"A key driver to increasing market share is to invest in new stores," said Blake Nordstrom, president. "This investment continues to be the most productive use of capital. And with strong margins, cash flow, and a healthy balance sheet, our financial position allows us to capitalize on good real estate."

In the third quarter, the company plans to open full-line stores in Thousand Oaks, CA; Indianapolis; Naples, FL; and Pittsburgh. A unit in Tacoma, WA; will be relocated in October. Four new Rack discount stores will open in White Plains, NY; Laguna Hills, CA; Naperville, IL; and Lyndhurst, OH. Future openings include a full-line store at Santa Monica (CA) Place and Rack units at the Beverly Connection in Los Angeles and Orland Place in Chicago.

For the quarter, total sales were $2.29 billion, down 4.3% from the same period last year. Same-store sales decreased 6%. Net earnings were $143 million, compared with earnings of $180 million last year. Full-line stores saw a same-store sales decline of 9%, while value-oriented Nordstrom Rack comps rose 6.3%. Internet sales rose 14.6%. Nordstrom operates 159 U.S. stores located in 28 states under the Nordstrom, Nordstrom Rack and Jeffrey names.