Robert E. Campbell - Vice President of Investor Relations and Treasurer Blake W. Nordstrom - Principal Executive Officer, President and Director Michael G. Koppel - Chief Financial Officer and Executive Vice President Peter E. Nordstrom - Executive Vice President, President of Merchandising and Director Erik B. Nordstrom - Executive Vice President, President of Stores and Director

Edward J. Yruma - KeyBanc Capital Markets Inc., Research Division Deborah L. Weinswig - Citigroup Inc, Research Division Paul Swinand - Morningstar Inc., Research Division Joan Payson - Barclays Capital, Research Division Dorothy S. Lakner - Topeka Capital Markets Inc., Research Division Lorraine Maikis Hutchinson - BofA Merrill Lynch, Research Division Neely J.N. Tamminga - Piper Jaffray Companies, Research Division Jennifer Black - Black & Company Inc., Research Division Dana Lauren Telsey - Telsey Advisory Group LLC Erika K. Maschmeyer - Robert W. Baird & Co. Incorporated, Research Division Tracy Kogan - Wells Fargo Securities, LLC, Research Division Michael B. Exstein - Crédit Suisse AG, Research Division Rob Wilson - Tiburon Research Group, Inc. Howard Tubin - RBC Capital Markets, LLC, Research Division Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division

Hello, and welcome to the Nordstrom 2013 First Quarter Conference Call. At the request of Nordstrom, today's conference call is being recorded. [Operator Instructions] I will now introduce Rob Campbell, Treasurer and Vice President of Investor Relations for Nordstrom. You may begin, sir. Robert E. Campbell: Hello, everyone, and thank you for joining us. Today's earnings call will last 45 minutes and will include about 30 minutes for your questions. As a reminder, all forward-looking statements on this call are subject to risks and uncertainties that could cause the company's actual results to differ materially from the expectations and assumptions discussed due to a variety of factors that affect the company, including the risks specified in the company's most recently filed Forms 10-K and 10-Q. Participating in today's call are Blake Nordstrom, President of Nordstrom, Inc.; and Mike Koppel, Executive Vice President and Chief Financial Officer, who will discuss the company's first quarter performance and outlook for fiscal 2013. During the Q&A session, we will be joined by Pete Nordstrom, President of Merchandising; and Erik Nordstrom, President of Stores. Before we begin, I want to mention that Blake and Mike will be using slides that can be viewed in the Investor Relations section of our website. If you are listening to this conference call's webcast, you should already see the title slide. If you are listening by telephone, you can view the slides by going to nordstrom.com and the Investor Relations section. And now I'll turn over the call to Blake. Blake W. Nordstrom: Thanks, Rob, and good afternoon, everyone. The first quarter for us reflected continued progress on our strategic priorities of improving the customer experience, enhancing our merchandise offering, increasing relevance with existing and new customers and driving online growth. From a top line perspective, the increase was at the lower end of our expectations, with particular softness in more seasonal merchandise categories and in several geographic markets. Sales trends showed improvement in April, and throughout the quarter we were disciplined in our management of expenses and inventory. We remain positive about the balance of the year as we stay focused on our efforts to deliver the kind of customer experience across all channels that build loyalty and drive sales. As we've discussed over the last 12 months, we have multiple growth opportunities underway to improve the customer experience in our stores, in e-commerce and in the multichannel synergies between them. This quarter, we opened 5 Rack stores, with an additional 3 stores opened today in Maryland, Alabama and Maine. We plan to open 14 more Racks over the balance of 2013 and have over 230 Rack stores by the end of 2016. During the quarter, we also announced our plans for a second full-line store in Toronto to be located in the Yorkdale Shopping Centre, bringing our announced full-line store total in Canada to 5, thus far. One of the ways in which we increase our relevance with customers is through product innovation. Within the Women's Apparel area which continues to perform above our multichannel average, we repositioned our Savvy department during the quarter to maintain its trendy fashion appeal but at more accessible prices. It's too early to evaluate its overall performance, but we're excited about this important strategic change to further enhance our product offering and build on the learnings from our partnership with Topshop. The Topshop merchandise has performed well online and in the 14 stores where we currently carry it. Based on its success, we plan to expand its distribution to additional stores in the fall. As the functionality of our mobile point-of-sale devices continues to expand, it is allowing our full-line store salespeople to spend more time with customers and offer a more seamless shopping experience. In the Rack, we've been able to improve the service level through using mobile point-of-sale devices to reduce and often eliminate the checkout line. The next step which we took in the first quarter was to remove some of our fixed cash registers and capture over 20,000 square feet of incremental selling space. This is meaningful because of the high sales productivity we achieve in the Rack. In e-commerce, our focus has been on strengthening the customer experience through a focus on selection, convenience and experience. We've expanded the breadth of our online merchandise offering, so that today it virtually is at parity with our store offering and will continue to grow. In terms of convenience, during the quarter we added well over 100 new features to the website, made improvements to our mobile apps and increased the speed of fulfillment and delivery. We're still in the early stages in the area of personalization. In essence, customizing the experience on our site, providing product recommendations and building tools that help with fit and style. We're also making substantial investments in the infrastructure of our systems to support our accelerated pace and growth. Our Fashion Rewards program continues to grow with new accounts running ahead of last year. We now have 3.5 million active members, up from 2.9 million at this time last year. We've long recognized the program's ability to attract and deepen relationships with new and existing customers, and we're pleased that our customers are taking advantage of it. During the second quarter, we'll offer customers the ability to open a Fashion Rewards account online and have immediate shopping access, including participation in the Early Access portion of the Anniversary Sale. The second quarter is a particularly high-volume period for us, with our Men's and Women's Half-Yearly sales followed by the Anniversary Sale that begins on Friday, July 19. These events bring strong traffic into our stores and online, and give us meaningful opportunities to establish and strengthen our relationships with customers. In closing, we remain positive about the balance of the year. We're motivated by the strategic growth opportunities we're pursuing and we're on track in terms of our progress. We'll continue to update you as we go throughout the year. And now I'll turn over the call to Mike. Michael G. Koppel: Thanks, Blake. Consistent with what we've shared with you in recent quarters, we continue to focus on the execution of our long-term growth strategy that encompasses multiple channels and an expanding geography. To date, we are on track in terms of our progress with respect to our planned entry into Canada, our accelerated store expansion in the Rack, our aggressive growth in e-commerce and ongoing full-line store growth. The potential these initiatives offer in terms of the expansion of customers we serve and the differentiated experience we provide is significant, both individually by channel and in the synergy created across channels. Our confidence and commitment to the successful execution of these initiatives remains strong. Turning to the results of the current quarter, I'd like to offer a few comments. Our sales performance resulted in year-over-year growth, although lower than anticipated. As Blake mentioned, we experienced softer sales trends early in the quarter in both seasonal merchandise categories and geographically in the Northeast, Mid-Atlantic and Midwest regions. That being said, we did see improvement in April sales trends, and our outlook for the balance of the year remains positive. For the first quarter, earnings per diluted share of $0.73 came in at the lower end of our expectations, which was fully attributable to lower-than-planned sales volume. We delivered a same-store sales increase of 2.7%, while going up against last year's 8.5% improvement. The Direct business showed continued momentum, generating 25% sales growth on top of last year's 44% growth. Additionally, total Rack sales grew by 10%. Women's Apparel achieved same-store sales increases above the multichannel average. The strength in our regular price selling continued, reflecting our customers' preference for newness and fashion. The percentage of regular-price sales matched last year's recent historical high for the first quarter. Overall, operating disciplines were very encouraging. We began the year with inventory in good shape and we were able to exit the quarter in a great position, which sets us up well for the high-volume second quarter. This includes the incremental merchandise investment to support Rack growth. On the expense side, our variable costs were well controlled and our overhead was in line with plan. Earnings before interest and taxes, or EBIT, were $275 million, representing a decrease of $5 million or 2% from last year. While we achieved the sales increase of 4.8%, it was offset by planned expenses related to our growth. These included incremental expenses attributable to our strategic investments in Rack, Canada, e-commerce and our loyalty program. We previously shared with you estimated costs of $20 million to $25 million for 2013 associated with our entry into Canada and accelerated Rack expansion, and we incurred roughly $6 million in the first quarter. Next, I'd like to provide some additional color on our long-term growth investment. As mentioned in our fourth quarter call, we are planning capital investments of $3.7 billion over the next 5 years. 75% of our plan consists of investments in stores, reflecting their importance in building and supporting our brand, while leveraging our multichannel presence. The remaining 25% or roughly $900 million represents e-commerce and technology initiatives. Approximately 1/3 of that $900 million relates to our fulfillment capabilities, largely through expanding capacity. The remaining 2/3 represent technology investments to improve the customer experience and to strengthen our infrastructure to support the growth of the business and the accelerated pace of change. We continue to believe our level of investment is appropriate, positioning us to serve more customers and deliver on an ever-changing experience consistent with what customers expect from our brand. Our 5-year capital plan represents approximately 5% of sales, which is in line where we have been historically and consistent with what has been the spend level over time for growing and adapting companies in our sector. We remain committed to our long-term financial goals of mid-teens ROIC, along with high single-digit sales growth. In 2012, our ROIC of 13.9% was the highest over the last 5 years, a period in which we invested nearly $2 billion in our business. Our first quarter ROIC was 14%, 90 basis points higher than a year ago. With our investments continuing in 2013, we expect ROIC to continue to grow. We are in a strong financial position. For some time, we've applied a balanced approach to capital allocation, which takes into account our strategic investments, combined with returning value to shareholders through dividends and share repurchases. In the first quarter, we repurchased 3 million shares for $166 million and we have $1 billion remaining under current authorizations. During the quarter, we also replaced 2 credit facilities, having a combined capacity of $800 million with a single 5-year $800 million borrowing facility. Now I'd like to address our current outlook for the year. We recognize that it is still early, with the first quarter typically representing the lightest sales volume. While we did experience slightly softer sales than expected, we believe that our plan for the remainder of the year is appropriate. As such, we are maintaining our view of 2013 earnings per diluted share of $3.65 to $3.80, which includes the impact of first quarter share repurchases of approximately $0.05. Our top line view has been adjusted to reflect the lower-than-planned volume in the first quarter. In closing, we continue to be excited about the many opportunities we have to serve more customers, with great product and an unmatched customer experience through our expanding channels and new geographies. With that, I'll turn the call over to Rob. Robert E. Campbell: Thank you, Mike. [Operator Instructions] With that, we'll take the first question.

Our first question today is from Ed Yruma from KeyBanc. Edward J. Yruma - KeyBanc Capital Markets Inc., Research Division: On the slides, you had a -- I think it was a Rack inventory slide, maybe it was a full business slide, and you had something called the pack-away Rack inventory. Could you talk a little bit about that? And whether that's a new strategy or not? Michael G. Koppel: Sure, Ed. This is Mike. Thanks for your question. Yes. The pack and hold is a strategy that we began last year, and the idea there is to be more assertive in the market to get the best product we can as we transition out of the season. And with the continued growth in our Rack business and the improvement in our partnership across all our channels, we're just getting more scale and more leverage, and we're able to get better inventory. And that increase in inventory represents that investment. Edward J. Yruma - KeyBanc Capital Markets Inc., Research Division: Got you. And one quick follow-up. Thank you for the table to kind of help us with the quarterly trends due to calendar shift, but I was wondering if you could maybe give us a little bit more quantification in terms of the magnitude of difference between 2Q and 3Q based on the week shifting? Michael G. Koppel: Yes. Ed, we're not giving specific direction by quarter. I think we did talk a little bit about that second quarter would be higher than average, and the back half would be lower.

[Operator Instructions] Our next question today is from Deborah Weinswig from Citigroup. Deborah L. Weinswig - Citigroup Inc, Research Division: Can you comment on traffic versus ticket in the quarter? And just how should we think about kind [ph] of things as they progress throughout the quarter? Blake W. Nordstrom: Traffic versus ticket, is it the question? Deborah L. Weinswig - Citigroup Inc, Research Division: Yes, yes. Blake W. Nordstrom: Well, there was a certainly a softness throughout the quarter. April was better, more return to normal. We had more softness in the first 2 months of the quarter regionally, in our Northeast capital, which is the Mid-Atlantic and our Midwest regions. So there was definitely some softness there. Deborah L. Weinswig - Citigroup Inc, Research Division: Okay. And it does seem like the Nordstrom Rack definitely bucked that trend. Can you comment on that business specifically? Michael G. Koppel: Deborah, this is Mike. I just wanted to just make one more comment on that. In terms of the average ticket in the first quarter, our regular-price selling was as good as it's ever been, and the average ticket was up. So we continue to see good progress there. And then the second part was the Rack? Second question was the Rack? Deborah L. Weinswig - Citigroup Inc, Research Division: I said Rack definitely seemed very strong in the quarter. I just wanted to see if you could comment on that business specifically? Blake W. Nordstrom: Deborah, this is Blake. Our Rack business continues to perform well, but it also mirrored to a degree that full-line stores, from a comp store point of view, but we're very pleased overall with it and its strategy and the new store growth is going on plan and, in some cases, exceeding our plan. So we still feel good about that but it was interesting that it's had a healthy trend for some time. And it came down a notch during the quarter, but a similar trend or a reflection of the full-line stores.

Our next question is from Paul Swinand from Morningstar Investment Research. Paul Swinand - Morningstar Inc., Research Division: We keep talking about the regular-price selling and how it's getting better, and it feels like you keep reaching new highs. Is there any reason that, that would not continue, or that, eventually, you might not want to have that high a level or something that could reverse? Or should that just continue to get stronger as you keep getting smarter about business? Peter E. Nordstrom: This is Pete. I mean, it was really just reflective of what customers are interested in buying from us. And I -- we -- it actually served us really well that we have a good full-price business that is reliant on newness and all that. And we geared everything that we do in terms of how we flow inventory to be along those lines. We don't have the same kind of margin pressures given the markdowns, which is a good position for us to be in, and frankly, serves us well when dealing with customers, too. We're in a position we have to match prices, and that sometimes affects it because most of our peers are more promotional than we are, as we know -- as you know. But all in all, it's been a good positive trajectory for us to be on, and we've just been trying to follow our customers' lead with what they're most interested in buying from Nordstrom. Paul Swinand - Morningstar Inc., Research Division: Is it kind of equal Rack to full-line stores? Peter E. Nordstrom: It's a little bit different. I mean, obviously, there is a different agenda happening in the Rack where the whole premise is around markdowns and what have you. But we -- I think, relative to that, we have good sell-throughs at our first marked price. And I don't know, Blake, if you can expand on that. Blake W. Nordstrom: I will -- this is Blake, I will concur with Pete. It's a little bit of a different animal full-line to Racks, but in terms of the regular-price selling particularly as we understand it amongst the peer group, we have one of the highest regular price business within the Rack. And that first markdown, hopefully, we're pricing it accordingly is moving well. And so that helps. And given their flow and their margins and there's a similar story, if you will, with the full-line stores even though there's some -- there's a different model there slightly.

Our next question today is from Bob Drbul From Barclays. Joan Payson - Barclays Capital, Research Division: It's Joan Payson on for Bob today. I guess, if you could speak more to the Fashion Rewards program, given the penetration today, just maybe what your long-term plans are, and when you think that growth and penetration will begin to slow? And then is there any difference in behavior for rewards customers? Michael G. Koppel: Sure. Joan, this is Mike. In terms of the program, we're still enjoying the momentum that was built last year when we introduced what we called Fashion Rewards 2.0, which was the next level of our offering, where we enhanced the benefits and we made it more accessible to more customers. And that momentum continues. We did, this past fall, do some testing on a non-tender-based program and we're learning from that, and we're going to continue to move forward and see ways that we can reach more customers through loyalty. In terms of their behavior, those customers spend several times more on the average than non-Fashion Reward customers, and clearly, their loyalty has a very high lifetime customer value. So those customers continue to be a core for us. With the expansion into the Rack, we're acquiring new customers at a younger stage of their buying cycle. And so those are all positives. So we're going to continue to learn from it and find ways to grow it.

Our next question is from Dana Telsey from Telsey Advisory Group. I apologize. We'll move on to the next question. Our next question today is from Dorothy Lakner from Topeka Capital. Dorothy S. Lakner - Topeka Capital Markets Inc., Research Division: I wondered if you could give us a little bit more color on some of the things that you're doing in Women's Apparel. Obviously, with Savvy, you've changed the pricing there, some of the departments seem to have moved around. I think, if I'm not mistaken, t.b.d is not there anymore. It seems like denim has moved kind of within the department. So I wondered if you could just talk a little bit more about the changes you've made there and how customers are responding? Peter E. Nordstrom: This is Pete. I feel like I got to run down to the floor and make sure t.b.d. didn't fall into the ocean or something, because we haven't moved that one. That's kind of been business as usual there for the most part. If anything we're -- pretty much have expanded our offer there. We did make a change with Savvy and was mostly just around trying to be more competitive, what's happening out there in the landscape of being able to buy a trend right [ph] clothes at lower prices than what we were offering, so we dropped our average price point considerably. And that has made a really interesting difference for us. In total, it's really benefited Women's Apparel. We're still trying to gain traction on this change. I think, to your point, that some stuff has moved around, and that's been somewhat unsettling to some customers. And we've been through this before, so we know it's going to take a little bit of time. But I'd say the early indications of this has been a good thing to do and it's going to enable us to attract more new customers. So I'd say, really, the success of Women's, that's part of it, but there's a couple of things that happened there. First of all, we've done a much better job of prioritizing and editing around disproportionate spend on key brands. Obviously, that's how customers tend to be able to navigate our stores based on these brands they expect to find from us, and we've invested more heavily in them with more inventory. We've given them more prominent locations and merchandising features on the floor, and the business has gone up quite a bit. So that's been a good move for us. We've also had a lot of improvement with our own label, what we call NPG, or Nordstrom Product Group. We've had really good success with our private label brands in Women's and really excellent growth, which has not only been great for the top line, but it's very good for our margins as well.

Our next question is from Lorraine Hutchinson from Bank of America. Lorraine Maikis Hutchinson - BofA Merrill Lynch, Research Division: With Topshop then maybe any productivity metrics? Blake W. Nordstrom: Could you repeat that question, please? Lorraine Maikis Hutchinson - BofA Merrill Lynch, Research Division: Sure. Topshop, can you give us any more details on your store rollout? How many do you think you'll have this year and maybe next year? And then, any details you can share on productivity? Peter E. Nordstrom: Yes, this is Pete. We're planning on opening some new stores this fall. It's been successful so far with the 14 stores we started out with. It's got to happen in some kind of measured pace because there's a lot that goes with this, and not the least of which is the amount of investment and effort it takes to give it the proper identity and location in our floors. And so we're working closely with the Topshop people to identify the stores, the locations and the specific merchandising elements it needs. So we're planning in, I think, late September, early October to add 28 stores at this point, that's what we've agreed upon, and we're working through those details with them. And presuming it will go as we all think it will continue to go that we would be able to follow up with another approximately 30 the next season. When I say that, more like January, February. Again, and I think it behooves both Topshop and us to -- once we've decided and figured out that this is good and worth doing, to get it going as quickly as reasonably possible, so that's -- we're aligned on that. And I would say, in general, it's been productive and more productive than an average department in Women's. So when you combine that with the fact that it attracts a lot of new customers as well, it's been a good thing for us. Lorraine Maikis Hutchinson - BofA Merrill Lynch, Research Division: Okay. And then, maybe can you just elaborate more on what exactly the investment looks like from a dollar perspective? Peter E. Nordstrom: Yes, I'm not going to get into the details of that. But it's fair to say that it's not trivial. To do this right and do it well in a way that they're happy and we're happy, we don't want to do this in a temporary looking way. We want to do it in a way that looks like we're serious about the business. So those details get worked out. We have a great partnership with Topshop that we share a lot of those costs. Michael G. Koppel: This is Mike. It's also, I think, fair to say that the expectations of the returns on wherever we're investing are very high. This is a significant opportunity for us.

Our next question is from Neely Tamminga from Piper Jaffray. Neely J.N. Tamminga - Piper Jaffray Companies, Research Division: Mike, I wanted to talk a little bit more about Fashion Rewards, if we could. I know that you guys have been testing that non-tender-based card. I'm just curious in those tests, if you could be a little bit more specific as to how you tested it and what you found? Did you test it full-line in Rack or both, or just one of them? And then related to that, is there going to be an additional rollout of this around pre-shop? Is that kind of what you guys were talking about in terms of being able to sign up for the Fashion Rewards online doing pre-shop? Is that the connector there? And then just one tiny, little additional, if I may. In terms of mobile iPhone functionality, you guys have definitely been ahead of the curve. We've been tracking it pretty closely. It does seem to me, though, that there's opportunity -- there's always endless opportunity -- but there's opportunity to really put more information around Fashion Rewards in your customers' hand. What's the timeline for something like that on the docket? Michael G. Koppel: Well, Neely, thank you. I tried to write down all those questions. I'll do my best to address them. The first is the test. The test we did was primarily full-line and in Cosmetics. That was an area that we felt certainly was an opportunity to enhance loyalty and repeat business. I'm not going to get into too many specifics in terms of what we learned, other than the fact that we do see opportunity down the road to have more of a non-tender offering. We are currently in the process of building and investing in the technology that would give us a better platform, not only with the Fashion Rewards on our tender program but also non-tender. So we learned enough to validate that I think there's opportunity to move forward. In terms of the pre-shop, I think what we were talking about in Blake's comments was the fact that we're going to have the functionality to apply for a card online and get immediate approval, so then you can turn around and shop online. And as you know, for Anniversary Sale, the pre-shop is only open for Fashion Rewards customers. So the fact that you can go on, apply, get approval, you can pre-shop online at that point. And so we see that as another opportunity, not only to get more customers in the program, but also to offer them the convenience of the pre-shop for Anniversary. And then, the mobile iPhone, E, you want to cover that? Erik B. Nordstrom: Yes, this is Erik. Mobile, we're not going to get into our exact rollout schedule. But you are right, there is a big opportunity to utilize mobile to get relevant information in the hands of the customers, and Fashion Rewards is certainly high on the list for us. It's a program that our customers have responded really well to. And the more we can engage it in, the better it is for us. So I'll tell you, it's on our list along with other features to get relevant information to our customers' hands.

Our next question is from Jennifer Black from Jennifer Black & Associates. Jennifer Black - Black & Company Inc., Research Division: You guys have made great success with Women's, and so I have questions on 2 different departments. One, I wondered if you could talk about Encore? It appears the performance is improving after underperformance for what seemed like many years. And I wondered if you're eliminating Encore in some of your stores and spreading plus sizes throughout other departments. That's my first question. Peter E. Nordstrom: Yes, this is Pete. Encore, we actually have had some improvement in the last 8 months or so, and largely it's been because our online business there has grown disproportionately fast to everything else. We've had big increases online with the Encore department. It's been more closer to flat in the stores, but that's where we've had the growth. I think because of that, we've learned that, perhaps it doesn't have to be in every store. I mean, every store is different based on the space constraints that we have and the customers that we have in the store. But if we can serve that customer well online, we're anxious to do that. I think every store, we have to evaluate and prioritize. I think the worst thing that we can do is to try to do a bunch of departments in a mediocre way rather than doing fewer in a really good way. And I think often times, the Encore department -- Mike get squeezed a little bit in terms of the space that it needs to do it successfully. So we can offer much more breadth of assortment online, and again, that seems to be working well for us. Jennifer Black - Black & Company Inc., Research Division: Great. And then my second question is about Activewear as a category for both men and women. I mean it's a categories that it seems like a tremendous opportunity, and retailers are clamoring to get into the space and Zella looks amazing. So I just wondered, if you could talk about that as an opportunity, and would you consider Zella or another private label brand for men? Peter E. Nordstrom: So another really good question. In fact, it has been successful for us, and Zella has been a huge catalyst for that, given that we own that brand and manufacture it and design it ourselves, that's something we're really proud of. And we've not really come close to the full potential of that brand in the Women's area. In terms of how that's going to translate to Men's, we've had those conversations about that line specifically, or there may be another label that we might be able to do in Men's through NPG. But right now, what we're doing is trying to expand on the big athletic brands that we have already. The challenge there is not dissimilar from the Encore conversation where we have to prioritize and edit, make the space that we need to be able to do it well rather than do it in kind of a mediocre way. So the good news for us is we have a lot of stores where we can try different iterations of how we layout Men's, and this is something that we are working on currently and will happen for the remainder of the year as we try to figure out the best go-forward plan.

Our next question is from Dana Telsey from Telsey Advisory Group. Dana Lauren Telsey - Telsey Advisory Group LLC: I wanted to talk a little bit about fulfillment. As obviously there's more dollars being allocated to fulfillment, how do you see ultimately, with online with the stores, how does the fulfillment equation work? And what do you think of the margin opportunity once you get fulfillment where you want it to be? Blake W. Nordstrom: Dana, it's Blake. On the fulfillment subject, it's really evolving. And if you go back, it was about in bulk just getting it to our stores. And then with catalog starting, but really the e-commerce business having one large efficient facility, as the customers expectations and really terrific choices have evolved, we're looking at our supply chain from a customer point of view of how do we deliver single items in a much more timely manner. And so that's going to mean -- we've been on this journey, and we've been utilizing our stores' inventory and services better, and we have an opportunity in all aspects of our business -- off price, as well as regular price. But it will require more smaller centers to be able to deal on a more timely way with our customers. And so we will be, over time, making more investments and evolving there, and technology plays a huge role in it, too, because the old days of fulfillment, it was a big cement building and kind of in bulk -- kind of going through that. And now, actually, the technology is ensuring that the allocation is proper to where the customer and the demand is to be able in a timely way get it in their hands. And so you talked about margin lastly. Where the efficiencies occur is that we're able to, again, maximize that inventory and turn it better and flow it better, and through this multichannel strategy then that creates a more higher percentage of regular-price selling, which improves our bottom line. So we're encouraged by that. And we're -- we've made good progress, but there's a lot to do, and we look forward to, in future calls, communicating with all of you about what our plans are there. Peter E. Nordstrom: Yes. And Dana, this is Pete. What I would add to that is the challenge that we've had in the last couple of years is trying to catch up with all the demand we've had online. I mean, the most efficient way to allocate inventory is to put it where the demand is coming from. And so I think we've done a much better job in this last quarter of getting the inventory in the right place. But it's all based on having really good information and good flexibility, and this is just an ongoing challenge for us to continue to try to put the inventory where the demand is being generated.

Our next question is from Erika Maschmeyer from Robert W. Baird. Erika K. Maschmeyer - Robert W. Baird & Co. Incorporated, Research Division: Could you provide any sense for the magnitude around how trends picked up in April or the weakness for seasonal, or how warmer regions outperformed? Essentially, any metrics that helped give you confidence in the 3% to 5% comp guidance for the rest of the year? Michael G. Koppel: Yes. Erika, this is Mike. We're not going to get into that level of detail. But suffice it to say, we did see measurable change in terms of improvement in those regions that we called out, and we have seen a more normalized pattern of selling in the seasonal goods. And our practice has been, as we've said in the past, is that we will replace the actual that we've incurred with the plan that was there, and we'll use the plan the remainder of the year unless there is something materially different. And at this point in time, we don't see anything materially different from that plan. Erika K. Maschmeyer - Robert W. Baird & Co. Incorporated, Research Division: Okay, that makes sense. And then just a follow-up, how big are your private label brands today? Michael G. Koppel: How big are the private label brands? Peter E. Nordstrom: Yes. What do you exactly mean? Like what... Erika K. Maschmeyer - Robert W. Baird & Co. Incorporated, Research Division: What proportion of sales or... Peter E. Nordstrom: We don't give that exact information. I would say it's at a fairly similar level as it's been in total, but we have some places where it's really grown quite a bit. And we mentioned Women's in particular, and I think that's just been good for us all the way around. The good news there is that there's a great example to be able to follow, and all our merchants are nothing if not competitive. And they like seeing that example out there and feeling like there's an opportunity for them to expand with private label as well. Most of it is happening along what we would consider the better price points, that's where most of the opportunity is. And we are trying to enhance that, make it bigger and better because we're encouraged by what we've been able to achieve of late.

Our next question is from Paul Lejuez from Wells Fargo. Tracy Kogan - Wells Fargo Securities, LLC, Research Division: It's Tracy Kogan filling in for Paul. I was wondering if we can assume, just based on what you said about full-price selling, that your merchandise margin was up in the quarter? And if so, could you give us the magnitude? And then wondering how much the shipping hurts you there. And then secondly, if you could just talk a little bit about the new store performance of your recent Rack openings? Michael G. Koppel: Yes. Tracy, this is Mike. In terms of merchandise performance, actually, we continue to see somewhat of a downtrend in our total merchandise margin because of the growth of the Rack is becoming a larger percent of total. And Rack, just by its inherent nature, has a lower margin. That being said, the individual businesses relative to their plan and expectations did very well for the quarter, so we were happy with the merchandise margin performance. And then the second question, excuse me, was? Blake W. Nordstrom: On the Rack, new store performance this quarter. And I made -- this is Blake, I made brief mention on that, Mike, on earlier question. We've been really pleased with our new store performance throughout 2012, and that's continued in 2013 in Q1. And so I think we made mention that we've opened 8 stores to date, and you're going to have 1 or 2 that vary a little bit. But overall, it's been exceeding our plans, and that teams executing those openings well to date.

Our next question is from Michael Exstein from Crédit Suisse. Michael B. Exstein - Crédit Suisse AG, Research Division: A quick question, please. Can you just give us a sense about non-seasonal goods, how they did versus seasonal goods? Peter E. Nordstrom: This is Pete. I think -- well, for example, we had a good coat season, I think that's part of what the same thing. Our coat business for the quarter was up considerably. But most of it, how we trace it, was along the lines of the seasonal goods being spring or summer goods, from T-shirts to shorts to sandals, was measurably down. And that has improved. Again, as everyone has mentioned, as the quarter went on and we feel like we're in a much more normalized place. But that is definitely how we measured it and looked at it. Michael B. Exstein - Crédit Suisse AG, Research Division: And so just following up, so the businesses that are less seasonal, seasonally impacted, was their rate of sale relatively unchanged throughout the quarter? Or was the lack of seasonal goods really hurting traffic in the front end of the quarter? Peter E. Nordstrom: Yes. Maybe the best way to look at that is Cosmetics, which had a good quarter. And so if you were to look at that, you would get the sense that things have really been unchanged for them. And so I think that would speak to what you're talking about, traffic has generally been good, their businesses continue to go at the same momentum it's gone for quite a while. So yes, I think that would probably be a good example to demonstrate what we suggested here.

Our next question is from Rob Wilson from Tiburon Research. Rob Wilson - Tiburon Research Group, Inc.: Mike, you've mentioned in the past, you've had this higher regular-price metric that you've discussed. I think for many quarters now, yet I'm looking at a gross profit margin that's in decline. So can you help me reconcile the 2? Michael G. Koppel: Sure. Well, there's a couple of things in there outside of the merchandise margin. One is what I just discussed, and that's the growth of the Rack business. The off-price business, the economics of that business has a lower merchandise margin, Rack's becoming a larger percent of the total, so it's bringing the average down. And the second thing, which is something else we've also shared, is the growth of the Fashion Rewards program. The accounting requires that the cost of the benefits get reflected in the gross profit line, and so that's also having an effect. But in terms of the actual merchandise margins and the health of the inventory and our ability to sell things at a regular price, that continues to be a positive. Rob Wilson - Tiburon Research Group, Inc.: Can you help me -- can you define regular price? I mean, are you talking about all 3 channels, the Rack, the full price and the Internet? Michael G. Koppel: We're primarily talking about our full-line stores and our Direct channel, not the Rack.

Our next question is from Howard Tubin from RBC Capital Markets. Howard Tubin - RBC Capital Markets, LLC, Research Division: Can you provide us any update on HauteLook, and how that business trended in the quarter? And whether you have anything new going on with that business? Michael G. Koppel: Sure. Well, actually, HauteLook had a very good quarter. Its comps were actually higher than our Direct channel, and for the first time, we had operating profitability. So that business has shown some good legs [ph]. We're making some progress in terms of leveraging our ability to get product and some of the things we've done operationally to improve fulfillment. So we actually made some very good progress in the first quarter.

Our next question is from Richard Jaffe from Stifel. Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division: A couple of just housekeeping questions and then a bigger picture issue. The number of square feet at the end of the quarter, is that -- if you could share that with us for modeling purposes? Michael G. Koppel: I don't have that in front of me, but I'm sure we can get that to you, Richard, off-line. Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division: And the Anniversary Sale, given the shift in the fiscal calendar this year, will that be the same year-over-year or apples-to-apples on a quarterly basis? Michael G. Koppel: No. Actually, it will be different. You may recall last year, the last week of the Anniversary Sale fell into the third quarter. This year, it will all be in the second quarter. So our second quarter sales will be higher as a result of that. Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division: And 3Q might suffer a little bit? Michael G. Koppel: And 3Q would be down, that's correct. Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division: Right. And then just a bigger question on the Men's business and what's been a source of success for you, and I'm wondering if you could comment on that and how that's performing, and what's making it work? Peter E. Nordstrom: This is Pete. Men's has been a real solid performer for us, and that's been that way for over a year now. And we've had pretty good strength really across the board. In particular, our clothing departments had, with suits, primarily, has been really strong. I think that our Men's team has done a good job of evolving our operative to feel more modern and relevant and give a guy a reason to buy something new, it's -- you've got to keep moving forward and make sure that you're really grounded in what the customers are -- what's motivating the customer to buy and lifestyles evolve and change. I mean, Jennifer [Black] even spoke to it a little bit in terms of like the Active trend, as an example. I think that our Men's team has done a really nice job of continuing to evolve our offer and be there for our customers.

And our final question today is from Dorothy Lakner from Topeka Capital Market. Dorothy S. Lakner - Topeka Capital Markets Inc., Research Division: Just to get a little bit of color on the credit business, it seems to be continuing to improve, although the credit revenues were lower than last year. So I wondered, Mike, if you could just add a little color there? Michael G. Koppel: Yes, sure. Well, our credit metrics continue to be very strong, and matching and then sometimes better than where they were pre-recession. Our write-offs are in the low 3s, our delinquencies are 1.7 right now, so that's very positive. In terms of the credit revenue, I thought the credit revenue was relatively even with last year. Blake W. Nordstrom: Is she speaking to reserves, maybe? Taking them or... Michael G. Koppel: No, I don't think so. So I mean, we haven't seen a significant growth in our receivables because the trend we've seen over several years is improving payment rates. So the efficiency of that asset continues to get better, and so that's why we've seen relatively flat credit revenue year-over-year just because of the growth of the receivables. And by the way, we have a large percentage of our customers who don't revolve. Dorothy S. Lakner - Topeka Capital Markets Inc., Research Division: Right. So they're paying off as opposed to actually using the credit? Michael G. Koppel: That's exactly right. Robert E. Campbell: Thank you for joining us today for our first quarter earnings call. As a reminder, a webcast replay of this call, along with our slide presentation, will be available for 1 year on the Investor Relations section at nordstrom.com under Webcast. In addition, an overview that summarizes today's discussion is included at the end of our slide presentation. Thank you for your interest in Nordstrom. Goodbye.

Thank you. And this does conclude today's conference. Thank you for participating. You may disconnect at this time.