Williams-Sonoma Q1 beats forecasts, raises guidance and returns $373 M
WSM•Williams-Sonoma reported Q1 revenue of $1.81 billion, exceeding estimates by $10 million, and EPS of $1.93, beating forecasts by $0.12. The retailer reaffirmed fiscal 2026 guidance for 2.7–6.7% net revenue growth and 17.5–18.1% operating margin, while returning $373 million to shareholders.
1. Q1 Financial Results
Williams-Sonoma delivered revenue of $1.81 billion versus $1.80 billion expected and diluted EPS of $1.93 compared with $1.81 consensus, reflecting broad-based sales growth across all brands and 4.3% year-over-year EPS improvement.
2. Fiscal 2026 Outlook
The company reaffirmed annual net revenue growth guidance of 2.7–6.7% and projected comparable sales growth of 2–6%, along with an operating margin target of 17.5–18.1%, assuming steady tariffs and oil prices.
3. Cost and Margin Dynamics
Gross margin dipped to 44.0% due to tariff-related costs and lower merchandise margins, partially offset by supply chain efficiencies; SG&A expenses rose modestly on higher employment and general costs.
4. Financial Position and Returns
Inventory rose 9% to $1.46 billion, including $60 million in tariff costs, while cash reached $652 million and operating cash flow was $156 million; $373 million was returned via $288 million in buybacks and $85 million in dividends.
