Williams-Sonoma vs. RH: Which Retail Stock Is the Better Buy Right Now?
Key Points
Williams-Sonoma generates consistently higher overall revenue than RH across the observed periods.
Williams-Sonoma experiences significant quarter-over-quarter volatility in revenue the past two years, while RH maintains a more stable trend.
Investors should watch whether the revenue gap between the two companies continues to follow this historical pattern or begins to shift.
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Top retail brands have struggled to grow revenue amid inflation and soft consumer spending over the past few years. This has particularly weighed on growth in home goods and furnishings. Despite these headwinds, shares of Williams-Sonoma (NYSE:WSM) have outperformed RH (NYSE:RH).
Here’s a look at how these retail companies compare on revenue performance, and which could be the better bet beyond 2026.
Williams-Sonoma: Navigating Seasonal Revenue Cycles
Williams-Sonoma functions as a specialized, multi-channel retailer offering a diverse array of home products. While managing a product recall and launching a new brand for dorm rooms, the company reported an approximately 13% net income margin for the quarter ended May 3, 2026.
RH: Maintaining Flat Revenue Trends
RH operates as a retailer specializing in home furnishings through its retail galleries, catalogs, and online platforms. While opening new international gallery locations in Milan and London, it reported an EBIT margin of approximately 4% for the quarter ended May 2, 2026.
Why Revenue Matters for Retail Investors
Revenue is the most fundamental measure of a company’s performance. Investors can easily track it over time to measure a business’s overall scale and demand, which can be very helpful when comparing it with others in the same industry.
Quarterly Revenue for Williams-Sonoma and RH
| Quarter (Period End) | Williams-Sonoma Revenue | RH Revenue |
|---|---|---|
| Q3 2024 | $1.8 billion (period ended July 2024) | $829.7 million (period ended Aug. 2024) |
| Q4 2024 | $1.8 billion (period ended Oct. 2024) | $811.7 million (period ended Nov. 2024) |
| Q1 2025 (Jan. 2025) | $2.5 billion | $812.4 million |
| Q2 2025 | $1.7 billion (period ended May 2025) | $814.0 million (period ended May 2025) |
| Q3 2025 | $1.8 billion (period ended Aug. 2025) | $899.2 million (period ended Aug. 2025) |
| Q4 2025 | $1.9 billion (period ended Nov. 2025) | $883.8 million (period ended Nov. 2025) |
| Q1 2026 | $2.4 billion (period ended Feb. 2026) | $842.6 million (period ended Jan. 2026) |
| Q2 2026 | $1.8 billion (period ended May 2026) | $800.3 million (period ended May 2026) |
Data source: Company filings. Data as of July 13, 2026.
Foolish Take
Macroeconomic headwinds, including higher prices and interest rates, have weighed on both companies’ revenue growth. However, Williams-Sonoma has managed to convert a higher percentage of its revenue into net income, boosting its share price. RH hasn’t fared as well on the margin front, which has tanked its stock price.
A near-term catalyst for Williams-Sonoma is near-term market share gains and continued momentum in comparable store sales growth. Comp sales, which measure performance excluding new stores, grew 4.8% year over year last quarter. This looks particularly strong in an overall weak market for home goods.
RH hasn’t been able to maintain its margins, but it has a history of earning above-average retail margins in a healthy home furnishings market. This is noteworthy given management’s forward guidance. It now expects full-year revenue to grow 4.5% to 8%, with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin reaching the mid-teens.
Both stocks are trading at a similar forward price-to-earnings multiple of about 24. However, analysts expect RH to post earnings growth of approximately 16% annualized over the next two years, compared to just 7% for Williams-Sonoma. This could make RH stock the better buy right now.
RH will need to execute. It needs to meet guidance in revenue growth and margins. Long term, RH’s international expansion efforts might be the catalyst that narrows its revenue gap with Williams-Sonoma, potentially leading to superior returns for shareholders.
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John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Williams-Sonoma. The Motley Fool recommends RH. The Motley Fool has a disclosure policy.
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