Nordstrom Inc. trimmed its annual profit forecast on Tuesday, signaling that steep discounts on outdated inventory, coupled with higher operating costs and supply chain pressures, are squeezing the company’s profit margins.

Profit margins of global fashion retailers have been hurt by rising raw material and labor costs coupled with supply chain disruptions, that have been further aggravated by the ongoing conflict in Ukraine.

The company expects fiscal 2022 profit between $2.13 and $2.43 per share, compared to a prior forecast of $2.45 to $2.75.

Nordstrom reported a net loss of $20 million, or 13 cents per share for the quarter ended Oct. 29, compared to a profit of $64 million, or 39 cents per share, a year earlier.

The company’s total revenues fell to $3.55 billion in the third quarter, from $3.64 billion a year earlier, but beat analysts’ expectations of $3.47 billion, according to Refinitiv data.

However, the company reaffirmed its annual revenue and adjusted profit forecast.

By Granth Vanaik, Editing by Krishna Chandra Eluri

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