Who said luxury retailing was in trouble? Certainly not Nordstrom (NYSE: JWN), which reported some pretty impressive figures last night considering that worries over consumer spending are still fresh on everyone's mind.

The retailer of luxury apparel and jewelry reported a 25% increase in net income on a 12% jump in overall sales. Perhaps more impressive, the company's same-store sales figures showed a 6.5% rise over the year-ago period. Same-store sales figures are important because they negate the impact of newly opened and recently closed stores on revenue and give us a more direct comparison to the true health of a company. Based on these numbers, Nordstrom is doing great.

The company attributed its bullish results to growth in its designer apparel, jewelry, and men's apparel segments. As the piece de resistance of the report, Nordstrom also announced a $750 million stock buyback concurrent with the $235 million it has remaining on a previous buyback.

So the stock must be shooting higher, right? Not quite.

Cotton and commodities and guidance, oh my!
At the heart of the selling pressure behind Nordstrom's performance are worries over its acquisition costs in purchasing online retailer HauteLook, and rapidly rising commodity prices.

HauteLook, a flash-sale site that allows members who sign up to purchase designer clothing at discount prices for a limited time, was purchased by Nordstrom in February for $270 million in stock. The acquisition costs associated with the all-stock purchase drove Nordstrom's full-year guidance down by $0.15 from a range of $2.95 to $3.10 to $2.80 to $2.95.

Not mentioned in the report, but clearly at the forefront of investors' minds, is just how clearly rising commodity costs might affect future sales. Cotton prices are at multidecade highs, and designer denim products, which use high levels of cotton, could come under pressure. More worrisome is Nordstrom's jewelry line, which could find its margins pinched by rapidly rising gold and silver prices. A common misconception is that higher commodity prices are good for jewelry retailers, but this simply isn't the case. Higher gold and silver prices will simply crunch margins and cause consumers to push off their purchases to a later date.

Weighing in on Nordstrom
Weighing the good and the bad, Nordstrom appears to be outpacing most of its luxury peers. Luxury jewelry retailer Tiffany (NYSE: TIF) has recently been hurt by reduced spending from its Japanese clientele, while Coach (NYSE: COH) felt a similar slowdown stemming from the earthquake in Japan. Nordstrom is even keeping pace with other luxury designer lines, specifically True Religion Apparel (Nasdaq: TRLG). Both companies have thus far bucked the trend of rising cotton prices.

With a total share buyback of $985 million on the table through 2013, this represents more than 9% of its total shares outstanding. As Nordstrom's shares are reduced, the propensity for it to beat on earnings increases because those profits are compared against a shrinking share base. The company's future looks bright as long as commodity prices remain under control, and for the time being it looks like a solid choice in luxury retailing.

Are you a buyer of Nordstrom at these levels or are you waiting for its once a year sale? Share your thoughts in the comments section and consider adding Nordstrom as well as your own personalized list of stocks to My Watchlist.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. He would like to remind you not to forget about our friends in Japan who could still use a helping hand. You can follow him on CAPS under the screen name TMFUltraLong. Coach is a Motley Fool Stock Advisor recommendation. The Fool owns shares of Coach. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that's free of charge and full of value.