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November 27, 2025 • 4 min read
Williams-Sonoma, Inc., the specialty retailer behind popular home goods brands like Pottery Barn, West Elm, and its namesake Williams Sonoma stores, recently released its financial results for the third quarter of fiscal 2025. Let's dive into the company's latest 10-Q filing to see how it's performing and what the numbers tell us about its current standing.
For the thirteen weeks ending November 2, 2025, Williams-Sonoma reported net revenues of $1.88 billion, a healthy 4.6% increase from the $1.80 billion generated in the same period last year. This growth is particularly noteworthy when looking at the performance of its individual brands, which all showed positive momentum.
The company's "comparable brand revenue," a key metric that measures sales growth in stores and online channels open for at least a year, turned positive across the portfolio, reversing declines seen in the prior year.
This broad-based strength suggests that the company's product assortments and marketing strategies are resonating with consumers across its different customer segments.
While growing sales is crucial, managing costs to turn that revenue into profit is just as important. For the third quarter, Williams-Sonoma generated net earnings of $241.6 million, a slight increase from $237.3 million a year ago.
This flow from revenue to expenses and ultimately to net earnings for the quarter is visualized below.
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The company's gross margin—the percentage of revenue left after accounting for the cost of goods sold—improved to 46.1% from 45.4% last year. This indicates better profitability on the products it sells. However, this gain was mostly offset by an increase in Selling, General, and Administrative (SG&A) expenses, which rose to 29.1% of revenue from 28.5% in the prior year. This uptick in spending on areas like advertising and employee costs meant that the operating margin remained essentially flat at 16.9%.
Despite the modest increase in net income, diluted earnings per share (EPS) grew by a more robust 4.8% to $1.96, up from $1.87. This outpaced growth in net earnings is primarily due to the company's active share repurchase program, which reduces the number of shares outstanding and boosts the earnings attributable to each remaining share.
Williams-Sonoma continued its focus on returning value to its investors. Over the first nine months of the fiscal year, the company demonstrated significant capital allocation through:
In the final five weeks of the third quarter alone, the company repurchased over 1.4 million shares for approximately $267 million. As of November 2, 2025, Williams-Sonoma still had approximately $637 million authorized for future repurchases under its program, signaling continued confidence from management in the company's long-term value.
Williams-Sonoma's third-quarter results paint a picture of a company regaining its footing with solid, across-the-board brand growth. The strong performance of the Williams Sonoma brand is a particular highlight. While the company is successfully managing its cost of goods to improve gross margins, rising operating expenses are a key area to monitor. The aggressive share buyback strategy continues to provide a direct boost to shareholder returns, reflecting a healthy financial position and a confident outlook from leadership.
Last updated: November 27, 2025