What happened
Shares of upscale home-goods retailer Williams-Sonoma (WSM 0.06%) surged on Friday, after the company reported results for the quarter ended May 5 that were well above Wall Street's expectations.
Williams-Sonoma's shares ended Friday's session at $83.21, up 13.9% on the day.
So what
Williams-Sonoma's results for its fiscal first quarter were surprisingly good given that its stores were closed for most of the period. Net income of $35.4 million was down from $52.7 million in the year-ago quarter, but it was far better than the loss that Wall Street had expected.
Image source: Williams-Sonoma.
On a non-GAAP adjusted basis, Williams-Sonoma earned $0.74 per share on revenue of $1.235 billion. That was a double beat: Wall Street analysts polled by Thomson Reuters had expected a loss of $0.15 per share on revenue of $1.02 billion.
CEO Laura Alber attributed the results to the company's strong and growing online storefronts.
"Our teams maximized demand online, leaning into new and innovative ways to engage and serve our customers virtually," Alber said. "We gained market share with strong new customer growth in our DTC business, giving us even more confidence in the growth trajectory of our e-commerce business longer term."
Now what
Understandably, given the ongoing economic uncertainties, Williams-Sonoma declined to provide consumer-discretionary investors with guidance for the remainder of the 2020 fiscal year. But it reiterated its longer-term financial targets:
- Revenue growth in the mid to high-single-digit percentage range.
- Non-GAAP operating income growth in line with revenue growth, driving operating margin stability.
- Return on invested capital above the industry average.
