reflect the number of shares subject to each unvested PSU (assuming performance as indicated in the table) at $24.20, the closing price
of our common stock on January 31, 2025, the last market trading day of the fiscal year. See discussion of PSUs on page 84.

OPTION EXERCISES AND STOCK VESTED IN FISCAL YEAR 2024
The following table provides information for the NEOs on the number of shares of Company common stock acquired and value realized from
options exercised and awards that vested with respect to fiscal year 2024.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Option Awards

Stock Awards

Number of Shares
Acquired on Exercise
(#)
— 
— 
— 
— 
— 

Value Realized
on Exercise
($)
— 
— 
— 
— 
— 

Number of Shares
Acquired on Vesting
(#)(a)
5,434 
141,922 
5,434 
25,490 
70,455 

Value Realized on
Vesting
($)(b)
130,362 
3,017,836 
130,362 
462,579 
1,494,351 

(a) Number of Shares Acquired on Vesting
The numbers reported include RSUs and PSUs that vested during the fiscal year 2024 for the NEOs.

(b) Value Realized on Vesting
The amounts reported are the values realized for the RSUs and PSUs that vested during fiscal year 2024 for the NEOs.

PENSION BENEFITS
The Company’s original SERP was introduced in the 1980s. Over the years, the plan design changed to better meet the purpose of
encouraging designated executives to stay with Nordstrom throughout their careers and rewarding their significant and sustained contribution
to the Company’s success by adding to their financial security upon retirement. Beginning in 2012, the SERP was closed to new entrants.

The NEOs are eligible for the SERP, except Catherine Smith and Jason Morris, who joined the Company after the SERP had been closed to
new entrants. The eligible NEOs are entitled to receive their full retirement benefit at age 58. Their full benefit is equal to 1.6% multiplied by
final average pay, as described in the following paragraph, and their years of credited service, up to a maximum of 25 years. They may retire
early and could receive a reduced benefit if they are between the ages of 53 and 57, inclusive, with at least 10 years of credited service, and
the CPCC, as the plan’s administrator, approves the early retirement. The early retirement benefit is reduced 10% for each year that their
retirement age is less than 58. If they retire after age 58, they are entitled to their full retirement benefit, increased with interest of 5% per
year, compounded annually, for each full year worked beyond age 58, for a maximum of 10 years. The annual SERP benefit is capped at
$700,000 after any early retirement reductions are applied.

Final average pay is the average base salary and annual performance-based cash bonus of the highest 36 months over the longer of:

•

•

the most recent five years of service, or

the entire period of service after the executive’s 53rd birthday.

The annual SERP benefit is paid upon retirement for the remaining life of the executive with a 50% annuity paid to a surviving spouse or life
partner after the executive’s death. A surviving spouse or life partner also receives a 50% survivor benefit if the executive dies before retiring.
The amount of this survivor benefit depends on the executive’s age and years of credited service at the time of death.

The SERP provides that no benefit will be paid to an executive whose employment is terminated for cause, which includes competitive
behavior against the Company, as determined by the CPCC in the exercise of its discretion in accordance with the Plan. The CPCC also has
discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct or in
competitive behavior against the Company.

Information about payment of the SERP benefit related to change in control is provided on page 101 in footnote (b) to the Potential Payments
Upon Termination or Change in Control at Fiscal Year End 2024 table.

Because the SERP is a nonqualified deferred compensation plan, the Company is not obligated to fund it. If the Company were to become
insolvent, participants would be unsecured general creditors, and there is no guarantee that funds would be available to pay all creditors in
full. See Note 9: Supplemental Executive Retirement Plan in Item 8 of Part II for a discussion of the benefit obligation.

Nordstrom, Inc. and subsidiaries 95

 
 
 
 
 
 
 
Table of Contents

Fiscal Year 2024 Pension Benefits Table
The following table shows the present value of the accumulated SERP benefit payable to each of the NEOs, based on the number of years of
service credited under the Plan to each NEO and actuarial assumptions. For more information on actuarial assumptions used to calculate the
benefit obligations, see Note 9: Supplemental Executive Retirement Plan in Item 8 of Part II.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Plan Name
SERP
— 
SERP
SERP
— 

Age
(#)(a)
61 
— 
62 
60 
— 

Number of Years Credited
Service
(#)(b)
25 
— 
25 
15 
— 

Present Value of
Accumulated Benefit
($)(c)
9,749,740 
— 
9,791,670 
8,349,105 
— 

Payments During
Last Fiscal Year
($)
— 
— 
— 
— 
— 

(a) Age
Age is as of February 1, 2025, the last day of the fiscal year.

(b) Number of Years Credited Service
Although Erik Nordstrom and Peter Nordstrom each have more than 25 years of service, the number of years of credited service under the
SERP is capped at 25.

(c) Present Value of Accumulated Benefit
Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have met the minimum full retirement age of 58 with at least 10 years of credited
service and would be eligible to receive the SERP benefit having the present values as shown in the table.

NONQUALIFIED DEFERRED COMPENSATION
The Company offers participation in the NDCP to eligible employees, including the NEOs. Under this Plan, a participant may defer up to 80%
of base salary, up to 100% of performance-based bonus earned under the Company’s bonus plan and up to 100% of any vested PSUs, less
applicable payroll taxes. Deferral elections are irrevocable and are made in compliance with Section 409A of the IRC. If a participant’s NDCP
deferrals cause a reduction in the Company’s 401(k) match contribution, the Company may deposit a make-up contribution into the
participant’s NDCP account. The Company may also provide a matching contribution, up to 4% of eligible pay over the 401(k) calendar year
compensation limit, on deferrals into the NDCP by eligible participants. Participants in the Company’s SERP are not eligible for this matching
contribution.

Plan participants may direct their cash deferrals to deemed investment alternatives, priced and valued similar to retail mutual funds. As of the
end of the fiscal year, the Company offered 14 deemed investment alternatives. In addition, Plan participants are offered a fixed rate option,
which was 4.42% for calendar year 2024 and 4.79% for calendar year 2025, which is not subsidized by the Company but rather is a rate
based on guaranteed contractual returns from a third-party insurance company provider. With the exception of the fixed rate fund,
participants may change their investment allocations among these investment alternatives daily. Gains and losses for cash deferrals are
credited to participant accounts daily, based on their investment elections. The deemed investment alternatives for cash do not include
Company common stock. Vested PSUs that are deferred into the NDCP remain as stock units until distribution.

96

Table of Contents

Fiscal Year 2024 Nonqualified Deferred Compensation Table
The following table discloses information on nonqualified deferred compensation for the NEOs under the Company’s NDCP for the fiscal year
ended February 1, 2025. The Company’s SERP is also a nonqualified plan. Information regarding benefits payable to NEOs under the SERP
is provided beginning on page 95.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Executive
Contributions in
Last Fiscal Year
($)(a)
— 
— 
— 
148,235 
— 

Registrant Contributions
in Last Fiscal Year
($)
— 
— 
— 
— 
— 

Aggregate Earnings in
Last Fiscal Year
($)(b)
— 
— 
— 
108,811 
— 

Aggregate
Withdrawals/Distributions
($)
— 
— 
— 
— 
— 

Aggregate Balance
at Last Fiscal Year
End
($)(c)
— 
— 
— 
1,683,253 
— 

(a) Executive Contributions in Last Fiscal Year
The amount reported are the deferrals made during the fiscal year for Kenneth Worzel.

(b) Aggregate Earnings in Last Fiscal Year
The amount includes the total interest or other earnings (loss) accrued in fiscal year 2024 on the entire NDCP account balance, including
deferred PSUs for Kenneth Worzel.

(c) Aggregate Balance at Last Fiscal Year End
The amount shown are the total NDCP balances, including earnings on deferrals, as of February 1, 2025. The amount also includes a
corrective deferral, and related earnings, for Kenneth Worzel in the amount of $308,125 that was due to an administrative error in a prior
fiscal year and corrected in fiscal year 2024.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
The following information describes and quantifies certain amounts that would become payable under existing compensation plans if the
NEOs’ employment had terminated on February 1, 2025, the last day of the fiscal year. The amounts are based on each executive’s
compensation and years of service as of that date and, if applicable, based on the closing price of our common stock on January 31, 2025,
the last market trading day of the fiscal year, of $24.20. The estimates are based on all relevant plans effective at the end of the fiscal year
and information available at that time. Actual values would reflect specific circumstances at the time of any termination, the plans and
provisions effective if and when a termination event occurs and any other applicable factors.

Employment Agreements
The Company does not have employment agreements with any Nordstrom employees, including the NEOs. The Company maintains an
executive severance plan to provide certain NEOs an appropriate level of severance benefits in the event of involuntary separation of
service, not for cause. Except as described on the following pages, there are no agreements, arrangements or plans that entitle the NEOs to
enhanced benefits upon termination of their employment.

Nordstrom, Inc. and subsidiaries 97

Table of Contents

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL AT FISCAL YEAR END 2024
The following table shows various termination scenarios and payments that would be triggered under the Company’s compensation plans.
On February 27, 2025, Catherine Smith informed the Company of her intention to step down from her role. Her last day will be on or about
March 21, 2025. She is not entitled to any separation benefits upon her resignation.

Death
($)

Disability
($)

Retirement
($)

Termination
without Cause
($)

5,468,839 
4,697,210 
1,770,000 
174,622 
— 
— 
— 
12,110,671 

6,141,083 
— 
1,750,000 
— 
— 
— 
— 
7,891,083 

5,468,839 
4,978,120 
1,770,000 
158,549 
— 
— 
— 
12,375,508 

5,204,265 
4,237,550 
1,790,000 
181,636 
— 
— 
— 
11,413,451 

4,739,062 
— 
1,660,000 
— 
— 
— 
— 
6,399,062 

5,468,839 
9,749,740 
— 
349,086 
— 
35,000 
— 
15,602,665 

6,141,083 
— 
— 
— 
— 
35,000 
— 
6,176,083 

5,468,839 
9,791,670 
— 
305,233 
— 
35,000 
— 
15,600,742 

5,204,265 
8,349,105 
— 
368,707 
— 
35,000 
— 
13,957,077 

4,739,062 
— 
— 
— 
— 
35,000 
— 
4,774,062 

5,189,390 
9,749,740 
— 
349,086 
— 
— 
— 
15,288,216 

2,426,357 
— 
— 
— 
— 
— 
— 
2,426,357 

5,189,390 
9,791,670 
— 
305,233 
— 
— 
— 
15,286,293 

4,978,396 
8,349,105 
— 
368,707 
— 
— 
— 
13,696,208 

— 
— 
— 
— 
— 
— 
— 
— 

5,189,390 
9,749,740 
— 
349,086 
— 
— 
— 
15,288,216 

2,426,357 
— 
— 
— 
1,772,250 
— 
— 
4,198,607 

5,189,390 
9,791,670 
— 
305,233 
— 
— 
— 
15,286,293 

4,978,396 
8,349,105 
— 
368,707 
635,792 
— 
— 
14,332,000 

— 
— 
— 
— 
1,682,250 
— 
— 
1,682,250 

Qualifying
Termination
Following a
Change in
Control
($)

7,801,341 
9,749,740 
— 
349,086 
— 
— 
— 
17,900,167 

10,720,116 
— 
— 
— 
— 
— 
— 
10,720,116 

7,801,341 
9,791,670 
— 
305,233 
— 
— 
— 
17,898,244 

7,376,896 
8,349,105 
— 
368,707 
— 
— 
— 
16,094,708 

8,487,714 
— 
— 
— 
— 
— 
— 
8,487,714 

(f)

(f)

(c)

(c)

(g)

(b)

(g)

(e)

(b)

(e)

(d)

(d)

(b)

Name and Potential Payment
Erik B. Nordstrom
Continued or Accelerated Vesting of Equity Awards
Vested SERP Benefit
Life Insurance Proceeds
Retiree Health Care Benefit
Separation Benefit
Disability Insurance Benefit
Executive Management Bonus
Total Value of Incremental Benefits
Catherine R. Smith
Continued or Accelerated Vesting of Equity Awards
Vested SERP Benefit
Life Insurance Proceeds
Retiree Health Care Benefit
Separation Benefit
Disability Insurance Benefit
Executive Management Bonus
Total Value of Incremental Benefits
Peter E. Nordstrom
Continued or Accelerated Vesting of Equity Awards
Vested SERP Benefit
Life Insurance Proceeds
Retiree Health Care Benefit
Separation Benefit
Disability Insurance Benefit
Executive Management Bonus
Total Value of Incremental Benefits
Kenneth J. Worzel
Continued or Accelerated Vesting of Equity Awards
Vested SERP Benefit
Life Insurance Proceeds
Retiree Health Care Benefit
Separation Benefit
Disability Insurance Benefit
Executive Management Bonus
Total Value of Incremental Benefits
Jason Morris
Continued or Accelerated Vesting of Equity Awards
Vested SERP Benefit
Life Insurance Proceeds
Retiree Health Care Benefit
Separation Benefit
Disability Insurance Benefit
Executive Management Bonus
Total Value of Incremental Benefits

(b)

(d)

(e)

(d)

(d)

(e)

(e)

(b)

(g)

(g)

(g)

(c)

(c)

(c)

(f)

(f)

(f)

(a)

(a)

(a)

(a)

(a)

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(a) Continued or Accelerated Vesting of Equity Awards
As of the end of fiscal year 2024, the NEOs had unvested equity awards under our EIP. Treatment of the awards under various termination
scenarios is described in this section.

Stock Options

Death or Disability
The stock option agreements under the Company’s EIP generally provide that if a participant’s employment is terminated by reason of death
or disability, all unvested stock options will immediately vest. Vested stock options may be exercised by the participant or participant’s
beneficiary during the period ending four years after termination, provided the 10-year term of the grant has not expired. The amounts shown
in the table include the market values, as of the end of the fiscal year, of unvested stock options that would immediately vest and be
exercisable during the period ending four years after termination.

If, during the term of any outstanding grant, the executive divulges or improperly uses any of the Company’s confidential or proprietary
information, then the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and
any shares of our common stock delivered under such grants will be automatically forfeited.

Retirement or Termination Without Cause
Stock option agreements for annual grants under the Company’s EIP generally provide that if a participant satisfies a minimum age and
years of service requirement and the participant’s employment is terminated by reason of retirement or termination without cause, stock
options granted more than six months prior to termination will continue to vest and may be exercised during the period ending four years after
termination, provided the 10-year term of the grant has not expired. Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have unvested
stock options from their annual grants that qualify for this continued vesting, as they have reached the minimum retirement age of 55 with at
least 10 years of service. The amounts shown in the table include the market values, as of the end of the fiscal year, of unvested stock
options that would continue to vest and be exercisable during the earlier of four years after termination or the 10-year term date of the grant.

If, during the term of any outstanding grant, the executive divulges or improperly uses any of the Company’s confidential or proprietary
information, then the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and
any shares of our common stock delivered under such grants will be automatically forfeited.

Qualifying Termination Following a Change in Control
Stock option grants under the Company’s EIP do not provide for any payment or accelerated benefit upon a change in control. In the event of
a change of control, outstanding awards shall continue in effect or be assumed, or an equivalent award substituted, by the successor
corporation. If a participant experiences a qualifying termination (termination by the Company without cause or termination by the participant
for good reason) within 12 months following a change in control of the Company, then the unvested stock options will automatically vest in
full. Notwithstanding, if the successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the cancellation
of the vested portion of any such award in exchange for either an amount of cash (or stock, other securities or other property) and provide for
the cancellation of the unvested portion of the award, if any, without payment of consideration. Generally, a change in control occurs upon:

•

•

•

•

the merger or consolidation of the Company with or into another entity,

the sale, transfer or other disposition of all or substantially all the Company’s assets,

a change in composition of 50% or more of the Board of Directors, or

any transaction as a result of which any person is the “beneficial owner” of securities of the Company representing at least 30% of
the total voting power of the Company’s outstanding voting securities.

The amounts shown in the table include the market values, as of the end of the fiscal year, of unvested stock options that would immediately
vest and be exercisable if the NEOs experienced a qualifying termination within 12 months following a change in control of the Company.
RSUs

Death or Disability
The RSU agreements under the EIP generally provide that if a participant’s employment is terminated by reason of death or disability, all
unvested RSUs will immediately vest, with the exception of the one-time RSU grants made on June 2, 2023 to Catherine Smith and Jason
Morris. These one-time RSU grants provide that if employment is terminated by reason of death or disability, a prorated number of the RSUs
will immediately vest. The amounts in the table include the market values, as of the end of the fiscal year, of unvested RSUs that would
immediately vest.

If, during the term of any outstanding grant, the participant divulges or improperly uses any of the Company’s confidential or proprietary
information, then any unvested RSUs and any Company common stock delivered on vesting under such grants will be automatically
forfeited.

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Retirement or Termination Without Cause
The RSU agreements for annual grants under the EIP generally provide that if a participant satisfies a minimum age and years of service
requirement and the participant’s employment is terminated by reason of retirement or termination without cause, RSUs granted more than
six months prior to termination will continue to vest. Erik Nordstrom, Catherine Smith, Peter Nordstrom and Kenneth Worzel have unvested
RSUs from annual grants that qualify for this continued vesting as of the end of the fiscal year, as they have met the criteria of at least age 55
with at least 10 years of service or at least age 60. The amounts in the table include the market values, as of the end of the fiscal year, of
unvested RSUs from their annual grants that would continue to vest after termination.

If, during the term of any outstanding grant, the participant divulges or improperly uses any of the Company’s confidential or proprietary
information, then any unvested RSUs and any Company common stock delivered on vesting under such grants will be automatically
forfeited.

Qualifying Termination Following a Change in Control
RSU grants under the EIP do not provide for any payment or accelerated benefit upon a change in control. In the event of a change of
control, outstanding awards shall continue in effect or be assumed, or an equivalent award substituted, by the successor corporation. If a
participant experiences a qualifying termination (termination by the Company without cause or termination by the participant for good reason)
within 12 months following a change in control of the Company, then the unvested RSUs will automatically vest in full. Notwithstanding, if the
successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the cancellation of the vested portion of
any such award in exchange for either an amount of cash (or stock, other securities or other property) and provide for the cancellation of the
unvested portion of the award, if any, without payment of consideration. See the Change in Control paragraph under Stock Options on page
99 for information about when a change in control occurs.

The amounts shown in the table include the market values, as of the end of the fiscal year, of unvested RSUs that would vest if the NEOs
experienced a qualifying termination within 12 months following a change in control of the Company.

PSUs

Death or Disability
The PSU agreements under the EIP provide that if a participant’s employment is terminated before the end of a performance cycle by reason
of death or disability, the participant, or participant’s beneficiary, will be entitled to a prorated payout, based on target performance.
The amounts in the table include the market values of the prorated PSUs at a payout of 100% (target) based on termination on the last day of
fiscal year 2024.

If, during the term of any outstanding grant, the participant divulges or improperly uses any of the Company’s confidential or proprietary
information, then any unvested PSUs and any Company common stock delivered on vesting under such grants will be automatically forfeited.

Retirement or Termination Without Cause
The PSU agreements under the EIP provide that if a participant satisfies a minimum age and years of service requirement and the
participant’s employment is terminated before the end of the performance cycle by reason of retirement or termination without cause, the
participant will be entitled to a prorated payout with respect to any PSU award granted more than six months prior to termination that were
earned during the performance cycle. Erik Nordstrom, Catherine Smith, Peter Nordstrom and Kenneth Worzel qualify for this prorated
treatment upon retirement as of the end of the fiscal year, as they have met the criteria of at least age 55 with at least 10 years of service or
at least age 60. The amounts in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the market values of the prorated
number of their 2023 PSU grant at 75% performance achievement. The amounts in the table for Erik Nordstrom, Catherine Smith, Peter
Nordstrom and Kenneth Worzel include the market values of the prorated number of their 2024 PSU grant based on 135% achievement of
the first-year performance cycle and 100% achievement of the second and third year performance cycles.

If, during the term of any outstanding grant, the participant divulges or improperly uses any of the Company’s confidential or proprietary
information, then any unvested PSUs and any Company common stock delivered on vesting under such grants will be automatically forfeited.

Qualifying Termination Following a Change in Control
The PSU grants under the EIP do not provide for any payment or accelerated benefit upon a change in control. In the event of a change of
control, outstanding awards shall continue in effect or be assumed, or an equivalent award substituted, by the successor corporation. If a
participant experiences a qualifying termination (termination by the Company without cause or termination by the participant for good reason)
within 12 months following a change in control of the Company, then the unvested PSUs will vest in full based on the CPCC’s assessment of
performance through the date of the qualifying termination, or if such performance is indeterminable at that time, at the 100% “target” level of
performance. Notwithstanding, if the successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the
cancellation of the vested portion of any such award in exchange for either an amount of cash (or stock, other securities or other property)
and provide for the cancellation of the unvested portion of the award, if any, without payment of consideration. See the Change in Control
paragraph under Stock Options on page 99 for information about when a change in control occurs.

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The amounts in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values of the unvested number of their 2023
PSU grant at 75% performance achievement that would vest if they experienced a qualifying termination within 12 months following a change
in control of the Company. The amounts in the table also include the market values of the unvested number of the NEOs’ 2024 PSU grant
based on 135% achievement of the first-year performance cycle and 100% achievement of the second and third year performance cycles
that would vest if they experienced a qualifying termination within 12 months following a change in control of the Company.

(b) Vested SERP Benefit
The annual SERP benefit is paid upon retirement for the remaining life of the executive, with a 50% survivor annuity paid to the surviving
spouse or life partner for the remainder of their life after the executive’s death, as described in the Pension Benefits section beginning on
page 95.

Death
The amounts shown are the present values of the 50% survivor annuity, payable in equal installments to the spouse or life partner of the
executive, and would continue for the remaining lifetime of the spouse or life partner.

Disability
The amounts shown for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are the present values of their SERP benefits, as they have
met the minimum age of 58 with at least 10 years of service and would be eligible for their full retirement benefits under the SERP. The
amounts payable would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the
last day of fiscal year 2024.

Retirement or Termination Without Cause
The amounts shown for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are the present values of their SERP benefits, as they have
met the minimum age of 58 with at least 10 years of service and would be eligible for their full retirement benefits under the SERP. The
amounts payable would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the
last day of fiscal year 2024.

Qualifying Termination Following a Change in Control
No benefits are paid solely due to a change in control, although a change in control triggers immediate vesting. If an executive was separated
from the Company after a change in control, a deferred annuity would be payable upon the executive reaching retirement age, or the
executive’s actual age, if older.

The amounts shown for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are the present values of their SERP benefits, as they have
met the minimum age of 58 with at least 10 years of service and would be eligible for their full retirement benefits under the SERP. The
amounts payable would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the
last day of the fiscal year.

The CPCC has discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct
or in competitive behavior against the Company.

(c) Life Insurance Proceeds
The Company provides life insurance for the NEOs of approximately two times their annual base salary. The amounts reported in the table
represent the life insurance proceeds that would be payable if the NEOs had died as of the last day of the fiscal year. The premiums paid for
the Company-provided life insurance are included in column (b) in the All Other Compensation in Fiscal Year 2024 table on page 90.

(d) Retiree Health Care Benefit
The Company provides continued health care coverage for the eligible NEOs if they separate from the Company after age 55 with at least 10
profit sharing years of service. These benefits include medical, behavioral health/substance abuse, vision, prescription drug and dental
coverage. The eligible NEOs and their spouses or registered domestic partners and eligible dependents would be covered under the retiree
health plan, and the executive and the Company would continue to share in the cost of the insurance premium. Coverage and cost sharing
would continue for the surviving spouse or registered domestic partner and eligible dependents after the executive’s death. Effective
November 1, 2013, the retiree health plan was closed to new entrants.

The amounts in the table for the eligible NEOs are the present values of the health care cost that would be payable by the Company if they
had separated on the last day of the fiscal year. Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have met the minimum retirement age
of 55 with at least 10 profit sharing years of service and would be eligible for retirement. Assumptions used in determining these amounts
include a discount rate of 5.74% and the PRI2012 White Collar, Fully Generational Mortality Table with projection scale MP2021.

An executive who is terminated for cause, as determined by the Company in the exercise of its discretion in accordance with the Plan, is not
eligible to receive the retiree health care benefit.

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(e) Separation Benefit
Under the Nordstrom, Inc. Executive Severance Plan, Catherine Smith, Kenneth Worzel and Jason Morris are eligible to receive benefits
upon involuntary termination of employment by the Company, not for cause. To be eligible to participate in the Plan upon involuntary
termination, the eligible NEO must have signed a non-competition and non-solicitation agreement.

Erik Nordstrom and Peter Nordstrom are not eligible under the Plan. The benefits for eligible and participating employees include:

•

•

•

lump sum cash payment for severance: 18 or 24 months of base salary for Executive Officers, depending on their roles. This is
reduced by an amount equal to the participant’s gross monthly SERP benefit multiplied by the number of months used to calculate
the severance payment, if applicable,

lump sum cash payment for health coverage: the cost of the Company-paid portion of the employee’s currently elected health
coverage for 12 months, unless the employee is eligible for the retiree health care benefit, as described in footnote (d), “Retiree
Health Care Benefit”, and

six months of outplacement services.

Kenneth Worzel’s estimated separation payment shown on the following table is reduced by an amount equal to his estimated gross monthly
SERP benefit multiplied by the number of months used to calculate his separation payment. No amount is included for the Company-paid
portion of medical benefits, as he qualifies for retiree health care benefits.

To be eligible to receive any benefits under the Nordstrom, Inc. Executive Severance Plan, the NEO must sign a release in which the
executive agrees, among other things, not to disclose to anyone at any time any confidential information acquired during employment with
the Company, and not to publish any statement, or instigate, assist or participate in the making or publication of any statement, which is
disparaging or detrimental in any way to the Company, except in each case as required by applicable law.

The potential separation benefits for the NEOs are shown in the following table.

Name
Erik B. Nordstrom
Catherine R. Smith
Peter E. Nordstrom
Kenneth J. Worzel
Jason Morris

Separation
Payment
($)
— 
1,750,000 
— 
630,292 
1,660,000 

Company-Paid
Portion of
Medical Benefits
($)
— 
16,750 
— 
— 
16,750 

Cost of
Outplacement
Services
($)
— 
5,500 
— 
5,500 
5,500 

Total Separation
Benefit
($)
— 
1,772,250 
— 
635,792 
1,682,250 

(f) Disability Insurance Benefit
The Company provides long-term disability insurance for the NEOs. The amount reported in the table for each NEO is the long-term disability
benefit provided of up to $35,000 per month. The premiums for the Company-provided disability insurance are included in column (b) in the
All Other Compensation in Fiscal Year 2024 table on page 90.

(g) Executive Management Bonus
The performance period under the EMBP is the fiscal year. Therefore, a termination event that occurred on the last day of the fiscal year
would not result in any additional or accelerated benefits under this Plan. However, if an employee died, became disabled or retired (after
having met certain age and years of service requirements) during the fiscal year, the CPCC would have the sole discretion to determine what
amounts, if any, an executive would remain eligible to receive as a performance-based bonus award. Any bonus award would be prorated to
reflect the period of service during the fiscal year.

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NON-EMPLOYEE DIRECTOR SUMMARY COMPENSATION TABLE
During the fiscal year ended February 1, 2025, non-employee Directors of the Company received the following compensation for their
services:

1

Name
Stacy Brown-Philpot
James L. Donald
Kirsten A. Green
Glenda G. McNeal
Amie Thuener O’Toole
Guy B. Persaud
Eric D. Sprunk
Bradley D. Tilden
Mark J. Tritton
Atticus N. Tysen

Retainers Earned
or Paid in Cash
($)(a)(b)
97,500 
132,500 
97,500 
127,500 
137,500 
97,500 
97,500 
97,500 
97,500 
97,500 

Stock
Awards
($)(b)(c)
164,982 
164,982 
164,982 
164,982 
164,982 
164,982 
164,982 
364,985 
164,982 
164,982 

All Other
Compensation
($)(d)
3,280
10,855
20,054
12,241
14,309
323
19,062
10,857
9,022
10,176

Total
($)
265,762
308,337
282,536
304,723
316,791
262,805
281,544
473,342
271,504
272,658 

1 

On December 13, 2024, Stacy Brown-Philpot resigned from the Board.

(a) Retainers Earned or Paid in Cash
The amounts reported reflect the cash retainer paid to each non-employee Director, whether or not such retainers were deferred. The annual
cash retainers paid to Directors for service on the Board of Directors in 2024 was $97,500. In addition to the annual cash retainer, James
Donald received $35,000 in cash for service as Chair of the CPCC, Glenda McNeal received $30,000 in cash for service as Chair of the
CGNC and Amie Thuener O’Toole received $40,000 in cash for service as Chair of the AFC.

(b) Deferred Compensation Program
Non-employee Directors may elect to defer all or a part of their cash retainers and stock awards under the Nordstrom Directors Deferred
Compensation Plan. Directors are required to make advance elections to defer the receipt of retainers or stock awards, and all deferral
elections generally are irrevocable. Directors are also required to make advance elections about the form and timing of the distribution of
their deferred cash retainers or stock awards.

In 2024, cash deferrals could be directed among 14 deemed investment alternatives, and gains and losses for cash deferrals were posted to
the Director’s account daily based on their investment elections. In addition, plan participants were offered a fixed rate option of 4.42% in
2024, which was not subsidized by the Company, but rather was a rate based on guaranteed contractual returns from a third-party insurance
company provider. Deferred stock awards are credited to the Director’s account as units. Each unit in the Nordstrom Directors Deferred
Compensation Plan is equal in value to the price of one share of our common stock. Each deferred unit is credited with dividends, in the form
of additional units, to the same extent as a share of our common stock.

During the fiscal year ended February 1, 2025, Glenda McNeal deferred 100% of her cash retainer into the Nordstrom Directors Deferred
Compensation Plan and Stacy Brown-Philpot deferred 100% of her Stock Award into the Nordstrom Directors Deferred Compensation Plan.

(c) Stock Awards
The amounts reported reflect the grant date fair value associated with each Director’s stock awards. Director stock awards are generally
made on the first open trading day following the Company’s Annual Meeting of Shareholders. Fractional shares are not awarded or paid in
cash. The grant date fair value of the 2024 annual stock awards was $165,000. In recognition of the significant time and attention in
performing the duties required of the position, our Chairman of the Board of Directors is annually awarded an additional stock award having a
grant date value of $200,000.

(d) All Other Compensation
All Directors, their spouses and eligible children may participate in the Company’s employee merchandise discount program. The program
provides a discount of 33% for purchases at Nordstrom stores and Nordstrom.com and 20% for purchases at Nordstrom Rack stores,
NordstromRack.com and our restaurants. A 40% discount is available at certain times of the year on specific merchandise. The merchandise
discount provided to the Directors is the same as for all other eligible management and high-performing non-management employees. During
the fiscal year ended February 1, 2025, All Other Compensation consisted only of merchandise discounts for all Directors.

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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the fiscal year ended February 1, 2025, no member of the CPCC was an employee or officer of the Company or any of its subsidiaries
or had any relationship otherwise requiring disclosure.

PAY RATIO DISCLOSURE
SEC rules require that U.S. publicly traded companies disclose the ratio of their Principal Executive Officer’s compensation to that of their
median employee. Our Principal Executive Officer is our CEO, Erik Nordstrom.

For fiscal year 2024:

•

•

the annual total compensation of Erik Nordstrom was $5,367,016, and

the estimated median of the annual total compensation of all employees of our Company, other than Erik Nordstrom, was $35,686.

Based on this information, for 2024 the ratio of the annual total compensation of Erik Nordstrom, our CEO and Principal Executive Officer, to
the median of the annual compensation of all employees was 150 to 1.

The SEC rules for identifying the median employee and calculating the pay ratio permit companies to use various methodologies and
assumptions to apply certain exclusions and to make reasonable estimates that reflect their employee population and compensation
practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio that we have reported.

To identify the median employee, we used the total compensation as reported on the 2024 W-2 for all of our employees, excluding our
Principal Executive Officer, who were employed by us on February 1, 2025, the last day of our fiscal year. We included full-time, part-time,
seasonal and temporary employees and did not annualize the compensation for our permanent full-time and part-time employees who were
not employed with us for the entire fiscal year. Similar to other large retail companies, a significant portion of our workforce is employed on a
part-time and seasonal basis. As of the end of fiscal year 2024, approximately 28,000 of our 55,000 employees – or 52% of our workforce –
were either part-time or seasonal.

After identifying the median employee, we calculated annual total compensation for the median employee using the same methodology we
used for determining total compensation for our NEOs as shown in the 2024 Summary Compensation Table on page 88.

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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters.
(Dollar and share amounts in ones, except where otherwise noted)

EQUITY COMPENSATION PLANS
The following table provides information as of the fiscal year ended February 1, 2025 about Company common stock that may be issued
upon the exercise of options and rights that have been or may be granted to employees and members of the Board of Directors under all of
the Company’s existing equity compensation plans.

Plan Category
Equity compensation plans approved by the Company’s
shareholders
Equity compensation plans not approved by the Company’s
shareholders
TOTAL

1

Number of Securities to
Be Issued Upon
Exercise of Outstanding
Options, Warrants and
Rights
(a) (#)

Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b) ($)

Number of Securities
Remaining Available for Future
Issuance Under Equity
Compensation Plans
(excluding securities to be
issued as reflected in
column (a))
(c) (#)

15,458,567 

2

— 
15,458,567 

33 

— 
33 

20,623,797 

3

— 
20,623,797 

1
 Consists of the 2010 Equity Incentive Plan, EIP and the ESPP. PSUs and RSUs do not have an exercise price and therefore have been excluded from the weighted average
exercise price calculation in column (b).
2
 Includes 42,516 related to deferred PSUs.
3
 Includes 16,495,193 shares from the EIP and 4,128,604 shares from the ESPP.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Beneficial Ownership Table
The following table sets forth the amount of Company common stock beneficially owned as of March 14, 2025 by:

•

•

•

•

each person (including any “group” as that term is used in Section 13(d)(3) of the Exchange Act) who is known by Nordstrom to be
the beneficial owner of more than 5% of Company common stock,

each of Nordstrom’s Named Executive Officers,

each of Nordstrom’s Directors, and

all of Nordstrom’s Executive Officers and Directors as a group.

The number of shares beneficially owned by each shareholder is determined under rules issued by the SEC. Under these rules, beneficial
ownership includes any shares as to which a person has sole or shared voting power or investment power. Applicable percentage ownership
is based on 166,898,470 shares of Company common stock outstanding as of March 14, 2025. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person, shares of Company common stock subject to options, or other
rights held by such person that are currently exercisable or will become exercisable within 60 days of March 14, 2025 are considered
outstanding, although these shares are not considered outstanding for purposes of computing the percentage ownership of any other person.

Unless otherwise indicated, the address of each beneficial owner listed below is 1617 Sixth Avenue, Seattle, Washington 98101. We believe,
based on information provided to us, that each of the shareholders listed below has sole voting and investment power with respect to the
shares beneficially owned by the shareholder unless noted otherwise, subject to community property laws where applicable.

Nordstrom, Inc. and subsidiaries 105

 
 
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Name of Beneficial Owner
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(o)

Erik B. Nordstrom
Peter E. Nordstrom
Kenneth J. Worzel
Catherine R. Smith
Bradley D. Tilden
Jason Morris
Kirsten A. Green
Glenda G. McNeal
James L. Donald
Mark J. Tritton
Amie Thuener O’Toole
Atticus N. Tysen
Eric D. Sprunk
Guy B. Persaud
Directors and Executive Officers as a group (20 persons)

(p)
(q)

(r)

(s)

(t)

(u)

(v)

Greater than 5% Security Holders
The Nordstrom Family Group**
El Puerto de Liverpool, S.A.B. de C.V.
   Mario Pani No. 200, Col. Santa Fé Cuajimalpa 
   Cuajimalpa, Ciudad de México, CP 05348, Mexico
Anne E. Gittinger
   1617 Sixth Avenue
   Seattle, Washington 98101
The Vanguard Group
   100 Vanguard Boulevard
   Malvern, Pennsylvania 19355
Charles W. Riley, Jr.***
   1420 Fifth Avenue, Suite 4200
   Seattle, Washington 98101
Estate of Bruce A. Nordstrom
   1420 Fifth Avenue, Suite 4200
   Seattle, Washington 98101
BlackRock, Inc.
   50 Hudson Yards
   New York, New York 10001

Amount and Nature of
Beneficial Ownership
(#)
12,043,562
11,982,602
870,266
103,415
103,009
60,457
39,820
39,820
34,730
34,730
21,316
17,201
15,273
12,153
27,228,164

Percent of
Ownership
(%)
7.19 %
7.15 %
*
*
*
*
*
*
*
*
*
*
*
*
16.06 %

55,692,148
15,755,000

33.37 %
9.44 %

15,404,779

9.23 %

10,629,378

6.37 %

12,436,880

7.45 %

10,244,147

6.14 %

8,866,520

5.31 %

*    Does not exceed 1% of the Company’s outstanding common stock.
**    See footnote (p) below for the addresses of the Nordstrom Family Group.
***    Solely in his capacity as the successor trustee of the Anne E. Gittinger Trust u/w Everett W. Nordstrom created under the will of Everett W. Nordstrom dated April 1, 1971,

and as a successor co-trustee of Trust A u/w Frances W. Nordstrom created under the will of Frances W. Nordstrom dated April 4, 1984.

(a) Erik B. Nordstrom

(b) Peter E. Nordstrom

Amount and nature of beneficial ownership includes:

Amount and nature of beneficial ownership includes:

• 2,661,571 shares owned by him directly;

• 2,530,782 shares owned by him directly;

• 649,190 shares that may be acquired by him through stock
options exercisable within 60 days after March 14, 2025;

• 42,646 shares owned by his wife individually;
• 8,490,560 shares held by trusts of which he is the co-trustee, for

which he has shared voting and dispositive power; and
• 199,595 shares held by a trust of which he is the trustee.

• 39,431 shares held by him in the Company’s 401(k) Plan;

• 649,190 shares that may be acquired by him through stock
options exercisable within 60 days after March 14, 2025;

• 175,533 shares owned by his wife individually;

• 529 shares held by his wife in the Company’s 401(k) Plan;

• 49,060 shares held by trusts of which he is the trustee;
• 8,490,560 shares held by trusts of which he is the co-trustee, for

which he has shared voting and dispositive power; and

• 47,518 shares held by trusts of which he is the trustee, for which

he has sole voting and dispositive power and for which he
disclaims beneficial ownership.

106

 
 
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(c) Kenneth J. Worzel

Amount and nature of beneficial ownership includes:

• 166,780 shares owned by him directly;

• 6,758 nonvoting stock units held under the NDCP;

• 5,697 shares held by him in the Company’s 401(k) Plan; and

• 691,031 shares that may be acquired by him through stock
options exercisable within 60 days after March 14, 2025.

(o) Directors and Executive Officers as a group (20 persons)

Collectively, the combined amount and nature of beneficial
ownership for the Directors and all Executive Officers include:

• 6,779,282 shares owned directly;

• 17,724,618 shares owned by spouses and trusts of which the

respective Director or Executive Officer is a trustee, or a trustee
and beneficiary;

• 6,758 nonvoting stock units held by participating Executive

(d) Catherine R. Smith

Officers under the NDCP;

Amount and nature of beneficial ownership includes:

• 80,540 shares held by participating Executive Officers and their

• 103,415 shares owned by her directly.

(e) Bradley D. Tilden

Amount and nature of beneficial ownership includes:

• 103,009 shares held by a family trust, of which he is a trustee and

beneficiary.

(f) Jason Morris

Amount and nature of beneficial ownership includes:

• 60,457 shares owned by him directly.

(g) Kirsten A. Green

Amount and nature of beneficial ownership includes:

• 39,820 shares owned by her directly.

(h) Glenda G. McNeal

Amount and nature of beneficial ownership includes:

• 39,820 shares owned by her directly.

(i) James L. Donald

Amount and nature of beneficial ownership includes:

• 34,730 shares held in a trust of which he is a trustee and

beneficiary.

(j) Mark J. Tritton

Amount and nature of beneficial ownership includes:

• 34,730 shares owned by him directly.

(k) Amie Thuener O’Toole

Amount and nature of beneficial ownership includes:

• 21,316 shares owned by her directly.

(l) Atticus N. Tysen

Amount and nature of beneficial ownership includes:

• 17,201 shares held in a trust of which he is a trustee and

beneficiary.

(m) Eric D. Sprunk

eligible spouses in the Company’s 401(k) Plan; and

• 2,636,966 shares that may be acquired by the Executive Officers
as a group through stock options exercisable within 60 days after
March 14, 2025.

(p) The Nordstrom Family Group

Members of the Nordstrom family have formed a group consisting
of the individuals identified below and their addresses: Erik B.
Nordstrom, Peter E. Nordstrom, James F. Nordstrom, Jr., Anne E.
Gittinger, Margaret Jean O’Roark Nordstrom, Linda Nordstrom,
Susan E. Dunn, Molly Nordstrom, Alexandra F. Nordstrom, Andrew
L. Nordstrom, Leigh E. Nordstrom, Samuel C. Nordstrom, Sara D.
Nordstrom, Kimberly Mowat Bentz and Mari Mowat Wolf at 1617
Sixth Avenue, Seattle, Washington, 98101, and Charles W. Riley, Jr.
and the Estate of Bruce A. Nordstrom at 1420 Fifth Avenue, Suite
4200, Seattle, Washington 98101. The Nordstrom Family Group
beneficially owns in the aggregate 55,692,148 shares. The
ownership of Erik B. Nordstrom, Peter E. Nordstrom, Anne E.
Gittinger, Charles W. Riley, Jr. and the Estate of Bruce A. Nordstrom
are also reported in the table above. If the Merger is consummated,
following the Merger, Nordstrom common stock will no longer be
publicly traded, and Nordstrom’s shareholders (other than the
Nordstrom Family Group and El Puerto de Liverpool, S.A.B. de
C.V., indirectly) will cease to have any ownership interest in
Nordstrom.

(q) El Puerto de Liverpool, S.A.B. de C.V.

Pursuant to a Schedule 13D/A filing made with the SEC, as of
December 26, 2024, the aggregate amount beneficially owned by El
Puerto de Liverpool, S.A.B. de C.V. includes:

• 15,755,000 shares for which it has sole power to vote or to

dispose or to direct disposition.

(r) Anne E. Gittinger

Pursuant to a Schedule 13D filing made with the SEC, as of
December 23, 2024, and information provided to Nordstrom, the
aggregate amount beneficially owned by Ms. Gittinger includes:

• 13,846,274 shares owned by her directly;

• 3,305 shares held by her in the Nordstrom 401(k) Plan; and

Amount and nature of beneficial ownership includes:

• 1,555,200 shares held by a trust for which she is the trustee, for

• 15,273 shares owned by him directly.

(n) Guy B. Persaud

Amount and nature of beneficial ownership includes:

• 12,153 shares owned by him directly.

which she has sole voting and dispositive power.

Nordstrom, Inc. and subsidiaries 107

Table of Contents

(s) The Vanguard Group

(u) Estate of Bruce A. Nordstrom

Pursuant  to  a  Schedule  13G/A  filing  made  with  the  SEC,  as  of
January 31, 2025, the aggregate amount beneficially owned by The
Vanguard Group includes:

Pursuant to a Schedule 13D filing made with the SEC, as of
December 23, 2024, the aggregate amount beneficially owned by
the Estate of Mr. Nordstrom includes:

• 36,758 shares for which it has shared power to vote or to direct

• 10,244,147 shares for which it has sole power to vote or to

the vote;

• 154,971 shares for which it has shared power to dispose or to

direct disposition; and

• 10,474,407 shares for which it has sole power to dispose or to

direct disposition.

(t) Charles W. Riley, Jr.

Pursuant  to  a  Schedule  13D  filing  made  with  the  SEC,  as  of
December  23,  2024,  the  aggregate  amount  beneficially  owned  by
Mr. Riley includes:

• 5,501,520 shares for which he has sole power to vote or to direct

the vote and to dispose or to direct disposition; and

• 6,935,360 shares for which he has shared power to vote or direct

the vote and to dispose or to direct disposition.

dispose or to direct disposition.

(v) BlackRock, Inc.

Pursuant to a Schedule 13G/A filing made with the SEC, as of
January 31, 2024, the aggregate amount beneficially owned by
BlackRock, Inc. includes:

• 8,544,954 shares for which it has sole power to vote or to direct

the vote; and

• 8,866,520 shares for which it has sole power to dispose or to

direct disposition.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Review and Approval Process
We maintain policies and procedures regarding the identification, review and approval of related party transactions. In compliance with SEC
rules, the CGNC reviews and approves or disapproves any transaction or series of related transactions in which: (1) the amount involved
exceeds $120,000, (2) the Company or any of its subsidiaries is a participant, and (3) a related party (a Director or Executive Officer of the
Company, any nominee for Director, any greater than 5% shareholders and any immediate family member of such persons) has a direct or
indirect material interest. When considering a transaction, the CPCC will review all relevant factors, including the Company’s rationale for
entering into a related party transaction, alternatives to the transaction, whether the transaction is on terms at least as fair to the Company as
would be the case if the transaction were entered with a third party, and the potential of an actual or apparent conflict of interest. After
reviewing the information, the CPCC will approve or ratify the transaction or transactions only if the CPCC determines that the transaction is
reasonable and fair to the Company.

Related Party Transactions
On December 22, 2024, we entered into the Merger Agreement with Parent and Acquisition Sub. As a result of the transactions
contemplated by the Merger Agreement, the Family Group and Liverpool, through Parent, will acquire all of our outstanding common stock,
other than shares beneficially owned by them, in an all-cash transaction valued at approximately $6.25 billion on an enterprise basis.
Additionally, the Merger Agreement requires us to pay Parent a termination fee of $85 million or $42.5 million in certain circumstances. For a
summary of the Merger, please refer to our Form 8-K filed with the SEC on December 23, 2024. Liverpool and certain members of the Family
Group are related persons of the Company under the rules of the SEC regarding related person transactions, including Erik B. Nordstrom
and Peter E. Nordstrom (directors, executive officers, and significant shareholders of the Company), James F. Nordstrom, Jr. (an executive
officer of the Company), and Liverpool, Anne E. Gittinger, and the Estate of Bruce A. Nordstrom (significant shareholders of the Company).
Upon completion of the transactions contemplated by the Merger Agreement, these persons are expected to own the following approximate
percentages of Parent’s common stock: Liverpool 49.9%, Anne E. Gittinger 13.6%, the Estate of Bruce A. Nordstrom 10.1%, Erik B.
Nordstrom 2.6%, Peter E. Nordstrom 2.5%, and James F. Nordstrom, Jr. 0.8%.

DIRECTOR INDEPENDENCE
A Director is considered independent when our Board of Directors affirmatively determines the Director has no material relationship with the
Company, other than as a Director. Our Board of Directors makes this determination in accordance with the standards set forth in our
Corporate Governance Guidelines, which are consistent with the listing standards of the NYSE and applicable SEC rules. In making this
determination, the Board of Directors considers existing relationships between the Company and the Director, whether directly or as a
partner, shareholder or officer of an organization that has a relationship with the Company. The Board of Directors has affirmatively
determined that each of the Directors, except Erik B. Nordstrom and Peter E. Nordstrom, is independent within the meaning of the listing
standards of the NYSE, applicable SEC rules and the Company’s Corporate Governance Guidelines.

108

Table of Contents

Item 14. Principal Accountant Fees and Services.
(Dollar and share amounts in ones, except where otherwise noted)

Our independent registered public accounting firm is Deloitte & Touche LLP, Seattle, Washington, Auditor ID: 34.

AUDIT FEES
The following table summarizes fees billed or expected to be billed to the Company in connection with services by Deloitte:

Type of Fee
1
Audit Fees
2
Audit-Related Fees
Total

Fiscal Year Ended February 1, 2025

Fiscal Year Ended February 3, 2024

($)
4,365,000 
562,000 
4,927,000 

(%)
89 
11 
100 

($)
4,765,000 
431,000 
5,196,000 

(%)
92 
8 
100 

1
 Audit Fees primarily relate to fees for services for: (i) auditing the consolidated financial statements of the Company; (ii) reviewing the interim financial information of the
Company included in its Form 10-Qs; and (iii) auditing the Company’s internal controls over financial reporting. Substantially all of Deloitte’s work on these audits was
performed by full-time, regular employees and partners of Deloitte and its affiliates.
2
 Audit-Related Fees are fees for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements
and internal controls over financial reporting, services related to the issuance of debt securities and accounting research tool subscription fees. This amount does not reflect
additional amounts of $397,593 for fiscal year ended February 1, 2025, and $383,171 for fiscal year ended February 3, 2024, which were reimbursed to the Company by its
banking partner in connection with the System and Organization Controls report related to the Company’s credit card servicing activities.

PRE-APPROVAL POLICY
Consistent with SEC policies regarding auditor independence, the services performed by Deloitte for the fiscal years ended February 1, 2025
and February 3, 2024 were pre-approved in accordance with the policies and procedures adopted by the AFC. The pre-approval policy is
periodically reviewed and updated. It describes the permitted audit, audit-related, tax and other services that Deloitte may perform.

Normally, pre-approval is provided at regularly scheduled AFC meetings. However, the authority to grant specific pre-approval between
meetings, as necessary, has been assigned to the Chair of the AFC. The Chair is responsible for updating the AFC at the next regularly
scheduled meeting of any services that were pre-approved between meetings.

The AFC approves proposed services, which incorporates appropriate oversight and control of the Deloitte relationship, while permitting the
Company to receive immediate assistance from Deloitte when time is of the essence.

The AFC also reviews on a regular basis:

•

•

•

a listing of approved services since its last review,

a report summarizing the year-to-date services provided by Deloitte, including fees paid for those services, and

a projection for the current fiscal year of estimated fees.

The policy prohibits the Company from engaging the independent registered public accountants for services billed on a contingent fee basis
and from hiring current or former employees of the independent auditor who have not satisfied the statutory cooling-off period for certain
positions.

Nordstrom, Inc. and subsidiaries 109

 
Table of Contents

Item 15. Exhibit and Financial Statement Schedules.
The following information required under this item is filed as part of this report:

PART IV

(a)1. FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm
Consolidated Statements of Earnings
Consolidated Statements of Comprehensive Earnings
Consolidated Balance Sheets
Consolidated Statements of Shareholders’ Equity
Consolidated Statements of Cash Flows
Management’s Report on Internal Control Over Financial Reporting
Report of Independent Registered Public Accounting Firm

(a)3. EXHIBITS

Nordstrom, Inc. and Subsidiaries Exhibit Index

Page

44
46
46
47
48
49
73
74

111

All other schedules and exhibits are omitted because they are not applicable, not required or because the information required has been
given as part of this report.

110

 
Table of Contents

Nordstrom, Inc. and Subsidiaries
Exhibit Index

Exhibit
Agreement and Plan of Merger, dated as of December 22, 2024, by and
among Norse Holdings, Inc., Navy Acquisition Co. Inc. and Nordstrom,
Inc.

Articles of Incorporation as amended and restated on May 25, 2005

Bylaws, as amended and restated on September 20, 2023

Description of Nordstrom, Inc. securities

Indenture between Registrant and Norwest Bank Colorado, N.A., as
trustee, dated March 10, 1998

Indenture dated December 3, 2007, between the Company and Wells
Fargo Bank, National Association

Form of 5.00% Global Note due 2044

Form of 5.00% Rule 144A Global Note due 2044

Form of 5.00% Regulation S Global Note due 2044

Form of 7.00% Note due January 2038

Form of 4.00% Note due 2027

Form of 5.00% Note due 2044

Form of 4.375% Note due 2030

Form of 2.300% Global Note due 2024

Form of 4.250% Global Note due 2031

*

Trunk Club Newco, Inc. 2010 Equity Incentive Plan

Shareholder Rights Agreement, dated as of September 19, 2022, by and
between the Company and Computershare Trust Company, N.A., as
rights agent (which includes the Form of Rights Certificate as Exhibit A
thereto).

First Amendment to the Shareholder Rights Agreement, dated as of
August 21, 2023, by and between Nordstrom, Inc. and Computershare
Trust Company, N.A., as rights agent

Second Amendment to the Shareholder Rights Agreement, dated as of
September 3, 2024, by and between Nordstrom, Inc. and Computershare
Trust Company, N.A., as rights agent

Third Amendment to the Shareholder Rights Agreement, dated as of
December 22, 2024, by and between Nordstrom, Inc. and Computershare
Trust Company, N.A., as rights agent

Incorporated by Reference

Exhibit
2.1

Filing Date
December 23, 2024

3.1

3.1

4.4

4.1

4.1

4.2

4.3

4.4

4.2

4.1

4.2

4.1

4.2

4.3

4.1

4.1

May 31, 2005

September 21, 2023

April 30, 2001

March 10, 1998

April 29, 2014

March 28, 2014

March 28, 2014

March 28, 2014

December 3, 2007

March 9, 2017

March 9, 2017

November 6, 2019

September 3, 2021

September 3, 2021

August 27, 2014

September 20, 2022

4.1

August 21, 2023

4.1

September 4, 2024

4.1

December 23, 2024

Form
8-K

8-K

8-K

S-3

S-3/A

S-4/A

S-4

S-4

S-4

8-K

8-K

8-K

8-K

10-Q

10-Q

S-8

8-K

8-K

8-K

8-K

*

*

*

*

*

*

*

*

*

Nordstrom, Inc. 2019 Equity Incentive Plan (2020 Amendment)

DEF 14A

Appendix B

April 7, 2020

Nordstrom, Inc. 2019 Equity Incentive Plan (2023 Amendment)

DEF 14A

Appendix B

April 28, 2023

Nordstrom, Inc. Employee Stock Purchase Plan (2023 Amendment)

DEF 14A

Appendix C

April 28, 2023

Nordstrom 401(k) Plan (2024 Restatement)

Amended and Restated Nordstrom, Inc. Executive Management Bonus
Plan

Nordstrom Deferred Compensation Plan (2024 Restatement)

Form of the 2015 Nonqualified Stock Option Grant Agreement

Form of the 2016 Nonqualified Stock Option Grant Agreement

Form of 2016 Nonqualified Stock Option Grant Agreement, Supplemental
Award

10-Q

10-K

10-Q

8-K

8-K

10-Q

10.1

10.2

10.2

10.1

10.1

10.2

September 5, 2024

March 10, 2023

September 5, 2024

February 19, 2015

March 1, 2016

August 30, 2016

2.1

3.1

3.2

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

4.13

4.14

4.15

4.16

4.17

10.1

10.2

10.3

10.4

10.5

10.6

10.7

10.8

10.9

Nordstrom, Inc. and subsidiaries 111

Table of Contents

10.10

10.11

10.12

10.13

10.14

10.15

10.16

10.17

10.18

10.19

10.20

10.21

10.22

10.23

10.24

10.25

10.26

10.27

10.28

10.29

10.30

10.31

10.32

10.33

10.34

10.35

10.36

10.37

Exhibit

Form of the 2017 Nonqualified Stock Option Grant Agreement

Form of 2019 Nonqualified Stock Option Award Agreement

Form of 2019 Nonqualified Stock Option Award Agreement, Supplemental
Award

Form of 2020 Nonqualified Stock Option Award Agreement

Form of 2020 Nonqualified Stock Option Award Agreement, Supplemental
Award

Form of 2023 Nonqualified Stock Option Award Agreement

Nordstrom, Inc. 2010 Equity Incentive Plan

Nordstrom, Inc. 2010 Equity Incentive Plan as amended February 27,
2013

Nordstrom, Inc. 2010 Equity Incentive Plan as amended and restated
February 26, 2014

Nordstrom, Inc. 2010 Equity Incentive Plan as amended and restated
February 16, 2017

Nordstrom Executive Severance Plan (2024 Restatement)

Form of 2022 Performance Share Unit Award Agreement

Form of 2023 Performance Share Unit Award Agreement

Form of 2024 Performance Share Unit Award Agreement

*

*

*

*

*

*

*

*

*

*

*

*

*

*

*†

Form of 2025 Performance Share Unit Award Agreement

Nordstrom Directors Deferred Compensation Plan (2024 Restatement)

*

Nordstrom Retiree Health Plan (2024 Restatement)

*† Nordstrom Supplemental Executive Retirement Plan (2024 Restatement)

*

*

*

2010 Form of Independent Director Indemnification Agreement

2023 Form of Independent Director Indemnification Agreement

Form of Restricted Stock Unit Award (Supplemental Award) under the
2019 Equity Incentive Plan

Form of 2023 Restricted Stock Unit Agreement – Supplemental Award
under the 2019 Equity Incentive Plan

Form of 2024 Restricted Stock Unit Award Agreement

Revolving Credit Agreement dated May 6, 2022 between Registrant and
each of the initial lenders named therein as lenders; Wells Fargo Bank,
National Association as administrative agent; and Bank of America, N. A.
and U.S. Bank, National Association as co-syndication agents

First Amendment to Revolving Credit Agreement

Rollover, Voting and Support Agreement, dated as of December 22, 2024,
by and among the shareholders party thereto, Norse Holdings, Inc., and
Nordstrom, Inc.

Rollover, Voting and Support Agreement, dated as of December 22, 2024,
by and among El Puerto de Liverpool, S.A.B. de C.V., Norse Holdings,
Inc., and Nordstrom, Inc.

Consent under the Revolving Credit Agreement, dated as of December
22, 2024, by and among Nordstrom, Inc., Wells Fargo Bank, National
Association, the Lenders party thereto, and the Guarantors party thereto

Incorporated by Reference

Exhibit
10.1

Filing Date
February 23, 2017

10.1

10.2

10.1

10.5

10.1

March 4, 2019

March 4, 2019

March 3, 2020

June 10, 2020

March 6, 2023

Form
8-K

8-K

8-K

8-K

10-Q

8-K

DEF 14A

Appendix A

April 8, 2010

DEF 14A

Appendix A

April 1, 2013

8-K

10.4

March 4, 2014

DEF 14A

Appendix A

April 5, 2017

10-Q

8-K

8-K

8-K

10-Q

10-Q

10-K

10-Q

8-K

8-K

8-K

10-Q

10-K

8-K

8-K

8-K

10.4

10.2

10.2

10.2

10.3

10.5

10.78

10.1

10.1

10.1

10.1

10.2

September 5, 2024

February 28, 2022

March 6, 2023

March 5, 2024

September 5, 2024

September 5, 2024

March 18, 2011

December 1, 2023

May 20, 2022

May 10, 2023

March 5, 2024

June 3, 2022

10.30

10.1

March 10, 2023

December 23, 2024

10.2

December 23, 2024

10.3

December 23, 2024

19.1

Amended and Restated Nordstrom Insider Trading Policy

10-K

19.1

March 19, 2024

112

Table of Contents

Incorporated by Reference

Form

Exhibit

Filing Date

Exhibit
Significant subsidiaries of the Registrant

Consent of Independent Registered Public Accounting Firm, filed as page
115 of this report

Certification of Chief Executive Officer required by Section 302(a) of the
Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer required by Section 302(a) of the
Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer and Chief Financial Officer
pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002

Nordstrom, Inc. Clawback Policy

Nondisclosure Confidentiality Agreement, dated as of April 17, 2024

10-K

8-K

97.1

99.2

March 19, 2024

April 18, 2024

†

†

†

‡

21.1

23.1

31.1

31.2

32.1

97.1

99.1

101.INS

†

Inline XBRL Instance Document

101.SCH †

Inline XBRL Taxonomy Extension Schema Document

101.CAL †

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB †

Inline XBRL Taxonomy Extension Labels Linkbase Document

101.PRE †

Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF †

Inline XBRL Taxonomy Extension Definition Linkbase Document

104

†

Cover Page Interactive Data File (Inline XBRL)

* Management contract, compensatory plan or arrangement
† Filed herewith electronically
‡ Furnished herewith electronically

Nordstrom, Inc. and subsidiaries 113

Table of Contents

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

NORDSTROM, INC.
(Registrant)

/s/

Catherine R. Smith
Catherine R. Smith
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)

Date: March 21, 2025

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.

Principal Financial Officer and Principal Accounting Officer:

Principal Executive Officer:

Catherine R. Smith
Catherine R. Smith
Chief Financial Officer

/s/

Date: March 21, 2025

James L. Donald
James L. Donald
Director

/s/

Glenda G. McNeal
Glenda G. McNeal
Director

Peter E. Nordstrom
Peter E. Nordstrom
Director

Guy B. Persaud
Guy B. Persaud
Director

Bradley D. Tilden
Bradley D. Tilden
Chairman of the Board of Directors

Atticus N. Tysen
Atticus N. Tysen
Director

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

Directors:

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

/s/

Date: March 21, 2025

114

Erik B. Nordstrom
Erik B. Nordstrom
Chief Executive Officer

Kirsten A. Green
Kirsten A. Green
Director

Erik B. Nordstrom
Erik B. Nordstrom
Director

Amie Thuener O’Toole
Amie Thuener O’Toole
Director

Eric D. Sprunk
Eric D. Sprunk
Director

Mark J. Tritton
Mark J. Tritton
Director

 
 
Table of Contents

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement Nos. 333-239087, 333-239086, 333-239083, 333-231969, 333-
225295, 333-211825, 333-207396, 333-198413, 333-189301, 333-166961, 333-161803, 333-275859, 333-275861, 333-275864, on Form S-8
of our reports dated March 21, 2025, relating to the financial statements of Nordstrom Inc. and subsidiaries, and the effectiveness of
Nordstrom, Inc. and subsidiaries’ internal control over financial reporting, appearing in the Annual Report on Form 10-K of Nordstrom, Inc. for
the year ended February 1, 2025.

/s/ Deloitte & Touche LLP
Seattle, Washington
March 21, 2025

Nordstrom, Inc. and subsidiaries 115

Exhibit 10.24

Performance Share Unit Award Agreement

AN AWARD (“AWARD”) FOR PERFORMANCE SHARE UNITS (“UNITS”), representing a number of shares of Nordstrom Common Stock (“Common
Stock”) as noted in the Performance Share Unit Award Notice (the “Notice”), of Nordstrom, Inc., a Washington Corporation (the “Company”), is hereby
granted to the Recipient (“Unit holder”) on the date set forth in the Notice, subject to the terms and conditions of this Award Agreement. The Units are also
subject to the terms, definitions and provisions of the Nordstrom, Inc. 2019 Equity Incentive Plan (the “Plan”), adopted by the Board of Directors of the
Company (the “Board”) and approved by the Company’s shareholders, which is incorporated in this Award Agreement. To the extent inconsistent with this
Award Agreement, the terms of the Plan shall govern. Terms not defined herein shall have the meanings as set forth in the Plan. The Compensation, People
and Culture Committee of the Board (the “Committee”) has the discretionary authority to construe and interpret the Plan and this Award Agreement
(including the related Notice). All decisions of the Committee upon any question arising under the Plan or under this Award Agreement (including the related
Notice) shall be final and binding on all parties. The Units are subject to the following terms and conditions:

1. VESTING AND SETTLEMENT OF UNITS

Units shall vest and be settled in accordance with the provisions of the Plan as follows:

(a)    Vesting

Each Unit is equal in value to one share of Common Stock. The Units shall be earned based on the Company’s achievement of the Performance
Goals set forth in the Notice and the related payout matrix attached thereto (as updated for each Performance Cycle) and shall become vested on
the Vesting Date set forth in the Notice, subject to the continued employment of the Unit holder, except as otherwise provided in Section 4. Any
Units that do not become vested will be forfeited.

(b)     Settlement

Vested Units shall be settled and automatically converted into Common Stock, unless the Unit holder has elected to defer all or a portion of the
Units into the Deferred Compensation Plan (“DCP”) in accordance with its rules. For the avoidance of doubt, only Common Stock shall be
deliverable upon the vesting of the Units. No fractional shares of Common Stock will be issued and the number of Units that vest will be rounded
down to the next whole number upon conversion of the Units into Common Stock. The delivery of Common Stock on vesting of the Units is
intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), together with regulatory guidance issued
thereunder, and shall occur as soon as administratively possible, but not to exceed 90 days after the Vesting Date set forth in the Notice.

(c)    Withholding Taxes

No stock certificates will be distributed to the Unit holder, or amounts deferred into the DCP, unless the Unit holder has made acceptable
arrangements to pay any withholding taxes that may be due as a result of the settlement of this Award. These arrangements may include
withholding shares of Common Stock that otherwise would be distributed when the Units are settled. The fair market value of the shares required to
cover withholding will be applied to the withholding of taxes prior to the Unit holder receiving the remaining shares.

If the Unit holder becomes retirement eligible, as outlined in Section 4(d), during the vesting life of the Units, then the Company retains the right to
withhold that number of shares required to cover the Social Security, Medicare, and any other applicable taxes due in the calendar year in which the
Unit holder becomes retirement eligible.

(d)     Restrictions on Resale

The Unit holder agrees not to sell any shares of Common Stock at a time when applicable laws or Company policies prohibit a sale. This restriction
will apply as long as the Unit holder is an employee, director or affiliate of the Company.

2. ACCEPTANCE OF UNITS AND TERMS

The Unit holder must accept the Award online in accordance with the procedures established by the Company and the Plan administrator.
Notwithstanding the foregoing, in the event the Unit holder refuses or otherwise fails to accept the Award, if the Unit holder accepts any benefit under
this Award Agreement, the Unit holder and each person claiming under or through the Unit holder shall be conclusively deemed to have indicated their
acceptance and ratification of, and consent to, all of the terms and conditions of this Award Agreement. The Unit holder agrees to comply with any and
all legal requirements and Company policies related to the resale or disposition of any Award or shares of Common Stock under this Award Agreement.
The Unit holder

acknowledges receipt of a copy of the Plan in connection with the acceptance of the Award as provided hereunder.

3. NONTRANSFERABILITY OF UNITS

The Units may not be sold, pledged, assigned or transferred in any manner except in the event of the Unit holder’s death. In the event of the Unit
holder’s death, the Units may be transferred to the person indicated on a valid beneficiary form, as designated by the Company, or if no designated
beneficiary form is available, then to the person to whom the Unit holder’s rights have passed by will or the laws of descent and distribution. Except as
set forth in Section 4, the Units may be settled during the lifetime of the Unit holder only by the Unit holder or by the guardian or legal representative of
the Unit holder. The terms of the Award Agreement shall be binding upon the executors, administrators, heirs and successors of the Unit holder.

4. SEPARATION OF EMPLOYMENT

If the Unit holder is not an employee of the Company or one of its subsidiaries (the “Employer”) on the Vesting Date set forth in the Notice, all Units are
forfeited except as set forth in this section. If the Unit holder’s employment with the Employer is terminated, the Units shall vest only as follows:

(a)     If the Unit holder dies while employed by the Employer, a prorated number of Units represented by the Award shall immediately vest based on (i)

actual achievement of the Performance Goals with respect to the Units allocated to a Performance Cycle, if any, that ended prior to the Unit holder’s
death, and (ii) target achievement of the Performance Goals with respect to the Units allocated to the Performance Cycle in which the Unit holder’s
death occurs, in each case multiplied by the Pro-Ration Factor defined below. The Units allocated to a Performance Cycle, if any, that has not
commenced as of the date of death shall be forfeited without further action or notice. The Units earned, if any, after application of this Section 4(a)
shall be delivered in Common Stock as soon as administratively possible, but not to exceed 90 days after the date of death to the person named on
the Unit holder’s beneficiary form, as designated by the Company. If no valid beneficiary form exists, then the Common Stock delivered pursuant to
the preceding sentence shall be issued to the person to whom the Unit holder’s rights have passed by will or the laws of descent and distribution.

(b)     If the Unit holder is separated due to his or her disability, as defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the

“Code”), and the Unit holder provides Nordstrom Compensation department, or any successor department, with reasonable documentation of his or
her disability, a prorated number of Units represented by the Award shall immediately vest based on (i) actual achievement of the Performance
Goals with respect to the Units allocated to a Performance Cycle, if any, that ended prior to the Unit holder’s separation, and (ii) target achievement
of the Performance Goals with respect to the Units allocated to the Performance Cycle in which the Unit holder’s separation occurs, in each case
multiplied by the Pro-Ration Factor defined below. The Units allocated to a Performance Cycle, if any, that has not commenced as of the date of
separation shall be forfeited without further action or notice. The Units earned, if any, after application of this Section 4(b) shall be delivered in
Common Stock as soon as administratively possible, but not to exceed 90 days after the separation.

(c)    For purposes of Section 4(a) and (b) above, the Pro-Ration Factor for each Performance Cycle shall be determined as follows: (i) the Pro-Ration

Factor for the Units, if any, allocated to Performance Cycle that ended prior to the Unit holder’s termination of employment shall equal 100%, and (ii)
the Pro-Ration Factor for the Units allocated to the Performance Cycle in which the Unit holder’s employment terminates shall equal a fraction (x)
the numerator of which is the number of days during the period that commences on (and includes) the first day of the Performance Cycle and ends
on (and includes) the date of termination of employment, and (y) the denominator of which is the number of days in the Performance Cycle.

(d)     If the Unit holder terminates employment after having met any of the requirements set forth below, and the Units were granted at least six months
prior to the termination date, the Unit holder shall be entitled to a prorated distribution, based on the number of days the Unit holder was employed
during the period commencing on (and including) the first day of the first Performance Cycle and ending on (and including) the last day of the third
Performance Cycle, and based on the extent to which the Performance Goals were achieved for each of the three Performance Cycles (and
payable at the time set forth in Section 1(b) above):
(i)     the Unit holder has attained age 55 with 10 continuous years of service to the Employer from the most recent hire date with the Employer; or

(ii) the Unit holder has attained age 60.

If the Units were granted less than six months prior to termination, such Units shall be forfeited as of the date of termination with no rights to a
prorated distribution at settlement.

(e)     Notwithstanding subparagraphs (a), (b) and (d) of this section, a Unit holder shall immediately forfeit any unvested and unsettled Units

represented by this Award and any shares of Common Stock or proceeds from the sale of such shares of Common Stock, and the post-separation
proration of Units and settlement rights

set forth above shall cease immediately, if: (i) he or she is terminated by the Company or any of its subsidiaries for embezzlement, theft of funds,
fraud, violation of rules, regulations or policies, or any intentional harmful act or acts; or (ii) he or she at any time during the term of this Award
divulges any confidential or proprietary information to a third party who is not authorized to receive the confidential or proprietary information, or
improperly uses any confidential or proprietary information.

(f) Except as otherwise provided in the Plan with respect to a Change in Control, if the Unit holder is separated for any reason other than those set forth

in subparagraphs (a), (b), (d) and (e) above, Units, to the extent not vested and settled as of the date of his or her separation, shall be forfeited as
of that date.

5. TERM OF UNITS

Any Units allocated to a Performance Cycle that are not earned in that Performance Cycle, based on the applicable performance matrix, shall be
forfeited.

6. ADJUSTMENTS TO PERFORMANCE GOALS

The Performance Goals may be subject to the following adjustments as determined by the Committee:, unusual or non-recurring items of gain or loss;
gains or losses on the disposition of a business, a segment of a business, or significant assets outside the ordinary course of business; changes in tax
or accounting standards, principles, regulations or laws; the effect of a merger or acquisition, including all financial results derived therefrom during the
period from the merger or acquisition date through the end of the Performance Cycle in which the merger or acquisition occurred; gains or losses due to
non-cash adjustments which relate to the valuation of long-term assets rather than current-year performance (including but not necessarily limited to
asset impairments, gain or loss recognized for store closures, lease terminations, pension adjustments and mark to market adjustments); the impact of
other similar occurrences outside of the Company’s core, on-going business activities (including but not necessarily limited to litigation or tax reserves,
financing activities, foreign exchange rate fluctuations and restructuring charges); and material impacts of non-operational tax items (e.g.,
reorganizations, settlements, method changes).

7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

The Units shall be adjusted pursuant to the Plan, in such manner, to such extent (if any) and at such time as the Committee deems appropriate and
equitable in the circumstances, as set forth in Article 12 of the Plan.

8. NO DIVIDEND RIGHTS

Except to the extent required pursuant to Section 7 of this Award Agreement or under the terms of the DCP (for any Units deferred under that plan),
ownership of Units shall not entitle the Unit holder to receive any dividends declared with respect to Common Stock.

9. ADDITIONAL UNITS

The Committee may or may not grant the Unit holder additional Units in the future. Nothing in this Award or any future Award Agreement should be
construed as suggesting that additional Units to the Unit holder will be forthcoming.

10. LEAVES OF ABSENCE

For purposes of this Award, the Unit holder’s service does not terminate due to a military leave, a medical leave or another bona fide leave of absence if
the leave was approved by the Employer in writing and if continued crediting of service is required by the terms of the leave or by applicable law. But,
service terminates when the approved leave ends unless the Unit holder immediately returns to active work.

11.

INDEPENDENT TAX ADVICE
The tax consequences to the Unit holder of receiving the Units or disposing of the shares of Common Stock which may be issuable upon vesting and
conversion of the Units are complicated and will depend, in part, on the Unit holder’s specific tax situation. The Unit holder is advised to consult with an
independent tax advisor for a full understanding of the specific tax consequences of receiving or disposing of the Units or the shares of Common Stock
that may be received upon vesting and conversion of the Units.

12. RIGHTS AS A SHAREHOLDER

Neither the Unit holder nor the Unit holder’s beneficiary or representative shall have any rights as a shareholder with respect to any Common Stock
subject to these Units, unless and until the Units vest and are settled in Common Stock.

13. NO RETENTION RIGHTS

Nothing in this Award Agreement or in the Plan shall give the Unit holder the right to be retained by the Employer as an employee or in any capacity.
The Employer reserves the right to terminate the Unit holder’s service at any time, with or without cause.

14. CLAWBACK POLICY

The Units, and any proceeds (Common Stock or cash) received in connection with the settlement of the Units or subsequent sale of such issued
Common Stock, shall be subject to the Clawback Policy adopted by the Company’s Board, as amended from time to time, whether such policy was in
effect as of the Grant Date or thereafter.

In the event the Clawback Policy is deemed unenforceable with respect to the Units, or with respect to the proceeds received in connection with the
settlement of the Units or subsequent sale of such issued Common Stock, then the award of Units subject to this agreement shall be deemed
unenforceable due to lack of adequate consideration.

15. DEFERRAL OF UNITS

A Unit holder may elect to defer all or a portion of the Units into the DCP in accordance with its terms. Upon deferral, the vested Units (and their
subsequent settlement and payment) shall be governed by the terms and conditions of the DCP, as that plan may be amended from time to time by the
Company.

16. ENTIRE AGREEMENT

The Notice, this Award Agreement and the Plan constitute the entire contract between the parties hereto with regard to the subject matter hereof. They
supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject
matter hereof. In the event of any inconsistency between the Plan and this Award Agreement, the terms of the Plan shall control.

This Award Agreement may not be modified or amended, except for a unilateral amendment by the Company that does not materially adversely affect
the rights of the Unit holder under this Award Agreement. No party to this Award Agreement may unilaterally waive any provision hereof, except in
writing. Any such modification, amendment or waiver signed by, or binding upon, the Unit holder, shall be valid and binding upon any and all persons or
entities who may, at any time, have or claim any rights under or pursuant to this Award Agreement.

17. CHOICE OF LAW

This Award Agreement shall be governed by, and construed in accordance with, the laws of the State of Washington, without regard to principles of
conflicts of laws, as such laws are applied to contracts entered into and performed in such State.

18. SEVERABILITY

If any provision of this Award Agreement shall be invalid or unenforceable, such invalidity or unenforceability shall attach only to such provision and shall
not in any manner affect or render invalid or unenforceable any other severable provision of this Award Agreement, and this Award Agreement shall be
carried out as if such invalid or unenforceable provision were not contained herein.

19. CODE SECTION 409A

The Company reserves the right, to the extent the Company deems reasonable or necessary in its sole discretion, to unilaterally amend or modify this
Award Agreement as may be necessary to ensure that all vesting or delivery of compensation provided under this Award Agreement is made in a
manner that complies with Section 409A of the Code, together with regulatory guidance issued thereunder. Notwithstanding the foregoing, neither the
Company nor the Committee shall have any obligation to take any action to prevent the assessment of any additional tax or penalty on any Unit holder
under Section 409A of the Code and neither the Company nor the Committee will have any liability to any Unit holder for such tax or penalty.

Exhibit 10.27

NORDSTROM

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

2024 Restatement

As Adopted on December 22, 2024

ARTICLE I.

TITLE, PURPOSE AND EFFECTIVE DATE

1.01

Title. This plan shall be known as the Nordstrom Supplemental Executive Retirement Plan, and any reference in this

instrument to the “Plan” or “SERP” shall include the plan as described herein and as amended from time to time.

1.02

Purpose. The Plan is intended to constitute an unfunded plan maintained primarily for the purpose of providing deferred

compensation for a select group of management or highly compensated employees of Nordstrom, Inc., a Washington corporation
(“Company”), and its U.S. subsidiaries and affiliates, within the meaning of Section 201(2), 301(a)(3) and 401(a)(4) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”). In addition, the Plan is an unfunded, nonqualified plan that is not intended
to satisfy the qualification requirements set forth in Section 401(a) of the Internal Revenue Code of 1986, as amended (“Code”). The benefits
provided to a Participant under this Plan are in addition to any other benefits available to such Participant under any other plan or program for
employees. The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as may otherwise be
expressly provided.
1.03

Effective Date. The Plan was originally effective as of July 18, 1988. The Plan has been subsequently amended on a number

of occasions in order to provide a number of Plan design changes, to make changes in Plan administration and to otherwise clarify certain
Plan provisions. The Plan was also previously amended to comply with Section 409A of the Code. For the period from January 1, 2005 to
December 31, 2008, the Plan observed operational compliance with Section 409A of the Code, in accordance with transitional guidance
issued by the Internal Revenue Service. This 2024 Restatement is effective as of December 22, 2024.

ARTICLE II.

ELIGIBILITY AND PARTICIPATION

2.01 Eligibility. Eligibility for this Plan shall be limited to Executives as that term is defined herein.

(a)

Executive Defined. For purposes of this Plan, the term “Executive” means the officers of Company and any other

management or highly compensated employee of the Company or a U.S. subsidiary or affiliate, who has been specifically designated by the
Plan Administrator as eligible to become a Participant in this Plan. When designating such individual as an “Executive,” the Plan
Administrator shall have the discretion to categorize Executives as any one of the following:

1999 Plan Executives. A “1999 Plan Executive” is any Executive who, as of January 1, 2003, was both: (1)
designated as eligible under the Plan (either because he or she was a corporate officer or as a result of the Company’s Board of Directors or
Board Committee designation), and (2) eligible for, or within one year of being eligible for, Early Retirement under the Plan.

(i)

(ii)

Transition Plan Executives. A “Transition Plan Executive” is any Executive who, as of January 1, 2003, met

all of the following requirements: (1) was designated as eligible under the Plan (either because he or she was a corporate officer or as a
result of the Company’s Board of Directors or Board Committee designation), (2) had more than 15 Years of Credited Service under the
Plan, (3) was not eligible for, and was not within one year of being eligible for, Early Retirement under the Plan, and (4) was not
specifically designated as a Tier I or Tier II Executive.
(iii)

Tier I Executives. A “Tier I Executive” is any Executive designated by the Plan Administrator as a Tier I

Executive and who is not a 1999 Plan Executive or a Transition Plan Executive.

Executive and who is not a 1999 Plan Executive or a Transition Plan Executive.

(iv)

Tier II Executives. A “Tier II Executive” is any Executive designated by the Plan Administrator as a Tier II

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Executive’s designation, provided that the time and form of payment of a benefit under this Plan shall be determined based on the
Executive’s category when he or she was first designated as eligible for this Plan.

(v)

Change in Designation. The Plan Administrator shall have the discretion and authority to change an

(b)

Revocation of Designation. Notwithstanding the foregoing, the Plan Administrator may, in its sole and exclusive
discretion, revoke an employee’s designation as an Executive hereunder at any time. An Executive whose designation has been revoked
shall be entitled to only those benefits, if any, which have vested as of the date of revocation, and the revocation shall not change the time or
form of payment of vested benefits.
(c)

Certain Executive Transfers. An Executive who experiences a change in his or her employment status (other than

separation from active employment) such that he or she no longer qualifies as an Executive, shall continue to be considered an eligible
Executive solely for purposes of determining whether the Executive has separated from active employment (including for purposes of
determining eligibility for Early Retirement under 3.06), but shall not accrue any additional benefits and shall not receive benefit credit for
such service except unless otherwise determined by the Plan Administrator.

2.02 Participation. An Executive becomes a “Participant” in the Plan, when such Executive retires under 2.02(a), with the

appropriate approval under 2.02(b) and 2.02(c), as follows:

(a)

“Retirement” Defined. An Executive retires under the terms of the Plan when such Executive separates from active
employment with the Company and each and every subsidiary and affiliate of the Company, on or after a retirement date specified in this
section. For purposes of this Plan, an Executive separates from active employment on the date when the Company and the Executive
reasonably anticipate that the Executive’s level of bona fide services will be permanently reduced to 49 percent or less of the level of bona
fide services performed during the immediately preceding period of 36 consecutive months. An Executive’s transfer to a subsidiary or
affiliate of the Company shall not, by itself, constitute a separation from active employment for purposes of this section. For purposes of the
Plan, the Retirement Dates are:

sixtieth (60th) birthday, (b) a Transition Plan Executive’s fifty-fifth (55th) birthday, or (c) a Tier I or Tier II Executive’s fifty-eighth (58th)
birthday.

(i)

Normal Retirement Date. The Executive’s Normal Retirement Date shall be (a) a 1999 Plan Executive’s

(ii)

Early Retirement Date. The Executive’s Early Retirement Date shall be the date that the Executive has both:

(1) completed at least ten (10) Years of Credited Service (as defined

under 3.01(a)); and

Plan Executive, attained age 53.

(2)

in the case of a 1999 Plan Executive, attained age 50, or in the case of a Tier I, Tier II or Transition

(iii) Disability Retirement Date. The Executive’s Disability Retirement Date shall be the date on which: (1) a

1999 Plan Executive becomes eligible for unreduced Early Retirement Benefits under Section 3.06, provided that the Executive continues to
be permanently Disabled on such date, or (2) a Tier I, Tier II or Transition Plan Executive becomes eligible for Normal Retirement Benefits
under 3.05, provided that the Executive continues to be permanently Disabled through his or her Normal Retirement Date.

(b)

Plan Administrator Approval for Early Retirement. An Executive who separates from active employment on or after
his or her Early Retirement Date (but prior to Normal Retirement Date) must receive the consent and approval of the Plan Administrator for
such early retirement. If the Executive elects to separate from active employment without Plan Administrator approval of early retirement,
the Executive’s entire benefit under the Plan shall be forfeited.

2.03 Disability. An Executive who becomes Disabled while employed by the Company or a U.S. subsidiary or affiliate shall be

deemed to be an Executive in active service with the Company or such subsidiary or affiliate during the period of such Disability and shall
continue to accrue Years of Credited Service for such period whether or not such Executive actually performs services for the Company or
such subsidiary or affiliate during such period; provided, however, that accrual of service under this section shall cease upon the earlier of the
Disabled Executive’s: (i) recovering from such Disability; or (ii) Disability Retirement Date. An Executive who recovers from such
Disability, but who does not thereafter return to

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active service with the Company or a U.S. subsidiary or affiliate shall be treated as though he or she terminated employment prior to reaching
a Retirement Date and his or her Plan benefit shall be forfeited. For purposes of the Plan, “Disability” or “Disabled” means the Participant’s
inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months;
provided that, to the extent required to comply with Code Section 409A, “Disability” shall have the meaning provided in Code Section 409A.

2.04 Leave of Absence. The Plan Administrator shall determine, on an individual basis and in its sole and absolute discretion, the

treatment under the Plan of an Executive who takes an unapproved leave of absence for reasons other than Disability, provided that the time
or form of payment of benefits set forth in this Plan may not be changed solely because of the Executive’s leave of absence. If an Executive
is on an approved leave of absence for reasons other than Disability, the employment relationship will be treated as continuing for the entire
period of the approved leave.

ARTICLE III.

BENEFITS

3.01 Retirement Benefit. An Executive’s “Retirement Benefit” shall mean the benefit payable to the Executive as a Participant,
pursuant to this Article III, expressed and payable as a monthly benefit in the form of a 50% Joint and Survivor Annuity, commencing on the
Retirement Date. An Executive’s Retirement Benefit depends on the Executive’s eligibility category as designated by the Company’s Board
of Directors or Board Committee as a 1999 Plan Executive, Transition Plan Executive, Tier I Executive, or Tier II Executive, with the
following provisions and definitions applying to each of those categories:

(a)

Year of Credited Service. A “Year of Credited Service” shall have the same meaning as “Years of Vesting Service” under the

Nordstrom 401(k) Plan (and any predecessor or successor thereto) (“401(k) Plan”). Service with a subsidiary or affiliate of the Company
shall not be considered “Credited Service” unless the Plan Administrator specifically agrees to credit such service. In addition, Years of
Credited Service may be granted by the Plan Administrator under 4.05. In no case, however, will more than twenty-five (25) Years of
Credited Service be counted for any purpose under the Plan.

(b)

Final Average Compensation. For purposes of this Plan, “Final Average Compensation” shall mean the monthly

compensation resulting from the average of the highest thirty-six (36) months of the Executive’s Covered Compensation, measured over the
Averaging Period:
(i)

Covered Compensation. For purposes of determining an Executive’s Final Average Compensation, “Covered Compensation”

shall include base salary and the actual cash bonus paid under the Company’s (or a subsidiary or affiliate’s) broad-based and/or executive
management bonus plan for the fiscal year. Covered Compensation shall not include any other items of remuneration such as
reimbursements, allowances, fringe benefits, spot bonuses, sign-on bonuses, and amounts realized from the exercise of stock options or when
other forms of equity compensation or awards vest, regardless of whether such amounts are included in the taxable income of the Executive.
Except as otherwise determined pursuant to Section 2.01(c), Covered Compensation shall not include any remuneration received during any
period when the Participant did not qualify as an Executive.

(ii)

Averaging Period. The Executive’s “Averaging Period” shall be the longer of: (a) the final sixty (60) months of the

Executive’s employment; or (b) the entire period of service (measured in months) after either (1) a 1999 Plan Executive’s fiftieth (50th)
birthday, or (2) a Transition Plan or Tier I or II Executive’s fifty-third (53rd) birthday. Except as otherwise determined pursuant to Section
2.01(c), periods of employment during which the Participant did not qualify as an Executive shall not be considered for purposes of
determining the Averaging Period.

(c)

Maximum Retirement Benefit. Notwithstanding anything in the Plan to the contrary, including but not necessarily limited to

this Article III, the Retirement Benefit payable to an Executive under this Plan shall at no time exceed $58,333.33 per month.

3.02 Tier I Executive Retirement Benefit. A Tier I Executive’s Retirement Benefit shall be equal to one and six-tenths percent (1.6%)

of such Executive’s Final Average Compensation, multiplied by the Executive’s Years of Credited Service.

4

3.03 Tier II Executive Retirement Benefit. A Tier II Executive’s Retirement Benefit shall be equal to eight-tenths percent (0.8%) of

such Executive’s Final Average Compensation, multiplied by the Executive’s Years of Credited Service.

3.04 1999 and Transition Plan Executive Retirement Benefit. A 1999 Plan Executive’s Retirement Benefit and a Transition Plan

Executive’s Retirement Benefit shall be equal to two and four-tenths percent (2.4%) of such Executive’s Final Average Compensation,
multiplied by the Executive’s Years of Credited Service, but reduced by the Executive’s Annuity Value of 401(k) Plan, determined as
follows:

(a)

Annuity Value of 401(k) Plan. The Executive’s Annuity Value of 401(k) Plan means the actuarially equivalent

monthly amount of the Executive’s Company contribution account balances as of the date such Executive retires, if the account balances
were paid in the form of a 50% Joint and Survivor Annuity, as follows:

(i)

401(k) Plan. Company-provided 401(k) Plan and matching contributions (and income thereon) under the

401(k) Plan; plus

qualified plan of the Company or its subsidiaries or affiliates; plus

(ii)

Other Qualified Plans. The amount of any Company-provided benefits to the Executive under any other

(iii) Distributions. The amount of any previous withdrawals or other distributions of any type (regardless of the

payee) from the previously described plans (without adjustment for imputed earnings for any period following the actual date of withdrawal
or distribution), other than (1) distributions of life insurance policies from the 401(k) Plan; and (2) the excess (if any) of premiums paid with
respect to life insurance policies prior to such date over the cash surrender value used in computing the account balances in the 401(k) Plan
as of such date expressed and payable as a monthly benefit commencing on the applicable payment date in the form of a 50% Joint and
Survivor Annuity.

(b)

50% Joint and Survivor Annuity. For purposes of determining the reductions under Section 3.04(a), a 50% Joint and

Survivor Annuity means the annuity defined in Section 5.02, with the following modifications to take into account the determination of
such annuity value upon the Participant’s (as opposed to the Beneficiary’s) commencement of benefits under the Plan:

(i)

Beneficiary. A Participant’s joint annuitant in this context is the individual who would be considered the

Participant’s Beneficiary under Section 5.02(a) (for purposes of the Plan’s pre-retirement survivor annuity) on the date the Participant
retires. In the event that there is no Beneficiary on such date, the survivor annuity shall be calculated as though the Participant had a
Beneficiary of the same age as the Participant.

used pursuant to Section 5.02(b), except that the interest rate used shall be the IRS Long Term Applicable Federal Rate (AFR) stated for the
month prior to the month in which the Executive retires.

(ii)

Actuarial Equivalent. The Actuarial Equivalent used for this section shall be the same as that defined and

3.05 Normal Retirement Benefits. An Executive who retires on or after Normal Retirement Date shall be entitled to a Retirement

Benefit under either 3.02, 3.03 or 3.04 (as appropriate) determined as of the actual date the Executive retires.

3.06 Early Retirement Benefits. Subject to 3.06(c), an Executive who retires (with the consent and approval of the Plan

Administrator) on or after his or her Early Retirement Date but before his Normal Retirement Date shall be entitled to an Early Retirement
Benefit as follows:

(a)

Retirement Benefit. The Executive’s Retirement Benefit under 3.02, 3.03 or 3.04 (as appropriate) determined on the

actual date the Executive retires, reduced by the Early Retirement Reduction Factor.
Early Retirement Reduction Factor.
(i)

(b)

1999 Plan Executives.    For 1999 Plan Executives, three percent (3%) for each year the sum of the

Participant’s age and Years of Credited Service is less than 75.

Transition Plan Executives. For Transition Plan Executives, twelve and one-half percent (12.5%) for each
year prior to the Executive’s Normal Retirement Date, with such reduction percentage to be prorated for any applicable fraction of a year,
based on the number of full months worked in such year.

(ii)

5

Executive’s Normal Retirement Date, with such reduction percentage to be prorated for any applicable fraction of a year, based on the
number of full months worked in such year.

(iii)

Tiers I and II Executives. For any Tier I or Tier II Executive, ten percent (10%) for each year prior to the

(c)

Transition Plan Executives. If a Transition Plan Executive's Early Retirement Benefit calculated as though they were
a Tier I Executive (under 3.02 and 3.06(b)(iii)), is greater than the Early Retirement Benefit calculated as a Transition Plan Executive (under
3.04 and 3.06(b)(ii)), then such Transition Plan Executive shall be entitled to receive such greater Early Retirement Benefit calculated as
though they were a Tier I Executive.

3.07 Deferred Retirement Benefits. An Executive who retires after his or her Normal Retirement Date shall be entitled to a Deferred
Retirement Benefit equal to his or her Normal Retirement Benefit, but increased with interest for each Year of Post-Normal Retirement Date
Service, up to a maximum of ten (10) Years of Post-Normal Retirement Date Service. For Executives who have not retired as of August 8,
2014, a Year of Post-Normal Retirement Date Service means the period of twelve (12) consecutive full months beginning with the
Participant’s Normal Retirement Date, and each successive period of twelve (12) consecutive full months, prior to the Participant’s date of
Retirement (as defined in 2.02(a)). Partial Years of Post-Normal Retirement Date Service shall be disregarded. An interest rate of five percent
(5%) per Year of Post-Normal Retirement Date Service, compounded annually, shall be used to calculate the increase under this section.

3.08 Disability Retirement Benefits. A Disabled Executive continuing to accrue service credit under Section 2.03 shall be treated, for

purposes of the Plan, as an active Executive for such period, and the Retirement Benefit under this Article III shall be determined as of such
Disabled Executive’s Disability Retirement Date. A Disabled Executive may not receive Retirement Benefits prior to the Disability
Retirement Date, even if, for example, the Executive qualifies for Early Retirement before his or her Disability Retirement Date. In addition,
a Disabled Executive who receives Retirement Benefits while also receiving long-term disability or other disability income benefits pursuant
to any other Company-sponsored (or subsidiary- or affiliate-sponsored) plan, fund or program that covers a substantial number of employees
(excluding disability income paid by Social Security), shall have the monthly Retirement Benefit payable under this Plan reduced (but not
below zero) by the monthly benefit actually paid or payable under such other plan. The amount by which the disability retirement benefit is
reduced due to other payments shall be permanently forfeited.

3.09 Death Benefit. The Death Benefit under this Plan, whether payable before or after Retirement, shall consist solely of a survivor

annuity, payable for the life of the Beneficiary (if any), as described in Article V.

3.10 Payment of Benefits. The following shall apply to the payment of benefits:

(a)

 Payment Commencement.

Participant may not designate the taxable year in which payments will begin.

(i)

General Rule. Payment of benefits shall commence within 90 days after the date the Executive retires. The

(ii)

Specified Employees. If the Executive is a Specified Employee, in order to comply with Code Section 409A,

payments during the six-month period beginning on the Retirement Date shall be suspended. The first payment after expiration of the six-
month waiting period shall include all periodic payments that were suspended during the six-month waiting period. For purposes of the
Plan, “Specified Employee” means, as of any date, a “specified employee” as defined in Code Section 409A (as determined under the
Company’s procedure for determining specified employees as of such date).

payroll dates in accordance with the Company’s payroll policy then in effect.

(b)

Timing of Payment. Periodic payments of benefits shall be paid in equal amounts on each of the Company’s regular

(c)

Withholding.
(i)

Income Tax and Other Withholding. The Company shall withhold from any and all benefit payments made
under the Plan, all federal, state and local income taxes the Company reasonably determines are required to be withheld in connection with
the benefits hereunder, and any other amounts due, owing and unpaid by the Participant to the Company or a subsidiary or affiliate, to be
determined in the sole discretion of the Company. In the event the amounts to be withheld under this

6

paragraph exceed the amount of benefits currently payable, the Participant shall be required to pay to the Company an amount necessary to
meet such obligations.

(ii)

Employment Taxes. At the time of Retirement, the Company shall calculate the employment taxes (i.e.,

Social Security and Medicare taxes) due on the Participant's benefit under the Plan. Employment taxes shall be remitted to the appropriate
taxing authority in accordance with applicable federal and state tax regulations. The Company may, but is not required to, pay the
Participant’s share of the employment taxes on behalf of the Participant.

ARTICLE IV.
RIGHTS OF PARTICIPANTS IN THE PLAN

4.01 Vesting. Except as otherwise provided in this Section and elsewhere in Article IV and Section 6.02, no Executive, Participant or

Beneficiary shall have any vested interest in any Plan benefits. The Benefits in which such Participant or Beneficiary has a vested interest
under this Section (subject to forfeiture in 4.02) shall be determined as follows:

(a)

Years in Position. In addition to the other requirements of this Section 4.01, a Participant must have been a

designated Tier II Executive under the Plan for a period of at least seven Years of Credited Service in order to become vested in a benefit
under this Plan.

in such benefits after the Plan Administrator consents to and approves the Participant’s Early Retirement Date.

(b)

Early Retirement. A Participant entitled to Early Retirement Benefits under Section 3.06 shall have a vested interest

interest in Normal Retirement benefits on the Participant’s Normal Retirement Date.

(c)

Normal Retirement. A Participant entitled to Normal Retirement benefits under Section 3.05 shall have a vested

Deferred Retirement. An Executive who retires after Normal Retirement Date shall have a vested interest in
Retirement Benefits granted under Section 3.05 on the Participant’s Normal Retirement Date, and shall have a vested interest in the
additional benefits under Section 3.07 on such Participant’s deferred retirement date.

(d)

(e)

Death Benefit. The Beneficiary of a Participant who is entitled to a survivor annuity under Article V shall have a

vested interest in any applicable survivor annuity which is actually payable in accordance with the terms of Article V, on and after the date
of the Participant’s death.

4.02 Exceptions to Vesting.    Notwithstanding any other provision of this Plan, an Executive’s benefit shall be forfeited in the

following situations:
(a)

Tier II Executives. No benefits shall be paid to a Tier II Executive who terminates employment with less than seven

Years of Credited Service as a designated Tier II Executive under the Plan.

(b)

Suicide or Self-Inflicted Injury. No benefits shall be paid to an Executive or to any Beneficiary of such Executive as

a result of suicide or self-inflicted injury by the Executive within three (3) years after such Executive becomes an “Executive” under the
Plan.

(c)

Termination for Cause. If an Executive is terminated for “cause” or if an Executive is found by the Plan

Administrator at any time to have engaged in any acts as would have constituted “cause” for termination, the Executive and any Beneficiary
of the Executive shall immediately forfeit any and all rights to benefits under this Plan. Accordingly, any benefits in pay status shall cease
immediately, and no future benefits shall be payable to the Executive or to his or her Beneficiary. For purposes of this Plan, “cause” shall
mean (i) the Executive’s conviction of, or plea of guilty or no contest to, (A) any felony (or its international equivalent) or (B) any other
crime that results, or could reasonably be expected to result, in material harm to the business or reputation of the Company or any
subsidiary or affiliate, (ii) an act of personal dishonesty or disloyalty in the course of fulfilling the Executive’s duties to the Company or a
subsidiary or affiliate, or an act of fraud or misappropriation, embezzlement, or misuse of funds or property belonging to the Company or
any subsidiary or affiliate, (iii) the Executive’s deliberate and continued failure to perform substantially such Executive’s material duties to
the Company or a subsidiary or affiliate, (iv) a material violation of the written policies of the Company or its subsidiaries and affiliates,
including but not limited to those relating to sexual harassment or the disclosure or misuse of confidential information, or those set forth in
the manuals or statements of policy of the Company or its

7

subsidiaries and affiliates, (v) the Executive’s engagement in willful misconduct in connection with the Executive’s employment or services
with the Company or its subsidiaries and affiliates, which results, or could reasonably be expected to result, in material harm to the business
or reputation of the Company or any subsidiary or affiliate, and (vi) breach of any restrictive covenants applicable to the Executive as a
result of any agreement with the Company or any subsidiary or affiliate or any policy or plan maintained by the Company or any subsidiary
or affiliate. The Plan Administrator shall have the sole discretion to determine whether the Executive has engaged in any acts that constitute
“cause” for termination.

(d)

Cessation of Benefits for Competition. Benefits currently in pay status to a Participant shall cease, and no further

benefits shall be payable, to the Participant (or Beneficiary) to the extent the Participant competes, directly or indirectly, with the Company.
For purposes of this Plan, “competing, directly or indirectly, with the Company” shall mean (without limitation) a determination, in the sole
discretion of the Plan Administrator, of any of the following: (i) engaging in the operation of any type of business or enterprise in any way
competitive with the business of the Company or its subsidiaries or affiliates, (ii) holding an interest, either directly or indirectly, as owner,
director, officer, employee, partner, shareholder (other than as the owner of less than two percent (2%) of the outstanding stock of a publicly
owned company), in any type of business or enterprise in any way competitive with the business of the Company or its subsidiaries or
affiliates; or (iii) investing capital in, lending money or property to or rendering services to any type of business or enterprise in any way
competitive with the business of the Company or its subsidiaries or affiliates. In the event of a dispute as to the application of this
paragraph, the Plan Administrator may waive or modify its right to discontinue payment to any Participant or to any Beneficiary of such
Participant by written agreement.

4.03 Application of Clawback Policy. In the event the Company or a subsidiary or affiliate is required to recoup compensation from a

Participant under its clawback policy, and such recoupment results in a reduction in the Participant’s Final Average Compensation, the
Participant’s benefit shall be recalculated, and the Participant’s future payments shall be adjusted automatically beginning with the first
payment after the recalculation is completed. To the extent that the Participant has already received payments under the Plan and those
payments are greater than the recalculated benefit (i.e., an overpayment), the Plan Administrator shall recover the overpayment by reducing
the next payment due under the Plan (but not below zero) and applying it to the overpayment. To the extent that there continues to be an
overpayment after reduction of the first recalculated payment, each successive payment shall be reduced (but not below zero) and the
reduction shall be applied to the overpayment until the overpayment has been repaid in full. Once the overpayment has been repaid in full,
the Participant shall receive the recalculated benefit as if the recalculated benefit had been the initial benefit calculated under the Plan. The
provisions of this section for recovery of overpayments shall also apply to the Beneficiary of a Participant after the Participant’s death.

4.04 Rights in Plan are Unfunded and Unsecured. The Company’s obligation under the Plan shall in every case be an unfunded and
unsecured promise to pay. A Participant’s right to Plan distributions shall be no greater than the rights of general, unsecured creditors of the
Company. The Company may establish one or more grantor trusts (as defined in Code Section 671 et seq.) to facilitate the payment of
benefits hereunder; however, the Company shall not be obligated under any circumstances to fund its financial obligations under the Plan.
Any assets which the Company may acquire or set aside to defray its financial liabilities shall be general assets of the Company, and such
assets, as well as any assets set aside in a grantor trust, shall be subject to the claims of its general creditors in the event of the Company’s
insolvency.

4.05 Discretion to Grant Years of Service or Increase Age. If circumstances warrant, and it is decided it is in the best interests of the
Company, the Plan Administrator shall have the authority and discretion to grant to certain individuals additional Years of Credited Service
or to treat such individuals as having attained a certain age for purposes of this Plan, provided, however, that no such action may alter the
time or form of payment of Plan benefits. Such circumstances may include (a) providing Executives with a recruiting incentive, or (b) such
other circumstances that the Plan Administrator deems appropriate. The Plan Administrator may condition the receipt of such additional
benefits (to which the Executive is not otherwise entitled) on the Participant’s execution of an election of increased benefits under this Plan
and a general release of all claims. The Plan Administrator’s granting of Years of Credited Service and/or treating the Executive as attaining a
certain age may affect the amount of the Executive’s benefit under this Plan, but shall not alter, and shall not be construed as altering, the
Executive’s actual age or years of

8

service under any other plan of the Company or a subsidiary or affiliate or for purposes of determining the time or form of payment under
this Plan.

ARTICLE V.

DEATH BENEFITS

5.01 Death Benefit Payable. Each Executive’s Retirement Benefit is expressed and payable as a monthly benefit in the form of a 50%

Joint and Survivor Annuity under this Plan. Accordingly, the sole death benefit payable under this Plan on behalf of an Executive or a
Participant is as follows:

(a)

Pre-Retirement Death Benefit. If a Participant dies while actively employed as an Executive, a pre-retirement death

benefit shall be payable under the Plan upon the death of the Executive. The pre-retirement death benefit shall be a Survivor Annuity
payable for the life of the Executive’s Beneficiary, calculated as though the Executive had retired as a Participant and had begun receiving
Early, Normal or Deferred Retirement Benefits under the Plan based on his or her actual age and Years of Credited Service on the day
before his or her death. The periodic payment to the Beneficiary is 50% of the periodic payment that would have been paid to the Executive
if the Executive had not died prior to Retirement. If the Executive dies before reaching a Retirement Date under the Plan, the survivor
annuity shall commence on the earliest date the Executive would have been eligible to retire under the Plan.

(b)

Post-Retirement Death Benefit. The Post-Retirement Death Benefit payable on behalf of a Participant shall be a 50%

Survivor Annuity payable for the life of the Participant’s Beneficiary, based on the actual Retirement Benefit the Participant was receiving
at the time of his or her death, calculated in accordance with the provisions of Section 5.02.

5.02 50% Joint and Survivor Annuity. A 50% Joint and Survivor Annuity means an annuity for the life of the Participant and, after

his or her death, a survivor annuity for the life of the Participant’s Beneficiary in an amount that is fifty percent (50%) of the original annuity
amount paid to the Participant; provided, however, that if the Beneficiary is more than five years younger than the Participant, such survivor
annuity will be calculated so that it is the Actuarial Equivalent of the 50% survivor annuity for a Beneficiary five years younger than the
Participant.

(a)

Beneficiary. A Participant’s Beneficiary is the individual to whom the Participant is legally married or the

Participant’s “registered domestic partner” on the date of the Participant’s death. For this purpose, the term “registered domestic partner”
has the same meaning as is used for benefit coverage purposes under the Nordstrom Welfare Benefit Plan; provided, however, that the Plan
Administrator may, in its discretion, substitute a less restrictive definition than is used in the Nordstrom Welfare Benefit Plan.

(b)

Actuarial Equivalent. The Plan Administrator shall have the authority to periodically determine and change the

appropriate factors used to determine Actuarial Equivalence under the Plan. As of the Effective Date of this Restatement, the mortality table
shall be the 1983 Group Annuity Mortality Table for males (GAM 83) and the interest rate shall be the IRS Long Term Applicable Federal
Rate (AFR) stated for the month of the Executive’s death.

5.03 Acknowledgment. The Plan Administrator shall have the discretion to determine the identity of any Beneficiary, and no person
shall have a right to any death benefit under this Plan in the absence of a determination that he or she is the Beneficiary of the Executive or
Participant.

5.04 Surviving Beneficiary. For purposes of determining whether the Beneficiary predeceases the Executive, the individual is

considered to survive the Executive if such Beneficiary is alive seven (7) days after the date of the Executive’s death.

5.05 Doubt as to Beneficiary. If there is doubt as to the proper individual to receive payments pursuant to this Plan, the Plan

Administrator shall have the right to direct the Company to withhold such payments until the matter is resolved.

5.06 Correction of Erroneous Payments and Overpayments. If payment is made under the Plan to any individual or estate to whom

no payment should have been made or the amount paid to an individual or estate exceeds the amount to which such individual or estate is
entitled under the Plan, the Company shall have an equitable lien on the erroneous payment or the overpayment. The Company, acting
through its

9

Compensation Department or successor department, may correct the erroneous payment or the overpayment using any one or a combination
of the following methods: (a) the Company may offset, set off, or obtain restitution of all or any part of future payments from the Plan to the
individual or any individual claiming benefits through such individual until the erroneous payment or the overpayment is entirely recouped
by the Company; and (b) the Company may request the individual (or any individual claiming through such individual) or estate to repay to
the Company the amount of the erroneous payment or the overpayment and, if repayment is not made voluntarily, take any action deemed by
the Company to be reasonable and necessary to compel repayment, including, but not limited to, instituting legal proceedings against the
individuals or estate (and shall have the right to recover attorney’s fees and other costs incurred with respect to such recovery or repayment).

ARTICLE VI.

TERMINATION, AMENDMENT OR MODIFICATION OF THE PLAN

6.01 Plan Amendments and Termination. The Compensation, People and Culture Committee of the Company’s Board of Directors,
or its successor (“CPCC”) has the authority to approve and adopt amendments to the Plan and to terminate the Plan. Except as provided in
6.02, such amendment may modify or eliminate any benefit hereunder other than a benefit that is in pay status, or the vested portion of a
Retirement Benefit that is not in pay status. The Company’s senior executive with responsibility for Human Resources (“CHRO”) has the
authority to approve and adopt non-material, technical, legal compliance and/or administrative amendments to the Plan. The Company’s
CHRO shall notify the CPCC of any amendment adopted under this provision. If the Plan is terminated, benefit payments may be accelerated
only to the extent permitted under Code Section 409A.

6.02 Change of Control – Protected Benefits. In the event of a Change of Control (as defined in paragraph (c) below), the following

additional provisions shall apply.

(a)

No Amendment or Termination. No amendment or termination of the Plan can occur that would reduce or otherwise

eliminate the monthly benefit payable under the Plan to any person with respect to a Participant who retired prior to such Change of
Control, nor shall any Plan amendment reduce the benefit to be paid with respect to an Executive who has not retired below the amount
which such Executive has accrued and would have received upon reaching Normal Retirement Date had he or she retired the day before
such Change of Control (the “Change of Control Benefit”).

(b)

Full Vesting in Accrued Benefit. Upon the occurrence of a Change of Control, each active Executive shall be fully

vested in his or her Change of Control Benefit under this Plan through the date of the Change of Control; in the event of termination of
employment after a Change of Control and before the Executive’s Normal Retirement Date, the terminated Executive shall receive a
reduced Early Retirement benefit commencing on his or her Early Retirement Date (with reductions based upon the age attained on the
actual Early Retirement Date and without the need for Plan Administrator approval of the Early Retirement Date).

(c)

For purposes of the Plan, "Change of Control" means the first of the following events to occur:

(i)

Change in Ownership of Stock. Any person, entity or group of persons purchases or acquires, within the

meaning of section 13(d) or 14(d) of the Securities Exchange Act of 1934 ("Act"), or any comparable successor provisions, beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Act) of Company stock that, together with stock already held by such
person, entity, or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company.

(ii)

Change in Effective Control. Either of the following occurs, representing a change in effective control of the

Company:

the 12-month period ending on the date of-the most recent acquisition by the person or group) ownership of Company stock constituting
30% or more of the total voting power of Company stock; or

(I)

Voting Power. Any one person, or more than one person acting as a group, acquires (or has acquired during

period of 12 consecutive months by directors whose appointment or

(II)

Board Composition. A majority of the members of the Company's Board of Directors is replaced during any

10

election is not endorsed by a majority of the members of the Company's Board of Directors prior to the date of the appointment or election.

(iii) Change in Ownership of Assets. Any one person, or more than one person acting as a group, acquires (or has

acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) Company assets that have
a total gross fair market value equal to or greater than 40% of the total gross fair market value of all of the assets of the Company
immediately prior to such acquisition or acquisitions. Gross value means the value of the assets determined without regard to any liabilities
associated with such assets. A Change of Control does not occur to the extent that ownership of assets is transferred to:

(I)

a Company shareholder (immediately before the asset transfer) in exchange for or with respect to his or her

Company stock;

Company;

(II)

an entity, 50% or more of the total value or voting power of which is owned directly or indirectly by the

value or voting power of the Company;

(III)

a person, or more than one person acting as a group, that owns directly or indirectly 50% or more of the total

(IV)

an entity, at least 50% of the total value or voting power of which is owned directly or indirectly by a person

described in (III).

consistent with Department of Treasury regulations under Code Section 409A.

(iv)

Interpretation. These provisions related to Change in Control shall be interpreted and applied in a manner that is

ARTICLE VII.

CLAIMS PROCEDURES

7.01 Submission of Claim. Benefits shall be paid in accordance with the provisions of this Plan. The Participant, any person claiming

through the Participant including but not limited to a Beneficiary (“Claiming Party”), shall make a written request for benefits under this
Plan, mailed or delivered to the Compensation Department or its successor department. The Compensation Department or its successor
department shall review and make a determination with respect to such claim.

7.02 Denial of Claim. If a claim for payment of benefits is denied in full or in part, the Compensation Department or its successor
department shall provide a written notice to the Claiming Party within ninety (90) days setting forth: (a) the specific reasons for denial; (b)
any additional material or information necessary to perfect the claim; (c) an explanation of why such material or information is necessary;
and (d) an explanation of the steps to be taken for a review of the denial. A claim shall be deemed denied if the Compensation Department or
its successor department does not take any action within the aforesaid ninety (90) day period.

7.03 Review of Denied Claim. If the Claiming Party desires the Plan Administrator review of a denied claim, the Claiming Party

shall notify the Plan Administrator in writing within sixty (60) days after receipt of the written notice of denial. As part of such written
request, the Claiming Party may request a review of the Plan document or other non-privileged documents relevant to the claim, may submit
any written issues and comments, and may request an extension of time for such written submission of issues and comments.

7.04 Decision upon Review of Denied Claim. The decision on the review of the denied claim shall be rendered by the Plan
Administrator within sixty (60) days after receipt of the request for review. If circumstances require, the Plan Administrator may take up to
an additional sixty (60) days to render its decision. The decision shall be in writing and shall state the specific reasons for the decision,
including reference to specific provisions of the Plan on which the decision is based.

ARTICLE VIII.
TRUST

8.01 Establishment of the Trust. The Company may establish a trust, provided that any trust created by the Company, and any assets

held by such trust to assist the Company in meeting its obligations under this Plan, shall be structured in a way to avoid immediate taxation to
Participants in the Plan. The

11

Company reserves the absolute right, in its sole and exclusive discretion, to direct (or refrain from directing) the transfer over to the trust of
such assets to the extent the Company deems advisable, provided that no such transfer, trust or other arrangement entered into by the
Company shall affect the status of the Plan as unfunded for purposes of ERISA or the Code.

8.02 Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receive

distributions pursuant to the Plan. The provisions of the trust shall govern the rights of the Company, Participants and the creditors of the
Company to the assets transferred to the trust. The Company shall at all times remain liable to carry out its obligations under the Plan. The
Company’s obligations under the Plan may be satisfied with trust assets distributed pursuant to the terms of the trust, and any such
distribution shall reduce the Company’s obligations under this Plan.

8.03 Administration of Trust Assets. The Company’s Compensation Department or its successor department shall direct the trustee

regarding the investment of trust assets.

ARTICLE IX.

PLAN ADMINISTRATION

9.01 Plan Administrator. The Compensation, People and Culture Committee of the Board or its successor is the “Plan Administrator.”
9.02 Powers and Authority of the Plan Administrator. The Plan Administrator shall have the authority and responsibility and all

powers necessary to carry out the provisions of the Plan and to control and manage the operation and administration of the Plan. The Plan
Administrator has discretionary authority to construe and interpret the provisions of the Plan.

9.03 Delegation of Powers and Authority. The Plan Administrator may, but is not obligated to, delegate to any person, employee,

department, committee or third party service provider all or any portion of its duties and responsibilities as Plan Administrator. To the extent
the Plan Administrator delegates fiduciary duties and obligations, such delegation shall be done in writing (including a written action
delegating authority or a written services agreement). The Compensation Department or its successor department shall be responsible for the
day-to-day administration and operation of the Plan in accordance with its terms and is authorized to take such actions as may be necessary to
fulfill its responsibilities, including, but not limited, to engaging third party service providers to assist with Plan administration.

9.04 Reliance on Opinions. The person or entity authorized to act under this Plan shall be entitled to rely on all certificates and

reports made by any duly appointed accountants, and on all opinions given by any duly appointed legal counsel, including legal counsel for
the Company.

9.05 Information. The Plan Administrator and/or Compensation Department shall be provided with such pertinent information as

may be necessary for the effective administration of the Plan, including but not limited to the compensation of Participants and the date and
circumstances of the termination of employment or death of a Participant.

9.06 Indemnification. To the extent permitted by applicable law, the Company hereby indemnifies any Company employee who

carries out any responsibilities under the Plan, and holds them harmless from the effects, consequences, expenses, attorney fees and damages
of their acts or conduct in such capacity, except to the extent that such consequences are the result of their own willful misconduct or breach
of good faith. Such indemnification shall be in addition to any other rights such employee may have as a matter of law, or by reason of any
insurance or other indemnification.

10.01 No Employment Contract. The terms and conditions of the Plan shall not be deemed to constitute a contract of employment

between the Company or a subsidiary or affiliate and an Executive. Nothing in this Plan shall be deemed to give an Executive the right to be
retained in the service of the Company or its subsidiaries or affiliates or to interfere with any right of the Company or its subsidiaries or
affiliates to discipline or discharge the Executive at any time, with or without cause or with or without notice.

ARTICLE X.

MISCELLANEOUS

12

10.02 Employee Cooperation. An Executive will cooperate with the Company or Plan Administrator by furnishing any and all

information reasonably requested by the Company or Plan Administrator and take such other actions as may be requested to facilitate Plan
administration and the payment of benefits hereunder.

10.03 Illegality and Invalidity. If any provision of this Plan is found illegal or invalid, said illegality or invalidity shall not affect the

remaining parts hereof, but the Plan shall be construed and enforced as if such illegal and invalid provision had not been included herein.

10.04 Required Notice. Any notice which shall be or may be given under the Plan shall be in writing and shall be mailed by United

States mail, postage prepaid. If notice is to be given to the Company or Plan Administrator, such notice shall be addressed to Nordstrom, Inc.
c/o Compensation Department, at 1600 Seventh Avenue, Ste. 2500, Seattle, Washington 98101. If notice is to be given to a Participant, such
notice shall be hand-delivered to the Participant or may be mailed to the last known address of the Participant on the Company’s Human
Resources records. Any party may, from time to time, change the address to which notices shall be mailed by giving written notice of such
new address.

10.05 Interest of Participant’s Beneficiary. The interest in the benefits hereunder of a spouse or registered domestic partner of a
Participant who, at any time prior to the death of the Participant, ceases to be the spouse or registered domestic partner of the Participant
(whether by death, dissolution, annulment, separation, divorce or, in the case of a Life Partner, the termination of the life partnership), shall
automatically pass to the Participant unless the spouse is required to be treated as the “Surviving Spouse” pursuant to a court order meeting
the requirements of a Qualified Domestic Relations Order, applying rules analogous to those under Code Section 414(p). A former spouse or
registered domestic partner may not transfer his or her interest in the Plan in any manner, including, but not limited to, by his or her will, nor
shall such interest pass under the laws of intestate succession.

10.06 Tax Liabilities from Plan. If an Executive’s participation in this Plan generates a state or federal tax liability to the Participant
prior to commencement of benefit payments (including a tax liability under Section 409A of the Code), the Plan Administrator may exercise
its discretion to authorize a distribution of funds in an amount not to exceed the amount needed to satisfy such liability (including additions to
tax, penalties and interest). A distribution under this provision is solely at the discretion of the Plan Administrator, and the Executive may not
elect, directly or indirectly, to accelerate payment. The Executive’s tax liability shall be measured by using that Executive’s then current
highest federal, state and local marginal tax rate, plus the rates or amounts for the applicable additions to tax, penalties and interest. Such a
distribution shall affect and reduce the benefits to be paid under Articles III and V hereof.

10.07 Benefits Nonexclusive. The benefits provided for a Participant and Participant’s Beneficiary under the Plan are in addition to

any other benefits available to such Participant under any other plan or program for employees of the Company and its subsidiaries and
affiliates. The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as may otherwise be
expressly provided.

10.08 Discharge of Company Obligation. The payment of benefits under the Plan to a Participant or Beneficiary shall fully and

completely discharge the Company from all further obligations under this Plan with respect to a Participant, and participation shall terminate
upon such full payment of benefits.

10.09 Costs of Enforcement. If any action at law or in equity is necessary to enforce the terms of the Plan, the Company or Plan
Administrator shall be entitled to recover reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to
which that party may be entitled.

10.10 Gender and Case. Unless the context clearly indicates otherwise, masculine pronouns shall include the feminine and singular

words shall include the plural and vice versa.

10.11 Titles and Headings. Titles and headings of the Articles and Sections of the Plan are included for ease of reference only and are

not to be used for the purpose of construing any portion or provision of the Plan document.

10.12 Applicable Law. To the extent not preempted by federal law, the Plan shall be governed by the laws of the State of Washington.
10.13 Code Section 409A: The Company intends that the Plan comply with the requirements of Code Section 409A and shall be

operated and interpreted consistent with that intent. Notwithstanding the

13

foregoing, the Company makes no representation that the Plan complies with Code Section 409A and shall have no liability to any
Participant for any failure to comply with Code Section 409A.

10.14 Dispute Resolution: Any disputes related to this Plan other than a claim for benefits subject to the provisions of Article VII

shall be resolved through mutually binding arbitration as outlined in Nordstrom’s Dispute Resolution Program, the terms of which are
incorporated by reference into this Plan. Any legal action related to a claim for benefits must be initiated within one (1) year after the Plan
Administrator has issued its final decision on review and must be filed in the United States District Court for the Western District of
Washington.

14

Nordstrom, Inc. and Subsidiaries
Significant Subsidiaries of the Registrant
As of and for the fiscal year ended February 1, 2025

Name of Subsidiary
Nordstrom Card Services, Inc.

Jurisdiction of Incorporation
Delaware

Exhibit 21.1

Exhibit 31.1

Certification required by Section 302(a) of the Sarbanes-Oxley Act of 2002

I, Erik B. Nordstrom, certify that:

1. I have reviewed this Annual Report on Form 10-K of Nordstrom, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period
covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-
15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting.

Date: March 21, 2025

/s/ Erik B. Nordstrom
Erik B. Nordstrom
Chief Executive Officer of
Nordstrom, Inc.

 
Exhibit 31.2

Certification required by Section 302(a) of the Sarbanes-Oxley Act of 2002

I, Catherine R. Smith, certify that:

1. I have reviewed this Annual Report on Form 10-K of Nordstrom, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period
covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-
15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting.

Date: March 21, 2025

/s/ Catherine R. Smith
Catherine R. Smith
Chief Financial Officer of
Nordstrom, Inc.

 
Exhibit 32.1

NORDSTROM, INC.

1617 SIXTH AVENUE

SEATTLE, WASHINGTON 98101

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Nordstrom, Inc. (the “Company”) on Form 10-K for the period ended February 1, 2025, as filed with
the Securities and Exchange Commission on the date hereof (the “Report”), we, Erik B. Nordstrom, Chief Executive Officer (Principal
Executive Officer), and Catherine R. Smith, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer), of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

•

•

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations
of the Company.

Date: March 21, 2025

/s/ Erik B. Nordstrom
Erik B. Nordstrom
Chief Executive Officer of Nordstrom, Inc.

/s/ Catherine R. Smith
Catherine R. Smith
Chief Financial Officer of Nordstrom, Inc.

A signed original of this written statement required by Section 906 has been provided to Nordstrom, Inc. and will be retained by Nordstrom,
Inc. and furnished to the Securities and Exchange Commission or its staff upon request.