How did WSM's revenue and expenses trend in Q4 2025?

Williams-Sonoma's (WSM) revenue and expenses in Q4 2025 showed robust performance with significant beats on both fronts relative to market expectations.

1. **Revenue Trend**: WSM's revenue for Q4 2025 was reported at $2.46 billion, surpassing the anticipated $2.35 billion, indicating a notable 8% year-over-year growth. This outperformance was driven by strong retail and online furniture sales, as well as robust performance across key segments.
2. **Expense Trend**: The company's expenses, particularly in the form of costs of goods sold, were well-managed, allowing WSM to achieve a record operating margin of 21.5% in Q4 2025. This marked an improvement of 140 basis points from the previous year, reflecting enhanced operational efficiencies and cost management strategies.
3. **Profitability Metrics**: WSM's gross margin improved to 47.3% in Q4 2025, benefiting from occupancy leverage and supply chain efficiencies. The company's operating income reached $530.14 million, marking a 15.7% year-over-year increase. This strong profitability was underscored by a return on equity of 59% and a gross profit margin of 46.75%.
4. **Dividend and Financial Health**: WSM continued its track record of returning value to shareholders, increasing its quarterly dividend by 16% to $0.66 per share. The company maintained a solid cash balance of $1.2 billion with no outstanding debt, supporting its dividend payments and overall financial stability.

In summary, WSM's Q4 2025 financial results demonstrate robust revenue growth, excellent cost management, and enhanced profitability, underscoring the company's strong financial performance and resilience in a challenging retail environment.