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 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
Cost of goods sold			1,015,081						983,102						2,951,522						2,832,649
Gross profit			867,733						817,566						2,498,165						2,416,674
Selling, general and administrative expenses			548,590						512,535						1,560,250						1,516,631
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
Income taxes			87,336						79,571						245,896						228,573
Net earnings			$	241,592					$	237,262					$	720,417					$	714,533
Basic earnings per share			$	1.99					$	1.89					$	5.89					$	5.61
Diluted earnings per share			$	1.96					$	1.87					$	5.82					$	5.54
Shares used in calculation of earnings per share:
Basic			121,434						125,333						122,221						127,334
Diluted			123,273						126,892						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 2, 2025						October 27, 2024						November 2, 2025						October 27, 2024
Net earnings			$	241,592					$	237,262					$	720,417					$	714,533
Other comprehensive income (loss):
Foreign currency translation adjustments			(530)						(13)						5,120						(1,404)
Change in fair value of derivative financial instruments, net of tax			—						—						—						1
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.

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

			As of
(In thousands, except per share amounts)			November 2, 2025						February 2, 2025						October 27, 2024
ASSETS
Current assets
Cash and cash equivalents			$	884,663					$	1,212,977					$	826,784
Accounts receivable, net			118,385						117,678						105,620
Merchandise inventories, net			1,530,896						1,332,429						1,396,253
Prepaid expenses			92,481						66,914						84,810
Other current assets			20,571						24,611						19,432
Total current assets			2,646,996						2,754,609						2,432,899
Property and equipment, net			1,061,354						1,033,934						1,019,874
Operating lease right-of-use assets			1,286,299						1,177,805						1,147,673
Deferred income taxes, net			88,608						120,657						109,444
Goodwill			77,374						77,260						77,301
Other long-term assets, net			150,750						137,342						127,267
Total assets			$	5,311,381					$	5,301,607					$	4,914,458
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable			$	667,490					$	645,667					$	665,803
Accrued expenses			246,618						286,033						215,608
Gift card and other deferred revenue			592,490						584,791						583,022
Income taxes payable			37,771						67,696						19,887
Operating lease liabilities			220,239						234,180						231,667
Other current liabilities			90,436						93,607						101,272
Total current liabilities			1,855,044						1,911,974						1,817,259
Long-term operating lease liabilities			1,245,525						1,113,135						1,083,809
Other long-term liabilities			142,854						134,079						132,612
Total liabilities			3,243,423						3,159,188						3,033,680
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
Additional paid-in capital			567,873						571,585						545,205
Retained earnings			1,517,368						1,591,630						1,351,630
Accumulated other comprehensive loss			(16,473)						(21,593)						(16,861)
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)						(435)
Total stockholders’ equity			2,067,958						2,142,419						1,880,778
Total liabilities and stockholders’ equity			$	5,311,381					$	5,301,607					$	4,914,458

See Notes to Condensed Consolidated Financial Statements.

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

			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
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

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

2**Repurchases of common stock include accrued excise taxes of $4.7 million as of November 2, 2025, which is recorded in retained earnings.

See Notes to Condensed Consolidated Financial Statements.

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

			Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Treasury Stock						Total Stockholders’ 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

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

2**Repurchases of common stock include accrued excise taxes of $6.0 million as of October 27, 2024, which is recorded in retained earnings.

See Notes to Condensed Consolidated Financial Statements.

WILLIAMS-SONOMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

			For the Thirty-nine Weeks Ended
(In thousands)			November 2, 2025						October 27, 2024
Cash flows from operating activities:
Net earnings			$	720,417					$	714,533
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization			170,676						171,657
Loss on disposal/impairment of assets			5,138						4,494
Non-cash lease expense			185,302						192,501
Deferred income taxes			19,437						(9,003)
Tax benefit related to stock-based awards			11,686						10,472
Stock-based compensation expense			77,152						66,061
Other			(1,840)						(2,205)
Changes in:
Accounts receivable			(517)						17,287
Merchandise inventories			(196,061)						(150,055)
Prepaid expenses and other assets			(33,184)						(21,393)
Accounts payable			5,024						37,239
Accrued expenses and other liabilities			(31,686)						(36,598)
Gift card and other deferred revenue			7,348						9,367
Operating lease liabilities			(191,002)						(200,947)
Income taxes payable			(29,925)						(76,667)
Net cash provided by operating activities			717,965						726,743
Cash flows from investing activities:
Purchases of property and equipment			(178,505)						(154,354)
Other			(1,172)						360
Net cash used in investing activities			(179,677)						(153,994)
Cash flows from financing activities:
Repurchases of common stock			(555,703)						(707,477)
Payment of dividends			(236,629)						(208,861)
Tax withholdings related to stock-based awards			(69,671)						(90,733)
Debt issuance costs			(1,187)						—
Other			(6,941)						—
Net cash used in financing activities			(870,131)						(1,007,071)
Effect of exchange rates on cash and cash equivalents			3,529						(901)
Net decrease in cash and cash equivalents			(328,314)						(435,223)
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.

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 2, 2025, February 2, 2025 and October 27, 2024, 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 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 2, 2025, 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 2, 2025.

The Company's fiscal year ends on the Sunday closest to January 31. All references to “fiscal 2025” represent the 52-week fiscal year that will end on February 1, 2026 and all references to “fiscal 2024” represent the 53-week fiscal year that ended February 2, 2025.

The results of operations for the thirteen and thirty-nine weeks ended November 2, 2025 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 2, 2025.

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 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The improvements in the ASU address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. This ASU is effective for fiscal years beginning after December 15, 2024. The application of this new guidance is not expected to have a material impact on our financial condition, results of operations, or cash flows, as the ASU pertains to disclosure only.

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.

NOTE B. BORROWING ARRANGEMENTS

Credit Facility

In June 2025, we amended our existing credit facility, which increased our unsecured revolving line of credit to $600 million, amended certain interest rates and extended the maturity date of the facility, in addition to other updates (the “Credit Facility”). 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 2, 2025 and October 27, 2024, we had no borrowings under our Credit Facility. Additionally, as of November 2, 2025, issued but undrawn standby letters of credit of $12.0 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.

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 2, 2025, 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 2, 2025, the aggregate amount outstanding under our letter of credit facilities was $0.6 million, 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 2, 2025, there were approximately 7.7 million shares available for future grant. Awards may be granted under our Plan to officers, associates and non-associate 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 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 Board of Directors members generally vest in one year. Non-associate 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 Board of Directors member). Non-associate 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.

Stock-Based Compensation Expense

During the thirteen and thirty-nine weeks ended November 2, 2025, we recognized total stock-based compensation expense, as a component of selling, general and administrative expenses ("SG&A") of $30.2 million and $77.2 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.

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						Weighted Average Shares						Earnings Per Share
Thirteen weeks ended November 2, 2025
Basic			$	241,592					121,434						$	1.99
Effect of dilutive stock-based awards									1,839
Diluted			$	241,592					123,273						$	1.96
Thirteen weeks ended October 27, 2024
Basic			$	237,262					125,333						$	1.89
Effect of dilutive stock-based awards									1,559
Diluted			$	237,262					126,892						$	1.87
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 2, 2025 and October 27, 2024, respectively.

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 catalogs, 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 2, 2025.

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.

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

1**Other 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.

			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
1**Includes business-to-business net revenues within each brand.
2**Primarily consists of net revenues from Rejuvenation, our international franchise operations, Mark and Graham, and GreenRow.
3**Includes 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.

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

			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

management time and result in the diversion of significant operational resources. The results of these lawsuits, claims and proceedings cannot be predicted with certainty. However, 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.

NOTE G. STOCK REPURCHASE PROGRAM AND DIVIDENDS

Stock Repurchase Program

During the thirteen weeks ended November 2, 2025, pursuant to our stock repurchase program we repurchased 1,402,750 shares of our common stock at an average cost of $190.05 per share for an aggregate cost of $266.6 million, excluding excise taxes on stock repurchases (net of issuances) of $2.6 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 2, 2025, there was $636.8 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.

During the thirteen weeks ended October 27, 2024, we repurchased 3,929,491 shares of our common stock at an average cost of $135.86 per share for an aggregate cost of $533.9 million, excluding excise taxes on stock repurchases (net of issuances) of $5.3 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 2, 2025, February 2, 2025 and October 27, 2024, we held treasury stock of $2.0 million, $0.4 million and $0.4 million, respectively, that represents the cost of shares available for issuance intended to satisfy future stock-based award settlements in certain foreign jurisdictions.

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

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.

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 2, 2025, no impairment charges were recognized. During the thirty-nine weeks ended November 2, 2025, we recognized impairment charges of $0.3 million. During the thirteen and thirty-nine weeks ended October 27, 2024, we recognized impairment charges of $1.6 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 2, 2025 and October 27, 2024.

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 Currency Translation						Cash Flow Hedges						Accumulated Other Comprehensive Income (Loss)
Balance at February 2, 2025			$	(21,593)					$	—					$	(21,593)
Foreign currency translation adjustments			5,170						—						5,170
Other comprehensive income (loss)			5,170						—						5,170
Balance at May 4, 2025			$	(16,423)					$	—					$	(16,423)
Foreign currency translation adjustments			480						—						480
Other comprehensive income (loss)			480						—						480
Balance at August 3, 2025			$	(15,943)					$	—					$	(15,943)
Foreign currency translation adjustments			(530)						—						(530)
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)

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 2, 2025, February 2, 2025 and October 27, 2024, we recorded a liability for expected sales returns of $32.1 million, $42.7 million and $29.2 million, respectively, within other current liabilities and a corresponding asset for the expected net realizable value of the merchandise inventory to be returned of $9.0 million, $12.1 million and $7.2 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 is not material to our Condensed Consolidated Financial Statements.

We have customer loyalty programs, which allow members to earn points for each qualifying purchase. Customers can earn points through spend on both our private label and co-branded credit cards, or can earn points as part of our non-credit card related loyalty program. Points earned through both loyalty 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. 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 2, 2025, February 2, 2025 and October 27, 2024, we had recorded $592.5 million, $584.8 million and $583.0 million, respectively, for gift card and other deferred revenue within current liabilities in our Condensed Consolidated Balance Sheets.

NOTE K. INCOME TAXES

The effective tax rate was 25.4% for the first thirty-nine weeks of fiscal 2025, compared to 24.2% for the first thirty-nine weeks of fiscal 2024. The increase was primarily driven by (i) lower excess tax benefit from stock-based compensation in the first thirty-nine weeks of fiscal 2025, (ii) the tax effect of the change in earnings mix and (iii) the tax benefit of state amended returns filed in fiscal 2024.

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.

NOTE L. IMMATERIAL CORRECTION OF 2024 INTERIM PERIOD CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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.

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

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

Condensed Consolidated Statements of Stockholders' Equity (unaudited)

			Retained Earnings						Total Stockholders’ 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