Trina Schurman - Director-Investor Relations Blake W. Nordstrom - Co-President & Director Michael G. Koppel - Chief Financial Officer & Executive Vice President Peter E. Nordstrom - Director, Executive VP & President-Merchandising Erik B. Nordstrom - Co-President and Director

Lorraine Maikis Hutchinson - Bank of America Merrill Lynch Research Matthew Robert Boss - JPMorgan Securities LLC Jeffrey Stein - Northcoast Research Partners LLC Paul E. Trussell - Deutsche Bank Securities, Inc. Lindsay Drucker Mann - Goldman Sachs & Co. Kimberly Conroy Greenberger - Morgan Stanley & Co. LLC Omar Saad - Evercore ISI Paul Lejuez - Citigroup Global Markets, Inc. (Broker) Brian Jay Tunick - RBC Capital Markets LLC Richard Jaffe - Stifel, Nicolaus & Co., Inc. Edward J. Yruma - KeyBanc Capital Markets Inc./Pacific Crest Securities Michael Binetti - UBS Securities LLC Tom Forte - Maxim Group LLC Neely J. N. Tamminga - Piper Jaffray & Co. (Broker) Oliver Chen - Cowen and Company, LLC Mark R. Altschwager - Robert W. Baird & Co., Inc. (Broker)

Greetings and welcome to the Nordstrom Second Quarter 2016 Earnings Conference Call. At this time, all participants are in a listen-only mode. We will begin with the prepared remarks, followed by a question-and-answer session. As a reminder, this conference is being recorded. At this time, I will turn the call over to Trina Schurman, Director of Investor Relations for Nordstrom. You may begin. Trina Schurman - Director-Investor Relations: Good afternoon and thank you for joining us. Today's earnings call will last 45 minutes and will include 30 minutes for your questions. Before we begin, I want to mention that our speakers will be referring to slides which can be viewed by going to nordstrom.com in the Investor Relations section. Today's discussion may include forward-looking statements, so please refer to the slides showing our Safe Harbor language. Participating in today's call are Blake Nordstrom, Co-President, and Mike Koppel, Chief Financial Officer, who will discuss the company's second quarter performance and the outlook for fiscal year 2016. Joining during the Q&A session will be Pete and Erik Nordstrom, Co-Presidents. With that, I'll turn the call over to Blake. Blake W. Nordstrom - Co-President & Director: Thank you and good afternoon. Over the past several quarters, our team has been actively addressing our inventory, expense, and capital as we align to current sales trends. In the second quarter, the team made substantial progress by bringing down inventory in line with sales. We're also pleased with our customers' response to the Anniversary Sale. This year marked one of the best events we've had in our history, with an all-time high in sales volume. The strength of our Anniversary event, along with the team's inventory and expense execution, drove better-than-expected results for the second quarter. Our Anniversary performance reflected an improvement from our recent sales trends. We had a strong start to the sale and the momentum continued throughout the event. Our sell-through rates were at record highs, putting us in a clean inventory position for the second half of the year. Customers responded favorably to newness with shoes and beauty leading our results. As a reminder, historically, every several years we have a shift in our Anniversary event which moves one week of the event into the third quarter. As a result, our comp decrease of 1.2% was unfavorably impacted by roughly 250 basis points. On May 18, we achieved an important milestone with the expansion of our loyalty program. Nordstrom Rewards serves as a powerful tool to drive incremental sales and trips. Even more importantly, it gives us an opportunity to strengthen relationships with customers. In response to feedback for more flexibility in joining our program, we've expanded it so that all of our customers can earn rewards regardless of how they choose to pay. We're encouraged with the strong response. We now have around 6 million total Rewards customers who shopped with us over the last year, up significantly from 4.7 million last quarter. As we head into the second half of the year, we are focused on a number of initiatives to improve the customer experience and drive top-line growth. In our Nordstrom brand, we're expanding our reach to serve more customers. We're building on the success of our Canada expansion with two full-line store openings in Toronto. On September 16, we will open a flagship at Eaton Centre followed by another store at Yorkdale Shopping Centre on October 21. In the U.S., we will open a second full-line store in Austin, Texas on September 30. In our Nordstrom Rack brand, we plan to open 15 stores this fall for a total of 215 by the end of the year. Our merchandise strategy remains focused on providing our customers with newness. Our efforts to grow relevant brands that have limited distribution play an important role in creating excitement and attracting new customers. They now make up the majority of our top 20 fastest-growing vendors and we're continuing to expand the most highly sought-after brands like IVY PARK, Madewell, and Charlotte Tilbury with new partnerships to come. In addition to providing a differentiated product offering, we recognize that our customers desire a personalized and convenient experience. To meet their evolving expectations, we are making digital enhancements to better serve customers no matter how they choose to shop with us. We have several initiatives underway that include new mobile features, improvements to our website, and enhanced selling tools. In the second quarter, we've made ongoing improvements to our mobile app, including features that enable customers to shop their store of choice and shop for items based on a visual search. This fall, we are piloting a mobile feature that gives customers the ability to reserve merchandise online and try on in our stores. In closing, our ability to deliver strong Anniversary results while realigning inventory and expense speaks volumes to the quality of our team. We're proud of the team's high level of execution and remain committed to continuing this progress. Next quarter, we look forward to providing further updates on our efforts, including our expanded loyalty program and performance in Canada. I'll now turn it over to Mike, who will provide additional color on our results and our ongoing efforts to improve our business models. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Thanks, Blake. Our second quarter results are reflective of the ongoing efforts to realign our resources and priorities to customer expectations. This includes the progress we have made adjusting our inventory and expense, which had a positive impact on our second quarter results. As we evolve our business model, we will continue to aggressively prioritize our resources to ensure that we can serve customers with high-quality products and services while achieving profitable growth. Our earnings per diluted share of $0.67 were ahead of our expectations, driven by our strong execution of the Anniversary Sale, inventory management, and expense control. We are also continuing to see benefits from the strategic growth investments we've made to fuel growth in new markets and ecommerce. These investments, HauteLook, our expansion into Canada, and Trunk Club are expected to contribute over $1 billion to our top-line in 2016. Our full-line stores, Nordstrom.com, and Trunk Club had a combined comp decrease of 2.3%. This reflected an unfavorable impact of over 250 basis points from the event shift. The momentum of Nordstrom Rack, consisting of stores and online, continued with a comp increase of 5.3% on top of last year's increase of 6.5%. Over the last several quarters, we have been aggressively adjusting our inventory plans as consumer demand has changed. We have a complex portfolio of businesses, and combined with the uncertainty of sales trends, our merchant and planning teams were making continuous adjustments. That high level of execution combined with a compelling product offering for the Anniversary Sale drove better-than-expected results for the second quarter. Our inventories are well-positioned, current and in line with our sales trends. As a result, we are on the offense, focused on bringing in the latest and most compelling product offering that resonates with our customers. In terms of our broader efforts to improve profitability, we recognize that the shift towards e-commerce is having an impact to our financial model. As we accelerate investments to support changes in customer expectations, our expenses, particularly in technology, supply chain, and marketing, grew faster than sales. To address this, we are continuing to make operational changes to right-size this trajectory. As we shared last quarter, we identified over $150 million in productivity improvements this year, of which roughly half has been realized to-date. We are streamlining corporate headquarters and executed on a number of initiatives that will enhance the customer experience and improve our operating model. In technology, we're on a path to modernize our platform and increase the productivity of delivering features that will improve the customer experience. For example, this year, we implemented new technology solutions that support our expanded loyalty program and online search engine. These modernized platforms enable us to serve customers in a more personalized and relevant way. In supply chain, we've executed on several initiatives to improve operating performance. This included optimizing our supplier network for both inbound and outbound carriers, reducing split shipments through a greater allocation of merchandise to our fulfillment centers and editing out less profitable items online. A year ago, we opened our East Coast fulfillment center, which has the potential to double our fulfillment capacity as we scale for growth. For customers we serve on the East Coast, we've been able to speed up delivery times by over 30% with lower unit shipping costs due to the increased proximity to our customers. In continuing these efforts, we are further integrating Trunk Club's operations into the Nordstrom fulfillment network with completion expected by mid-2017. In marketing, we are repositioning our organization to better align with the customer journey and our strategic priorities around customer acquisition and retention. This includes strengthening our capabilities around customer analytics and digital engagement so that we can reach customers in a more efficient and cost-effective manner. Our expanded loyalty program demonstrates our efforts to rebalance our marketing resources towards a greater focus on personalization. This will help us better serve customers and increase their lifetime value. In addition to the adjustments we've made to inventory and expense, we have re-prioritized our capital investments to better align with changing customer expectations and strengthen our financial position. This resulted in a 10% reduction to our five-year capital plan. Our reduced CapEx plan of $3.6 billion is appropriately balanced between store and technology investments. We have made a modest reduction to our Rack store expansion plans, given the growth of our online business, which has doubled since the launch of Nordstromrack.com a couple years ago. All of these efforts to improve our productivity will result in a more productive use of financial resources, which is beginning to positively impact our results. During the second quarter, our cash flow from operating activities was $853 million, more than twice what it was last year. Now I'd like to address our financial outlook. We have adjusted our earnings per share outlook to $2.60 to $2.75 from our prior outlook of $2.50 to $2.70. As we head into the second half of the year, we believe we are well positioned to manage our business while also being mindful of uncertainty in retail trends. In closing, as our business evolves, we remain confident in our ability to serve customers in an exemplary way and achieve sustainable profitable growth. Through our ongoing efforts, we believe Nordstrom will emerge stronger and better positioned for future success. I'll now turn it over to Trina for Q&A. Trina Schurman - Director-Investor Relations: Thank you, Mike. Before we get started with Q&A, we'd like to ask that you limit to one question. If you have additional questions, please return to the queue. We will now move to the Q&A session.

Thank you. Thank you. Our first question comes from Lorraine Hutchinson from Bank of America Merrill Lynch. Lorraine Maikis Hutchinson - Bank of America Merrill Lynch Research: Thank you. Good afternoon. I was just hoping that you could give us some clarity on which of the categories you saw the most sequential improvement in during the Anniversary Sale, and how you're modeling receipts for those specific categories coming into the back-half? Peter E. Nordstrom - Director, Executive VP & President-Merchandising: This is Pete. We experienced some good success in a few categories. You heard us call out Beauty and Shoes, in particular. I think categories within there, boots were particularly good for us in Shoes. In Apparel, our denim business was strong, as were sweaters. In terms of how that impacts our inventory plans going forward, I think, for us, we're really well served to try to keep our inventory plans conservative. We've been able to prove over the years that we can exceed sales plans with conservative inventory plans. And when you do that, I mean, obviously it just – it creates a good scenario for us in reducing markdowns. So I think while we're happy about the sales results, we're very cautious not to over-invest either our plans just in the way that we're allocating inventory. So we're still taking a cautious approach here for the second half. Lorraine Maikis Hutchinson - Bank of America Merrill Lynch Research: Thank you.

Thank you. Our next question comes from Matthew Boss from JPMorgan. Matthew Robert Boss - JPMorgan Securities LLC: Thanks. So the Rack seems to be striking a really nice balance with stable brick-and-mortar and then outsized online growth, but the full-line still remains negative. What do you think off-price is delivering that the full-line's missing? And what's the best way to think about initiatives in place to drive better traffic at the full-line? Blake W. Nordstrom - Co-President & Director: Well – Matthew, this is Blake. We don't look at it as the Rack's doing something that the full-line store's missing, that those are different businesses. There's some similarities. But we're making terrific progress within the full-line stores. And that trend improved greatly in that second quarter. So the Rack's had a more consistent business the last couple of years than the full-line stores, but we've got a team on the full-price business, the Nordstrom brand. And we view it together, both the stores and the online, as one business. And it's, over time, becoming more and more merged because the customer doesn't view that as two different experiences. But, that said, there are experiences that – with products and experiences in the store and online that the customers desire and deems as good service, and it's a fluid thing. And we're working on a number of initiatives, and we're encouraged about, on the Anniversary Sale, the feedback and response we got and the opportunities we have going forward. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Hey, Matt. This is Mike. The one thing I would also add to that is you have to look at the relative maturity of the online channel in the full-price sector versus the off-price. And we're one of the few that actually have an online offering off-price. Most off-price is done in-store. So I think there's a little bit of apples and oranges there in terms of comparing the two. Matthew Robert Boss - JPMorgan Securities LLC: Great point. Good luck. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Yes. Thanks.

Thank you. Our next question comes from Jeff Stein from Northcoast Research. Jeffrey Stein - Northcoast Research Partners LLC: Yeah, guys. Question on the service levels in the store. If you continue to see drops in same-store sales, are you making adjustments in selling payroll? Because obviously your online business is more of a variable cost model and you've got that fixed cost in the store, and if it – we continue to see negative comps, obviously that is going to continue to weigh on your EBIT margins. But – so I guess I'm asking a question – I'm also making a comment. Do you risk – if that's the case, and if you do adjust payroll on the downside, are you risking service levels, I guess – inferior service levels in-store? Michael G. Koppel - Chief Financial Officer & Executive Vice President: Sure. This is Mike. I think the first point I would make there is, certainly, a key differentiator for us is our service levels. So we're very conscious of assuring that we deliver that high level of service. But keep in mind, in our regular-price business in the full-line stores, that's a 100% commission-based sales force. So, by its very nature, it does adjust to the overall level of sales volume activity. And certainly, we also ensure that we have the right level of staffing there to ensure that we can deliver the right level of service. So I think that's something that we'd prefer not to compromise. Jeffrey Stein - Northcoast Research Partners LLC: Okay. Thank you.

Our next question comes from Paul Trussell from Deutsche Bank. Paul E. Trussell - Deutsche Bank Securities, Inc.: Hey. Good afternoon. I apologize if I missed it, but did you give the actual comp for the Anniversary Sale? And also, if you can just touch on the narrower spread between comp and overall sales growth this quarter. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Yeah, Paul. We didn't break out the actual Anniversary Sale comp. In terms of the difference between the total sales and the comp sales, the recent it was so – the spread was so narrow is, at the end of every quarter, we're required to make a number of adjustments that primarily relate to the timing of sales and the timing of returns at the end of every quarter. And because of the high volume of Anniversary, that tends to be a higher adjustment at the end of the second quarter. It's basically timing, and it's a GAAP adjustment. And that will reappear next quarter. Paul E. Trussell - Deutsche Bank Securities, Inc.: Got it. That's helpful. And then just a very quick follow-up. Could you just speak to merchandise margins in the second quarter versus your expectations coming in? And given where inventories are now, how should we think about that line item in the second half? Michael G. Koppel - Chief Financial Officer & Executive Vice President: Sure. Well, the line item that we report is gross profit. And interestingly enough, our overall merchandise margins in our Nordstrom brand, our full-price business, were roughly equal to last year. Most of the impact we had in negative merchandise margins came through the off-price business. We also had some deterioration in the gross profit as a result of increased occupancy costs with the opening of new Rack stores. But basically the regular-price business was roughly on – better than it – I'm sorry, better than expectations but equal to last year.

Thank you. Our next question comes from Lindsay Drucker Mann from Goldman Sachs. Lindsay Drucker Mann - Goldman Sachs & Co.: Thanks. Good afternoon, everyone. I was – is the big delta versus your expectation in 2Q the stronger execution in the Anniversary Sale? And if so, could you talk about maybe some of the things that you might have done differently this Anniversary Sale versus prior sales, besides just moving the date? Peter E. Nordstrom - Director, Executive VP & President-Merchandising: Yeah, this is Pete. No, I think it's fair to say that Anniversary was a good catalyst for us in terms of getting some positive top-line results, but I think what really made it happen for us is the way that we manage inventories, and we went into a very conservative plan at the beginning of the year when we recognized that the sales momentum and trends were tough. We've made the adjustments necessary for the sale given the current reality of the sales trends. And so, once we got that down, what happened is we ended up having very good sell-through on our Anniversary product, which puts us in a great position for the fall. So that's probably what contributes to the bottom-line the most, is just the efficient application and deployment of inventory. Lindsay Drucker Mann - Goldman Sachs & Co.: Great. Erik B. Nordstrom - Co-President and Director: And I'd just want to add – this is Erik – just mainly as is usually the case, it's the product that drives, especially Anniversary. But I think we did get some lift from the enhancement of our Rewards program. By launching the non-tender part of our Rewards program, it allowed us to connect with customers in a more direct way. Lindsay Drucker Mann - Goldman Sachs & Co.: Great. And I was hoping I could just follow up on traffic. Could you comment on sequential changes in traffic? Michael G. Koppel - Chief Financial Officer & Executive Vice President: Now, well, you know we really don't track traffic within our stores. I would say, generally speaking, it was roughly – for the quarter, roughly equivalent to what it has been. I don't think there was any big news there.

Thank you. Our next question comes from Kimberly Greenberger from Morgan Stanley. Kimberly Conroy Greenberger - Morgan Stanley & Co. LLC: Okay. Thank you so much. Mike, I just wanted to follow up on the merchandise margin comments. I thought you said that the pressure in merchandise margin is coming from the off-price business. Could you just talk about that a little bit, is that related to returns? Is it the off-price ecommerce business that's pressuring that margin? And did you see any increased markdowns in the full-price business? Michael G. Koppel - Chief Financial Officer & Executive Vice President: Okay. Yeah, Kimberly, I would say the markdown pressure that we were having in off-price is primarily related to the fact that we're still working through the operational challenges of operating an integrated in-store and online business. We still don't have all our systems fully aligned, we're still working through the challenges of taking online returns in the stores, and finding the right way to balance our inventories based on that kind of flow. And so, that caused us to take some more markdowns. Now that being said, we continue to make progress there and we're narrowing the gap, and I think as we go forward that should continue to be a better news story for us. In terms of full-line, the markdowns, I wouldn't say the markdowns were necessarily better than they were last year, but they were certainly better than our plan for the second quarter.

Thank you. Our next question comes from Omar Saad from Evercore ISI. Omar Saad - Evercore ISI: Good afternoon. Thanks for taking my question. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Sure. Omar Saad - Evercore ISI: I wanted to follow up on some the comments you just made about the loyalty program, the tender-agnostic version I think you rolled out in May. What you're seeing there, are you getting a lot of sign-ups from new customers, and how much you're able to expand that program in terms of members? Is the program, from the consumer side, the same sort of benefits, whether you're participating in the credit card or whether you're a tender-agnostic loyalty member? What kind of information you can get from that program as you build out that base? It seems pretty interesting from our perspective. Thanks. Erik B. Nordstrom - Co-President and Director: Yeah, thanks, Omar. This is Erik. The program works – for a non-tender, the rewards are one point for every dollar spent where it's two points for every dollar spent if a customer has our card, so it's a little different level of reward there. The real appeal of – to refer – the one for customers is there's just no barrier to sign up. It's an e-mail. The identifier is the customer's mobile number, and it takes a few seconds to sign-up and anyone can participate in it. So it's been received really well by customers who just see it as a very friction-free way of enhancing their and being rewarded for their shopping experience. For us, we've – as you know, our Reward program has long been one of the main drivers of our business, our attention, our loyalty, and it helps. I mean, getting those reward notes out to customers really helps. But the second piece, which I think is what you're touching on is the information, having a lot more customers involved in our program, and we've signed up through the quarter about 1.5 million customers into our non-tender program. It allows us to, number one, connect with them; and number two, deliver a much more personalized experience for them. So that's the longer-term unlock that we're particularly excited about.

Thank you. Our next question comes from Paul Lejuez from Citi. Paul Lejuez - Citigroup Global Markets, Inc. (Broker): Hey. Thanks, guys. Just going back to the merchandise margin pressure at Rack, I'm just curious, can you just remind us what percent of Rack's product comes from the full-line stores? And has that changed over the last couple of quarters? Is that having any sort of an impact on merch margin at Rack? When you talk about merch margins, how do you account for the product that transfers from full-price to Rack? Does it count against full-price merch margins or Rack? And just where do you see that mix going forward in terms of what percent of Rack's product comes from full-price? Thanks. Blake W. Nordstrom - Co-President & Director: Paul, this is Blake. It's been fairly consistent for some time, and where it does change very slightly is if we change, in any material way, the amount of Racks we have, because the full-line stores have been fairly consistent. But it's approximately 15% of the merchandise, at this point, comes from the full-line stores, and then the rest of the merchandise are with our top vendors, their closeouts, and it's – and that merchandise allows us to be very current and have a good offering in sizes and balance. In terms of the margin, and Mike alluded to it earlier, there's different components that affect the markdowns, and part of it is the merchandise that comes from the full-line stores. So we're dealing with immediate impact today, but there's also a tail to it, so as we're addressing merchandise over the last – first half of the year, it has go through our system, both the full-line stores and online and then through our Racks. And so, some of that stuff that didn't sell well at full-price has been challenged a little bit at off-price, and so we're taking the necessary markdowns in all of our businesses upfront to try to address what is the right price to clear these goods. And I think, overall, the most important thing is, whether it's the Rack or our stores, we're in one of the best inventory positions we've been in, in many years. We're able to respond to the customer, partner with our vendors and have good flow, and a lot of good things come from that.

Thank you. Our next question comes from Brian Tunick from RBC Capital Markets. Brian Jay Tunick - RBC Capital Markets LLC: Thanks very much, and good afternoon. I think last quarter you talked about a big delta between your sale customer and your full-price customers. So just wondering, prior to the Anniversary Sale, if you were seeing any change in customer shopping patterns. And then as far as your gross margin opportunity to recover, price matching I know has been a big issue and now we talk about some of the vendors wanting to pullback themselves from the Friends & Family and couponing. So just have you changed your perspective on what price matching means to your customer now that it seems like every client out there is already looking at transparency? Erik B. Nordstrom - Co-President and Director: I'll take the first one. This is Erik. And Pete will take the second. As far as comparing our regular-price customers to our sale customers, look, the first thing to understand is Anniversary is unlike any other sale, certainly we have, and I think unlike any sales out there. It's not a clearance sale, so it's not older merchandise that's priced to clear out in broken size runs. It's just brand-new merchandise that – full-size runs that we mark back up after the sale. So the behavior we've long seen from customers around Anniversary is much more around a regular-price customer who is motivated by newness than it is a sale customer that's motivated by price promotion. So, in that regard, I would say our trends have really been unchanged, that our business continues to be driven by customers who are looking for newness as opposed to customers looking for the one-day sale. Peter E. Nordstrom - Director, Executive VP & President-Merchandising: With regards to price matching – this is Pete – our practices remain the same. But I think it's fair to say that the promotional activity has stabilized a bit here in the last quarter or so. To the point you made, there's vendors out there choosing to participate in different ways than they may have in the past with our competitors. What we're trying to do is put ourselves in a real favorable position with vendors to be the retailer of choice for them, and what that means for most of the vendors we deal with is our desire, strong desire, to sell at full-price. And so, we focus a lot on flow and newness and all that. So I think in terms of the price matching thing, it's – we've had a lot of success and growth with brands, again, that are aligned with us in trying to sell at full-price. And where you see kind of the growth by brand in some of these brands that maybe aren't entirely ubiquitously distributed but have good growth prospects and we try to identify those brands kind of early-on in that trajectory so we can partner with them to grow really healthy business together.

Thank you. Our next question comes from Richard Jaffe from Stifel. Richard Jaffe - Stifel, Nicolaus & Co., Inc.: Thanks very much, guys, and congratulations. Really lots of good news in the call. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Thanks, Richard. Richard Jaffe - Stifel, Nicolaus & Co., Inc.: It's my pleasure. The Canadian business, I know, has a different leasing structure and you're ending up paying rent before you would generate sales to offset that rent. And I'm wondering where that process stands? I know you've opened a few Canadian stores. Are you now paying rent on the next wave of Canadian stores, and the size of that liability, if you will? And then a second question, if you would. Thank you. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Sure. Richard, this is Mike. As you may recall, we have shared, and I think we shared directionally on one of the slides the impact that our investment in Canada is having on our P&L, and some of that does relate to how we need to recognize rent. Right now, we have three full-line stores that are yet to open that are in process; two that will open this fall that will start to get some sales, and the third that will open next spring. So I think some – in 2017, we should start to see the overall volumes of the six stores we'll have there start to move forward and mitigate the loss impact from all those investments. Richard Jaffe - Stifel, Nicolaus & Co., Inc.: And I read somewhere that Canada – Canada, I'm sorry; New York City, is 2019, is that in time for the holiday season 2019, or still a work in progress? Michael G. Koppel - Chief Financial Officer & Executive Vice President: Well, I would say, overall, it's still a work in progress, but we'd love to be open by holiday 2019. Peter E. Nordstrom - Director, Executive VP & President-Merchandising: That's our plan; yes.

Thank you. Our next question comes from Ed Yruma from KeyBanc. Edward J. Yruma - KeyBanc Capital Markets Inc./Pacific Crest Securities: Hi. Good afternoon. Thanks for taking my question. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Sure, Ed. Edward J. Yruma - KeyBanc Capital Markets Inc./Pacific Crest Securities: Just real quickly on Trunk Club, in looking at the slide you have on 10, it looks like you've been able to, or at least point to minimization of some of the other costs of Canada and Rack, dot-com. I guess how should we think about the cost trajectory at Trunk Club? And then as a follow-up, I noticed you tweaked your credit income guidance a little bit, so any insight into drivers there would be helpful. Thank you. Erik B. Nordstrom - Co-President and Director: Okay. This is Erik. I'll take the Trunk Club question. Trunk Club is – we've had it for two years. It's still I think very much a start-up business that's having high growth. Our results have been in-line with our expectations. But it's a business that is increasingly getting integrated into our business. The merchandising and supply chain would be probably the biggest examples. So it certainly helps from leveraging costs, but more, it's leveraging capabilities to deliver a better customer experience. So I think you'll see us continue to find ways to integrate it and leverage the strengths of our businesses to serve customers across those channels. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Ed, in terms of the credit side of the business, there's a couple things in there. One is that we've made some very good progress on improving our fraud results, and that has shown a better-than-plan performance. And, in addition, we're starting to see some early signs of some benefits of our partnership from – in the revenue-sharing agreement we have. So we had a little good news on the top-line there and some good news within the expense and credit.

Thank you. Our next question comes from Michael Binetti from UBS. Michael Binetti - UBS Securities LLC: Oh, hey, guys. Congrats on a nice quarter. Could you... Michael G. Koppel - Chief Financial Officer & Executive Vice President: Thanks, Michael. Michael Binetti - UBS Securities LLC: Could you help us on – just reconcile a couple of things really quickly. From a position of strength, I suppose, as you've accelerated the Rack a little bit now and you sound a much more positive on the outlook there than you have in the last few quarters, but you did lower your long-term store outlook for Rack, and I think it was part of a bigger capital tightening plan. But as a bigger picture relatively, this is a relatively low store-count chain at this point. Can you help us think about how you see the store opportunity longer-term here if the reduction that you did make was done more out of a necessity during some fairly high volatility around the P&L that the industry saw over the last few quarters? Blake W. Nordstrom - Co-President & Director: Michael, this is Blake. We shared a couple quarters back that we had an estimate that we thought we could be around 300 stores by 2020. We are sensitive to the capital deployment but as we've said, the Rack stores have been a good return on the shareholders' investment. I think what we said in our remarks and what we're mindful of is just the terrific growth online that's coming, and so we want to be sensitive with our resources and what we're short-term committing to. So we didn't have, when we talked about 300 stores to be exact, that include Canada. We think Canada could have roughly 15 Racks when we're done. We start with our first Rack in 2018 I believe, and so when we put the 15 stores with kind of the reduced number, we're just shy of 300 stores at this point, but it's not a linear thing. When these opportunities come forward in key locations, we take advantage of that and that could go up a little bit or it could come down. But to the best of our knowledge today, we think it's just under 300 stores at this point by 2020.

Thank you. Our next question comes from Tom Forte from Maxim Group. Tom Forte - Maxim Group LLC: Great. Thanks for the questions. So two things. On the East Coast fulfillment center, should we think of the benefits on shorter ship miles as immediate or something that ramps up over time? And then on mobile ecommerce, can you talk at all about either conversion or mix of ecommerce sales that's coming from mobile ecommerce? Because it seems like you've made some adjustments to your app and improvements there. Thank you. Blake W. Nordstrom - Co-President & Director: So, Tom, this is Blake. On the East Coast fulfillment center, it's relatively new. We opened it last fall and it's ramping up. The first test was the holidays last year and then our Anniversary event, so it hasn't gotten to full capacity. And so what we're saying is that we're well-positioned where a good portion of our customers live, and so we're able to improve the delivery times and our execution, but it's not at full operating strength like our Cedar Rapids facility that's been open for some time. So I think the main thing is that we're on track at this early point one year in, and it's providing a meaningful way to service our customers with opportunities to be more efficient down the road. Erik B. Nordstrom - Co-President and Director: This is Erik. On the split between mobile and desktop for our ecommerce business, certainly mobile is outpacing desktop and it has been for some time and we've continued to see that, quite a delta between those channels. And just to clarify, we have two ways of conducting mobile commerce. One's through a mobile browser, the other's through our app, and both we're seeing quite outsized gains in.

Thank you. Our next question comes from Neely Tamminga from Piper Jaffray. Neely J. N. Tamminga - Piper Jaffray & Co. (Broker): Great. Good afternoon. Congratulations on a great result here. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Thanks, Neely. Neely J. N. Tamminga - Piper Jaffray & Co. (Broker): Yeah, you bet. So, Erik, for you, I think I remember hearing 5 million sign-ups for the Rewards of non-tender base, is that still – did I hear that right, and is that still on track? And more importantly, Anniversary Sale's a great catalyst to get people to sign up. Are there incremental events planned in the back half to drive that? And, Mike, for you a housekeeping question on SG&A. When you take that big large Anniversary Sale week and move it into Q3, I think back in 2012 it actually did drive some interesting and outsized sort of leverage on SG&A. Could you give us any sort of contextualization to guidance around, like, how we should be thinking about the SG&A leverage in Q3 this year because of the shift? Thank you. Erik B. Nordstrom - Co-President and Director: Hi, Neely. Yeah, it's – we look at it as one program, it's our Fashion Rewards program, and there's two ways for customers to participate in it. Overall, we're up to 6 million participants in the program and we're clearly in the early stages of the non-tender offer there. Anniversary provides tremendous opportunity to sign-up customers for our Rewards program, it always has. It's been a big driver of opening our credit accounts previously. Now, it does provide the opportunity to additionally add the non-tender portion of it. So we're very pleased with the rate of sign-ups in both the card and the non-tender and have a lot of plans to continue that. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Neely, in terms of the SG&A, we haven't broken that out by quarter. Those assumptions are included in our guidance for the year. But, that being said, it's probably a relatively consistent directionally accurate relationship between what happened in 2012.

Thank you. Our next question comes from Oliver Chen from Cowen. Oliver Chen - Cowen and Company, LLC: Hi. Thank you. I was curious about your customer research. On your customer research, what would you say customers really want that you don't yet offer? And what are the longer-term implications for how you allocate CapEx towards IT to kind of address what's evolving there? Also, related to the future – just on a long-term basis, how do you see your brand composition evolving in terms of ensuring that you have the specialness that is required in this new version of retail that we're in now? Peter E. Nordstrom - Director, Executive VP & President-Merchandising: I'll take the first part. I guess, what do we not have that customers want? You know, I would say... Oliver Chen - Cowen and Company, LLC: Yeah, I think you've been on top of it. You're like a case study for knowing the customer. That's what you guys do best. And you were ahead of the curve, like, five years ago with Rack and free shipping. So I'm sure – what's 5G and Generation Z, and what are they asking you for? Peter E. Nordstrom - Director, Executive VP & President-Merchandising: Well, this is Pete. I would say probably the evergreen subject there is any enabler to service – and technology has been the best enabler to improving customer service that we have in integrating multiple channels and all that stuff. So I think that that's going to be an ongoing deal for us. Outside of that, if you look at it more kind of in the bigger picture, it has so much to do with what we have to offer – the products we have to offer. And a big part of our success is online as we're able to add to our selection there. That was really helpful. Customers liked that a lot. And I think one of the things that happens slightly on the downside of that is the context it creates for some stores. There's so much more available online than there might be at any given store. So I think our ongoing challenge is to do the best we can to make sure each store has the best possible product offer that it has, and the kind of stuff that customers ask about are the things that are hard to get. And they ask for that everywhere. And that has to do with some of the limited distribution stuff that's obvious – that's usually connected to designer or what have you. But knowing we can't get that everywhere, we do the best we can to put it in places we think it'll be successful. But that's been an ongoing subject for us forever. And it's just retailing stuff that we work on every day. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Oliver, this is Mike. In terms of the IT, if you look at our allocation of capital today, we've got over a third of our capital focused on IT investment. And post the completion of Manhattan and Canada, it'll be even a larger proportion. So we're highly committed there, and if you ask what that's going to mean to the future and what we're trying to do, so much of the investment we're making today is to build a platform that's going to allow us to, in a much more frictionless way, develop applications for the customer to make the experience with us very dynamic and very easy. And so we're highly committed to making those investments. And the path we're on is, not only are we moving very fast to make those investments, but we're also learning as we go. So we're going to continue to move down that path. Blake W. Nordstrom - Co-President & Director: And Oliver, this is Blake. Your last question, as I recall, was on brand composition – composition and levels, degree of specialness. As I mentioned – both Mike and I did, we look at it from the Nordstrom brand, and which is our full-price stores, and dot-com, and Trunk Club business, and our Nordstrom Rack brand, which is inclusive of HauteLook and Nordstromrack.com as well. And so we think the customer views it that way. And there's an opportunity to be current and relevant, and to ensure that the experience they have, whether online or in our stores, through our people and through our product, is meeting and exceeding their expectations. And it's a very fluid thing. And we need to keep testing and trying things and evolve to be in lockstep with our customer. Trina Schurman - Director-Investor Relations: We'll now take one more question.

Thank you. Our last question comes from Mark Altschwager from Robert W. Baird. Mark R. Altschwager - Robert W. Baird & Co., Inc. (Broker): Great. Good afternoon, and congrats on a nice quarter. Michael G. Koppel - Chief Financial Officer & Executive Vice President: Thanks, Mark. Mark R. Altschwager - Robert W. Baird & Co., Inc. (Broker): Just wanted to dig into inventory one more time. Could you just talk about the trends you're seeing in the full-line versus the Rack? And really, are there any constraints in procuring the inventory that's needed to fuel growth in off-price? Peter E. Nordstrom - Director, Executive VP & President-Merchandising: This is Pete. At this time, we don't really see that. I mean, that's part of what Blake mentioned in terms of what we think is a reasonable growth plan for the Rack business. We have to contemplate that, getting the supply that we need from vendors. But to this point, that's not really been a challenge. Again, if we can position ourselves as the retailer of choice based on the type of business we're trying to do with full-price, doing it at a high service quality level and being able to present brands in the best possible way and with all the customers that we serve, that's a compelling – it's a compelling formula, I think, for vendors. So we just – it's not really been a challenge for us, at this point. It's ongoing and this stuff evolves. But at this point, we feel good about our plans going forward. Trina Schurman - Director-Investor Relations: Again, thank you for joining today's call. A replay, along with the slide presentation and prepared remarks, will be available for one year on our website. Thank you for your interest in Nordstrom.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.