Kitchenware and home goods retailer Williams-Sonoma (NYSE: WSM) met Wall Street’s revenue expectations in Q1 CY2026, with sales up 4.4% year on year to $1.81 billion. Its GAAP profit of $1.93 per share was 7.3% above analysts’ consensus estimates.
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Williams-Sonoma (WSM) Q1 CY2026 Highlights:
- Revenue: $1.81 billion vs analyst estimates of $1.80 billion (4.4% year-on-year growth, in line)
- EPS (GAAP): $1.93 vs analyst estimates of $1.80 (7.3% beat)
- Adjusted EBITDA: $377.3 million vs analyst estimates of $344.7 million (20.9% margin, 9.5% beat)
- Operating Margin: 16.2%, in line with the same quarter last year
- Free Cash Flow Margin: 5.5%, up from 3.5% in the same quarter last year
- Locations: 506 at quarter end, down from 508 in the same quarter last year
- Same-Store Sales rose 4.8% year on year (3.4% in the same quarter last year)
- Market Capitalization: $21.22 billion
Company Overview
Started in 1956 as a store specializing in French cookware, Williams-Sonoma (NYSE: WSM) is a specialty retailer of higher-end kitchenware, home goods, and furniture.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.
With $7.88 billion in revenue over the past 12 months, Williams-Sonoma is a mid-sized retailer, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale.
As you can see below, Williams-Sonoma’s demand was weak over the last three years. Its sales fell by 2.6% annually as it closed stores.
This quarter, Williams-Sonoma grew its revenue by 4.4% year on year, and its $1.81 billion of revenue was in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 4.5% over the next 12 months, an acceleration versus the last three years. This projection is noteworthy and indicates its newer products will spur better top-line performance.
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Store Performance
Number of Stores
A retailer’s store count often determines how much revenue it can generate.
Williams-Sonoma operated 506 locations in the latest quarter. Over the last two years, the company has generally closed its stores, averaging 1.6% annual declines.
When a retailer shutters stores, it usually means that brick-and-mortar demand is less than supply, and it is responding by closing underperforming locations to improve profitability.
Same-Store Sales
The change in a company's store base only tells one side of the story. The other is the performance of its existing locations and e-commerce sales, which informs management teams whether they should expand or downsize their physical footprints. Same-store sales provides a deeper understanding of this issue because it measures organic growth at brick-and-mortar shops for at least a year.
Williams-Sonoma’s demand within its existing locations has been relatively stable over the last two years but was below most retailers. On average, the company’s same-store sales have grown by 2% per year. Given its declining store base over the same period, this performance stems from a mixture of higher e-commerce sales and increased foot traffic at existing locations (closing stores can sometimes boost same-store sales).
In the latest quarter, Williams-Sonoma’s same-store sales rose 4.8% year on year. This growth was an acceleration from its historical levels, which is always an encouraging sign.
Key Takeaways from Williams-Sonoma’s Q1 Results
We were impressed by how significantly Williams-Sonoma blew past analysts’ EBITDA expectations this quarter. We were also happy its gross margin outperformed Wall Street’s estimates. Overall, we think this was a decent quarter with some key metrics above expectations. The stock traded up 2.2% to $184.23 immediately after reporting.
Williams-Sonoma had an encouraging quarter, but one earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
