Williams-Sonoma (WSM) Q2 2027 earnings summary

Executive summary

• Achieved Q2 comparable brand revenue growth of 6.2% and total revenue growth of 6.7% year-over-year, outperforming a flat home furnishings industry and gaining market share.

• All brands posted positive comps, with notable strength in Pottery Barn (5.1%), Williams Sonoma (7.6%), West Elm (6.4%), and double-digit growth in emerging brands and B2B (14.5%).

• Raised full-year 2026 guidance for both revenue and operating margin, reflecting confidence in ongoing initiatives and execution.

• GAAP operating margin reached 22.9% and non-GAAP operating margin was 17.3%.

• GAAP diluted EPS was $2.84 (+42% YoY); non-GAAP diluted EPS was $2.10 (+5% YoY).

Financial highlights

• Q2 net revenues reached $1.96 billion, up 6.7% year-over-year.

• Operating income (GAAP) was $449 million (22.9% margin); non-GAAP was $338 million (17.3% margin).

• Gross margin (GAAP) was 51.6%, up 450bps YoY, driven by tariff refunds and supply chain efficiencies; non-GAAP gross margin was 45.5%, down 160bps YoY due to tariffs.

• Diluted EPS was $2.10, up 5% year-over-year (non-GAAP).

• Maintained strong liquidity with $1.0 billion in cash and $696 million in operating cash flow.

Outlook and guidance

• Raised FY2026 guidance: comparable brand revenue growth of 4%-6.5%, total net revenue growth of 4.7%-7.2%.

• Non-GAAP operating margin guidance increased to 17.8%-18.2%.

• Guidance assumes all current tariffs remain, elevated oil prices, and no further tariff refund benefits.

• Long-term outlook reiterated: mid to high single-digit revenue growth, operating margins in the mid to high teens.