Williams-Sonoma Inc
Q4 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +7.15%.
Did WSM Beat Earnings? Q4 2025 Results
Williams-Sonoma delivered a mixed but largely encouraging fourth quarter for fiscal 2025, beating on earnings while falling short of Wall Street's revenue target, as a calendar shift clouded the year-over-year comparison. GAAP diluted EPS of $3.04 cleared the $2.91 consensus by 4.46%, supported by a 20.3% operating margin and supply chain efficiencies that helped offset softer merchandise margins. Net revenues of $2.36 billion missed the $2.42 billion estimate and fell 4.3% from a year ago, though management noted the prior-year quarter included a 14th fiscal week, a meaningful headwind to the comparison. Beneath the headline, comparable brand revenue actually grew 3.2%, with the Williams Sonoma brand leading at 7.2% comp growth and West Elm adding 4.8%. Inventory rose 9.8% to $1.46 billion, with roughly $80 million tied to incremental tariff costs, a dynamic that looms large over fiscal 2026 guidance calling for net revenue growth of 2.7% to 6.7% and an operating margin of 17.5% to 18.1%, with tariff pressures expected to be heaviest in the first half of the year.
- Comparable brand revenue growth of +3.2% in Q4 and +3.5% for fiscal year
- Williams Sonoma brand led with 7.2% Q4 comp growth
- Favorable physical inventory results contributed +160 bps to Q4 gross margin
- Supply chain efficiencies contributed +50 bps to Q4 gross margin
- Lower employment expenses and advertising expenses partially offset SG&A pressure
- Strong consumer demand for distinctive products and brands
“We are proud of our strong finish to 2025. In Q4, our comp came in at +3.2%, and we delivered an operating margin of 20.3% with earnings per share of $3.04. Normalizing for the 53rd week last year and the tariff impact this year, we delivered substantial operating margin improvement versus last year. As we look forward to 2026 and beyond, we are confident in our competitive advantages that have allowed us to take market share, and our focus is on widening that advantage.”
Williams Sonoma CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2026, Williams-Sonoma expects annual net revenue growth of +2.7% to +6.7%, with comparable brand revenue growth of +2.0% to +6.0%, and an operating margin between 17.5% and 18.1%. Guidance assumes all current tariff rates remain in place for fiscal 2026, including Section 232, Section 301, and Section 122 tariffs, with no refund of IEEPA tariffs paid. The tariff impact will be front-loaded in the first half of fiscal 2026 as tariffs flow through weighted average cost of goods sold. Although Section 122 tariffs expire in July 2026, guidance assumes replacement at a similar rate. 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.