Williams-Sonoma (NYSE:WSM) announced better-than-expected fiscal fourth-quarter 2017 results earlier this week, highlighting accelerated top-line growth and positive sales trends at each of its core brand concepts.

Now that the dust has settled, let's pull back the curtains to get better view of how the home furnishings retailer ended its year, as well as what shareholders can expect as we peer ahead.

Furnished room with a blue armchair, tan couch, and blue-and-tan rug.

IMAGE SOURCE: WILLIAMS-SONOMA/POTTERY BARN.

Williams-Sonoma results: The raw numbers

Metric

Fiscal Q4 2017*

Fiscal Q4 2016

Year-Over-Year Change

Revenue

$1.680 billion

$1.582 billion

6.2%

GAAP net income

$95.8 million

$144.6 million

(33.7%)

GAAP earnings per diluted share

$1.13

$1.63

(30.7%)

DATA SOURCE: WILLIAMS-SONOMA. *FOR THE PERIOD ENDED JAN. 28, 2018.

What happened with Williams-Sonoma this quarter?

  • On a non-GAAP basis -- which notably adjusts for one-time acquisition expenses and the impact of recent U.S. tax reform -- earnings increased 8.4% to $1.68 per share.
  • By comparison, Williams-Sonoma's guidance (provided last quarter) called for lower revenue in the range of $1.610 billion to $1.675 billion and lower adjusted earnings per diluted share in the range of $1.49 to $1.64.
  • Comparable-brand revenue grew 5.4%, near the high end of guidance for a range of 2% to 6%, and accelerating from 3.3% last quarter.
  • By retail concept, comparable-brand revenue climbed 4.1% at Pottery Barn, 12.3% at West Elm, 4.3% at Williams Sonoma, 0.9% at Pottery Barn Kids, and 2.6% at PBteen.
  • E-commerce revenue jumped 8.4% to $877 million, or 52.2% of total sales (up from 51.1% this time one year ago).
  • Retail revenue went up 3.9% to $803 million.
  • Williams-Sonoma's board authorized a 10% boost in the company's quarterly dividend, bringing it to $0.43 per share.
  • The board also increased the amount available for repurchases under its existing stock-repurchase program to $500 million. For perspective, the program had $256 million remaining at the end of last quarter.
  • Closed on the previously announced $112 million acquisition of Outward, Inc., a 3D imaging and augmented reality platform focused on the home furnishings and decor industry.

What management had to say

Williams-Sonoma CEO Laura Alber added:

We ended the year with a strong fourth quarter. Our product and operational initiatives drove broad-based comp growth in all our brands and a substantial acceleration in e-commerce and retail revenue growth from last year. For the full year, we made significant progress against our strategic priorities to strengthen our competitive advantages and drive accelerated growth. With revenue and EPS growth of 4.1% and 5.2%, respectively, we ended the year again demonstrating our ability to consistently deliver top line and bottom line growth with robust cash flow generation.

Alber added that in the coming year, Williams-Sonoma will continue making strategic investments in digital advertising, technology, and improving its customer experience.

Looking forward

For the first quarter of fiscal 2018, Williams-Sonoma expects revenue in the range of $1.135 billion to $1.170 billion, assuming comparable-brand revenue growth of 2% to 5%. On the bottom line, that should translate to adjusted earnings per diluted share in the range of $0.55 to $0.60.

Finally, for the full fiscal-year 2018, the company sees revenue of $5.475 billion to $5.635 billion, assuming comparable-brand revenue growth remains consistent with the first quarter. Fiscal 2018 adjusted earnings should arrive in the range of $4.12 to $4.22 per share. The midpoints of both ranges sit slightly above consensus expectations.

All things considered, this was as strong a showing as investors could have asked of Williams-Sonoma -- especially when we recall that shares plunged immediately after last quarter's report in November, when the market deemed its near-term earnings guidance too conservative.

Thankfully, that wasn't the case this time. And I think Williams-Sonoma investors have every reason to celebrate as it operates from a position of strength today. 

Steve Symington has no position in any of the stocks mentioned. The Motley Fool recommends Williams-Sonoma. The Motley Fool has a disclosure policy.