Williams-Sonoma Beats Q4 Estimates But Stock Tumbles On Soft 2025 Outlook

Williams-Sonoma, Inc. WSM stock plummeted after the company reported fourth-quarter 2024 results.

On Wednesday, the company reported that fourth-quarter revenue grew 8% year over year to $2.46 billion, beating the consensus of $2.35 billion. Comparable brand revenue was up 3.1%.

Adjusted earnings per share were $3.28, up from $2.72 the previous year, and above the analyst consensus of $2.93.

The gross margin expanded by 133 basis points to 47.3% from last year, driven by occupancy leverage (+80bps), higher merchandise margins (+40bps), and supply chain efficiencies (+10bps).

Related: Williams-Sonoma Gears Up For Q4 Print; Here Are The Recent Forecast Changes From Wall Street’s Most Accurate Analysts

Operating income reached $530.14 million (+15.7% YoY), with a record operating margin of 21.5%, up 140 bps year over year. Merchandise inventories grew 6.9% YoY to $1.33 billion.

The company maintained a liquidity position of $1.2 billion in cash and operating cash flow of $1.4 billion. It returned $1.1 billion to stockholders through $807 million in stock repurchases and $280 million in dividends.

“This success was fueled by the strength of our operating model, our standout seasonal offerings, our impactful collaborations, and a strong improvement in both retail and online furniture sales. On the full year, our comp ran down 1.6%. We delivered a record annual operating margin of 17.9% with full-year earnings per share of $8.50,” stated Laura Alber, President and Chief Executive Officer.

Dividend: Williams-Sonoma announced a 16% increase in its quarterly dividend to $0.66 per share, payable May 24, 2025, to shareholders of record as of April 17.

2025 Outlook: Williams-Sonoma net revenue is expected to range from -1.5% to +1.5%, comps from flat to +3.0%, and operating margin between 17.4% and 17.8%, including a 20bps impact from the prior year’s extra week.

Long-Term Guidance: The company continues to project mid-to-high single-digit annual revenue growth and operating margins in the mid-to-high teens.

Fiscal 2025 is a 52-week year vs. 53 weeks in fiscal 2024; comps will be reported on a 52-week basis for both years.

Price Action: Williams-Sonoma shares are trading lower by 11.1% at $153.14 at last check Wednesday.

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