Home products retailer Williams-Sonoma, Inc. (WSM) announced a profit for the third quarter that rose from last year and topped the expectation of market analysts. However, the company provided a cautious outlook for the key holiday quarter, warning of volatile consumer demand.
Sales rose nearly 8 percent for the quarter, helped by comparable store sales growth at its West Elm and Pottery Barn Kids brands.
The company reported net earnings for the third quarter of $70.5 million, or $0.77 per share. This compared to $64.9 million, or $0.68 per share, in the same period last year.
Analysts had been expecting the company to report earnings of $0.72 per share, according to figures compiled by Thomson Reuters.
Net revenues advanced to $1.23 billion, compared to $1.14 billion in last year's third quarter. This was slightly above the $1.22 billion analysts had predicted.
Comparable store sales growth came in at 4.5 percent for the quarter. The growth rate was down noticeably from last year, when comps were up by 8.7 percent.
Comparable store sales measure sales from existing stores and strip out the impact of new store openings. It is considered a key stat for measuring retail performance.
West Elm was the company's best brand in terms of comparable sales growth. While this is a smaller chain, its growth reached 15.7 percent. Pottery Barn Kids was another strong performer, with comparable store growth of 4.7 percent.
Williams-Sonoma's namesake brand posted a 1.2 percent advance in comparable store sales. Its Pottery Barn brand saw 2.0 percent growth.
Looking ahead, the company predicted earnings for the fourth quarter of $1.53 to $1.62 per share. Revenue is projected to come in between $1.575 billion and $1.630 billion.
Analysts were looking for a fourth-quarter profit of $1.67 per share on revenue of $1.64 billion.
For the full year, Williams-Sonoma is projecting a profit between $3.36 and $3.45 per share on revenue of between $4.965 billion and $5.020 billion. Analysts' full-year consensus calls for earnings of $3.44 per share and revenue for $5.02 billion.
Commenting on its forecast, Laura Alber, the company's president and CEO, warned that the "retail landscape and consumer demand has been more volatile" but said the company was positioned for market share gains because of its portfolio of brands.
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