West Elm’s strong comps highlighted a positive third quarter performance for Williams-Sonoma. The company also plans to acquire Outward, a home decor oriented augmented reality technology platform.
Comparable brand revenue for the company was up 3.3% in the third quarter year over year. All Pottery Barn brands delivered positive comps in the third quarter except Pottery Barn, which was negative 0.3%. Comps at West Elm had the biggest gain, up 11.5%, followed by PBteen, up 3%, Williams-Sonoma, up 2.3% and Pottery Barn Kids, up 0.1%.
Net revenues for the third quarter were $1.3 billion versus $1.25 billion in the year-earlier quarter. In the 2017 quarter, e-commerce represented 53.1% of total revenues. Operating income was $110.8 million versus $110 million in the previous third quarter.
For the third quarter ended October 29, Williams-Sonoma posted net earnings of $71.3 million, or 84 cents per diluted share, versus $69.4 million, or 78 cents per share, in the year-prior period. Earnings per diluted share matched a MarketBeat published analyst average estimate.
Diluted earnings per share in the third quarter incorporated an unfavorable impact of approximately two cents from the impact of lost sales associated with the hurricanes that recently hit the U.S. With severance-related reorganization charges excluded, non-GAAP EPS was 79 cents in the 2016 period.
“Our third quarter results demonstrate the effectiveness of our strategic priorities to deliver value, quality and excellent customer service,” said Laura Alber, Williams-Sonoma president and CEO. “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. 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.”
Alber added that Williams-Sonoma “initiatives are underpinned by our vision to create a high-touch customer service platform that is truly transformational for the home furnishings industry. Our acquisition of Outward, Inc. will enhance and extend this platform and enable us to create highly engaging and interactive shopping experiences that set a new industry standard.”