UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_________________________

FORM 10-Q

_________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~November~~May 23, ~~2025~~2026.


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-14077

_________________________

WILLIAMS-SONOMA, INC.

(Exact name of registrant as specified in its charter)

_________________________

Delaware

(State or other jurisdiction of

incorporation or organization)

3250 Van Ness Avenue, San Francisco, CA

(Address of principal executive offices)

94-2203880

(I.R.S. Employer

Identification No.)

94109

(Zip Code)

(415) 421-7900

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

_________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange

on which registered

Common Stock, par value $.01 per share

WSM

New York Stock Exchange, Inc.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of ~~November~~May 2317, ~~2025~~2026, ~~119~~117,~~380~~746,~~711~~611 shares of the registrant’s Common Stock were outstanding.

Table of Contents

WILLIAMS-SONOMA, INC.

REPORT ON FORM 10-Q

FOR THE QUARTER ENDED ~~NOVEMBER~~MAY 23, ~~2025~~2026

TABLE OF CONTENTS

	PART I. FINANCIAL INFORMATION
		PAGE
Item 1.	Financial Statements (Unaudited)	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1713
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2318
Item 4.	Controls and Procedures	2419
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	2520
Item 1A.	Risk Factors	2520
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2520
Item 3.	Defaults Upon Senior Securities	2520
Item 4.	Mine Safety Disclosures	2520
Item 5.	Other Information	2621
Item 6.	Exhibits	2722

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

For the Thirteen Weeks Ended

~~For the Thirty-nine Weeks Ended~~

(In thousands, except per share amounts)

~~November~~May 23, ~~2025~~2026

~~October~~May 274, ~~2024~~2025

~~November 2, 2025~~

~~October 27, 2024~~

Net revenues

1,~~882~~805,~~814~~456

1,~~800~~730,~~668~~113

~~5,449,687~~

~~5,249,323~~

Cost of goods sold

1,~~015~~012,~~081~~030

~~983~~964,~~102~~304

~~2,951,522~~

~~2,832,649~~

Gross profit

~~867~~793,~~733~~426

~~817~~765,~~566~~809

~~2,498,165~~

~~2,416,674~~

Selling, general and administrative expenses

~~548~~501,~~590~~738

~~512~~475,~~535~~096

~~1,560,250~~

~~1,516,631~~

Operating income

~~319~~291,~~143~~688

~~305~~290,~~031~~713

~~937,915~~

~~900,043~~

Interest income, net

96,~~785~~907

119,~~802~~533

~~28,398~~

~~43,063~~

Earnings before income taxes

~~328~~298,~~928~~595

~~316~~300,~~833~~246

~~966,313~~

~~943,106~~

Income taxes

8767,~~336~~233

7968,~~571~~983

~~245,896~~

~~228,573~~

Net earnings

~~241~~231,~~592~~362

~~237~~231,~~262~~263

~~720,417~~

~~714,533~~

Basic earnings per share

1.9995

1.8988

~~5.89~~

~~5.61~~

Diluted earnings per share

1.9693

1.8785

~~5.82~~

~~5.54~~

Shares used in calculation of earnings per share:

Basic

~~121~~118,~~434~~386

~~125~~123,~~333~~108

~~122,221~~

~~127,334~~

Diluted

~~123~~119,~~273~~894

~~126~~124,~~892~~789

~~123,875~~

~~129,019~~

See Notes to Condensed Consolidated Financial Statements.

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Thirteen Weeks Ended				~~For the Thirty-nine Weeks Ended~~
(In thousands)	~~November~~May 23, ~~2025~~2026		~~October~~May 274, ~~2024~~2025		~~November 2, 2025~~		~~October 27, 2024~~
Net earnings	$	~~241~~231,~~592~~362	$	~~237~~231,~~262~~263	$	~~720,417~~	$	~~714,533~~
Other comprehensive income (loss):
Foreign currency translation adjustments	~~(530)~~761		~~(13)~~5,170		~~5,120~~		~~(1,404)~~
Change in fair value of derivative financial instruments, net of tax	—		—		—		1
Comprehensive income	$	232,123	$	236,433
Reclassification adjustment for realized gains (losses) on derivative financial instruments, net of tax	—		—		—		94
Comprehensive income	$	241,062	$	237,249	$	725,537	$	713,224

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

As of

(In thousands, except per share amounts)

~~November~~May 23,~~2025~~2026

February 21,~~2025~~2026

~~October~~May 274,~~2024~~2025

ASSETS

Current assets

Cash and cash equivalents

~~884~~651,~~663~~601

1,~~212~~019,~~977~~801

~~826~~1,~~784~~047,181

Accounts receivable, net

~~118~~139,~~385~~347

~~117~~126,~~678~~821

~~105~~122,~~620~~773

Merchandise inventories, net

1,~~530~~455,~~896~~030

1,~~332~~462,~~429~~849

1,~~396~~335,~~253~~356

Prepaid expenses

9280,~~481~~035

6680,~~914~~053

8469,~~810~~442

Other current assets

2019,~~571~~699

2423,~~611~~663

1922,~~432~~570

Total current assets

2,~~646~~345,~~996~~712

2,~~754~~713,~~609~~187

2,~~432~~597,~~899~~322

Property and equipment, net

1,~~061~~102,~~354~~339

1,~~033~~095,~~934~~158

1,~~019~~031,~~874~~990

Operating lease right-of-use assets

1,~~286~~295,~~299~~745

1,~~177~~270,~~805~~272

1,~~147~~198,~~673~~440

Deferred income taxes, net

8883,~~608~~686

~~120~~99,~~657~~161

~~109~~112,~~444~~366

Goodwill

77,~~374~~386

77,~~260~~398

77,~~301~~347

Other long-term assets, net

~~150~~154,~~750~~680

~~137~~156,~~342~~736

~~127~~139,~~267~~850

Total assets

5,~~311~~059,~~381~~548

5,~~301~~411,~~607~~912

45,~~914~~157,~~458~~315

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities

Accounts payable

~~667~~560,~~490~~674

~~645~~637,~~667~~985

~~665~~553,~~803~~655

Accrued expenses

~~246~~151,~~618~~462

~~286~~314,~~033~~588

~~215~~146,~~608~~692

Gift card and other deferred revenue

~~592~~622,~~490~~049

~~584~~602,~~791~~940

~~583~~589,~~022~~432

Income taxes payable

37113,~~771~~920

6778,~~696~~943

19112,~~887~~390

Operating lease liabilities

~~220~~215,~~239~~150

~~234~~221,~~180~~356

~~231~~229,~~667~~070

Other current liabilities

9099,~~436~~517

9398,~~607~~318

~~101~~90,~~272~~604

Total current liabilities

1,~~855~~762,~~044~~772

1,~~911~~954,~~974~~130

1,~~817~~721,~~259~~843

Long-term operating lease liabilities

1,~~245~~278,~~525~~414

1,~~113~~235,~~135~~549

1,~~083~~139,~~809~~745

Other long-term liabilities

~~142~~148,~~854~~558

~~134~~139,~~079~~674

~~132~~134,~~612~~451

Total liabilities

3,~~243~~189,~~423~~744

3,~~159~~329,~~188~~353

32,~~033~~996,~~680~~039

Commitments and contingencies – See Note F

Stockholders’ equity

Preferred stock: $0.01 par value; 7,500 shares authorized; none issued

—

Common stock: $0.01 par value; 253,125 shares authorized; 120,399, 123,125 and 123,876 shares issued and outstanding at November 2, 2025, February 2, 2025 and October 27, 2024, respectively

1,205

1,232

1,239

Common stock: $0.01 par value; 253,125 shares authorized; 117,743, 118,770 and 122,994 shares issued and outstanding at May 3, 2026, February 1, 2026 and May 4, 2025, respectively

1,178

1,188

1,231

Additional paid-in capital

~~567~~517,~~873~~774

~~571~~587,~~585~~433

~~545~~524,~~205~~405

Retained earnings

1,~~517~~364,~~368~~925

1,~~591~~509,~~630~~129

1,~~351~~654,~~630~~078

Accumulated other comprehensive loss

(1612,~~473~~415)

(2113,~~593~~176)

(16,~~861~~423)

Treasury stock, at cost: 14, 4 and 4 shares as of November 2, 2025, February 2, 2025 and October 27, 2024, respectively

(2,015)

(435)

Treasury stock, at cost: 11, 14 and 14 shares as of May 3, 2026, February 1, 2026 and May 4, 2025, respectively

(1,658)

(2,015)

Total stockholders’ equity

21,~~067~~869,~~958~~804

2,~~142~~082,~~419~~559

12,~~880~~161,~~778~~276

Total liabilities and stockholders’ equity

5,~~311~~059,~~381~~548

5,~~301~~411,~~607~~912

45,~~914~~157,~~458~~315

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

	Common Stock			AdditionalPaid-inCapital		RetainedEarnings		AccumulatedOtherComprehensiveIncome (Loss)		TreasuryStock		TotalStockholders’Equity
(In thousands)	Shares	Amount
Balance at February 2, 2025	123,125	$	1,232	$	571,585	$	1,591,630	$	(21,593)	$	(435)	$	2,142,419
Balance at February 1, 2026	118,770	$	1,188	$	587,433	$	1,509,129	$	(13,176)	$	(2,015)	$	2,082,559
Net earnings	—	—		—		231,~~263~~362		—		—		231,~~263~~362
Foreign currency translation adjustments	—	—		—		—		~~5,170~~761		—		~~5,170~~761
Release of stock-based awards 1	~~468~~581	56		(6593,~~071~~312)		—		—		(290)		(6593,~~356~~596)
Repurchases of common stock 2	(~~599~~1,608)	(616)		(15,~~864~~307)		(86284,~~329~~320)		—		~~(1,911)~~—		(90289,~~110~~643)
Reissuance of treasury stock under stock-based compensation plans 1	—	—		(~~448~~388)		(~~173~~259)		—		~~621~~647		—
Stock-based compensation expense	—	—		2029,~~203~~348		—		—		—		2029,~~203~~348
Dividends declared	—	—		—		(8290,~~313~~987)		—		—		(8290,~~313~~987)
Balance at May 4, 2025	122,994	$	1,231	$	524,405	$	1,654,078	$	(16,423)	$	(2,015)	$	2,161,276
Balance at May 3, 2026	117,743	$	1,178	$	517,774	$	1,364,925	$	(12,415)	$	(1,658)	$	1,869,804
Net earnings	—	—		—		247,562		—		—		247,562
Foreign currency translation adjustments	—	—		—		—		480		—		480
Release of stock-based awards 1	24	—		(2,548)		—		—		—		(2,548)
Repurchases of common stock 2	(1,228)	(12)		(3,916)		(197,159)		—		—		(201,087)
Stock-based compensation expense	—	—		26,303		—		—		—		26,303
Dividends declared	—	—		—		(82,290)		—		—		(82,290)
Balance at August 3, 2025	121,790	$	1,219	$	544,244	$	1,622,191	$	(15,943)	$	(2,015)	$	2,149,696
Net earnings	—	—		—		241,592		—		—		241,592
Foreign currency translation adjustments	—	—		—		—		(530)		—		(530)
Release of stock-based awards 1	11	—		(1,768)		—		—		—		(1,768)
Repurchases of common stock 2	(1,402)	(14)		(4,507)		(264,717)		—		—		(269,238)
Stock-based compensation expense	—	—		29,904		—		—		—		29,904
Dividends declared	—	—		—		(81,698)		—		—		(81,698)
Balance at November 2, 2025	120,399	$	1,205	$	567,873	$	1,517,368	$	(16,473)	$	(2,015)	$	2,067,958

1Amounts are shown net of shares withheld for employee taxes.

2Repurchases of common stock include accrued excise taxes of $41.78 million as of ~~November~~May 23, ~~2025~~2026, which is recorded in retained earnings.

See Notes to Condensed Consolidated Financial Statements.


	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Stockholders’ Equity
(In thousands)	Shares	Amount
Balance at February 2, 2025	123,125	$	1,232	$	571,585	$	1,591,630	$	(21,593)	$	(435)	$	2,142,419
Net earnings	—	—		—		231,263		—		—		231,263
Foreign currency translation adjustments	—	—		—		—		5,170		—		5,170


Release of stock-based awards 1	468	5		(65,071)		—		—		(290)		(65,356)
Repurchases of common stock 2	(599)	(6)		(1,864)		(86,329)		—		(1,911)		(90,110)
Reissuance of treasury stock under stock-based compensation plans 1	—	—		(448)		(173)		—		621		—
Stock-based compensation expense	—	—		20,203		—		—		—		20,203
Dividends declared	—	—		—		(82,313)		—		—		(82,313)
Balance at May 4, 2025	122,994	$	1,231	$	524,405	$	1,654,078	$	(16,423)	$	(2,015)	$	2,161,276

Table of Contents

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

	Common Stock			AdditionalPaid-inCapital		RetainedEarnings		AccumulatedOtherComprehensiveIncome (Loss)		TreasuryStock		TotalStockholders’Equity
(In thousands)	Shares	Amount
Balance at January 28, 2024	128,301	$	1,284	$	587,960	$	1,555,595	$	(15,552)	$	(1,426)	$	2,127,861
Net earnings	—	—		—		260,416		—		—		260,416
Foreign currency translation adjustments	—	—		—		—		(1,342)		—		(1,342)
Change in fair value of derivative financial instruments, net of tax	—	—		—		—		1		—		1
Release of stock-based awards 1	687	6		(86,787)		—		—		(227)		(87,008)
Repurchases of common stock	(313)	(2)		(957)		(42,822)		—		—		(43,781)
Reissuance of treasury stock under stock-based compensation plans 1	—	—		(1,218)		—		—		1,218		—
Stock-based compensation expense	—	—		22,191		—		—		—		22,191
Dividends declared	—	—		—		(74,030)		—		—		(74,030)
Balance at April 28, 2024	128,675	$	1,288	$	521,189	$	1,699,159	$	(16,893)	$	(435)	$	2,204,308
Net earnings	—	—		—		216,855		—		—		216,855
Foreign currency translation adjustments	—	—		—		—		(49)		—		(49)
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax	—	—		—		—		94		—		94
Release of stock-based awards 1	35	—		(1,842)		—		—		—		(1,842)
Repurchases of common stock 2	(922)	(10)		(2,808)		(127,700)		—		—		(130,518)
Stock-based compensation expense	—	—		21,633		—		—		—		21,633
Dividends declared	—	—		—		(74,391)		—		—		(74,391)
Balance at July 28, 2024	127,788	$	1,278	$	538,172	$	1,713,923	$	(16,848)	$	(435)	$	2,236,090
Net earnings	—	—		—		237,262		—		—		237,262
Foreign currency translation adjustments	—	—		—		—		(13)		—		(13)
Release of stock-based awards 1	17	—		(1,883)		—		—		—		(1,883)
Repurchases of common stock 2	(3,929)	(39)		(12,155)		(526,955)		—		—		(539,149)
Stock-based compensation expense	—	—		21,071		—		—		—		21,071
Dividends declared	—	—		—		(72,600)		—		—		(72,600)
Balance at October 27, 2024	123,876	$	1,239	$	545,205	$	1,351,630	$	(16,861)	$	(435)	$	1,880,778

1Amounts are shown net of shares withheld for employee taxes.

2Repurchases of common stock include accrued excise taxes of $6.0.1 million as of ~~October~~May 274, ~~2024~~2025, which is recorded in retained earnings.

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Thirty-nine Weeks Ended
	For the Thirteen Weeks Ended
(In thousands)	~~November~~May 23, ~~2025~~2026		~~October~~May 274, ~~2024~~2025
Cash flows from operating activities:
Net earnings	$	~~720~~231,~~417~~362	$	~~714~~231,~~533~~263
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization	~~170~~56,~~676~~116		~~171~~56,~~657~~404
Loss on disposal/impairment of assets	~~5,138~~671		~~4,494~~732
Non-cash lease expense	~~185~~62,~~302~~152		~~192~~60,~~501~~484
Deferred income taxes	193,~~437~~912		(91,~~003~~559)
Tax benefit related to stock-based awards	11,~~686~~755		10,~~472~~647
Stock-based compensation expense	7729,~~152~~540		6620,~~061~~390
Other	(~~1,840~~456)		(~~2,205~~637)
Changes in:
Accounts receivable	(~~517~~12,491)		17(4,~~287~~919)
Merchandise inventories	~~(196~~8,~~061)~~598		(~~150,055~~689)
Prepaid expenses and other assets	~~(33~~5,~~184)~~801		(212,~~393~~956)
Accounts payable	5(82,~~024~~408)		37(96,~~239~~022)
Accrued expenses and other liabilities	(31148,~~686~~910)		(36139,~~598~~206)
Gift card and other deferred revenue	719,~~348~~023		94,~~367~~173
Operating lease liabilities	(~~191~~63,~~002~~319)		(~~200~~63,~~947~~850)
Income taxes payable	~~(29~~34,~~925)~~977		~~(76~~44,~~667)~~694
Net cash provided by operating activities	~~717~~156,~~965~~323		~~726~~118,~~743~~949
Cash flows from investing activities:
Purchases of property and equipment	(~~178~~57,~~505~~685)		(~~154~~58,~~354~~250)
Other	~~(1,172)~~10		~~360~~21
Net cash used in investing activities	(~~179~~57,~~677~~675)		(~~153~~58,~~994~~229)
Cash flows from financing activities:
Repurchases of common stock	(~~555~~287,~~703~~805)		(~~707~~89,~~477~~971)
Payment of dividends	(236,629)		(208,861)
Tax withholdings related to stock-based awards	(93,596)		(65,357)
Tax withholdings related to stock-based awards	(69,671)		(90,733)
Payment of dividends	(85,580)		(74,667)
Debt issuance costs	(1,187)		—
Net cash used in financing activities	(466,981)		(229,995)
Other	(6,941)		—
Effect of exchange rates on cash and cash equivalents	133		3,479
Net cash used in financing activities	(870,131)		(1,007,071)
Net decrease in cash and cash equivalents	(368,200)		(165,796)
Effect of exchange rates on cash and cash equivalents	3,529		(901)
Cash and cash equivalents at beginning of period	1,019,801		1,212,977
Net decrease in cash and cash equivalents	(328,314)		(435,223)
Cash and cash equivalents at end of period	$	651,601	$	1,047,181
Cash and cash equivalents at beginning of period	1,212,977		1,262,007
Cash and cash equivalents at end of period	$	884,663	$	826,784

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

WILLIAMS-SONOMA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE A. FINANCIAL STATEMENTS - BASIS OF PRESENTATION

These financial statements include Williams-Sonoma, Inc. and its wholly owned subsidiaries (“Company,” “we,” “us” or “our”). The Condensed Consolidated Balance Sheets as of ~~November~~May 23, ~~2025~~2026, February 21, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025, the Condensed Consolidated Statements of Earnings, the Condensed Consolidated Statements of Comprehensive Income, and the Condensed Consolidated Statements of Stockholders’ Equity for the thirteen ~~and thirty-nine~~ weeks then ended and the Condensed Consolidated Statements of Cash Flows for the ~~thirty-nine~~thirteen weeks then ended, have been prepared by us, and have not been audited. In our opinion, the financial statements include all adjustments (which include normal recurring adjustments) necessary to present fairly the financial position at the balance sheet dates and the results of operations for the thirteen ~~and thirty-nine~~ weeks then ended. Intercompany transactions and accounts have been eliminated in our consolidation. The balance sheet as of February 21, ~~2025~~2026, presented herein, has been derived from our audited Consolidated Balance Sheet included in our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026.

The Company's fiscal year ends on the Sunday closest to January 31. All references to “fiscal ~~2025~~2026” represent the 52-week fiscal year that will end on ~~February~~January 131, ~~2026~~2027 and all references to “fiscal ~~2024~~2025” represent the 5352-week fiscal year that ended February 21, ~~2025~~2026.

The results of operations for the thirteen ~~and thirty-nine~~ weeks ended ~~November~~May 23, ~~2025~~2026 are not necessarily indicative of the operating results of the full year.

Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted. These financial statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026.

Out-of-Period Freight Adjustment in First Quarter of Fiscal 2024

Subsequent to the filing of our fiscal 2023 Form 10-K, in April 2024, we determined that we over-recognized freight expense in fiscal 2021, 2022 and 2023 for a cumulative amount of $49.0 million. We evaluated the error, both qualitatively and quantitatively, and determined that no prior interim or annual periods were materially misstated. We then evaluated whether the cumulative amount of the over-accrual was material to our projected fiscal 2024 results, and determined the cumulative amount was not material. Therefore, the Condensed Consolidated Financial Statements for the thirty-nine weeks ended October 27, 2024 include an out-of-period adjustment of $49.0 million, recorded in the first quarter of fiscal 2024, to reduce cost of goods sold and accounts payable, which corrected the cumulative error on the Consolidated Balance Sheet as of January 28, 2024.

Recently Issued Accounting Pronouncements

In ~~December~~November ~~2023~~2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ~~2023~~2024-0903, Income ~~Taxes~~Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (~~Topic~~Subtopic ~~740~~220-40): ~~Improvements~~Disaggregation toof Income ~~Tax~~Statement Expenses and ASU 2025-01, Income Statement—Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The ~~improvements~~ASU requires public business entities to disclose in the ~~ASU~~notes ~~address~~to ~~investor~~the ~~requests~~financial ~~for~~statements, ~~enhanced~~among ~~income~~other ~~tax~~things, specific information ~~primarily~~about ~~through~~certain ~~changes~~costs toand ~~the~~expenses ~~rate~~including ~~reconciliation~~purchases ~~and~~of ~~income~~inventory, ~~taxes~~employee ~~paid~~compensation, ~~information~~and depreciation and amortization. This ASU is effective for fiscal years beginning after December 15, ~~2024.~~2026 ~~The~~and ~~application~~interim ofreporting ~~this~~periods ~~new~~beginning ~~guidance~~after isDecember ~~not~~15, ~~expected~~2027, towith ~~have~~early aadoption ~~material~~permitted. ~~impact~~We onare ~~our~~currently ~~financial~~evaluating ~~condition,~~the ~~results~~impact of ~~operations,~~this orASU ~~cash~~on ~~flows,~~our asConsolidated ~~the~~Financial ~~ASU~~Statements ~~pertains~~and torelated ~~disclosure only~~disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses and ASU 2025-01, Income Statement—Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The ASU requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory, employee compensation, and depreciation and amortization. This ASU is effective for fiscal years beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40). The ASU amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. This ASU is effective for fiscal years and interim reporting periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures.

6In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. The ASU establishes the recognition, measurement and presentation of government grants received by a business entity, including guidance for a grant related to an asset and a grant related to income. This ASU is effective for fiscal years beginning after December 15, 2028, and interim reporting periods within those annual reporting periods. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures.

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NOTE B. BORROWING ARRANGEMENTS

Credit Facility

InWe ~~June~~have ~~2025,~~a ~~we amended our existing~~ credit facility, ~~which~~(the ~~increased~~“Credit ~~our~~Facility”) ~~unsecured~~which ~~revolving~~provides ~~line~~for ofa ~~credit to~~ $600 million, ~~amended~~unsecured ~~certain~~revolving ~~interest~~line ~~rates and extended the maturity date~~ of ~~the facility, in addition to other updates (the “Credit Facility”)~~credit. Our Credit Facility may be used to borrow revolving loans or to request the issuance of letters of credit. We may, upon notice to the administrative agent, request existing or new lenders, at such lenders’ option, to increase the Credit Facility by up to $250 million to provide for a total of ~~up to~~ $850 million of unsecured revolving credit.

During the thirteen ~~and thirty-nine~~ weeks ended ~~November~~May 23, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025, we had no borrowings under our Credit Facility. Additionally, as of ~~November~~May 23, ~~2025~~2026, issued but undrawn standby letters of credit of $1213.06 million were outstanding under our Credit Facility. The standby letters of credit were primarily issued to secure the liabilities associated with workers’ compensation and other insurance programs. Our Credit Facility matures on June 26, 2030, at which time all outstanding borrowings must be repaid and all outstanding letters of credit must be cash collateralized. We may elect to extend the maturity date, subject to lender approval.

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insurance programs. Our Credit Facility matures on June 26, 2030, at which time all outstanding borrowings must be repaid and all outstanding letters of credit must be cash collateralized. We may elect to extend the maturity date, subject to lender approval.

The interest rate applicable to the Credit Facility is variable and may be elected by us as: (i) the Secured Overnight Financing Rate (“SOFR”) and an applicable margin based on our leverage ratio, ranging from 0.91% to 1.55% or (ii) a base rate as defined in the Credit Facility, plus an applicable margin based on our leverage ratio, ranging from 0% to 0.55%.

Our Credit Facility contains certain restrictive loan covenants, including, among others, a financial covenant requiring a maximum leverage ratio (funded debt adjusted for operating lease liabilities to earnings before interest, income tax, depreciation, amortization and rent expense), and covenants limiting our ability to incur indebtedness, grant liens, make acquisitions, merge or consolidate, and dispose of assets. As of ~~November~~May 23, ~~2025~~2026, we were in compliance with our financial covenants under our Credit Facility and, based on our current projections, we expect to remain in compliance throughout the next 12 months.

Letter of Credit Facilities

We have three unsecured letter of credit facilities for a total of $35 million. Our letter of credit facilities contain covenants that are consistent with our Credit Facility. Interest on unreimbursed amounts under our letter of credit facilities accrues at a base rate as defined in the Credit Facility, plus an applicable margin based on our leverage ratio. As of ~~November~~May 23, ~~2025~~2026, ~~the~~no ~~aggregate~~amounts ~~amount~~were outstanding under our letter of credit facilities ~~was $0~~.6 ~~million,~~Two ~~which represents only a future commitment to fund inventory purchases to which we had not taken legal title. On August 7, 2025, we renewed two~~ of our letter of credit facilities totaling $30 million ~~on substantially similar terms. The two letter of credit facilities~~ mature on August 18, 2026, and the latest expiration date possible for future letters of credit issued under these facilities is January 15, 2027. One of the letter of credit facilities totaling $5 million matures on June 26, 2030, which is also the latest expiration date possible for future letters of credit issued under the facility.

NOTE C. STOCK-BASED COMPENSATION

Equity Award Programs

Our Amended and Restated 2001 Long-Term Incentive Plan (the “Plan”) provides for grants of incentive stock options, nonqualified stock options, stock-settled stock appreciation rights, restricted stock awards, restricted stock units (including those that are performance-based), deferred stock awards (collectively, “stock awards”) and dividend equivalents up to an aggregate of 85.4 million shares. As of ~~November~~May 23, ~~2025~~2026, there were approximately 76.71 million shares available for future grant. Awards may be granted under our Plan to officers, ~~associates~~employees and non-~~associate~~employee members of the Board of Directors of the Company or any parent or subsidiary. Shares issued as a result of award exercises or releases are primarily funded with the issuance of new shares.

Stock Awards

Annual grants of stock awards are limited to two million shares on a per person basis. Stock awards granted to ~~associates~~employees generally vest evenly over a period of four years for service-based awards. Certain performance-based awards, which have variable payout conditions based on predetermined financial targets, generally vest three years from the date of grant. Certain stock awards and other agreements contain vesting acceleration clauses which cover events including, but not limited to, retirement, disability, death, merger or a similar corporate event. Stock awards granted to non-~~associate~~employee Board of Directors members generally vest in one year. Non-~~associate~~employee Board of Directors members automatically receive stock awards on the date of their initial election to the Board of Directors and annually thereafter on the date of the annual meeting of stockholders (so long as they continue to serve as a non-~~associate~~employee Board of Directors member). Non-~~associate~~employee directors may also elect, on terms prescribed by the Company, to receive all of their annual cash compensation to be earned in respect of the applicable fiscal year either in the form of (i) fully vested stock units or (ii) fully vested deferred stock units.

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Stock-Based Compensation Expense

During the thirteen ~~and thirty-nine~~ weeks ended ~~November~~May 23, 2026 and May 4, 2025, we recognized total stock-based compensation expense, as a component of selling, general and administrative expenses ("“SG&A"”) of $3029.25 million and $7720.24 million, respectively. ~~During the thirteen and thirty-nine weeks ended October 27, 2024, we recognized total stock-based compensation expense, as a component of SG&A of $21.3 million and $66.1 million, respectively.~~

NOTE D. EARNINGS PER SHARE

Basic earnings per share is computed as net earnings divided by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed as net earnings divided by the weighted-average number of common shares outstanding and common stock equivalents outstanding for the period using the treasury stock method. Common stock equivalents consist of shares subject to stock-based awards to the extent their inclusion would be dilutive.

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The following is a reconciliation of net earnings and the number of shares used in the basic and diluted earnings per share computations:

(In thousands, except per share amounts)	Net Earnings		WeightedAverage Shares	EarningsPer Share
Thirteen weeks ended November 2, 2025
Thirteen weeks ended May 3, 2026
Basic	$	~~241~~231,~~592~~362	~~121~~118,~~434~~386	$	1.9995
Effect of dilutive stock-based awards			1,~~839~~508
Diluted	$	~~241~~231,~~592~~362	~~123~~119,~~273~~894	$	1.9693
Thirteen weeks ended October 27, 2024
Thirteen weeks ended May 4, 2025
Basic	$	~~237~~231,~~262~~263	~~125~~123,~~333~~108	$	1.8988
Effect of dilutive stock-based awards			1,~~559~~681
Diluted	$	~~237~~231,~~262~~263	~~126~~124,~~892~~789	$	1.8785
Thirty-nine weeks ended November 2, 2025
Basic	$	720,417	122,221	$	5.89
Effect of dilutive stock-based awards			1,654
Diluted	$	720,417	123,875	$	5.82
Thirty-nine weeks ended October 27, 2024
Basic	$	714,533	127,334	$	5.61
Effect of dilutive stock-based awards			1,685
Diluted	$	714,533	129,019	$	5.54

The effect of anti-dilutive stock-based awards was not material for the thirteen ~~and thirty-nine~~ weeks ended ~~November~~May 23, ~~2025~~2026 and ~~October~~May 274, ~~2024, respectively~~2025.

NOTE E. SEGMENT REPORTING

We identify our operating segments according to how our business activities are managed and evaluated. Each of our brands are operating segments. Because they share similar economic and other qualitative characteristics, we have aggregated our operating segments into a single reportable segment.

Our single reportable segment derives revenues from sales of merchandise through our e-commerce websites, ~~retail stores~~ and ~~direct-mail~~retail ~~catalogs~~stores, and includes shipping fees received from customers for delivery of merchandise to their homes. The accounting policies of our single reportable segment are described in the Summary of Significant Accounting Policies within Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026.

Our chief operating decision maker (“CODM”) is our Chief Executive Officer. The CODM assesses performance for our single reportable segment and decides how to allocate resources based on operating income, which is reported on the Condensed Consolidated Statements of Earnings. Segment balance sheet information is not regularly provided to the CODM. The CODM uses operating income to decide whether to reinvest profits into our operating segments or allocate to other purposes, such as for repurchases of common stock, payment of dividends or acquisitions.

Operating income is used to monitor budget versus actual results. The CODM also uses operating income in competitive analysis by benchmarking to our peers. The competitive analysis, along with the monitoring of budget versus actual results, is used in assessing performance of the segment.

8The following table summarizes reported net revenues, significant segment expenses, operating income and earnings before income taxes for the thirteen weeks ended May 3, 2026 and May 4, 2025.

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	For the Thirteen Weeks Ended
(In thousands)	May 3, 2026		May 4, 2025
Net revenues	$	1,805,456	$	1,730,113
Less:
Cost of merchandise and shipping	808,475		766,635
Occupancy, excluding depreciation	148,284		141,829
Employment	286,687		270,430
Advertising	121,801		117,750
Other segment items 1	93,174		86,877
Depreciation and amortization expense	55,347		55,879
Operating income	291,688		290,713
Interest income, net	6,907		9,533
Earnings before income taxes	$	298,595	$	300,246

The following table summarizes reported net revenues, significant segment expenses, operating income and earnings before income taxes for the thirteen and thirty-nine weeks ended November 2, 2025 and October 27, 2024.

	For the Thirteen Weeks Ended				For the Thirty-nine Weeks Ended
(In thousands)	November 2, 2025		October 27, 2024		November 2, 2025		October 27, 2024
Net revenues	$	1,882,814	$	1,800,668	$	5,449,687	$	5,249,323
Less:
Cost of merchandise and shipping	808,545		788,152		2,345,939		2,244,301
Occupancy, excluding depreciation	149,845		138,361		437,070		419,832
Employment	312,276		288,569		895,173		843,741
Advertising	141,011		131,579		392,180		398,600
Other segment items 1	95,053		91,189		271,728		272,897
Depreciation and amortization expense	56,941		57,787		169,682		169,909
Operating income	319,143		305,031		937,915		900,043
Interest income, net	9,785		11,802		28,398		43,063
Earnings before income taxes	$	328,928	$	316,833	$	966,313	$	943,106

1Other segment items within operating income include general expenses, which consist primarily of credit card fees, data processing expenses and administrative expenses.

~~The following table summarizes our net revenues by brand for the thirteen and thirty-nine weeks ended November 2, 2025 and October 27, 2024.~~7

	For the Thirteen Weeks Ended 1				For the Thirty-nine Weeks Ended 1
(In thousands)	November 2, 2025		October 27, 2024		November 2, 2025		October 27, 2024
Pottery Barn	$	741,526	$	718,240	$	2,161,197	$	2,120,898
West Elm	468,243		450,490		1,373,878		1,339,578
Williams Sonoma	276,417		252,125		782,963		730,231
Pottery Barn Kids and Teen	291,382		287,259		807,847		768,469
Other 2	105,246		92,554		323,802		290,147
Total 3	$	1,882,814	$	1,800,668	$	5,449,687	$	5,249,323
1Includes business-to-business net revenues within each brand.
2Primarily consists of net revenues from Rejuvenation, our international franchise operations, Mark and Graham, and GreenRow.
3Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom, and our franchise businesses) of $77.1 million and $76.8 million for the thirteen weeks ended November 2, 2025 and October 27, 2024, respectively, and $232.9 million and $229.3 million for the thirty-nine weeks ended November 2, 2025 and October 27, 2024, respectively.

	As of
(In thousands)	November 2, 2025		February 2, 2025		October 27, 2024
U.S.	$	2,421,034	$	2,268,691	$	2,212,022
International	61,551		68,425		70,569
Total	$	2,482,585	$	2,337,116	$	2,282,591

NOTE F. COMMITMENTS AND CONTINGENCIES

We are involved in lawsuits, claims and proceedings incident to the ordinary course of our business. These disputes, which are not currently material, have increased and continue to increase in number as our business expands and we grow as a company. We review the need for any loss contingency reserves and establish reserves when, in the opinion of management, it is probable that a matter would result in liability, and the amount of loss, if any, can be reasonably estimated. In view of the inherent difficulty of predicting the outcome of these matters, it may not be possible to determine whether any loss is probable or to reasonably estimate the amount of the loss until the case is close to resolution, in which case no reserve is established until that time. Any claims against us, whether meritorious or not, could result in costly litigation, require significant amounts of

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~~management~~The ~~time~~following ~~and~~table ~~result~~summarizes inour ~~the~~net ~~diversion~~revenues ofby ~~significant~~brand ~~operational~~for ~~resources.~~the ~~The~~thirteen ~~results~~weeks ofended ~~these lawsuits~~May 3, ~~claims~~2026 and ~~proceedings cannot be predicted with certainty. However~~May 4, ~~we believe that the ultimate resolution of these current matters will not have a material adverse effect on our Condensed Consolidated Financial Statements when taken as a whole~~2025.


	For the Thirteen Weeks Ended 1
(In thousands)	May 3, 2026		May 4, 2025
Pottery Barn	$	708,447	$	695,092
West Elm	471,174		437,085
Williams Sonoma 2	271,542		257,493
Pottery Barn Kids and Teen	240,149		229,716


Other 3	114,144		110,727
Total 4	$	1,805,456	$	1,730,113
1Includes business-to-business net revenues within each brand.
2Includes Williams Sonoma Home net revenues.
3Primarily consists of net revenues from Rejuvenation, Mark and Graham, our international franchise operations, GreenRow and Dormify.
4Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom, and our franchise businesses) of $73.4 million and $77.8 million for the thirteen weeks ended May 3, 2026 and May 4, 2025, respectively.

Long-lived assets by geographic location, which excludes deferred income taxes, goodwill, and intangible assets, are as follows:


	As of
(In thousands)	May 3, 2026		February 1, 2026		May 4, 2025
U.S.	$	2,482,635	$	2,448,273	$	2,289,438
International	53,399		57,552		68,021
Total	$	2,536,034	$	2,505,825	$	2,357,459

NOTE F. COMMITMENTS AND CONTINGENCIES

NOTE G. STOCK REPURCHASE PROGRAM AND DIVIDENDS

Stock Repurchase Program

During the thirteen weeks ended ~~November~~May 23, ~~2025~~2026, pursuant to our stock repurchase program we repurchased 1,~~402~~608,~~750~~253 shares of our common stock at an average cost of $~~190~~178.0596 per share for an aggregate cost of $~~266~~287.68 million, excluding excise taxes ~~on stock repurchases (net~~ of ~~issuances) of~~ $21.68 million. During the thirty-nine weeks ended November 2, 2025, we repurchased 3,229,540 shares of our common stock at an average cost of $172.07 per share for an aggregate cost of $555.7 million, excluding excise taxes on stock repurchases (net of issuances) of $4.7 million. As of ~~November~~May 23, ~~2025~~2026, there was $~~636~~50.8 million remaining under our September 2024 stock repurchase authorization. In November 2025, our Board of Directors approved a new $1.0 billion stock repurchase authorization, which will become effective once our September 2024 authorization is fully utilized. As of May 3, 2026, the total stock repurchase authorization remaining under the program was approximately $1.1 billion.

During the thirteen weeks ended ~~October~~May 274, ~~2024~~2025, we repurchased 3599,~~929,491~~191 shares of our common stock at an average cost of $~~135~~150.8615 per share for an aggregate cost of $~~533~~90.90 million, excluding excise taxes ~~on stock repurchases (net~~ of ~~issuances) of~~ $50.31 million. During the thirty-nine weeks ended October 27, 2024, we repurchased 5,164,755 shares of our common stock at an average cost of $136.98 per share for an aggregate cost of $707.5 million, excluding excise taxes on stock repurchases (net of issuances) of $6.0 million.

As of ~~November~~May 23, ~~2025~~2026, February 21, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025, we held treasury stock of $21.07 million, $02.40 million and $02.40 million, respectively,. ~~that~~We ~~represents~~intend ~~the cost of shares available for issuance intended~~ to satisfy future stock-based award settlements in certain foreign jurisdictions using this treasury stock.

Stock repurchases under our program may be made through open market and privately negotiated transactions at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements, capital availability and market conditions.

~~Dividends~~8

We declared cash dividends of $0.66 and $0.57 per common share during the thirteen weeks ended November 2, 2025 and October 27, 2024, respectively.

We declared cash dividends of $1.98 and $1.71 during the thirty-nine weeks ended November 2, 2025 and October 27, 2024, respectively. Our quarterly cash dividend may be limited or terminated at any time.

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Dividends

In March 2026, our Board of Directors authorized a 15% increase in our quarterly cash dividend, from $0.66 to $0.76 per common share, subject to capital availability. We declared cash dividends of $0.76 and $0.66 per common share during the thirteen weeks ended May 3, 2026 and May 4, 2025, respectively. Our quarterly cash dividend may be limited or terminated at any time.

NOTE H. FAIR VALUE MEASUREMENTS

Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

We determine the fair value of financial and non-financial assets and liabilities using the fair value hierarchy established by Accounting Standards Codification 820, Fair Value Measurement, which defines three levels of inputs that may be used to measure fair value, as follows:

•Level 1: inputs which include quoted prices in active markets for identical assets or liabilities;

•Level 2: inputs which include observable inputs other than Level 1 inputs, such as quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability; and

•Level 3: inputs which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability.

The fair values of our cash and cash equivalents are based on Level 1 inputs, which include quoted prices in active markets for identical assets.

Long-lived Assets

We review the carrying value of all long-lived assets for impairment, primarily at an individual store level, whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. We measure property and equipment at fair value on a nonrecurring basis using Level 3 inputs as defined in the fair value hierarchy. We measure right-of-use assets on a nonrecurring basis using Level 2 inputs that are corroborated by market data. Where Level 2 inputs are not readily available, we use Level 3 inputs. Fair value of these long-lived assets is based on the present value of estimated future cash flows using a discount rate commensurate with the risk.

The significant unobservable inputs used in the fair value measurement of our store assets are sales growth/decline, gross margin, employment costs, lease escalations, market rental rates, changes in local real estate markets in which we operate, inflation and the overall economics of the retail industry. Significant fluctuations in any of these inputs individually could significantly impact our measurement of fair value.

During the thirteen weeks ended ~~November~~May 23, ~~2025~~2026, nowe recognized impairment charges, ~~were~~as ~~recognized.~~a ~~During~~component ~~the~~of ~~thirty-nine weeks ended November 2~~SG&A, ~~2025, we recognized impairment charges~~ of $0.3 million. During the thirteen ~~and thirty-nine~~ weeks ended ~~October~~May 274, ~~2024~~2025, weno ~~recognized~~ impairment charges ofwere $1recognized.6 ~~million and $2.9 million, respectively.~~

There were no transfers in and out of Level 3 categories during the thirteen ~~and thirty-nine~~ weeks ended ~~November~~May 23, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025.

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NOTE I. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) by component, net of tax, are as follows:

(In thousands)	Foreign CurrencyTranslation		~~Cash FlowHedges~~		Accumulated OtherComprehensiveIncome (Loss)
Balance at February 2, 2025	$	(21,593)	$	—	$	(21,593)
Balance at February 1, 2026	$	(13,176)			$	(13,176)
Foreign currency translation adjustments	~~5,170~~761		—		~~5,170~~761
Other comprehensive income (loss)	~~5,170~~761		—		~~5,170~~761
Balance at May 4, 2025	$	(16,423)	$	—	$	(16,423)
Balance at May 3, 2026	$	(12,415)			$	(12,415)
Foreign currency translation adjustments	480		—		480
Balance at February 2, 2025	$	(21,593)			$	(21,593)
Other comprehensive income (loss)	480		—		480
Foreign currency translation adjustments	5,170				5,170
Balance at August 3, 2025	$	(15,943)	$	—	$	(15,943)
Other comprehensive income (loss)	5,170				5,170
Foreign currency translation adjustments	(530)		—		(530)
Balance at May 4, 2025	$	(16,423)			$	(16,423)
Other comprehensive income (loss)	(530)		—		(530)
Balance at November 2, 2025	$	(16,473)	$	—	$	(16,473)
Balance at January 28, 2024	$	(15,457)	$	(95)	$	(15,552)
Foreign currency translation adjustments	(1,342)		—		(1,342)
Change in fair value of derivative financial instruments	—		1		1
Other comprehensive income (loss)	(1,342)		1		(1,341)
Balance at April 28, 2024	$	(16,799)	$	(94)	$	(16,893)
Foreign currency translation adjustments	(49)		—		(49)
Reclassification adjustment for realized (gain) loss on derivative financial instruments	—		94		94
Other comprehensive income (loss)	(49)		94		45
Balance at July 28, 2024	$	(16,848)	$	—	$	(16,848)
Foreign currency translation adjustments	(13)		—		(13)
Other comprehensive income (loss)	(13)		—		(13)
Balance at October 27, 2024	$	(16,861)	$	—	$	(16,861)

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NOTE J. REVENUE

Merchandise Sales

Revenues from the sale of our merchandise through our e-commerce business, at our retail stores as well as to our business-to-business customers and franchisees are, in each case, recognized at a point in time when control of merchandise is transferred to the customer. Merchandise can either be picked up in our stores, or delivered to the customer. For merchandise picked up in the store, control is transferred at the time of the sale to the customer. For merchandise delivered to the customer, control is transferred either when delivery has been completed, or when we have a present right to payment which, for certain merchandise, occurs upon conveyance of the merchandise to the carrier for delivery. We exclude from revenue any taxes assessed by governmental authorities, including value-added and other sales-related taxes, that are imposed on and are concurrent with revenue-generating activities. Our payment terms are primarily at the point of sale for merchandise sales and for most services. We have elected to account for shipping and handling as fulfillment activities, and not as a separate performance obligation.

Revenue from the sale of merchandise is reported net of sales returns. We estimate future returns based on historical return trends together with current product sales performance. As of ~~November~~May 23, ~~2025~~2026, February 21, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025, we recorded a liability for expected sales returns of $32.13 million, $4240.71 million and $2936.2 million, respectively, within other current liabilities and a corresponding asset for the expected net realizable value of the merchandise inventory to be returned of $9.01 million, $1211.19 million and $710.21 million, respectively, within other current assets in our Condensed Consolidated Balance Sheets.

See Note E for the disclosure of our net revenues by operating segment.

Gift Card and Other Deferred Revenue

We defer revenue and record a liability when cash payments are received in advance of satisfying performance obligations, primarily associated with our merchandise sales, stored-value cards, customer loyalty programs, and incentives received from credit card issuers.

We issue stored-value cards that may be redeemed on future merchandise purchases. Our stored-value cards have no expiration dates. Revenue from stored-value cards is recognized at a point in time upon redemption of the card and as control of the merchandise is transferred to the customer. Breakage is recognized in a manner consistent with our historical redemption patterns taking into consideration escheatment laws as applicable. Breakage is recognized over the estimated period of redemption of our cards of approximately four years, the majority of which is recognized within one year of the card issuance. Breakage ~~revenue~~income is not material to our Condensed Consolidated Financial Statements.

We ~~have~~offer a customer loyalty ~~programs~~program, ~~which~~The ~~allow~~Key Rewards, that allows members to earn points ~~for~~on ~~each~~ qualifying ~~purchase~~purchases. Customers can earn points through spend on ~~both~~ our private label and co-branded credit cards, or ~~can~~through ~~earn points as part of our~~ non-credit card ~~related~~qualifying ~~loyalty program~~purchases. Points earned through ~~both~~either ~~loyalty~~method ~~programs~~ enable members to receive certificates that may be redeemed on future merchandise purchases. This customer option is a material right and, accordingly, represents a separate performance obligation to the customer. The allocated consideration for the points or certificates earned by our loyalty program members is deferred based on the standalone selling price of the points and recorded within gift card and other deferred revenue within our Condensed Consolidated Balance ~~Sheet~~Sheets. The measurement of standalone selling prices takes into consideration the discount the customer would receive in a separate transaction for the delivered item, as well as our estimate of certificates expected to be issued and redeemed, based on historical patterns. This measurement is applied to our portfolio of performance obligations for points or certificates earned, as all obligations have similar economic characteristics. We believe the impact to our Condensed Consolidated Financial Statements would not be materially different if this measurement was applied to each individual performance obligation. Revenue is recognized for these performance obligations at a point in time when certificates are redeemed by the customer. These obligations relate to contracts with terms less than one year, as our certificates generally expire within six months of issuance.

We enter into agreements with credit card issuers in connection with our private label and co-branded credit cards, whereby we receive cash incentives in exchange for promised services, such as licensing our brand names and marketing the credit card program to customers. These separate non-loyalty program related services promised under these agreements are interrelated and are thus considered a single performance obligation. Revenue is recognized over time as we transfer promised services throughout the contract term.

As of ~~November~~May 23, ~~2025~~2026, February 21, ~~2025~~2026 and ~~October~~May 274, ~~2024~~2025, we had recorded $~~592~~622.50 million, $~~584~~602.89 million and $~~583~~589.04 million, respectively, for gift card and other deferred revenue within current liabilities in our Condensed Consolidated Balance Sheets.

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NOTE K. INCOME TAXES

The effective tax rate was 2522.45% for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026, compared to 2423.20% for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2024~~2025. The ~~increase~~decrease was primarily driven by (i) ~~lower~~higher excess tax benefit from stock-based compensation in the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026, ~~(ii)~~partially ~~the~~offset ~~tax~~by ~~effect of the change in earnings mix and~~ (~~iii~~ii) ~~the~~a ~~tax~~higher ~~benefit~~disallowed ofexecutive ~~state~~compensation ~~amended~~deduction ~~returns filed~~ in fiscal ~~2024~~2026.

OnSince ~~July 4, 2025,~~ the ~~One~~Organization ~~Big~~for ~~Beautiful~~Economic ~~Bill~~Co-operation ~~Act~~and Development (“~~OBBB~~OECD”) ~~was~~announced ~~signed~~the ~~into~~OECD/G20 ~~law~~Inclusive inFramework ~~the~~on ~~United~~Base ~~States.~~Erosion ~~The~~and ~~OBBB~~Profit ~~includes~~Shifting a(“Framework”) ~~broad~~in ~~range~~2021, ofa ~~tax~~number ~~reform~~of ~~provisions,~~countries ~~including~~have ~~permanently~~begun ~~extending~~to ~~and~~enact ~~modifying~~legislation ~~certain~~to ~~expiring~~implement ~~provisions~~the ofFramework, including the ~~2017~~Pillar ~~Tax~~Two ~~Cuts~~minimum ~~and~~tax. ~~Jobs~~Our ~~Act.~~subsidiaries ~~The~~were ~~legislation~~not ~~has~~subject ~~multiple~~to ~~effective~~Pillar ~~dates,~~Two ~~with~~minimum ~~certain~~tax ~~provisions~~in ~~becoming~~the ~~effective~~first inquarter of fiscal ~~2025~~2026. ~~and~~Pillar ~~the~~Two ~~majority~~minimum ~~taking~~tax ~~effect~~will be treated as a period cost in future ~~years.~~periods Wewhen ~~currently~~it ~~expect~~is ~~the~~applicable. ~~OBBB~~We are continuing to ~~have~~evaluate athe ~~minimal~~potential impact onof the ~~effective~~Framework ~~tax~~on ~~rate~~future ~~but~~periods ~~result~~and inmonitoring ~~favorable~~legislative ~~cash~~developments ~~tax~~by ~~impacts~~other incountries, ~~fiscal~~especially ~~2025~~in asthe aregions ~~result~~in ofwhich ~~certain~~we ~~accelerated tax deductions~~operate.

~~Since~~NOTE the Organization for Economic Co-operation and Development (“OECD”) announced the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (“Framework”) in 2021, a number of countries have begun to enact legislation to implement the OECD international tax framework, including the Pillar Two minimum tax regimeL. ~~Our~~TARIFF subsidiaries were not subject to Pillar Two minimum tax in the first thirty-nine weeks of fiscal 2025. We are continuing to evaluate the potential impact on future periods of the Pillar Two Framework, and monitoring legislative developments by other countries, especially in the regions in which we operate.REFUNDS

~~NOTE~~On LApril 20, 2026, we filed for refunds of previously paid tariffs assessed under the International Emergency Economic Powers Act (“IEEPA”) in an aggregate amount of $197.8 ~~IMMATERIAL~~million. ~~CORRECTION~~As OFof ~~2024~~May ~~INTERIM~~3, ~~PERIOD~~2026, ~~CONDENSED~~due ~~CONSOLIDATED~~to ~~FINANCIAL~~the ~~STATEMENTS~~uncertainty with respect to the receipt of these refunds, we did not record a receivable for these refunds and a corresponding reduction to cost of goods sold or to merchandise inventories in our Condensed Consolidated Financial Statements for the first quarter of fiscal 2026. We expect to recognize the benefit for the refunds, related to tariffs that have been expensed in cost of goods sold, when we determine that the collection of the refund is probable.

In connection with our fiscal 2024 year-end close process, we identified that we did not timely record shrink losses for certain inventories not ultimately received, which also impacted our bonus accrual, in the first three quarters of fiscal 2024. Therefore, our previously issued interim financial statements for the first three quarters of fiscal 2024 did not reflect these adjustments. We properly accounted for this matter in our fiscal 2024 annual Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2025.12

Management evaluated the materiality of the above items based on an analysis of quantitative and qualitative factors and concluded they were not material to the interim periods of fiscal 2024, individually or in aggregate. The following tables reflect the effects of the correction on all affected line items of our previously reported Condensed Consolidated Financial Statements for the thirteen and thirty-nine weeks ended October 27, 2024:

Condensed Consolidated Statements of Earnings (unaudited)

	For the Thirteen Weeks Ended						For the Thirty-nine Weeks Ended
	October 27, 2024						October 27, 2024
(In thousands, except per share amounts)	As Previously Reported		Adjustments		As Corrected		As Previously Reported		Adjustments		As Corrected
Cost of goods sold	$	958,953	$	24,149	$	983,102	$	2,778,767	$	53,882	$	2,832,649
Gross profit	841,715		(24,149)		817,566		2,470,556		(53,882)		2,416,674
Selling, general and administrative expenses	521,072		(8,537)		512,535		1,536,169		(19,538)		1,516,631
Operating income	320,643		(15,612)		305,031		934,387		(34,344)		900,043
Earnings before income taxes	332,445		(15,612)		316,833		977,450		(34,344)		943,106
Income taxes	83,492		(3,921)		79,571		237,086		(8,513)		228,573
Net earnings	$	248,953	$	(11,691)	$	237,262	$	740,364	$	(25,831)	$	714,533
Basic earnings per share	$	1.99	$	(0.10)	$	1.89	$	5.81	$	(0.20)	$	5.61
Diluted earnings per share	$	1.96	$	(0.09)	$	1.87	$	5.74	$	(0.20)	$	5.54

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Condensed Consolidated Statements of Comprehensive Income (unaudited)

	For the Thirteen Weeks Ended October 27, 2024						For the Thirty-nine Weeks Ended October 27, 2024
(In thousands)	As Previously Reported		Adjustments		As Corrected		As Previously Reported		Adjustments		As Corrected
Net earnings	$	248,953	$	(11,691)	$	237,262	$	740,364	$	(25,831)	$	714,533
Comprehensive income	$	248,940	$	(11,691)	$	237,249	$	739,055	$	(25,831)	$	713,224

Condensed Consolidated Balance Sheets (unaudited)

	As of October 27, 2024
(In thousands)	As Previously Reported		Adjustments		As Corrected
Merchandise inventories, net	$	1,450,135	$	(53,882)	$	1,396,253
Total current assets	2,486,781		(53,882)		2,432,899
Total assets	4,968,340		(53,882)		4,914,458
Accrued expenses	235,146		(19,538)		215,608
Income taxes payable	28,400		(8,513)		19,887
Total current liabilities	1,845,310		(28,051)		1,817,259
Total liabilities	3,061,731		(28,051)		3,033,680
Retained earnings	1,377,461		(25,831)		1,351,630
Total stockholders’ equity	1,906,609		(25,831)		1,880,778
Total liabilities and stockholders’ equity	$	4,968,340	$	(53,882)	$	4,914,458

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Condensed Consolidated Statements of Stockholders' Equity (unaudited)

	RetainedEarnings		TotalStockholders’Equity
(In thousands)
As Previously Reported
Balance at January 28, 2024	$	1,555,595	$	2,127,861
Net earnings	265,666		265,666
Balance at April 28, 2024	1,704,409		2,209,558
Net earnings	225,745		225,745
Balance at July 28, 2024	1,728,063		2,250,230
Net earnings	248,953		248,953
Balance at October 27, 2024	1,377,461		1,906,609
Adjustments
Net earnings	(5,250)		(5,250)
Balance at April 28, 2024	(5,250)		(5,250)
Net earnings	(8,890)		(8,890)
Balance at July 28, 2024	(14,140)		(14,140)
Net earnings	(11,691)		(11,691)
Balance at October 27, 2024	(25,831)		(25,831)
As Corrected
Balance at January 28, 2024	1,555,595		2,127,861
Net earnings	260,416		260,416
Balance at April 28, 2024	1,699,159		2,204,308
Net earnings	216,855		216,855
Balance at July 28, 2024	1,713,923		2,236,090
Net earnings	237,262		237,262
Balance at October 27, 2024	$	1,351,630	$	1,880,778

Condensed Consolidated Statements of Cash Flows (unaudited)

	For the Thirty-nine Weeks Ended October 27, 2024
(In thousands)	As Previously Reported		Adjustments		As Corrected
Cash flows from operating activities:
Net earnings	$	740,364	$	(25,831)	$	714,533
Changes in:
Merchandise inventories	(203,937)		53,882		(150,055)
Accrued expenses and other liabilities	(17,060)		(19,538)		(36,598)
Income taxes payable	(68,154)		(8,513)		(76,667)
Net cash provided by operating activities	$	726,743	$	—	$	726,743

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements ~~that~~within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements may involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or ~~are~~prove ~~proven~~ incorrect, could cause our business and operating results ~~of operations~~ to differ materially from those expressed or implied by such ~~forward-looking~~ statements. Such forward-looking statements include, without limitation, statements related to: our ability to provide products that are designed and built for durability and longevity at competitive prices; changes in and the related impact of U.S. (federal, state and local) and international tax laws and trade policies and regulations; ~~the~~our ~~impact~~ability ofto mitigate current and potential future tariffs and ~~our~~realize ~~ability~~tariff ~~to mitigate such impacts~~refunds; the complementary nature of our e-commerce and retail channels; the plans, strategies, initiatives and objectives of management for future operations; our ability to execute strategic priorities and growth initiatives, including those regarding digital leadership, product and technology innovation, cross-brand initiatives, retail transformation and operational excellence; the strength of our business and our brands; our marketing efforts; our ability to provide ~~sustainable products at competitive prices; our ability to provide~~ world-class customer service ~~via~~through supply chain improvements ~~from reduced out-of-market and multiple shipments, fewer customer accommodations, lower returns and damages, and reduced replacements~~; our belief that our key differentiators, growth strategies and the efficiencies of our operating model will allow us to reduce costs and manage inventory levels in both the short- and long-term; ~~competition~~the ~~from~~highly ~~companies~~competitive ~~with~~nature ~~concepts~~of orour ~~products similar to ours~~industry; our beliefs about our competitive advantages and areas of potential future growth in the market; the seasonal variations in demand; our ability to recruit, retain and motivate skilled personnel; our ability to protect our intellectual property rights; our ability to comply with the laws, rules and regulations of the U.S. and multiple foreign jurisdictions in which we operate; ~~the~~factors, ~~impact~~including ofbut not limited to general economic conditions, inflationary pressures, consumer disposable income, rising fuel prices, recession and fears of recession, unemployment, war and fears of war, ~~outbreaks of disease,~~ adverse weather, availability of consumer credit, ~~consumer debt levels,~~ conditions in the housing market, elevated interest rates, ~~sales tax rates~~ and ~~rate increases,~~ consumer confidence in current and future economic ~~and~~conditions ~~political~~that ~~conditions,~~can ~~and~~affect consumer ~~perceptions of personal well-being and security~~spending; the impact of periods of decreased home ~~and home furnishing~~ purchases; ~~our~~challenges ~~ability~~we tomay ~~grow~~face growing our business-to-business division ~~and the challenges we may face executing such growth~~; our ability to anticipate consumer preferences and buying trends overall and as they ~~apply~~relate to specific brands; ~~dependence on timely introduction and customer acceptance of our merchandise;~~ effective inventory management; timely and effective sourcing of merchandise from our foreign and domestic suppliers and delivery of merchandise through our supply chain to our stores and customers; factors, including but not limited to fuel costs, labor disputes, union organizing activity, geopolitical instability, and acts of terrorism and war, that can affect the global supply chain, including our third-party providers; our belief in the adequacy of our facilities and the availability of suitable additional or substitute space; our ability to ~~improve~~successfully manage our ~~systems~~order-taking and ~~processes~~fulfillment operations; ~~changes~~our ability to protect our ~~information~~brand ~~technology infrastructure~~reputation; ~~shortages~~our ofability ~~raw~~to ~~materials~~respond ~~used~~to the growing use of and also to ~~make~~adopt new technologies, including artificial intelligence; changes to our ~~products~~technology; uncertainties in e-marketing, infrastructure and regulation; our belief in the reasonableness of the steps taken by us and our suppliers to protect the security and confidentiality of the information we collect; multi-channel and multi-brand complexities; ~~delays~~our inretail ~~store openings~~initiatives; our brands, products and related initiatives, including our ability to introduce new products, product lines, brands, and brand extensions, and bring in new customers; our belief in the ultimate resolution of current legal proceedings; challenges associated with our ~~increasing~~ global presence; ~~our global business~~ and expansion efforts,; ~~including~~shortages ~~franchise,~~of ~~other~~raw ~~third-party~~materials ~~arrangements~~used ~~and~~to ~~company-owned~~make ~~operations~~our products; the impact of non-adherence by our suppliers to our global compliance program and quality control standards; the effects of fluctuations in foreign currency rates and the impact of our hedging against such risks; ~~dependence~~our onability ~~external~~to ~~funding~~maintain ~~sources~~proper ~~for~~and ~~operating~~effective ~~capital~~internal controls; our compliance with financial covenants; disruptions in the financial markets; our ability to control employment, ~~occupancy~~advertising, ~~supply~~occupancy ~~chain, product, transportation~~ and other operating costs; the adequacy of our insurance coverage; our stock repurchase program; payment of dividends; the impact of new accounting pronouncements; our belief that our cash on hand and available credit facilities will provide adequate liquidity for our business operations; our belief regarding the effects of potential losses under our indemnification obligations; the effects of changes in our inventory reserves; our ability to deliver ~~organic,~~ core-brand growth; and growth from our emerging brands; our ability to drive long-term sustainable returns; our capital allocation strategy in fiscal ~~2025~~2026; our planned use of cash in fiscal ~~2025~~2026; projections of earnings, revenues, growth and other financial items; and ~~other risks and uncertainties, as well as~~ statements of belief and statements of assumptions underlying any of the foregoing. You can identify these and other forward-looking statements by the use of words such as “will,” “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “intends,” “potential,” “continue,” or the negative of such terms, or other comparable terminology. The risks, uncertainties and assumptions referred to above that could cause our results to differ materially from the results expressed or implied by such forward-looking statements include, but are not limited to, those discussed under the heading “Risk Factors” in this document and our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026, and the risks, uncertainties and assumptions discussed from time to time in our other public filings and public announcements. All forward-looking statements included in this document are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements.

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OVERVIEW

Williams-Sonoma, Inc., (the “Company”, “we”, or “us”) is a specialty retailer of high-quality products for the home. We are the world’s largest digital-first, design-led and sustainable home retailer. Our brands – Williams Sonoma, Pottery Barn, Pottery Barn Kids, Pottery Barn Teen, West Elm, Williams Sonoma Home, Rejuvenation, Mark and Graham, GreenRow, and ~~GreenRow~~Dormify – represent distinct merchandise strategies that are marketed through e-commerce, direct-mail catalogs, ~~and~~ retail stores, and business-to-business. These brands collectively support The Key Rewards, our loyalty and credit card program that offers members exclusive benefits. We operate in the U.S., Puerto Rico, Canada, Australia and the United Kingdom, and have unaffiliated franchisees that operate stores in ~~the Middle East, the Philippines,~~ Mexico, South Korea, India and ~~India~~the Philippines, as well as e-commerce websites in certain locations.

The following discussion and analysis of our financial condition, results of operations, and liquidity and capital resources for the thirteen weeks ended ~~November~~May 23, ~~2025~~2026 (“~~third~~first quarter of fiscal ~~2025~~2026”), as compared to the thirteen weeks ended ~~October~~May 274, ~~2024~~2025 (“~~third~~first quarter of fiscal ~~2024~~2025”) ~~and thirty-nine weeks ended November 2~~, ~~2025 ("first thirty-nine weeks of fiscal 2025"), as compared to the thirty-nine weeks ended October 27, 2024 ("first thirty-nine weeks of fiscal 2024"),~~ should be read in conjunction with our Condensed Consolidated Financial Statements and the notes thereto. ~~All~~Explanations ~~explanations~~ of changes in operational results are discussed in order of magnitude.

~~Third~~Beginning ~~Quarter~~in fiscal 2025, the tariff landscape has evolved and impacted our business. While our tariff mitigation efforts reduced the overall effect, tariffs had a greater impact on our Condensed Consolidated Statement of ~~Fiscal~~Earnings in the first quarter of fiscal 2026 than in the first quarter of fiscal 2025 ~~Financial~~due ~~Results~~to increased flow‑through of higher tariffs into cost of goods sold.

~~Net~~First ~~revenues~~Quarter ~~in the third quarter~~ of ~~fiscal~~Fiscal ~~2025~~2026 ~~increased~~Financial $82.1 million or 4.6%, with company comp growth of 4.0%. This increase was driven by strong non-furniture and furniture sales, including new product introductions and collaborations, as well as higher full-price selling. From a channel perspective, the company comp growth of 4.0% was driven by comp growth of 8.5% in our retail channel and comp growth of 1.9% in our e-commerce channel.Results

InNet revenues in the ~~third~~first quarter of fiscal ~~2025~~2026 increased $75.3 million, ~~Pottery~~or ~~Barn~~4.4%, ~~our~~due ~~largest~~to ~~brand,~~(i) ~~saw~~company comparable brand revenue (“~~brand~~company comp”) growth of 1$78.36 million, or 4.8%, ~~driven~~partially offset by ~~strength~~(ii) a decrease in ~~large~~non-~~ticket~~comparable ~~items,~~brand ~~including~~revenue ~~furniture,~~of ~~upholstery~~$3.3 million due to lower franchise net revenues and ~~lighting,~~the asclosure ~~well~~of asretail stores. From a ~~strong~~channel ~~retail~~perspective, ~~performance~~the company comp growth of 4.8% was driven by ~~improvements~~comp ingrowth ~~store~~of ~~inventory~~4.8% ~~availability,~~in ~~new~~our ~~product~~e-commerce ~~assortments~~channel and ~~our~~comp ~~design~~growth ~~services~~of 4.7% in our retail channel.

~~The~~In the first quarter of fiscal 2026, Pottery Barn, ~~Kids~~our ~~and~~largest ~~Teen~~brand, ~~brands~~ saw comparable brand revenue (“brand comp”) growth of 41.40% ~~in the third quarter of fiscal 2025~~ driven by strength in ~~collaborations~~furniture, ~~new~~textiles ~~product launches,~~ and ~~back-to-school and dorm offerings~~lighting.

~~West~~The ~~Elm~~Pottery Barn Kids and Teen brands saw brand comp growth of 34.35% in the ~~third~~first quarter of fiscal ~~2025,~~2026 driven by strength in ~~new non-~~furniture and non-furniture ~~product~~categories, ~~introductions~~collaborations and ababy ~~strong retail performance~~offerings.

~~The~~West ~~Williams~~Elm ~~Sonoma brand~~ saw brand comp growth of 78.35% in the ~~third~~first quarter of fiscal ~~2025~~2026 ~~with~~driven by strength in ~~the~~retail, ~~brand's~~new ~~kitchen~~furniture ~~business~~and ~~driven~~non-furniture byproducts ~~electrics~~ and ~~cookware as well as a strong retail performance~~collaborations.

The Williams Sonoma brand saw brand comp growth of 5.0% in the first quarter of fiscal 2026 driven by strength in the brand’s kitchen business supported by exclusive products and collaborations.

Finally, our emerging brands, Rejuvenation, Mark and Graham, and GreenRow, delivered double-digit brand comp growth on a combined basis.

For the ~~third~~first quarter of fiscal ~~2025~~2026, diluted earnings per share grew by 4.83% to $1.9693, compared to $1.8785 in the ~~third~~first quarter of fiscal ~~2024~~2025.

As of ~~November~~May 23, ~~2025~~2026, we had $~~884~~651.76 million in cash and cash equivalents and generated operating cash flow of $~~718~~156.03 million in the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026. In addition to our cash balance, we also ended the ~~third~~first quarter of fiscal ~~2025~~2026 with no outstanding borrowings under our revolving line of credit. This strong liquidity position allowed us to fund the operations of the business, invest $~~178~~57.57 million in capital expenditures and return $~~792~~373.34 million through stock repurchases and dividends to stockholders in the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026.

~~Out-of-Period~~Tariff ~~Freight Adjustment in First Quarter of Fiscal 2024~~Refunds

~~Subsequent~~On toApril ~~the~~20, ~~filing of our fiscal 2023 Form 10-K~~2026, inwe ~~April~~filed ~~2024,~~for werefunds ~~determined~~of ~~that~~previously wepaid ~~over-recognized~~tariffs ~~freight~~assessed ~~expense~~under inthe ~~fiscal~~International ~~2021,~~Emergency ~~2022~~Economic ~~and~~Powers ~~2023~~Act ~~for~~(“IEEPA”) ain ~~cumulative~~an aggregate amount of $49197.08 million. WeAs ~~evaluated~~of ~~the~~May ~~error~~3, ~~both qualitatively and quantitatively~~2026, ~~and~~due ~~determined~~to ~~that~~the nouncertainty ~~prior~~with ~~interim~~respect orto ~~annual~~the ~~periods~~receipt ~~were~~of ~~materially~~these ~~misstated.~~refunds, Wewe ~~then~~did ~~evaluated~~not ~~whether~~record ~~the~~a ~~cumulative~~receivable ~~amount~~for ofthese ~~the~~refunds ~~over-accrual~~and ~~was~~a ~~material~~corresponding reduction to ~~our~~cost ~~projected~~of ~~fiscal~~goods ~~2024~~sold ~~results,~~or ~~and~~to ~~determined~~merchandise ~~the~~inventories ~~cumulative~~in ~~amount~~our ~~was not material. Therefore, the~~ Condensed Consolidated Financial Statements for the ~~thirty-nine~~first ~~weeks~~quarter ~~ended~~of ~~October 27,~~fiscal ~~2024~~2026. ~~include~~We anexpect ~~out-of-period~~to ~~adjustment~~recognize ofthe ~~$49.0~~benefit ~~million,~~for ~~recorded~~the inrefunds, ~~the~~related ~~first~~to ~~quarter~~tariffs ofthat ~~fiscal~~have ~~2024,~~been toexpensed ~~reduce~~in cost of goods sold, ~~and~~when ~~accounts~~we ~~payable,~~determine ~~which~~that ~~corrected~~ the ~~cumulative~~collection ~~error~~of on the ~~Consolidated~~refund ~~Balance~~is ~~Sheet as of January 28, 2024~~probable.

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Looking Ahead

We remain focused on our three key priorities of (i) ~~returning~~accelerating to growth, (ii) ~~elevating~~delivering ~~our~~ world-class customer service and (iii) driving earnings. We believe these three key priorities will set us apart from our competition and ~~allow~~support ~~us to drive~~ long-term growth and profitability. WeGrowth ~~believe~~creates weleverage in our operating model, and improved service supports reinvestment in our business and delivers earnings growth. We have a powerful portfolio of brands, serving a range of categories, aesthetics, and life stages and we have built a strong omni-channel platform and infrastructure, which ~~will~~we ~~position~~believe positions us well for the next stage of growth. However, the current uncertain macroeconomic environment, including the evolving tariff and trade policy landscape, a weak housing market, elevated interest rates, layoffs, inflationary pressure, economic uncertainty and global geopolitical instability could negatively impact our business. Since the end of the first quarter of fiscal 2025, the tariff environment has materially evolved. Specifically, our incremental tariff rate has more than doubled from 14% in May 2025 to 29% as of this Quarterly Report on Form 10-Q. These tariffs, as well as any future tariffs, are expected to result in increased cost for imported materials and finished goods. While we believe that we can offset a portion of these costs, we may not be able to offset all the additional costs. Our inability to minimize the impact of tariffs on our products, increase prices or find alternative sources for our products may have a material impact on our earnings. For information on risks, please see “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended February 2, 2025.

However, the current uncertain macroeconomic environment, including higher oil prices, the evolving tariff and trade policy landscape, a weak housing market, elevated interest rates, layoffs, inflationary pressure, economic uncertainty and global geopolitical instability could continue to impact our business. The tariff environment has materially changed over the last year, and we expect that uncertainty to continue in fiscal 2026. For information on risks, please see “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended February 1, 2026.

NET REVENUES

Net revenues ~~primarily~~ consist of sales of merchandise to our customers through our e-commerce websites, ~~retail stores~~ and ~~direct-mail~~retail ~~catalogs~~stores, and include shipping fees received from customers for delivery of merchandise to their homes. Our revenues also include sales to our business-to-business customers and franchisees, incentives received from credit card issuers in connection with our private label and co-branded credit cards and breakage income related to our stored-value cards. Revenue from the sale of merchandise is reported net of sales returns.

~~Third~~First Quarter of Fiscal ~~2025~~2026 vs. ~~Third~~First Quarter of Fiscal ~~2024~~2025

Net revenues in the ~~third~~first quarter of fiscal ~~2025~~2026 increased $8275.13 million or 4.64%, ~~with~~due to (i) company comp growth of $78.6 million, or 4.08%., ~~This~~partially ~~increase~~offset ~~was~~by ~~driven~~(ii) bya ~~strong~~decrease in non-~~furniture~~comparable ~~and~~brand ~~furniture~~revenue ~~sales,~~of ~~including~~$3.3 ~~new~~million ~~product~~due ~~introductions~~to ~~and~~lower ~~collaborations,~~franchise asnet ~~well~~revenues asand ~~higher~~the ~~full-price~~closure ~~selling~~of retail stores. From a channel perspective, the company comp growth of 4.08% was driven by comp growth of 84.58% in our ~~retail~~e-commerce channel and comp growth of 14.97% in our ~~e-commerce~~retail channel.

First Thirty-nine Weeks of Fiscal 2025 vs. First Thirty-nine Weeks of Fiscal 2024

Net revenues in the first thirty-nine weeks of fiscal 2025 increased by $200.4 million, or 3.8%, with company comp growth of 3.7%. This was driven by strong non-furniture and furniture sales, including new product introductions and collaborations, as well as higher full-price selling. From a channel perspective, the company comp growth of 3.7% was driven by comp growth of 7.4% in our retail channel and comp growth of 2.0% in our e-commerce channel. Both channels benefited from improved in-stock inventory levels.

Comparable Brand Revenue

Comparable brand revenue includes comparable e-commerce sales, including through our direct-mail catalog, and store sales, as well as shipping fees, sales returns and other discounts associated with current period sales. Comparable stores are defined as permanent stores where gross square footage did not change by more than 20% in the previous 12 months, and which have been open for at least 12 consecutive months without closure for more than seven days within the same fiscal month. Outlet comparable store revenues are included in their respective brands. Business-to-business revenues are included in comparable brand revenue for each of our brands. Sales to our international franchisees are excluded from comparable brand revenue as their stores and e-commerce websites are not operated by us. Sales from certain operations are also excluded until such time that we believe those sales are meaningful to evaluating their performance. Additionally, comparable brand revenue for ~~new and~~ emerging ~~concepts~~brands is not separately disclosed until such time that we believe those sales are meaningful to evaluating the performance of the brand.

	For the Thirteen Weeks Ended 1				~~For the Thirty-nine Weeks Ended 1~~
Comparable brand revenue growth (decline)	November 2, 2025		October 27, 2024		November 2, 2025		October 27, 2024
Comparable brand revenue growth	May 3, 2026		May 4, 2025
Pottery Barn	1.30	%	(72.5)0	%	~~1.5~~	%	~~(8.4)~~	%
West Elm	38.35		(30.5)2		~~2.3~~		~~(4.1)~~
Williams Sonoma	7.3		(0.1)		6.6		0.0
Williams Sonoma 2	5.0		7.3
Pottery Barn Kids and Teen	4.45		3.8		~~4.5~~		~~2.7~~
Total 2	4.0	%	(2.9)	%	3.7	%	(3.7)	%
Total 3	4.8	%	3.4	%
1 Comparable brand revenue includes business-to-business revenues within each brand.
2 Total comparable brand revenue growth (decline) includes the results of Rejuvenation, Mark and Graham, and GreenRow.
2 Includes results from Williams Sonoma Home.
3 Total comparable brand revenue growth includes the results of Rejuvenation, Mark and Graham, and GreenRow.

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RETAIL STORE DATA

	Store Count					Average Leased SquareFootage Per Store
	August 3, 2025	Openings	Closings	November 2, 2025	October 27, 2024	November 2, 2025	October 27, 2024
	February 1, 2026	Openings	Closings	May 3, 2026	May 4, 2025	May 3, 2026	May 4, 2025
Pottery Barn	181	2	—(3)	~~183~~180	~~186~~180	1514,~~100~~900	1514,~~000~~900
Williams Sonoma	~~154~~152	—1	~~(1)~~—	153	~~160~~154	6,~~900~~800	6,900
West Elm	~~119~~116	—1	—(1)	~~119~~116	~~122~~119	13,~~300~~400	13,~~200~~300
Pottery Barn Kids	44	1—	—(1)	4543	4644	78,~~800~~000	7,800
Rejuvenation	1113	2—	—	13	11	78,~~900~~000	8,100
Total	509	5	(1)	513	525	11,400	11,400
GreenRow	—	1	—	1	—	5,500	—
Store selling square footage at period-end						3,817,000	3,886,000
Total	506	5	(5)	506	508	11,300	11,300
Store leased square footage at period-end						5,844,000	5,972,000
Store selling square footage at period-end						3,734,000	3,751,000
Store leased square footage at period-end						5,728,000	5,761,000

GROSS PROFIT

Gross profit is equal to our net revenues less cost of goods sold. Cost of goods sold includes (i) cost of ~~goods~~merchandise, ~~which consists of cost of merchandise~~tariffs, inbound freight ~~expenses~~costs, freight-to-store ~~expenses,~~costs ~~tariff expenses~~ and other inventory -related costs such as replacements, damages, obsolescence and shrinkage, (ii) occupancy ~~expenses~~costs, which consists of rent, other ~~occupancy~~ costs (including property taxes, common area maintenance and utilities) and depreciation, and (iii) shipping costs, which consists of third-party delivery services and shipping materials.

Our classification of ~~expenses~~costs in ~~cost~~gross ofprofit ~~goods sold~~ may not be comparable to other public companies, as we do not include non-occupancy-related costs associated with our distribution network in cost of goods sold. These costs, which include distribution network employment, third-party warehouse management and other distribution-related administrative expenses, are recorded in selling, general, and administrative expenses (“SG&A”).

For the Thirteen Weeks Ended

~~For the Thirty-nine Weeks Ended~~

(In thousands)

~~November~~May 23, ~~2025~~2026

% ~~NetRevenues~~Net Revenues

~~October~~May 274, ~~2024~~2025

% ~~NetRevenues~~Net Revenues

~~November 2, 2025~~

~~% NetRevenues~~

~~October 27, 2024~~

~~% NetRevenues~~

Gross profit 1

~~867~~793,~~733~~426

4644.10

~~817~~765,~~566~~809

4544.43

~~2,498,165~~

~~45.8~~

~~2,416,674~~

~~46.0~~

1Includes occupancy expenses of $~~206~~203.~~5 million~~6 ~~and $195.0~~ million ~~for the third quarter of fiscal 2025~~ and ~~fiscal 2024, respectively, and~~ $~~605~~197.~~6 million~~7 ~~and $588.3~~ million for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026 and fiscal ~~2024~~2025, respectively.

~~Third~~First Quarter of Fiscal ~~2025~~2026 vs. ~~Third~~First Quarter of Fiscal ~~2024~~2025

Gross profit increased $5027.26 million, or 63.16%, compared to the ~~third~~first quarter of fiscal ~~2024~~2025. Gross margin ~~increased~~decreased to 4644.10% from 4544.43% in the ~~third~~first quarter of fiscal ~~2024~~2025. This ~~increase~~decrease in gross margin of 7030 basis points was primarily driven by ~~higher~~(i) lower merchandise margins of 60100 basis points ~~due~~as toa ~~(i)~~result of the flow-through of tariffs into cost of goods sold, ~~being~~partially ~~slower~~offset ~~than~~by ~~anticipated due to delayed tariff effective dates,~~ (ii) ~~results from our tariff mitigation plan, including select price increases, and (iii) lower inbound transportation costs. Additionally,~~ supply chain efficiencies ~~contributed~~of 3050 basis points, including ~~reductions~~a inlower ~~outbound~~shrink ~~shipping expense~~accrual, ~~damages, replacements~~ and ~~accommodations.~~(iii) ~~These~~the ~~improvements~~leverage ~~were~~of ~~partially offset by higher~~ occupancy costs of 20 basis points due to ~~our retail outperformance and the~~ higher ~~occupancy costs in that channel~~sales.

First Thirty-nine Weeks of Fiscal 2025 vs. First Thirty-nine Weeks of Fiscal 2024

Gross profit increased $81.5 million, or 3.4%, compared to the first thirty-nine weeks of fiscal 2024. Gross margin decreased to 45.8% from 46.0% in the first thirty-nine weeks of fiscal 2024. This decrease in gross margin of 20 basis points was driven by (i) the out-of-period freight adjustment in the first quarter of fiscal 2024 of 90 basis points, partially offset by (ii) supply chain efficiencies of 40 basis points, including reductions in damages, replacements and accommodations, (iii) higher merchandise margins of 20 basis points, and (iv) the leverage of occupancy costs of 10 basis points resulting from higher sales.

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SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

SG&A consists of non-occupancy -related costs associated with our retail stores and e-commerce websites, distribution and manufacturing facilities, customer care centers, supply chain operations (buying, receiving and inspection) and corporate administrative functions. These costs include employment, advertising, third -party credit card processing, impairment and other general expenses.

For the Thirteen Weeks Ended

~~For the Thirty-nine Weeks Ended~~

(In thousands)

~~November~~May 23, ~~2025~~2026

% Net Revenues

~~October~~May 274, ~~2024~~2025

% Net Revenues

~~November 2, 2025~~

~~% Net Revenues~~

~~October 27, 2024~~

~~% Net Revenues~~

Selling, general and administrative expenses

~~548~~501,~~590~~738

2927.18

~~512~~475,~~535~~096

2827.5

~~1,560,250~~

~~28.6~~

~~1,516,631~~

~~28.9~~

~~Third~~First Quarter of Fiscal ~~2025~~2026 vs. ~~Third~~First Quarter of Fiscal ~~2024~~2025

SG&A increased $3626.16 million, or 75.06%, compared to the ~~third~~first quarter of fiscal ~~2024~~2025. SG&A as a percentage of net revenues increased to 2927.18% from 2827.5% in the ~~third~~first quarter of fiscal ~~2024~~2025. This increase of 6030 basis points was primarily driven by (i) an increase in employment expense of 5030 basis points due to an investment in talent, including higher performance-based incentive compensation, and (ii) an increase in ~~advertising~~general expenses of 2010 basis points, partially offset by (iii) ~~general~~advertising expense leverage of 10 basis points.

~~First Thirty-nine Weeks of Fiscal 2025 vs. First Thirty-nine Weeks of Fiscal 2024~~16

~~SG&A~~Table ~~increased $43.6 million, or 2.9%, compared to the first thirty-nine weeks~~ of fiscal 2024. SG&A as a percentage of net revenues decreased to 28.6% from 28.9% in the first thirty-nine weeks of fiscal 2024. This leverage of 30 basis points was primarily driven by (i) lower advertising expenses of 40 basis points and (ii) lower general expenses of 20 basis points, partially offset by (iii) an increase in employment expense of 30 basis points due to higher performance-based incentive compensation.Contents

INCOME TAXES

On July 4, 2025, the One Big Beautiful Bill Act (“OBBB”) was signed into law in the United States. The OBBB includes a broad range of tax reform provisions, including permanently extending and modifying certain expiring provisions of the 2017 Tax Cuts and Jobs Act. The legislation has multiple effective dates, with certain provisions becoming effective in fiscal 2025 and the majority taking effect in future years. We currently expect the OBBB to have a minimal impact on the effective tax rate but result in favorable cash tax impacts in fiscal 2025 as a result of certain accelerated tax deductions.

Since the Organization for Economic Co-operation and Development (“OECD”) announced the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (“Framework”) in 2021, a number of countries have begun to enact legislation to implement the OECD international tax framework, including the Pillar Two minimum tax regime. Our subsidiaries were not subject to Pillar Two minimum tax in the first thirty-nine weeks of fiscal 2025. We are continuing to evaluate the potential impact on future periods of the Pillar Two Framework, and monitoring legislative developments by other countries, especially in the regions in which we operate.

LIQUIDITY AND CAPITAL RESOURCES

Material Cash Requirements

There were no material changes during the quarter to the Company’s material cash requirements, commitments and contingencies that are described in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026, which is incorporated herein by reference.

Stock Repurchase Program and Dividends

See Note G to our Condensed Consolidated Financial Statements, Stock Repurchase Program and Dividends, within Item 1 of this Quarterly Report on Form 10-Q for further information.

Liquidity Outlook

For the remainder of fiscal ~~2025~~2026, we plan to use our cash resources to fund our inventory purchases, employment-related costs, advertising ~~and marketing initiatives~~costs, rental payments on our leases, capital expenditures, dividend payments, stock repurchases, and the payment of income taxes.

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We believe our cash on hand, cash flows from operations and our available credit facilities will provide adequate liquidity for our business operations as well as dividends, capital expenditures, stock repurchases and other liquidity requirements associated with our business operations over the next 12 months. We are currently not aware of any other trends or demands, commitments, events or uncertainties that will result in, or that are reasonably likely to result in, our liquidity increasing or decreasing in any material way that would impact our capital needs during or beyond the next 12 months.

Sources of Liquidity

As of ~~November~~May 23, ~~2025~~2026, we held $~~884~~651.76 million in cash and cash equivalents, the majority of which was held in money market funds and interest-bearing demand deposit accounts, and of which $6447.28 million was held by our international subsidiaries. Consistent with our industry, our cash balances are seasonal in nature, with the fourth quarter historically representing a significantly higher level of cash than other periods.

In addition to our cash balances on hand, ~~in June 2025,~~ we ~~amended~~have ~~our~~a ~~existing~~ credit facility, ~~which~~(the ~~increased~~“Credit ~~our~~Facility”) ~~unsecured~~which ~~revolving~~provides ~~line~~for ofa ~~credit to~~ $600 million, ~~amended~~unsecured ~~certain~~revolving ~~interest~~line ~~rates and extended the maturity date~~ of ~~the facility to June 26, 2030, in addition to other updates (the “Credit Facility”)~~credit. Our Credit Facility may be used to borrow revolving loans or to request the issuance of letters of credit. We may, upon notice to the administrative agent, request existing or new lenders, at such lenders’ option, to increase the Credit Facility by up to $250 million to provide for a total of ~~up to~~ $850 million of unsecured revolving credit.

Letter of Credit Facilities

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Cash Flows from Operating Activities

For the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026, net cash provided by operating activities was $~~718~~156.03 million compared to $~~726~~118.79 million for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2024~~2025, and was primarily attributable to net earnings of $231.4 million adjusted for non-cash items, partially offset by ~~higher~~accrued ~~spending~~expenses onand ~~merchandise~~other ~~inventories~~liabilities of $148.9 million (as a result of ~~increased~~our ~~tariff~~annual ~~costs~~bonus payout) and ~~timing~~accounts payable of ~~receipts)~~$82.4 ~~Net~~million ~~cash~~(as ~~provided~~a byresult ~~operating activities compared to the first thirty-nine weeks~~ of ~~fiscal~~supplier ~~2024~~payment ~~decreased primarily due to higher spending on merchandise inventories, partially offset by an increase in income taxes payable~~timing).

Net cash provided by operating activities compared to the first quarter of fiscal 2025 increased $37.4 million primarily due to an increase in gift card and other deferred revenue of $14.9 million and an increase in accounts payable of $13.6 million.

Cash Flows from Investing Activities

For the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026, net cash used in investing activities was $~~179~~57.7 million compared to $~~154~~58.02 million for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2024~~2025, and was ~~primarily~~ attributable to purchases of property and equipment, ~~related~~including toinvestments in technology of $24.4 million, ~~store~~retail ~~construction~~stores of $20.1 million and supply chain enhancements of $9.1 million.

Cash Flows from Financing Activities

For the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2025~~2026, net cash used in financing activities was $~~870~~467.10 million compared to $1230.0 ~~billion~~million for the first ~~thirty-nine~~quarter ~~weeks~~ of fiscal ~~2024~~2025, ~~primarily~~ driven by repurchases of our common stock, ~~payment~~ of ~~dividends~~$287.8 million, ~~and remittance of~~ tax withholdings remittance related to stock-based awards. ~~Net cash used in financing activities for the first thirty-nine weeks~~ of ~~fiscal~~$93.6 million ~~2025~~and ~~decreased~~payment ~~compared to the first thirty-nine weeks~~ of ~~fiscal~~dividends ~~2024, due to a decrease in repurchases~~ of ~~our common stock~~$85.6 million.

22Net cash used in financing activities for the first quarter of fiscal 2026 increased by $237.0 million compared to the first quarter of fiscal 2025, primarily due to an increase in repurchases of our common stock of $197.8 million.

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Seasonality

Our business is subject to substantial seasonal variations in demand. Historically, a significant portion of our revenues and net earnings have been realized during our peak selling season, the period from October through January, and levels of net revenues and net earnings have typically been lower during the period from February through September. We believe this is the general pattern within our industry. In preparation for and during our peak selling season, we hire a substantial number of additional temporary ~~associates~~employees, primarily in our retail stores, distribution facilities and customer care centers.

CRITICAL ACCOUNTING ESTIMATES

Management’s Discussion and Analysis of Financial Condition and Results of Operations is based on our Condensed Consolidated Financial Statements, which have been prepared in accordance with U.S. GAAP. The preparation of these Condensed Consolidated Financial Statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. These estimates and assumptions are evaluated on an ongoing basis and are based on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ significantly from these estimates. During the ~~third~~first quarter of fiscal ~~2025~~2026, there were no significant changes to the critical accounting estimates discussed in our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risks, which include significant deterioration of the U.S. and foreign markets, changes in U.S. interest rates, foreign currency exchange rate fluctuations, inflation and the effects of economic uncertainty which may affect the prices we pay our suppliers in the foreign countries in which we do business. We do not engage in financial transactions for trading or speculative purposes.

Interest Rate Risk

Our Credit Facility has a variable interest rate which, when drawn upon, subjects us to risks associated with changes in that interest rate. During the ~~third~~first quarter of fiscal ~~2025~~2026, we had no borrowings under our Credit Facility.

In addition, we have fixed and variable income investments consisting of short-term investments classified as cash and cash equivalents, which are also affected by changes in market interest rates. As of ~~November~~May 23, ~~2025~~2026, our investments, made primarily in money market funds and interest-bearing demand deposit accounts, are stated at cost and approximate their fair values.

Foreign Currency Risks

We purchase the majority of our inventory from suppliers outside of the U.S. in transactions that are primarily denominated in U.S. dollars and, as such, any foreign currency impact related to these international purchase transactions was not significant to us during the ~~third~~first quarter of fiscal ~~2025~~2026 or the ~~third~~first quarter of fiscal ~~2024~~2025. Since we pay for the majority of our international purchases in U.S. dollars, however, a decline in the U.S. dollar relative to other foreign currencies would subject us to risks associated with increased purchasing costs from our suppliers in their effort to offset any lost profits associated with any currency devaluation. We cannot predict with certainty the effect these increased costs may have on our financial statements or results of operations.

In addition, our businesses in Canada, Australia and the United Kingdom, and our operations throughout Asia and Europe, expose us to market risk associated with foreign currency exchange rate fluctuations. Substantially all of our purchases and sales are denominated in U.S. dollars, which limits our exposure to this risk. However, some of our foreign operations have a functional currency other than the U.S. dollar. While the impact of foreign currency exchange rate fluctuations was not material to us in the third quarter of fiscal 2025 or the third quarter of fiscal 2024, we have continued to see volatility in the exchange rates in the countries in which we do business. Additionally, the effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have a material impact on our historical or current Condensed Consolidated Financial Statements. As we continue to expand globally, the foreign currency exchange risk related to our foreign operations may increase. To mitigate this risk, we may hedge a portion of our foreign currency exposure with foreign currency forward contracts in accordance with our risk management policies.18

Inflation

While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we have experienced varying levels of inflation, resulting in part from various supply chain disruptions, increased shipping and transportation costs, increased product costs, increased labor costs in the supply chain and other disruptions caused by the uncertain economic environment. We believe the effects of inflation, if any, on our financial statements and results of operations have been immaterial to date. However, there can be no assurance that our results of operations and financial condition will not be materially impacted by inflation in the future. Our inability or failure to offset the impact of inflation could harm our business, financial condition and results of operations.

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In addition, our businesses in Canada, Australia and the United Kingdom, and our operations throughout Asia and Europe, expose us to market risk associated with foreign currency exchange rate fluctuations. Substantially all of our purchases and sales are denominated in U.S. dollars, which limits our exposure to this risk. However, some of our foreign operations have a functional currency other than the U.S. dollar. While the impact of foreign currency exchange rate fluctuations was not material to us in the first quarter of fiscal 2026 or the first quarter of fiscal 2025, we have continued to see volatility in the exchange rates in the countries in which we do business. Additionally, the effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have a material impact on our historical or current Condensed Consolidated Financial Statements. As we continue to expand globally, the foreign currency exchange risk related to our foreign operations may increase. To mitigate this risk, we may hedge a portion of our foreign currency exposure with foreign currency forward contracts in accordance with our risk management policies.

Inflation

While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we have experienced varying levels of inflation, resulting in part from various supply chain disruptions, increased shipping and transportation costs, higher oil costs, increased product costs, increased labor costs in the supply chain and other disruptions caused by the uncertain economic environment and geopolitical climate. We cannot be assured that our results of operations and financial condition will not be materially impacted by inflation in the future.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of ~~November~~May 23, ~~2025~~2026, an evaluation was performed by management, with the participation of our Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”), of the effectiveness of our disclosure controls and procedures. Based on that evaluation, our management, including our CEO and CFO, concluded that our disclosure controls and procedures are effective to ensure that information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow for timely discussions regarding required disclosures, and that such information is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the ~~third~~first quarter of fiscal ~~2025~~2026, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Information required by this Item is contained in Note F to our Condensed Consolidated Financial Statements within Part I of this Form 10-Q.

ITEM 1A. RISK FACTORS

See Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended February 21, ~~2025~~2026 for a description of the risks and uncertainties associated with our business. There were no material changes to such risk factors in the current quarterly reporting period.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides information as of ~~November~~May 23, ~~2025~~2026 with respect to shares of common stock we repurchased during the ~~third~~first quarter of fiscal ~~2025~~2026 under the $1.0 billion stock repurchase authorization announced in September 2024 (the “September 2024 authorization”).

Fiscal Period	Total Number of Shares Purchased 1	Average Price Paid Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program 1	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program
August 4, 2025 - August 31, 2025	—	$	—	—	$	903,415,000
February 2, 2026 - March 1, 2026	—	$	—	—	$	338,561,000
September 1, 2025 - September 28, 2025	—	$	—	—	$	903,415,000
March 2, 2026 - March 29, 2026	949,332	$	179.00	949,332	$	168,635,000
September 29, 2025 - November 2, 2025	1,402,750	$	190.05	1,402,750	$	636,820,000
March 30, 2026 - May 3, 2026	658,921	$	178.90	658,921	$	50,756,000
Total	1,~~402~~608,~~750~~253	$	~~190~~178.0596	1,~~402~~608,~~750~~253	$	~~636~~50,~~820~~756,000

1 Excludes shares withheld for employee taxes upon vesting of stock-based awards.

Additionally, in November 2025, we announced our Board of Directors approved a new $1.0 billion stock repurchase authorization (together with the September 2024 authorization, “our program”), which will become effective once our September 2024 authorization is fully utilized. For additional information, please see Note G to our Condensed Consolidated Financial Statements within Part I of this Form 10-Q.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5. OTHER INFORMATION

Insider Adoption or Termination of Trading Arrangements

During the ~~third~~first quarter of fiscal ~~2025~~2026, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Regulation S-K, Item 408~~, except as described in the table below:~~ .

Name & Title

Date Adopted

Character of Trading Arrangement 1

Aggregate Number of Shares of Common Stock to be Purchased or Sold Pursuant to Trading Arrangement

Duration

Date Terminated

Laura Alber, Director, President and Chief Executive Officer

October 2, 2025

Rule 10b5-1 Trading Arrangement

Up to 210,000 shares to be sold

January 15, 2026 through January 8, 2027

N/A

Karalyn Yearout, Executive Vice President and Chief Talent Officer

October 15, 2025

Rule 10b5-1 Trading Arrangement

Up to 7,250 shares to be sold 2

January 14, 2026 through December 15, 2026

N/A

Departure of Directors or Certain Officers

~~1 Each~~On ~~trading~~May ~~arrangement~~21, ~~marked~~2026, aswe aannounced ~~“Rule~~the ~~10b5-1~~departure ~~Trading~~from ~~Arrangement”~~the isCompany ~~intended~~of toMonica ~~satisfy~~Bhargava, ~~the~~a ~~affirmative~~named ~~defense~~executive officer and President of ~~Rule~~the ~~10b5-1(c)~~Pottery Barn brand, aseffective ~~amended~~May 21, 2026. Additionally, we announced that Jennifer Kellor has been named President of Pottery Barn.

~~2 This~~In ~~number~~connection ~~includes~~with ~~shares~~Ms. ofBhargava’s ~~our~~separation, ~~common~~the ~~stock~~Company ~~issuable~~entered ~~pursuant~~into toa ~~unvested~~Separation ~~restricted~~Agreement ~~stock~~and ~~units~~General ~~and~~Release ~~unvested~~with ~~performance~~Ms. ~~stock~~Bhargava ~~units~~on May 18, 2026 (the “~~PSUs~~Separation Agreement”). ~~The~~Pursuant ~~PSUs~~to ~~are~~the Separation Agreement and subject to ~~the~~her ~~achievement~~compliance ofwith certain ~~performance~~restrictive ~~conditions~~covenants, asMs. ~~set~~Bhargava ~~forth~~will inbe eligible for the following payments and benefits, all less applicable ~~PSU~~withholdings ~~agreement.~~and ~~The~~deductions: ~~actual~~(i) ~~number~~payments of ~~PSUs~~$1,571,400 ~~that~~(including ~~vest~~legal ~~following~~fees); (ii) the ~~end~~acceleration of ~~the~~vesting ~~applicable~~of ~~performance period~~25,370 ifrestricted ~~any,~~stock ~~and~~units; ~~therefore~~(iii) the ~~resulting~~acceleration ~~shares~~of vesting of ~~our~~9,580 ~~common~~performance stock ~~available~~units ~~for~~to ~~sale~~be ~~under~~issued ~~the~~on ~~plan~~March ~~will~~15, ~~depend~~2027; onand ~~the~~(iv) ~~attainment~~payments of $34,362 to cover the ~~performance~~cost ~~metrics.~~of health care coverage for up to 18 months.

26The foregoing summary of the terms of the Separation Agreement is qualified in its entirety by reference to the complete text of the Separation Agreement, a copy of which will be filed with our Quarterly Report on Form 10-Q for the period ending August 2, 2026.

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ITEM 6. EXHIBITS

(a) Exhibits

ExhibitNumber						Exhibit Description
31.1*						Certification of Chief Executive Officer, pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended
31.2*						Certification of Chief Financial Officer, pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended
32.1*						Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*						Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101*						The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~November~~May 23, ~~2025~~2026, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Earnings, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Stockholders’ Equity, (v) Condensed Consolidated Statements of Cash Flows and (vi) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags
104*						Cover Page Interactive Data File (formatted as Inline XBRL and contained in the Interactive Data Files submitted under Exhibit 101)

Filed herewith.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


WILLIAMS-SONOMA, INC.

By:						/s/ Jeffrey E. Howie
						Jeffrey E. Howie
						Executive Vice President and Chief Financial Officer
						(Principal Financial Officer)


By:						/s/ Jeremy Brooks
						Jeremy Brooks
						Senior Vice President and Chief Accounting Officer
						(Principal Accounting Officer)

Date: ~~November~~May 2522, ~~2025~~2026

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