Williams-Sonoma Q4 Highlights: 2% Revenue Decline, Bottom-Line Beat, Margin Pressure, Dividend Hike & More

Home retailer Williams-Sonoma, Inc WSM reported a fourth-quarter FY22 revenue decline of 1.9% year-over-year to $2.45 billion, missing the consensus of $2.60 billion.
Adjusted EPS was $5.50 (+1.5 Y/Y), above the consensus of $5.46.
WSM clocked comparable brand revenue decline of (0.6)%, including Pottery Barn growth at 5.8%, West Elm decline at (10.7)%, and Williams Sonoma down at (2.5)%.
The gross margin was 41.2%, down by 380 bps, driven by higher inbound and outbound shipping and freight costs with an occupancy deleverage of 60 bps.
Adjusted operating margin contracted from 21% to 19.9%, and the GAAP operating margin compressed by 182 bps to 19.2%.
The company held cash and equivalents of $367 million in cash and over $1.0 billion in operating cash flow for the fiscal.
Dividend: Williams Sonoma increased its quarterly cash dividend by 15% to $0.90 per share, payable on May 26, 2023, to stockholders of record on Apr. 21, 2023.
Buyback: The company's Board also approved a new $1 billion stock repurchase authorization, which supersedes the company's current stock repurchase authorization.
FY23 Outlook: Williams-Sonoma expects annual net revenue growth of -3% to +3% with an operating margin of 14% - 15%.
The company expects mid-to-high single-digit annual net revenue growth in the long term, with an operating margin above 15%.
Price Action: WSM shares are trading higher by 2.41% at $121.46 on the last check Thursday.

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