Williams-Sonoma (WSM) Q3 Earnings Fall In-Line, West Elm Same-Store Sales Up 11.5%

Williams-Sonoma Inc. (NYSE:WSM) just released its second quarter fiscal 2017 financial results, posting earnings of 84 cents per share and revenues of $1.299 billion. Currently, WSM is a #3 (Hold) on the Zacks Rank, and is down over 8% to $48.50 per share in trading shortly after its earnings report was released.

Williams-Sonoma:

Matched earnings estimates. The retailer reported earnings of 84 cents per share, coming in line with the Zacks Consensus Estimate of 84 cents per share.

Matched revenue estimates. The company saw revenues of $1.299 billion, also meeting our consensus estimate of $1.29 billion and growing 4.3% year-over-year. E-commerce net revenuesincreased 6.4% to $690 million.

Total comparable brand revenue grew 3.3%. By brand, Pottery Barn saw comps dip 0.3%, while Williams Sonoma comps increased 2.3% and West Elm comps surged 11.5%. Additionally, PBteen witnessed an increase of 3% in same store sales, but Pottery Barn Kids declined 0.1%.

Operating margin was 8.5% compared to 8.8% in the year ago quarter.

Looking ahead, WSM expects total net revenues in the range of $1.61 billion to $1.675 billion for Q4. Comparable brand revenue growth is expected in the range of 2% and 6%, while diluted EPS should fall between $1.49 and $1.64 per share.

“During the quarter, strong execution against our product and digital initiatives drove new customer acquisition and top-line expansion in a competitive and dynamic retail environment. Importantly, our demand during the quarter exceeded or was at least equal to net revenues across all of our brands – most notably in Pottery Barn and PBteen – which is a strong indication of the health of our business. Additionally, our investments in digital innovation and cross-brand services, as well as continued optimization of our supply chain, position us to further differentiate our business and to deliver long-term profitable growth.”

Here’s a graph that looks at Williams-Sonoma’s price, consensus, and EPS surprise:

Williams-Sonoma, Inc. Price, Consensus and EPS Surprise

Williams-Sonoma, Inc. Price, Consensus and EPS Surprise | Williams-Sonoma, Inc. Quote

Williams-Sonoma, Inc. is specialty retailer of products for the home. The retail segment sells its products through its three retail concepts: Williams-Sonoma, Pottery Barn and Hold Everything. The direct-to-customer segment sells similar products through its five direct-mail catalogs, Williams-Sonoma, Pottery Barn, Pottery Barn Kids, Hold Everything and Chambers, and the Internet.

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