Williams-Sonoma (NYSE:WSM) shares tanked by more than 12 percent on Thursday after the company cut its fourth quarter earnings expectations to below analyst estimates after the company had to offer more discounts over the holiday period to get them to buy products.
The high-end retailer said that it now expects to see earnings of $1.10 to $1.15 per share for the November to January quarter, down from its previous outlook of $1.15 to $1.20 per share. Analyst on average had been expecting earnings to reach $1.19 per share.
The company also trimmed its revenue outlook for the quarter to between $1.24 billion and $1.26 billion which would be close to on par with analyst predications of $1.26 billion. The company had previously forecast revenue to hit $1.27 billion.
Williams-Sonoma reported that revenue rose by 4.2 percent to $901 million in the eight weeks leading up to Christmas day while revenue at stores open at least one year rose by 4.9 percent.
The company wen on to announced that it raised its quarterly dividend to 22 cents per share, a 29 percent increased from the 17 cents per share it last offered shareholders. Williams Sonoma also announced a new $225 million share buyback program.
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