01:55 PM EDT, 08/22/2024 (MT Newswires) -- Williams-Sonoma ( WSM ) on Thursday downgraded its full-year revenue guidance after fiscal second-quarter sales fell short of market expectations amid macro uncertainty.

The home goods retailer now expects fiscal 2024 net revenue to fall between 1.5% and 4%, compared with its prior range indicating a 3% drop to 3% growth. Comparable sales are now seen dropping between 3% and 5.5%, versus the previous range of a 4.5% decrease to a 1.5% increase.

"2024 continues to be a challenging environment for home furnishings due to macroeconomic uncertainty in the slow housing market," Chief Financial Officer Jeff Howie said on an earnings conference call, according to a Capital IQ transcript. "This leads us to believe it's prudent to reduce our top-line outlook for the balance of the year."

Williams-Sonoma ( WSM ) shares were down 8% in Thursday afternoon trade.

Net revenue fell to $1.79 billion in the quarter through July 28 from $1.86 billion a year earlier, lagging the Street's $1.81 billion view. Company-level comparable brand revenue declined 3.3%, worse than the Street's call for a 2.6% decrease. Adjusted earnings rose to $1.74 a share from $1.56, topping analysts' $1.61 view.

"From a cadence perspective, our trends across the quarter were choppy and inconsistent, reflecting the uncertain macroeconomic backdrop," Howie told analysts. Second-quarter comparable revenue fell 7.1% for Pottery Barn ( WSM ) and 4.8% for West Elm. Williams Sonoma brand comps dropped 0.8%, while Pottery Barn Kids and Teen grew 1.5%.

The company now expects full-year operating margin between 17.4% and 17.8%, up from its prior range of 17% to 17.4%. Second-quarter operating margin was 16.2%.

"We continue to demonstrate the strength of our margin profile even in a difficult market," Chief Executive Laura Alber said on the call. "While we continue to navigate global macroeconomic pressures, our strategic initiatives are delivering positive results across key strategic markets, including India, Canada and Mexico."

Williams-Sonoma ( WSM ) expects to spend $225 million in capital expenditures over the long term, with 75% of the amount expected to go toward driving "e-commerce leadership and supply chain efficiency," Howie said on the call.

The company reiterated its long-term outlook of mid-to-high single-digit annual net revenue growth.

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