Williams-Sonoma to Post Q1 Earnings: What's in Store for the Stock?

Core Viewpoint - Williams-Sonoma, Inc. is set to release its first-quarter fiscal 2025 results, with expectations of mixed performance due to various market factors impacting sales and earnings [1][5]. Financial Performance - In the last reported quarter, Williams-Sonoma's earnings exceeded the Zacks Consensus Estimate by 12.7%, marking a year-over-year increase of 20.6%. Revenues also surpassed expectations by 5.4%, with an 8% year-over-year growth [1]. - The average earnings surprise over the last four quarters has been 19.2%, indicating a consistent trend of better-than-expected performance [2]. Q1 Estimates - The Zacks Consensus Estimate for Q1 earnings per share (EPS) is $1.76, reflecting a decrease of 13.7% from $2.04 reported in the same quarter last year. Revenue expectations are set at $1.67 billion, a slight increase of 0.5% from $1.76 billion year-over-year [3]. Factors Influencing Performance - Expected growth in the first quarter is attributed to the multi-channel, multi-brand platform, strong e-commerce growth, strategic initiatives, digital leadership, and product innovation. International expansion and new collaborations are also anticipated to support growth [4]. - However, the challenging sales environment in the home furnishings sector, particularly due to the weak U.S. housing market, is likely to negatively impact results. Fluctuations in mortgage rates and reduced consumer spending following tariff announcements may further exacerbate this issue [5]. Brand Performance Projections - Revenue projections for the Pottery Barn brand are estimated at $658.9 million, a decline of 2.7% year-over-year. West Elm's revenues are expected to reach $438.9 million, an increase of 2% from the previous year [6]. - The namesake brand's revenues are projected at $240.2 million, a slight increase of 0.8% year-over-year. Pottery Barn Kids and Teen brand revenues are expected to be $228.5 million, up 3% year-over-year [7]. Comparable Store Sales (Comps) Expectations - Pottery Barn Kids and Teen's comps growth is expected to be 3%, compared to a 2.8% increase a year ago. Pottery Barn's comps are projected to decline by 2.5% year-over-year, while West Elm's comps are expected to increase by 2% [8]. - The namesake brand's comps are anticipated to rise by 1%, showing a modest improvement from the previous year's 0.9% increase [9]. Earnings Prediction Model - The current model does not predict an earnings beat for Williams-Sonoma, as the Earnings ESP stands at -1.14% and the company holds a Zacks Rank of 3 (Hold) [11][12].