NEW YORK -- Upscale department store chain Nordstrom Inc. on Thursday reported better-than-expected profit and total revenue for the first quarter.

But sales at its established stores -- a key measure of a retailers' health -- showed meagre gains.

Shares in the Seattle-based company fell 7 per cent in after-market trading.

Department stores have been under financial pressure as more people shop online at off-price retailers or spend less money overall on clothing, which makes up a big part of their business.

Against a tough environment, the Nordstrom family -- including co-presidents Blake, Peter and Erik Nordstrom -- have offered take the company private so they could manage its reinvention away from the watch of the public markets.

But in March, the company rejected the offer -- $50 in cash for each share of the company that the family doesn't own, plus the same price for about 21 per cent of the company that the individual family members own. In total, family members, who are descents of founder John W. Nordstrom, own about 30 per cent of the company.

Meanwhile, Nordstrom is experimenting with new concepts to win back shoppers. It opened a store in Los Angeles that doesn't have any inventory. It's being staffed by personal stylists who can order merchandise for customers. It just opened its first Manhattan store -- a men's clothing store -- that has services like same-day delivery for a $20 fee and self-service kiosks for returns.

The department store chain earned $87 million, or 51 cents per share, on revenue of $3.56 billion.

That beat the average Street estimate for earnings per share of 42 cents on revenue of $3.47 billion, according to Zacks Investment Research.

In its full-price division, which consists of Nordstrom U.S. full-scale stores, Nordstrom.com, Trunk Club, revenue at stores comparable sales rose 0.7 per cent. The top-ranking merchandise was children's and men's clothing.

In the off-price sector, which consists of Nordstrom U.S. Rack stores, Nordstromrack.com/HauteLook and Last Chance clearance stores comparable sales increased 0.4 per cent.

Nordstrom expects full-year earnings to be $3.35 to $3.55 per share, with revenue in the range of $15.2 billion to $15.4 billion.

Analysts were expecting profits of $3.43 per share and revenue of $15.7 billion for the year, according to FactSet.

In after-hours extended trading, Nordstrom shares slid nearly $3.61 to $47.30 following the earnings report.