Williams-Sonoma Inc
Q1 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: −1.28%.
Did WSM Beat Earnings? Q1 2026 Results
Williams-Sonoma posted a solid fiscal first quarter, with every brand delivering positive comparable sales growth as the home furnishings retailer navigated a challenging tariff environment better than Wall Street had anticipated. GAAP diluted EPS of $1.93 beat the consensus estimate of $1.80 by 7.34%, while net revenues of $1.81 billion rose 4.3% year-over-year and edged past the $1.80 billion street estimate, fueled by comparable brand revenue growth of 4.8%. The headline numbers, however, masked real cost pressure: operating margin contracted 60 basis points to 16.2% as roughly $60 million in incremental tariff costs weighed on merchandise margins and pushed inventory 9% higher year-over-year. <a href="https://247wallst.com/investing/2026/04/13/goldman-sachs-upgrades-williams-sonoma-to-buy-after-a-14-pullback-from-february-highs/">Supply chain efficiencies</a> partially cushioned that hit, while the company returned $373 million to shareholders through buybacks and dividends. Management reiterated fiscal 2026 guidance calling for revenue growth of 2.7% to 6.7% and operating margins between 17.5% and 18.1%, assuming current tariff rates remain fully in place for the year.
- Comparable brand revenue growth of 4.8% with all brands posting positive comps
- West Elm led brand growth at 8.5% comparable brand revenue increase
- Supply chain efficiencies contributed +50bps to gross margin
- Occupancy leverage of +20bps
- Advertising expense leverage of -10bps
- Share repurchase activity reducing diluted share count from 124,789 to 119,894
“We are off to a strong start in 2026. In Q1, our comp came in at 4.8%, and we delivered an operating margin of 16.2% with earnings per share of $1.93. Every brand delivered a positive comp in the quarter, driven by the strength of our portfolio, our channels, and our teams.”
Williams Sonoma CEO, on the earnings call
Forward Guidance & Outlook
Williams-Sonoma reiterated its fiscal 2026 and long-term guidance. For fiscal 2026, the company expects annual net revenues in the range of +2.7% to +6.7%, with comps in the range of +2.0% to +6.0%, and an operating margin between 17.5% and 18.1%. The guidance assumes elevated oil prices, no refund of tariffs paid, front-loaded tariff impact in the first half via weighted average COGS, and all current tariff rates (Section 232, Section 301, Section 122) remaining in place. Annual interest income is expected to be approximately $25 million with an effective tax rate of approximately 25.5%. 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.