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WSM (Williams-Sonoma) Degree of Operating Leverage : 1.58 (As of Apr. 2025)


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What is Williams-Sonoma Degree of Operating Leverage?

Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. Williams-Sonoma's Degree of Operating Leverage for the quarter that ended in Apr. 2025 was 1.58. The higher Degree of Operating Leverage, the higher operating risk the company will take.

The industry rank for Williams-Sonoma's Degree of Operating Leverage or its related term are showing as below:

WSM's Degree of Operating Leverage is ranked worse than
54.84% of 1094 companies
in the Retail - Cyclical industry
Industry Median: 1.295 vs WSM: 1.58

Williams-Sonoma Degree of Operating Leverage Historical Data

The historical data trend for Williams-Sonoma's Degree of Operating Leverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Williams-Sonoma Degree of Operating Leverage Chart

Williams-Sonoma Annual Data
Trend Jan16 Jan17 Jan18 Jan19 Jan20 Jan21 Jan22 Jan23 Jan24 Jan25
Degree of Operating Leverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only 6.36 2.76 0.60 1.59 -28.55

Williams-Sonoma Quarterly Data
Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23 Jul23 Oct23 Jan24 Apr24 Jul24 Oct24 Jan25 Apr25
Degree of Operating Leverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.09 -0.94 -2.07 -28.55 1.58

Competitive Comparison of Williams-Sonoma's Degree of Operating Leverage

For the Specialty Retail subindustry, Williams-Sonoma's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Williams-Sonoma's Degree of Operating Leverage Distribution in the Retail - Cyclical Industry

For the Retail - Cyclical industry and Consumer Cyclical sector, Williams-Sonoma's Degree of Operating Leverage distribution charts can be found below:

* The bar in red indicates where Williams-Sonoma's Degree of Operating Leverage falls into.


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Williams-Sonoma Degree of Operating Leverage Calculation

Williams-Sonoma's Degree of Operating Leverage for the quarter that ended in Apr. 2025 is calculated as:

Degree of Operating Leverage=% Change in EBIT**/% Change in Revenue
=( 1397.069 (Apr. 2025) / 1361.828 (Apr. 2024) - 1 )/( 7781.306 (Apr. 2025) / 7655.549 (Apr. 2024) - 1 )
=0.0259/0.0164
=1.58***

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


Williams-Sonoma  (NYSE:WSM) Degree of Operating Leverage Explanation

Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.

A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.

Be Aware

The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.


Williams-Sonoma Degree of Operating Leverage Related Terms

Thank you for viewing the detailed overview of Williams-Sonoma's Degree of Operating Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.


Williams-Sonoma Business Description

Traded in Other Exchanges
Address
3250 Van Ness Avenue, San Francisco, CA, USA, 94109
With a retail and direct-to-consumer presence, Williams-Sonoma is a player in the $300 billion domestic home category and $450 billion international home market, focused on expanding its exposure in the B2B ($80 billion total addressable market), marketplace, and franchise areas. Namesake Williams-Sonoma (154 stores) offers high-end cooking essentials, while Pottery Barn (180) provides casual home accessories. West Elm (119) is an emerging concept for young professionals, and Rejuvenation (11) offers lighting and house parts. Brand extensions include Pottery Barn Kids and Pottery Barn Teen (44) as well as Mark & Graham and GreenRow. Williams-Sonoma also has a business-to-business team that supports projects that range from residential to large-scale commercial.
Executives
Jeffrey Howie officer: EVP CHIEF FINANCIAL OFFICER C/O WILLIAMS-SONOMA, INC., 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Karalyn Smith officer: EVP CHIEF TALENT OFFICER C/O WILLIAMS-SONOMA, INC., 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Laura Alber officer: PRESIDENT, POTTERY BARN BRANDS
David Randolph King officer: SVP GENERAL COUNSEL 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Marta Benson officer: PRESIDENT POTTERY BARN BRAND C/O RESTORATION HARDWARE, 15 KOCH ROAD, SUITE J, CORTE MADERA CA 94925
Jeremy Brooks officer: CHIEF ACCOUNTING OFFICER C/O WILLIAMS-SONOMA, INC., 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Julie Whalen officer: VP, CONTROLLER 3260 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Ryan Ross officer: PRESIDENT WS BRAND 3250 VAN NESS AVE., SAN FRANCISCO CA 94109
Sabrina Simmons director GAP INC., 2 FOLSOM STREET, SAN FRANCISCO CA 94105
Anne A. Finucane director ONE CVS DRIVE, WOONSOCKET RI 02895
Paula B Pretlow director C/O CION ARES MANAGEMENT LLC, 2000 AVENUE OF THE STARS, 12TH FLOOR, LOS ANGELES CA 90067
Alex Bellos officer: PRESIDENT WEST ELM BRAND C/O WILLIAMS-SONOMA, INC., 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Esi Eggleston Bracey director C/O SIX FLAGS ENTERTAINMENT CORPORATION, 1000 BALLPARK WAY, SUITE 400, ARLINGTON TX 76011
Grace Puma Whiteford director C/O WILLIAM SONOMA, INC., 3250 VAN NESS AVENUE, SAN FRANCISCO CA 94109
Bellamy Adrian D P director C/O GAP, INC., 2 FOLSOM ST., SAN FRANCISCO CA 94105