Retailer Williams-Sonoma raises annual sales forecast on strong demand

Aug 27 (Reuters) - Williams-Sonoma raised its annual comparable sales forecast and beat Wall Street expectations for quarterly results on Wednesday, riding on resilient demand for its furniture and home furnishing products at its Pottery Barn and West Elm outlets.

The company now expects annual comparable sales to rise between 2% and 5%, compared with its previous forecast of flat to a 3% rise.

However, shares of the retailer were down 1%, as it kept annual profit and operating margin forecasts intact due to higher tariff costs.

About 18% of Williams-Sonoma's products were produced in the U.S. in fiscal 2024. Among foreign suppliers, roughly 23% was from China, 16% from India, 14% from Vietnam and 29% from the rest of the world, the company has said.

U.S. tariffs on imports from India and Vietnam were set at 50% and 20% respectively in August, while duties on Chinese imports stood at 30%, posing risks to the company's profit margins.

Still, in the second quarter, its Pottery Barn brand posted a comparable sales rise 1.1% compared with a 7% decline in the year-ago quarter, and West Elm logged a 3.3% rise.

Overall, the company reported a second-quarter comparable sales rise of 3.7%, above expectations of 1.99% growth, according to data compiled by LSEG.

For the quarter ended August 3, the company reported profit of $2 per share, beating estimates of $1.80 per share.