What happened
Shares of Williams-Sonoma, Inc. (WSM 0.27%) are surging today, up 11% as of 10:27 a.m. EDT, after the specialty retailer of high-quality home furnishing products announced strong fiscal first-quarter 2018 results.
So what
Williams-Sonoma posted robust net revenue growth of 8.2%, powered by a 5.5% jump in comparable-brand revenue growth. Adjusted earnings per share checked in at $0.67, which was higher than analysts' estimates calling for $0.58 and well above the prior year's $0.51-per-share result. Williams-Sonoma's e-commerce success has always been at the core of investors' bull thesis, and it didn't disappoint this quarter: E-commerce net revenue grew 11.3% to account for 53.7% of total company net revenue.
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"Our customer growth continued to trend positively for both new and existing customers, demonstrating the success of our balanced customer acquisition strategy," said Laura Alber, president and CEO, in a press release. "These results speak to the power of our established multi-channel model, distinctive brand portfolio and world-class customer service heritage -- all of which are our company's competitive strengths."
Now what
Another great sign from Williams-Sonoma's first quarter was that its merchandise inventory only increased 1.5%, which is significantly below its 8.2% net revenue growth, suggesting much more efficient and profitable inventory management and sell-through. Last, but not least, management raised full-year guidance for net revenue by $20 million and for EPS by $0.03.
All told, it was a strong first quarter that continues momentum from a solid end to 2017.
