Williams-Sonoma Inc
Q2 2027 Earnings
GAAP EPS of $2.84 includes net tariff refund benefit: $167.8M COGS reduction from IEEPA tariff refunds, $6.3M interest income on refunds, partially offset by $47.5M vendor concession provision and $10.0M one-time employee 401(k) contribution. Non-GAAP EPS of $2.10 excludes all tariff-related items.
Market Reaction
Did WSM Beat Earnings? Q2 2027 Results
Williams-Sonoma posted a clean beat across the board in its fiscal second quarter of 2027, extending its streak of topping Wall Street expectations to five consecutive quarters. The home furnishings retailer reported adjusted non-GAAP diluted EPS of $2.10, edging past the $2.06 consensus by 2.12%, while revenue of $1.96 billion came in 1.84% ahead of estimates and grew 6.7% year over year. The quarter's standout driver was broad-based brand momentum, with every nameplate contributing positive comparable sales, led by Williams-Sonoma brand at 7.6%, West Elm at 6.4%, Pottery Barn at 5.1%, and Pottery Barn Kids and Teen at 3.5%. It's worth noting that tariff refund activity created a sharp divergence between GAAP and non-GAAP results, with GAAP diluted EPS reaching $2.84 after a $167.80 million cost-of-goods reduction from IEEPA tariff refunds. Management raised its full-year revenue growth outlook to 4.7% to 7.2%, with non-GAAP operating margin guided to 17.8% to 18.2%, even as the company assumes all current tariffs remain in effect for the remainder of fiscal 2026.
- Comparable brand revenue growth of 6.2% with all brands delivering positive comps
- Supply chain efficiencies contributing +30bps to non-GAAP gross margin
- Occupancy leverage of +40bps driven by revenue growth against relatively stable occupancy costs
- Employment expense leverage of -120bps on a non-GAAP basis
- Market share gains outperforming the broader home furnishings industry
- IEEPA tariff refund income of $167.8 million recognized in cost of goods sold (GAAP impact)
“We delivered a very strong second quarter. In Q2, our comp came in at 6.2%, with total revenue growth of 6.7%, and we drove an operating margin of 17.3% with earnings per share of $2.10. Every brand delivered again in the quarter, driven by strong execution across our brands, our channels, and our team.”
Williams Sonoma CEO, on the earnings call
Forward Guidance & Outlook
Williams-Sonoma raised its fiscal 2026 guidance. The company now expects annual net revenue growth of 4.7% to 7.2%, with comparable brand revenue growth of 4.0% to 6.5%, and non-GAAP operating margin of 17.8% to 18.2%. Guidance assumes all current tariffs remain in place (Section 232, existing and new Section 301, and Canada-U.S. tariffs), elevated oil prices for the remainder of the year, and no further benefit from tariff refunds or related interest. The company expects annual interest income of approximately $25 million and an effective tax rate of approximately 26%, both on a non-GAAP basis. Over the long term, the company continues to expect mid-to-high single-digit annual net revenue growth with an operating margin in the mid-to-high teens.
WSM YoY Financials
WSM Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.