Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Mar. 21, 2021 | Aug. 02, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Jan. 31, 2021 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000719955 | ||
Current Fiscal Year End Date | --01-31 | ||
Entity Registrant Name | WILLIAMS SONOMA INC | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Trading Symbol | WSM | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Public Float | $ 6,720,032,000 | ||
Entity Common Stock, Shares Outstanding | 76,192,973 | ||
Entity Interactive Data Current | Yes | ||
Entity File Number | 001-14077 | ||
Entity Tax Identification Number | 94-2203880 | ||
Entity Address, Address Line One | 3250 Van Ness Avenue | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94109 | ||
Entity Incorporation, State or Country Code | DE | ||
Title of 12(b) Security | Common Stock | ||
City Area Code | 415 | ||
Local Phone Number | 421-7900 | ||
Security Exchange Name | NYSE | ||
ICFR Auditor Attestation Flag | true |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | ||
Net revenues | [1] | $ 6,783,189 | $ 5,898,008 | $ 5,671,593 |
Cost of goods sold | 4,146,920 | 3,758,916 | 3,570,580 | |
Gross profit | 2,636,269 | 2,139,092 | 2,101,013 | |
Selling, general and administrative expenses | 1,725,572 | 1,673,218 | 1,665,060 | |
Operating income | 910,697 | 465,874 | 435,953 | |
Interest expense, net | 16,231 | 8,853 | 6,706 | |
Earnings before income taxes | 894,466 | 457,021 | 429,247 | |
Income taxes | 213,752 | 100,959 | 95,563 | |
Net earnings | $ 680,714 | $ 356,062 | $ 333,684 | |
Basic earnings per share | $ 8.81 | $ 4.56 | $ 4.10 | |
Diluted earnings per share | $ 8.61 | $ 4.49 | $ 4.05 | |
Shares used in calculation of earnings per share: | ||||
Basic | 77,260 | 78,108 | 81,420 | |
Diluted | 79,055 | 79,225 | 82,340 | |
[1] | Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $345.7 million, $365.6 million and $346.8 million for fiscal 2020, fiscal 2019 and fiscal 2018, respectively. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Net earnings | $ 680,714 | $ 356,062 | $ 333,684 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustments | 8,195 | (3,334) | (5,032) |
Change in fair value of derivative financial instruments, net of tax (tax benefit) of $(113), $195 and $390 | (315) | 163 | 1,098 |
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax (tax benefit) of $149, $261 and $122 | (410) | (343) | (357) |
Comprehensive income | $ 688,184 | $ 352,548 | $ 329,393 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Change in fair value of derivative financial instruments, tax | $ (113) | $ 195 | $ 390 |
Reclassification adjustment for realized losses on derivative financial instruments, tax | $ 149 | $ 261 | $ 122 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Current assets | ||
Cash and cash equivalents | $ 1,200,337 | $ 432,162 |
Accounts receivable, net | 143,728 | 111,737 |
Merchandise inventories, net | 1,006,299 | 1,100,544 |
Prepaid expenses | 93,822 | 90,426 |
Other current assets | 22,894 | 20,766 |
Total current assets | 2,467,080 | 1,755,635 |
Property and equipment, net | 873,894 | 929,038 |
Operating lease right-of-use assets | 1,086,009 | 1,166,383 |
Deferred income taxes, net | 61,854 | 47,977 |
Goodwill | 85,446 | 85,343 |
Other long-term assets, net | 87,141 | 69,666 |
Total assets | 4,661,424 | 4,054,042 |
Current liabilities | ||
Accounts payable | 542,992 | 521,235 |
Accrued expenses | 267,592 | 175,003 |
Gift card and other deferred revenue | 373,164 | 289,613 |
Income taxes payable | 69,476 | 22,501 |
Current debt | 299,350 | 299,818 |
Operating lease liabilities | 209,754 | 227,923 |
Other current liabilities | 85,672 | 73,462 |
Total current liabilities | 1,848,000 | 1,609,555 |
Deferred lease incentives | 20,612 | 27,659 |
Long-term operating lease liabilities | 1,025,057 | 1,094,579 |
Other long-term liabilities | 116,570 | 86,389 |
Total liabilities | 3,010,239 | 2,818,182 |
Stockholders' equity | ||
Preferred stock: $.01 par value; 7,500 shares authorized; none issued | ||
Common stock: $.01 par value; 253,125 shares authorized; 76,340 and 77,137 shares issued and outstanding at January 31, 2021 and February 2, 2020, respectively | 764 | 772 |
Additional paid-in capital | 638,375 | 605,822 |
Retained earnings | 1,019,762 | 644,794 |
Accumulated other comprehensive loss | (7,117) | (14,587) |
Treasury stock, at cost: 8 and 14 shares as of January 31, 2021 and February 2, 2020, respectively | (599) | (941) |
Total stockholders' equity | 1,651,185 | 1,235,860 |
Total liabilities and stockholders' equity | $ 4,661,424 | $ 4,054,042 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jan. 31, 2021 | Feb. 02, 2020 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 7,500,000 | 7,500,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 253,125,000 | 253,125,000 |
Common stock, shares issued | 76,340,000 | 77,137,000 |
Common stock, shares outstanding | 76,340,000 | 77,137,000 |
Treasury stock, shares | 8,000 | 14,000 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock | Additional Paid-in Capital | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | ||||
Beginning Balance (in shares) at Jan. 28, 2018 | 83,726,000 | |||||||||||
Beginning Balance at Jan. 28, 2018 | $ 1,203,566 | $ 837 | $ 562,814 | $ 647,422 | $ (6,782) | $ (725) | ||||||
Net earnings | 333,684 | 333,684 | ||||||||||
Foreign currency translation adjustments | (5,032) | (5,032) | ||||||||||
Change in fair value of derivative financial instruments, net of tax | 1,098 | 1,098 | ||||||||||
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | (357) | (357) | [1] | |||||||||
Conversion/release of stock-based awards, shares | [2] | 460,000 | ||||||||||
Conversion/release of stock-based awards, value | [2] | (14,435) | $ 5 | (14,149) | (291) | |||||||
Repurchases of common stock, shares | (5,373,000) | |||||||||||
Repurchases of common stock, value | (295,304) | $ (53) | (25,775) | (269,476) | ||||||||
Reissuance of treasury stock under stock-based compensation plans | [2] | (418) | (363) | 781 | ||||||||
Stock-based compensation expense | 59,428 | 59,428 | ||||||||||
Dividends declared | (144,609) | (144,609) | ||||||||||
Ending Balance (in shares) at Feb. 03, 2019 | 78,813,000 | |||||||||||
Ending Balance at Feb. 03, 2019 | 1,155,714 | $ 789 | 581,900 | 584,333 | (11,073) | (235) | ||||||
Adoption of accounting pronouncements | [3] | $ 17,675 | $ 17,675 | |||||||||
Net earnings | 356,062 | 356,062 | ||||||||||
Foreign currency translation adjustments | (3,334) | (3,334) | ||||||||||
Change in fair value of derivative financial instruments, net of tax | 163 | 163 | ||||||||||
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | (343) | (343) | [1] | |||||||||
Conversion/release of stock-based awards, shares | [2] | 649,000 | ||||||||||
Conversion/release of stock-based awards, value | [2] | (27,752) | $ 6 | (27,624) | (134) | |||||||
Repurchases of common stock, shares | (2,325,000) | |||||||||||
Repurchases of common stock, value | (148,834) | $ (23) | (11,658) | (136,195) | (958) | |||||||
Reissuance of treasury stock under stock-based compensation plans | [2] | (386) | 386 | |||||||||
Stock-based compensation expense | 63,590 | 63,590 | ||||||||||
Dividends declared | (156,103) | (156,103) | ||||||||||
Ending Balance (in shares) at Feb. 02, 2020 | 77,137,000 | |||||||||||
Ending Balance at Feb. 02, 2020 | 1,235,860 | $ 772 | 605,822 | 644,794 | (14,587) | (941) | ||||||
Adoption of accounting pronouncements | 644,794 | $ (3,303) | [4] | $ (3,303) | [4] | |||||||
Net earnings | 680,714 | 680,714 | ||||||||||
Foreign currency translation adjustments | 8,195 | 8,195 | ||||||||||
Change in fair value of derivative financial instruments, net of tax | (315) | (315) | ||||||||||
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | (410) | (410) | [1] | |||||||||
Conversion/release of stock-based awards, shares | [2] | 699,000 | ||||||||||
Conversion/release of stock-based awards, value | [2] | (31,729) | $ 7 | (31,565) | (171) | |||||||
Repurchases of common stock, shares | (1,496,000) | |||||||||||
Repurchases of common stock, value | (150,000) | $ (15) | (7,569) | (142,416) | ||||||||
Reissuance of treasury stock under stock-based compensation plans | [2] | (499) | (14) | 513 | ||||||||
Stock-based compensation expense | 72,186 | 72,186 | ||||||||||
Dividends declared | (163,316) | (163,316) | ||||||||||
Ending Balance (in shares) at Jan. 31, 2021 | 76,340,000 | |||||||||||
Ending Balance at Jan. 31, 2021 | 1,651,185 | $ 764 | $ 638,375 | $ 1,019,762 | $ (7,117) | $ (599) | ||||||
Adoption of accounting pronouncements | $ 1,019,762 | |||||||||||
[1] | Refer to Note L for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Consolidated Statements of Earnings. | |||||||||||
[2] | Amounts are shown net of shares withheld for employee taxes. | |||||||||||
[3] | Primarily relates to our adoption of ASU 2014-09, Revenue from Contracts with Customers, in fiscal 2018. | |||||||||||
[4] | Relates to our adoption of ASU 2016-02, Leases, in fiscal 2019. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Cash flows from operating activities: | |||
Net earnings | $ 680,714 | $ 356,062 | $ 333,684 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 188,655 | 187,759 | 188,808 |
Loss on disposal/impairment of assets | 32,365 | 1,755 | 10,209 |
Amortization of deferred lease incentives | (5,783) | (7,714) | (26,199) |
Non-cash lease expense | 216,368 | 215,810 | |
Deferred income taxes | (13,061) | (2,557) | 23,639 |
Stock-based compensation expense | 73,185 | 64,163 | 59,802 |
Other | (264) | (26) | (579) |
Changes in: | |||
Accounts receivable | (31,503) | (5,034) | (15,329) |
Merchandise inventories | 99,144 | 24,219 | (70,331) |
Prepaid expenses and other assets | (16,388) | (3,189) | (54,691) |
Accounts payable | 25,489 | (11,051) | 62,377 |
Accrued expenses and other liabilities | 129,142 | 13,259 | 45,976 |
Gift card and other deferred revenue | 82,841 | (640) | 38,899 |
Deferred rent and lease incentives | 0 | 0 | 24,929 |
Operating lease liabilities | (232,989) | (226,257) | |
Income taxes payable | 46,933 | 735 | (35,208) |
Net cash provided by operating activities | 1,274,848 | 607,294 | 585,986 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (169,513) | (186,276) | (190,102) |
Other | 629 | 728 | 2,203 |
Net cash used in investing activities | (168,884) | (185,548) | (187,899) |
Cash flows from financing activities: | |||
Borrowings under revolving line of credit | 487,823 | 100,000 | 60,000 |
Repayments of borrowings under revolving line of credit | (487,823) | (100,000) | (60,000) |
Payment of dividends | (157,645) | (150,640) | (140,325) |
Repurchases of common stock | (150,000) | (148,834) | (295,304) |
Tax withholdings related to stock-based awards | (31,729) | (27,752) | (14,437) |
Debt issuance costs | (3,645) | 0 | |
Net cash used in financing activities | (343,019) | (327,226) | (450,066) |
Effect of exchange rates on cash and cash equivalents | 5,230 | (1,312) | 797 |
Net increase (decrease) in cash and cash equivalents | 768,175 | 93,208 | (51,182) |
Cash and cash equivalents at beginning of year | 432,162 | 338,954 | 390,136 |
Cash and cash equivalents at end of year | 1,200,337 | 432,162 | 338,954 |
Supplemental disclosure of cash flow information: | |||
Cash paid during the year for interest | 18,346 | 12,682 | 11,424 |
Cash paid during the year for income taxes, net of refunds | 162,842 | 113,344 | 107,951 |
Non-cash investing activities: | |||
Purchases of property and equipment not yet paid for at end of year | $ 753 | $ 2,386 | $ 2,773 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2021 | |
Summary of Significant Accounting Policies | Note A: Summary of Significant Accounting Policies Williams-Sonoma, Inc. is a specialty retailer of high-quality sustainable products for the home. Our products, representing distinct merchandise strategies — Williams Sonoma, Pottery Barn, Pottery Barn Kids, Pottery Barn Teen, West Elm, Williams Sonoma Home, Rejuvenation, and Mark and Graham — are marketed through e-commerce free-to-join e-commerce Consolidation The Consolidated Financial Statements include the accounts of Williams-Sonoma, Inc. and its subsidiaries. All intercompany transactions and balances have been eliminated. Fiscal Year Our fiscal year ends on the Sunday closest to January 31, based on a 52 or 53-week 52-week 52-week 53-week Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. These estimates and assumptions are evaluated on an ongoing basis and are based on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ from these estimates. Cash Equivalents Cash equivalents include highly liquid investments with an original maturity of three months or less. As of January 31, 2021, we were invested primarily in interest-bearing demand deposit accounts and money market funds. Book cash overdrafts issued, but not yet presented to the bank for payment, are reclassified to accounts payable. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at their carrying values, net of an allowance for doubtful accounts. Accounts receivable consist primarily of credit card, franchisee and landlord receivables for which collectability is reasonably assured. Receivables are evaluated for collectability on a regular basis and an allowance for doubtful accounts is recorded, if necessary. Our allowance for doubtful accounts was not material to our financial statements as of January 31, 2021 and February 2, 2020. Merchandise Inventories Merchandise inventories, net of an allowance for shrinkage and obsolescence, are stated at the lower of cost (weighted average method) or market. To determine if the value of our inventory should be reduced below cost, we consider current and anticipated demand, customer preferences and age of the merchandise. The significant estimates used in inventory valuation are obsolescence (including excess and slow-moving inventory and lower of cost or market reserves) and estimates of inventory shrinkage. We reserve for obsolescence based on historical trends of inventory sold below cost and specific identification. Reserves for shrinkage are estimated and recorded throughout the year based on historical shrinkage results, cycle count results within our distribution centers, expectations of future shrinkage and current inventory levels. Actual shrinkage is recorded at year-end off-site year-end. Our obsolescence and shrinkage reserve calculations contain estimates that require management to make assumptions and to apply judgment regarding a number of factors, including market conditions, the selling environment, historical results and current inventory trends. If actual obsolescence or shrinkage estimates change from our original estimate, we will adjust our reserves accordingly throughout the year. We made no material changes to our assumptions included in the calculations of the obsolescence and shrinkage reserves throughout fiscal year 2020. As of January 31, 2021, and February 2, 2020, our inventory obsolescence reserves were $ and $ , respectively. Long-lived Assets Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the following estimated useful lives of the assets: Leasehold improvements Shorter of estimated useful life or lease term (generally Fixtures and equipment 2 – 20 years Buildings and building improvements 10 – 40 years Capitalized software 2 – 10 years 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 or asset group may not be recoverable. Our impairment analyses determine whether projected cash flows from operations are sufficient to recover the carrying value of these assets. The asset group is comprised of both property and equipment and operating lease right-of-use right-of-use right-of-use Given the material reductions in our retail store revenues and operating income during fiscal 2020 as a result of the COVID-19 pandemic, we evaluated our estimates and assumptions related to our stores’ future sales and cash flows, and performed a comprehensive review of our stores’ long-lived assets for impairment, including both property and equipment and operating lease right-of-use account for the estimated impact on future cash flows from the recent temporary store closures and capacity restrictions, including reduced store traffic and longer recovery times in those stores we have re-opened, These events and changes in circumstances, including a more prolonged and/or severe COVID-19 During fiscal 2020, we recognized asset impairment charges of approximately $19,204,000 related to property and equipment and $7,865,000 related to right-of 2016-02, Leases Leases We lease store locations, distribution and manufacturing facilities, corporate facilities, customer care centers and certain equipment for our U.S. and foreign operations with initial terms generally ranging from 2 to 22 years. We determine whether an arrangement is or contains a lease at inception by evaluating potential lease agreements including services and operating agreements to determine whether an identified asset exists that we control over the term of the arrangement. Lease commencement is determined to be when the lessor provides us access to, and the right to control, the identified asset. The rental payments for our leases are typically structured as either fixed or variable payments. Our fixed rent payments include: stated minimum rent and stated minimum rent with stated increases. We consider lease payments that cannot be predicted with reasonable certainty upon lease commencement to be variable lease payments, which are recorded as incurred each period and are excluded from our calculation of lease liabilities. Our variable rent payments include: rent increases based on a future index; rent based on a percentage of store sales; payments made for pass-through costs for property taxes, insurance, utilities and common area maintenance; and rent based on a percentage of store sales if a specified store sales threshold or contractual obligation of the landlord has not been met. Upon lease commencement, we recognize a right-of non-lease right-of-use right-of-use Many of our leases contain renewal and early termination options. The option periods are generally not included in the lease term used to measure our lease liabilities and right-of-use right-of-use Throughout fiscal 2020, we finalized rent concession negotiations with the majority of our store landlords due to the impact of temporary store closures from COVID-19. We COVID-19 right-of-use Our leases generally do not provide information about the rate implicit in the lease. Therefore, we utilize an incremental borrowing rate to calculate the present value of our future lease obligations. The incremental borrowing rate represents the rate of interest we would have to pay on a collateralized borrowing, for an amount equal to the lease payments, over a similar term and in a similar economic environment. We use judgment in determining our incremental borrowing rate, which is applied to each lease based on the lease term. An increase or decrease in the incremental borrowing rate applied would impact the value of our right-of-use We use judgment in determining lease classification, including our determination of the economic life and the fair market value of the identified asset. The fair market value of the identified asset is generally estimated based on comparable market data provided by third-party sources. All of our leases are currently classified as operating leases. Goodwill Goodwill is initially recorded as of the acquisition date and is measured as any excess of the purchase price over the estimated fair value of the identifiable net assets acquired. Goodwill is not amortized, but rather is subject to impairment testing annually (on the first day of the fourth quarter), or between annual tests whenever events or changes in circumstances indicate that the fair value of a reporting unit may be below its carrying amount. We first perform a qualitative assessment to evaluate goodwill for potential impairment. If based on that assessment it is more likely than not that the fair value of the reporting unit is below its carrying value, a quantitative impairment test is necessary. The quantitative impairment test requires determining the fair value of the reporting unit. We use the income approach, whereby we calculate the fair value based on the present value of estimated future cash flows, using a discount rate that approximates our weighted average cost of capital. The process of evaluating the potential impairment of goodwill is subjective and requires significant estimates and assumptions about the future such as sales growth, gross margins, employment costs, capital expenditures, inflation and future economic and market conditions. Actual future results may differ from those estimates. If the carrying value of the reporting unit’s assets and liabilities, including goodwill, exceeds its fair value, impairment is recorded for the excess, not to exceed the total amount of goodwill allocated to the reporting unit. As of January 31, 2021 and February 2, 2020, we had goodwill of $85,446,000 and $85,343,000, respectively, primarily related to our fiscal 2017 acquisition of Outward and to our fiscal 2011 acquisition of Rejuvenation, Inc. In fiscal 2020, fiscal 2019 and fiscal 2018, we performed our annual assessment of goodwill impairment and concluded that the fair value of each of our reporting units exceeded its carrying value. We currently do not expect the impact of COVID-19 to significantly affect the long-term estimates or assumptions of revenue and operating income growth, nor the long-term strategies of our brands considered in our goodwill assessment. Accordingly, Self-Insured Liabilities We are primarily self-insured for workers’ compensation, employee health benefits, product and other general liability claims. We record self-insurance liability reserves based on claims filed, including the development of those claims, and an estimate of claims incurred but not yet reported, based on an actuarial analysis of historical claims data. Factors affecting these estimates include future inflation rates, changes in severity, benefit level changes, medical costs and claim settlement patterns. Should a different number of claims occur compared to what was estimated, or costs of the claims increase or decrease beyond what was anticipated, reserves may need to be adjusted accordingly. Self-insurance reserves for workers’ compensation, employee health benefits, product and other general liability claims were $24,336,000 and $27,000,000 as of January 31, 2021 and February 2, 2020, respectively. Fair Value of Financial Instruments The carrying values of cash and cash equivalents, accounts receivable, accounts payable and debt approximate their estimated fair values. We use derivative financial instruments to hedge against foreign currency exchange rate fluctuations. The assets or liabilities associated with our derivative financial instruments are recorded at fair value in either other current or long-term assets or other current or long-term liabilities. The fair value of our foreign currency derivative instruments is measured using the income approach, whereby we use observable Revenue from Merchandise Sales Revenues from the sale of our merchandise through our e-commerce 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 January 31, 2021 and February 2, 2020, we recorded a liability for expected sales returns of approximately $36,115,000 and $25,456,000 within other current liabilities and a corresponding asset for the expected net realizable value of the merchandise inventory to be returned of approximately $11,995,000 and $9,941,000 within other current assets in our Consolidated Balance Sheet. Gift Card and Other Deferred Revenue We defer revenue when cash payments are received in advance of satisfying performance obligations, primarily associated with our stored-value cards, merchandise sales, customer loyalty programs, and incentives received from credit card issuers. We issue stored-value cards that may be redeemed on future merchandise purchases at our stores or through our e-commerce cards (“breakage”) is For merchandise sales, we record a liability at each period end where we have not fulfilled our obligation to transfer goods or services to the customer, but for which we have already received consideration or have a right to consideration. We have customer loyalty programs, which allow members to earn points for each qualifying purchase. Points earned enable members to receive certificates that may be redeemed on future merchandise purchases at our stores or through our e-commerce months from 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. 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 January 31, 2021 and February 2, 2020, we had recorded $376,456,000 and $292,550,000 for gift card and other deferred revenue in our Consolidated Balance Sheet, substantially all of which will be recognized into revenue within the next 12 months. Vendor Allowances We receive allowances or credits from certain vendors for volume rebates. We treat such volume rebates as an offset to the cost of the product or services provided at the time the expense is recorded. These allowances and credits received are recorded in both cost of goods sold and in selling, general and administrative expenses. Cost of Goods Sold Cost of goods sold includes cost of goods, occupancy expenses and shipping costs. Cost of goods consists of cost of merchandise, inbound freight expenses, freight-to-store Selling, General and Administrative Expenses Selling, general and administrative expenses consist of non-occupancy-related Stock-Based Compensation We account for stock-based compensation arrangements by measuring and recognizing compensation expense for all stock-based awards using a fair value-based method. Restricted stock units are valued using the closing price of our stock on the date prior to the date of grant. The fair value of each stock-based award is amortized over the requisite service period. Advertising Expenses Advertising expenses consist of media and production costs related to digital advertising, catalog mailings and other direct marketing activities. All advertising costs are expensed as incurred, or upon the release of the initial advertisement. Total advertising expenses (including digital advertising, catalog advertising and other advertising costs) were approximately $325,994,000, $388,194,000, and $390,115,000 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. Foreign Currency Translation Some of our foreign operations have a functional currency other than the U.S. dollar. Assets and liabilities are translated into U.S. dollars using the current exchange rates in effect at the balance sheet date, while revenues and expenses are translated at the average exchange rates during the period. The resulting translation adjustments are recorded as other comprehensive income within stockholders’ equity. Foreign currency exchange gains and losses are recorded in selling, general and administrative expenses, except for those discussed in Note L. 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 plus common stock equivalents for the period. Common stock equivalents consist of shares subject to stock-based awards with exercise prices less than or equal to the average market price of our common stock for the period, to the extent their inclusion would be dilutive. Income Taxes Income taxes are accounted for using the asset and liability method. Under this method, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in our Consolidated Financial Statements. We record reserves for our estimates of the additional income tax liability that is more likely than not to result from the ultimate resolution of foreign and domestic tax examinations. At any one time, many tax years are subject to examination by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues. We review and update the estimates used in the accrual for uncertain tax positions as more definitive information becomes available from taxing authorities, upon completion of tax examination, upon expiration of statutes of limitation, or upon occurrence of other events. In order to compute income tax on an interim basis, we estimate what our effective tax rate will be for the full fiscal year and adjust these estimates throughout the year as necessary. Adjustments to our income tax provision due to changes in our estimated effective tax rate are recorded in the interim period in which the change occurs. The tax expense (or benefit) related to items other than ordinary income is individually computed and recognized when the items occur. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of our earnings in various taxing jurisdictions or changes in tax law. New Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases, right-of-use In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use 350-40): internal-use 350-40 In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes step-up In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform held-to-maturity. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jan. 31, 2021 | |
Property and Equipment | N ote B: Property and Equipment Property and equipment consists of the following: In thousands Jan. 31, 2021 Feb. 2, 2020 Leasehold improvements $ 896,865 $ 946,880 Capitalized software 862,429 788,635 Fixtures and equipment 828,344 830,650 Land and buildings 178,586 177,088 Corporate systems projects in progress 58,599 62,059 Construction in progress 1 3,046 7,076 Total 2,827,869 2,812,388 Accumulated depreciation (1,953,975 ) (1,883,350 ) Property and equipment, net $ 873,894 $ 929,038 1 Construction in progress primarily consists of leasehold improvements and furniture and fixtures related to new, expanded or remodeled retail stores where construction had not been completed as of year-end. |
Borrowing Arrangements
Borrowing Arrangements | 12 Months Ended |
Jan. 31, 2021 | |
Borrowing Arrangements | Note C: Borrowing Arrangements Credit Facility We have a credit facility which provides for a $500,000,000 unsecured revolving line of credit (“revolver”) and a $300,000,000 unsecured term loan facility (“term loan”). The revolver may be used to borrow revolving loans or to During fiscal 2020, we had borrowings of $487,823,000 under our revolver (at a weighted average interest rate of all of which were repaid prior to the end of the fiscal year. our In May 2020, we entered into an amendment to our credit facility (the “Credit Facility Amendment”), which, among other changes, extends the maturity date and amends the interest rate of the term loan, modifies covenants under the credit facility, and maintains the maturity date and interest rate of the revolver. Under the Credit Facility Amendment, the interest rate applicable to the credit facility is variable, and may be elected by us as: (i) the LIBOR plus an applicable margin based on our leverage ratio ranging from 0.91% to 1.775% for a revolver borrowing, and 1.75% to 2.5% for the term loan, or (ii) a base rate as defined in the credit facility, plus an applicable margin ranging from 0% to 0.775% for a revolver borrowing, and 0.75% to 1.5% for the term loan. The revolver matures on January 8, 2023, 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 for an additional year, subject to lender approval. As of January 31, 2021, we had $300,000,000 outstanding under our term loan (at a weighted average interest rate of 2.79%). Costs incurred in connection with the issuance of the term loan are presented as a reduction to the carrying value of the debt in our Consolidated Balance Sheet. In February 2021, prior to maturity, we repaid the full outstanding balance on the term loan. In addition to the Credit Facility Amendment, during the second quarter of fiscal 2020 we entered into a new agreement (the “364-Day 364-Day During fiscal 2020, we had no borrowings under the 364-Day Credit Agreement. We do not expect to renew the 364-Day Credit Agreement upon its maturity in May 2021. The Credit Facility Amendment and the 364-Day Letter of Credit Facilities We have three unsecured letter of credit reimbursement facilities for a total of $35,000,000, each of which matures on August 22, 2021. The letter of credit facilities contain covenants that are consistent with our credit facility. Interest on unreimbursed amounts under the 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 January 31, 2021, an aggregate of $3,843,000 was outstanding under the letter of credit facilities, which represents only a future commitment to fund inventory purchases to which we had not taken legal title. The latest expiration date possible for any future letters of credit issued under the facilities is January 19, 2022. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 31, 2021 | |
Income Taxes | Note D: Income Taxes The components of earnings before income taxes, by tax jurisdiction, are as follows: In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) United States $ 773,317 $ 353,215 $ 333,594 Foreign 121,149 103,806 95,653 Total $ 894,466 $ 457,021 $ 429,247 The provision for income taxes consists of the following: In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal (53 Current Federal $ 171,821 $ 76,873 $ 43,745 State 39,498 14,205 15,357 Foreign 15,494 12,438 12,822 Total Current $ 226,813 $ 103,516 $ 71,924 Deferred Federal $ (7,575 ) $ (606 ) $ 23,507 State (5,997 ) (870 ) 1,562 Foreign 511 (1,081 ) (1,430 ) Total Deferred $ (13,061 ) $ (2,557 ) $ 23,639 Total provision $ 213,752 $ 100,959 $ 95,563 We have historically elected not to provide for U.S. income taxes with respect to the undistributed earnings of our foreign subsidiaries as we intended to utilize those earnings in our foreign operations for an indefinite period of time. Under Internal Revenue Code section 965 of U.S. Tax Reform, we are deemed to have distributed all the post-1986 accumulated earnings of our foreign subsidiaries to the U.S. as of December 31, 2017. In light of the U.S. Tax Cuts and Jobs Act, we re-evaluated A reconciliation of income taxes at the federal statutory corporate rate to the effective rate is as follows: Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Federal income taxes at the statutory rate 21.0% 21.0% 21.0% Re-measurement — — (2.2% ) Transition tax — — (0.6% ) State income tax rate 3.9% 2.9% 3.8% Officer’s compensation under Sec.162(m) 1.1% 1.0% — Change in uncertain tax positions 0.2% 0.5% 4.1% Deferred true u p (0.6% ) (1.3% ) — Rate differential (1.1% ) (1.8% ) (2.3% ) Research and development credits (0.2% ) (0.7% ) (2.1% ) Other (0.4% ) 0.5% 0.6% Total 23.9% 22.1% 22.3% Significant components of our deferred income tax accounts are as follows: In thousands Jan. 31, Feb. 2, Deferred tax asset (liabilities ) Operating lease liabilities $ 319,599 $ 347,693 Compensatio n 20,852 14,350 Merchandise inventories 20,631 22,311 Gift cards 19,345 19,520 Accrued liabilities 13,451 8,440 Stock-based compensation 9,926 9,860 Loyalty rewards 9,609 5,252 Executive deferred compensation 8,647 7,543 State taxe s 7,460 7,546 Federal and state net operating loss 2,609 3,443 Operating lease right-of-use (283,856 ) (309,801 ) Deferred lease incentives (31,672 ) (46,701 ) Property and equipment (54,724 ) (37,309 ) Other (317 ) (3,277 ) Valuation allowance (2,819 ) (3,648 ) Total deferred tax assets, net $ 58,741 $ 45,222 We had net state operating loss carry-forwards as of January 31, 2021. A valuation allowance has been provided against certain state net operating carry-forwards, as we do not expect to fully utilize the losses in future years. The following table summarizes the activity related to our gross unrecognized tax benefits: In thousands Fiscal 2020 Fiscal 2019 Fiscal 2018 Beginning Balance $ 36,638 $ 35,209 $ 18,051 Increases related to current year tax positions 4,593 3,438 4,694 Increases for tax positions for prior years 848 1,405 14,905 Decrease for tax positions for prior years (437 ) (308 ) (1,279 ) Settlements — — (376 ) Lapse in statute of limitations (2,946 ) (3,106 ) (786 ) Ending Balance $ 38,696 $ 36,638 $ 35,209 As of January 31, 202 1 We accrue interest and penalties related to unrecognized tax benefits in the provision for income taxes. As of January 31, 2021 and February 2, 2020, our accruals for the payment of interest and penalties totaled $8,225,000 and $7,251,000 , Due to the potential resolution of tax issues, it is reasonably possible that the balance of our gross unrecognized tax benefits could decrease within the next twelve months by a range of $0 to $15,800,000. We file income tax returns in the U.S. and foreign jurisdictions. We are subject to examination by the tax authorities in these jurisdictions. Our U.S. federal taxable years for which the statute of limitations has not expired are fiscal years 2017 to 2020. Substantially |
Leases
Leases | 12 Months Ended |
Jan. 31, 2021 | |
Leases [Abstract] | |
Leases | Note E: Leases The components of our lease costs are as follows: In thousands Fiscal 2020 Fiscal 2019 Operating lease costs $ 263,126 $ 267,883 Variable lease costs 107,477 129,018 Total lease costs $ 370,603 $ 396,901 Sublease income and short-term lease costs were not material to us for fiscal 2020. Supplemental cash flow information related to our leases are as follows: In thousands Fiscal 2020 Fiscal 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 285,906 $ 285,678 Net additions to right-of-use $ 135,457 $ 150,401 Additional information related to our leases is as follows: Fiscal 2020 Fiscal 2019 Weighted average remaining lease term (years) 7.0 7.3 Weighted average incremental borrowing rate 3.6% 3.8% As of January 31, 2021, the future minimum lease payments under our operating lease liabilities are as follows: In thousands Fiscal 2021 $ 267,760 Fiscal 2022 234,946 Fiscal 2023 198,107 Fiscal 2024 172,068 Fiscal 2025 148,427 Fiscal 2026 and thereafter 406,121 Total lease payments 1,427,429 Less: interest (192,618 ) Total operating lease liabilities 1,234,811 Less: current operating lease liabilities (209,754 ) Total non-current $ 1,025,057 Memphis-Based Distribution Facility We have entered into an agreement with a partnership comprised of the estate of W. Howard Lester, our former Chairman of the Board and Chief Executive Officer, and the estate of James A. McMahan, a former Director Emeritus and significant stockholder and two unrelated parties to lease a distribution facility in Memphis, Tennessee through July 31, 2022. We made annual rental payments of approximately $1,493,000, $1,765,000, and $1,689,000 plus applicable taxes, insurance and maintenance expenses in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Jan. 31, 2021 | |
Earnings Per Share | Note F: 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. Common stock equivalents consist of shares subject to stock-based awards with exercise prices less than or equal to the average market price of our common stock for the period, 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 Earnings Fiscal 2020 (52 Weeks) Basic $ 680,714 77,260 $ 8.81 Effect of dilutive stock-based awards 1,795 Diluted $ 680,714 79,055 $ 8.61 Fiscal 2019 (52 Weeks) Basic $ 356,062 78,108 $ 4.56 Effect of dilutive stock-based awards 1,117 Diluted $ 356,062 79,225 $ 4.49 Fiscal 2018 (53 Weeks) Basic $ 333,684 81,420 $ 4.10 Effect of dilutive stock-based awards 920 Diluted $ 333,684 82,340 $ 4.05 Stock-based awards of 9,000, 46,000, and 31,000 were excluded from the computation of diluted earnings per share in fiscal 2020, fiscal 2019 and fiscal 2018, respectively, as their inclusion would be anti-dilutive. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jan. 31, 2021 | |
Stock-Based Compensation | Note G: 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 (collectively, “option awards”), 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 approximately 36,570,000 shares. As of January 31, 2021, there were approximately 2,475,000 shares available for future grant. Awards may be granted under the Plan to officers, employees and non-employee C Stock Awards Annual grants of stock awards are limited to 1,000,000 shares on a per person basis and have a maximum term of seven years. Stock awards granted to employees 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 resulting from events including, but not limited to, retirement, disability, death, merger or a similar corporate event. Stock awards granted to non-employee Non-employee non-employee Stock-Based Compensation Expense During fiscal 2020, fiscal 2019 and fiscal 2018, we recognized total stock-based compensation expense, as a component of selling, general and administrative expenses, of $73,185,000, $64,163,000, and $59,802,000, respectively. As of January 31, 2021, there was $101,451,000 of unrecognized stock-based compensation expense (net of estimated forfeitures), which we expect to recognize on a straight-line basis over a weighted average remaining service period of approximately . At each reporting period, all compensation expense attributable to vested awards has been fully recognized. Restricted Stock Units The following table summarizes our restricted stock unit activity during fiscal 2020: Shares Weighted Average Grant Date Fair Value Weighted Average Contractual Term Remaining (Years) Intrinsic Value 1 Balance at February 2, 2020 2,884,194 $ 54.09 Granted 1,145,610 51.67 Granted, with vesting subject to performance conditions 267,000 93.17 Released 2 (1,061,159 ) 53.96 Cancelled (116,761 ) 53.08 Balance at January 31, 2021 3,118,884 $ 56.62 3.05 $ 402,087,000 Vested plus expected to vest at January 31, 2021 2,773,871 $ 56.61 3.42 $ 357,607,000 1 Intrinsic value for outstanding and unvested restricted stock units is based on the market value of our common stock on the last business day of the fiscal year (or $128.92). 2 Excludes 170,308 incremental shares released due to achievement of performance conditions above target. The following table summarizes additional information about restricted stock units: Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Weighted average grant date fair value per share of awards granted $ 59.51 $ 58.18 $ 49.57 Intrinsic value of awards released 1 $ 74,853,000 $ 65,403,000 $ 34,213,000 1 Intrinsic value for releases is based on the market value on the date of release. Tax Benefit We record excess tax benefits and deficiencies resulting from the settlement of stock-based awards as a benefit or expense within income taxes in the period in which they occur. During fiscal 2020, fiscal 2019, and fiscal 2018, the current tax benefit related to stock-based awards totaled $15,686,000, $13,793,000, and $9,927,000, respectively. |
Williams-Sonoma, Inc. 401(k) Pl
Williams-Sonoma, Inc. 401(k) Plan and Other Employee Benefits | 12 Months Ended |
Jan. 31, 2021 | |
Williams-Sonoma, Inc. 401(k) Plan and Other Employee Benefits | Note H: Williams-Sonoma, Inc. 401(k) Plan and Other Employee Benefits We have a defined contribution retirement plan, the Williams-Sonoma, Inc. 401(k) Plan (the “401(k) Plan”), which is intended to be qualified under Internal Revenue Code sections 401(a), 401(k), 401(m) and 4975(e)(7). The 401(k) Plan permits eligible employees to make salary deferral contributions up to 75% of their eligible compensation each pay period (7% for highly-compensated employees prior to February 3, 2020). Employees designate the funds in which their contributions are invested. Each participant may choose to have their salary deferral contributions and earnings thereon invested in one or more investment funds, including our company stock fund. Our matching contribution is equal to 50% of each participant’s salary deferral contribution, taking into account only those contributions that do not exceed 6% of the participant’s eligible pay for the pay period. Each participant’s matching contribution is earned on a semi-annual basis with respect to eligible salary deferrals for those participants that are employed with us on June 30th or December 31st of the year in which the deferrals are made. Each associate must complete of service prior to receiving company matching contributions. For the first years of the participant’s employment, all matching contributions vest at the rate of % per year of service, measuring service from the participant’s hire date. Thereafter, all matching contributions vest immediately. Our contributions to the plan were $ , $ , and $ in fiscal , fiscal and fiscal , respectively. The 401(k) Plan consists of two parts: a profit sharing plan portion and a stock bonus plan/employee stock ownership plan (the “ESOP”). The ESOP portion is the portion that is invested in the Williams-Sonoma, Inc. Stock Fund. The profit sharing and ESOP components of the 401(k) Plan are considered a single plan under Internal Revenue Code section 414(l). We also have a nonqualified executive deferred compensation plan that provides supplemental retirement income benefits for a select group of management. This plan permits eligible employees to make salary and bonus deferrals that are 100% vested. We have an unsecured obligation to pay in the future the value of the deferred compensation adjusted to reflect the performance, whether positive or negative, of selected investment measurement options chosen by each participant during the deferral period. As of January 31, 2021 and February 2, 2020, $34,988,000 and $30,534,000, respectively, is included in other long-term liabilities related to these deferred compensation obligations. Additionally, we have purchased life insurance policies on certain participants to potentially offset these unsecured obligations. The cash surrender value of these policies was $36,011,000 and $31,886,000 as of January 31, 2021 and February 2, 2020, respectively, and is included in other long-term assets, net. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 31, 2021 | |
Commitments and Contingencies | Note I: 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, are increasing in number as our business expands and our company grows. 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 Consolidated Financial Statements taken as a whole. |
Stock Repurchase Program and Di
Stock Repurchase Program and Dividends | 12 Months Ended |
Jan. 31, 2021 | |
Stock Repurchase Program and Dividends | Note J: Stock Repurchase Program and Dividends Stock Repurchase Program During fiscal 2020, we repurchased 1,496,100 shares of our common stock at an average cost of $100.26 per share and a total cost of approximately $150,000,000 under our stock repurchase program. As of January 31, 2021, there was approximately $424,982,000 remaining under our current stock repurchase program. In March 2021, our Board of Directors authorized a new stock repurchase program for $ , which replaced our existing program . As of January 31 , 2021 , we held treasury stock of $ ,000 that represents the cost of shares available for issuance intended to satisfy future stock-based award settlements in certain foreign jurisdictions. During fiscal 2019, we repurchased 2,341,931 shares of our common stock at an average cost of $63.55 per share and a total cost of approximately $148,834,000. During fiscal 2018, we repurchased 5,373,047 shares of our common stock at an average cost of $54.96 per share and a total cost of approximately $295,304,000. 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 other market conditions. Dividends Total cash dividends declared in fiscal 2020, fiscal 2019 and fiscal 2018, were approximately $163,316,000, or $2.02 per common share, $156,103,000, or $1.92 per common share and $144,609,000, or $1.72 per common share, respectively. In March 2021, our Board of Directors authorized a $0.06, or 11.3%, increase in our quarterly cash dividend, from $0.53 to $0.59 per common share, subject to capital availability. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Jan. 31, 2021 | |
Segment Reporting | Note K: Segment Reporting Prior to fiscal 2019 we managed our e-commerce e-commerce e-commerce The following table summarizes our net revenues by brand for fiscal 2020, fiscal 2019 and fiscal 2018. We have updated fiscal 2018 results to conform with the current year presentation. In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Pottery Barn $ 2,526,241 $ 2,214,397 $ 2,177,344 West Elm 1,682,254 1,466,537 1,292,928 Williams Sonoma 1,242,271 1,032,368 1,056,125 Pottery Barn Kids and Teen 1,042,531 908,561 895,762 Other1 289,892 276,145 249,434 Total2 $ 6,783,189 $ 5,898,008 $ 5,671,593 1 Primarily consists of net revenues from our international franchise operations, Rejuvenation and Mark and Graham. 2 Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $345.7 million, $365.6 million and $346.8 million for fiscal 2020, fiscal 2019 and fiscal 2018, respectively. Long-lived assets by geographic location are as follows: In thousands Jan. 31, 2021 Feb. 2, 2020 U.S. $ 2,043,950 $ 2,132,635 International 150,394 165,772 Total $ 2,194,344 $ 2,298,407 |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Jan. 31, 2021 | |
Derivative Financial Instruments | Note L: Derivative Financial Instruments We have retail and e-commerce Derivatives and Hedging Cash Flow Hedges We enter into foreign currency forward contracts designated as cash flow hedges (to sell Canadian dollars and purchase U.S. dollars) for forecasted inventory purchases in U.S. dollars by our Canadian subsidiary. These hedges have terms of up to 12 pre-tax As of January 31, 2021, and February 2, 2020, we had foreign currency forward contracts outstanding (in U.S. dollars) with notional values as follows: In thousands Jan. 31, 2021 Feb. 2, 2020 Contracts designated as cash flow hedges $ 28,300 $ 17,200 Hedge effectiveness is evaluated prospectively at inception, on an ongoing basis, as well as retrospectively using regression analysis. Any measurable ineffectiveness of the hedge is recorded in selling, general and administrative expenses. No gain or loss was recognized for cash flow hedges due to hedge ineffectiveness and all hedges were deemed effective for assessment purposes for fiscal 2020, fiscal 2019 and fiscal 2018. The effect of derivative instruments in our Consolidated Financial Statements, pre-tax, Fiscal 2020 Fiscal 2019 Fiscal 2018 In thousands Cost of goods sold Selling, general and administrative expenses Cost of goods sold Selling, general and administrative expenses Cost of goods Selling, general and administrative expenses Line items presented in the Consolidated Statement s $ 4,146,920 $ 1,725,572 $ 3,758,916 $ 1,673,218 $ 3,570,580 $ 1,665,060 Gain (loss) recognized in income Derivatives designated as cash flow hedges $ 562 $ — $ 604 $ — $ 478 $ 57 Derivatives not designated as hedging instruments $ — $ 17 $ — $ 28 $ — $ 3,967 The fair values of our derivative financial instruments are presented below according to their classification in our Consolidated Balance Sheets. All fair values were measured using Level 2 inputs as defined by the fair value hierarchy described in Note M. In thousands Fiscal 2020 Fiscal 2019 Derivatives designated as cash flow hedges: Other current assets $ 113 $ 138 Other current liabilities $ (692 ) $ — We record all derivative assets and liabilities on a gross basis. They do not meet the balance sheet netting criteria as discussed in ASC 210, Balance Sheet settlement. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 31, 2021 | |
Fair Value Measurements | Note M: 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 Fair Value Measurement • 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. Debt As of January 31, 2021, the fair value of our debt, which consists of outstanding borrowings under our term loan, approximates its carrying value, as the instrument is relatively short-term in nature and the interest rate under the term loan is based on observable Level 2 inputs, which consist primarily of quoted market interest rates for instruments with similar maturities. Foreign Currency Derivatives and Hedging Instruments We use the income approach to value our derivatives using observable Level 2 market data at the measurement date and standard valuation techniques to convert future amounts to a single present value amount, assuming that participants are motivated but not compelled to transact. Level 2 inputs are limited to quoted prices that are observable for the assets and liabilities, which include interest rates and credit risk ratings. We use mid-market The counterparties associated with our foreign currency forward contracts are large credit-worthy financial institutions, and the derivatives transacted with these entities are relatively short in duration, therefore, we do not consider counterparty concentration and non-performance 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 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. There were no transfers between Level 1, 2 or 3 categories during fiscal 2020 or fiscal 2019. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Jan. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) | Note N: Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) by component, net of tax, are as follows: In thousands Foreign Currency Cash Flow Accumulated Other Balance at January 28, 2018 $ (6,227 ) $ (555 ) $ (6,782 ) Foreign currency translation adjustments (5,032 ) — (5,032 ) Change in fair value of derivative financial instruments — 1,098 1,098 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (357 ) (357 ) Other comprehensive income (loss) (5,032 ) 741 (4,291 ) Balance at February 3, 2019 (11,259 ) 186 (11,073 ) Foreign currency translation adjustments (3,334 ) — (3,334 ) Change in fair value of derivative financial instruments — 163 163 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (343 ) (343 ) Other comprehensive income (loss) (3,334 ) (180 ) (3,514 ) Balance at February 2, 2020 (14,593 ) 6 (14,587 ) Foreign currency translation adjustments 8,195 — 8,195 Change in fair value of derivative financial instruments — (315 ) (315 ) Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (410 ) (410 ) Other comprehensive income (loss) 8,195 (725 ) 7,470 Balance at January 31, 2021 $ (6,398 ) $ (719 ) $ (7,117 ) 1 Refer to Note L for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Consolidated Statements of Earnings |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2021 | |
Consolidation | Consolidation The Consolidated Financial Statements include the accounts of Williams-Sonoma, Inc. and its subsidiaries. All intercompany transactions and balances have been eliminated. |
Fiscal Year | Fiscal Year Our fiscal year ends on the Sunday closest to January 31, based on a 52 or 53-week 52-week 52-week 53-week |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. These estimates and assumptions are evaluated on an ongoing basis and are based on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ from these estimates. |
Cash Equivalents | Cash Equivalents Cash equivalents include highly liquid investments with an original maturity of three months or less. As of January 31, 2021, we were invested primarily in interest-bearing demand deposit accounts and money market funds. Book cash overdrafts issued, but not yet presented to the bank for payment, are reclassified to accounts payable. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at their carrying values, net of an allowance for doubtful accounts. Accounts receivable consist primarily of credit card, franchisee and landlord receivables for which collectability is reasonably assured. Receivables are evaluated for collectability on a regular basis and an allowance for doubtful accounts is recorded, if necessary. Our allowance for doubtful accounts was not material to our financial statements as of January 31, 2021 and February 2, 2020. |
Merchandise Inventories | Merchandise Inventories Merchandise inventories, net of an allowance for shrinkage and obsolescence, are stated at the lower of cost (weighted average method) or market. To determine if the value of our inventory should be reduced below cost, we consider current and anticipated demand, customer preferences and age of the merchandise. The significant estimates used in inventory valuation are obsolescence (including excess and slow-moving inventory and lower of cost or market reserves) and estimates of inventory shrinkage. We reserve for obsolescence based on historical trends of inventory sold below cost and specific identification. Reserves for shrinkage are estimated and recorded throughout the year based on historical shrinkage results, cycle count results within our distribution centers, expectations of future shrinkage and current inventory levels. Actual shrinkage is recorded at year-end off-site year-end. Our obsolescence and shrinkage reserve calculations contain estimates that require management to make assumptions and to apply judgment regarding a number of factors, including market conditions, the selling environment, historical results and current inventory trends. If actual obsolescence or shrinkage estimates change from our original estimate, we will adjust our reserves accordingly throughout the year. We made no material changes to our assumptions included in the calculations of the obsolescence and shrinkage reserves throughout fiscal year 2020. As of January 31, 2021, and February 2, 2020, our inventory obsolescence reserves were $ and $ , respectively. |
Property and Equipment | Long-lived Assets Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the following estimated useful lives of the assets: Leasehold improvements Shorter of estimated useful life or lease term (generally Fixtures and equipment 2 – 20 years Buildings and building improvements 10 – 40 years Capitalized software 2 – 10 years 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 or asset group may not be recoverable. Our impairment analyses determine whether projected cash flows from operations are sufficient to recover the carrying value of these assets. The asset group is comprised of both property and equipment and operating lease right-of-use right-of-use right-of-use Given the material reductions in our retail store revenues and operating income during fiscal 2020 as a result of the COVID-19 pandemic, we evaluated our estimates and assumptions related to our stores’ future sales and cash flows, and performed a comprehensive review of our stores’ long-lived assets for impairment, including both property and equipment and operating lease right-of-use account for the estimated impact on future cash flows from the recent temporary store closures and capacity restrictions, including reduced store traffic and longer recovery times in those stores we have re-opened, These events and changes in circumstances, including a more prolonged and/or severe COVID-19 During fiscal 2020, we recognized asset impairment charges of approximately $19,204,000 related to property and equipment and $7,865,000 related to right-of 2016-02, Leases |
Leases | Leases We lease store locations, distribution and manufacturing facilities, corporate facilities, customer care centers and certain equipment for our U.S. and foreign operations with initial terms generally ranging from 2 to 22 years. We determine whether an arrangement is or contains a lease at inception by evaluating potential lease agreements including services and operating agreements to determine whether an identified asset exists that we control over the term of the arrangement. Lease commencement is determined to be when the lessor provides us access to, and the right to control, the identified asset. The rental payments for our leases are typically structured as either fixed or variable payments. Our fixed rent payments include: stated minimum rent and stated minimum rent with stated increases. We consider lease payments that cannot be predicted with reasonable certainty upon lease commencement to be variable lease payments, which are recorded as incurred each period and are excluded from our calculation of lease liabilities. Our variable rent payments include: rent increases based on a future index; rent based on a percentage of store sales; payments made for pass-through costs for property taxes, insurance, utilities and common area maintenance; and rent based on a percentage of store sales if a specified store sales threshold or contractual obligation of the landlord has not been met. Upon lease commencement, we recognize a right-of non-lease right-of-use right-of-use Many of our leases contain renewal and early termination options. The option periods are generally not included in the lease term used to measure our lease liabilities and right-of-use right-of-use Throughout fiscal 2020, we finalized rent concession negotiations with the majority of our store landlords due to the impact of temporary store closures from COVID-19. We COVID-19 right-of-use Our leases generally do not provide information about the rate implicit in the lease. Therefore, we utilize an incremental borrowing rate to calculate the present value of our future lease obligations. The incremental borrowing rate represents the rate of interest we would have to pay on a collateralized borrowing, for an amount equal to the lease payments, over a similar term and in a similar economic environment. We use judgment in determining our incremental borrowing rate, which is applied to each lease based on the lease term. An increase or decrease in the incremental borrowing rate applied would impact the value of our right-of-use We use judgment in determining lease classification, including our determination of the economic life and the fair market value of the identified asset. The fair market value of the identified asset is generally estimated based on comparable market data provided by third-party sources. All of our leases are currently classified as operating leases. |
Goodwill | Goodwill Goodwill is initially recorded as of the acquisition date and is measured as any excess of the purchase price over the estimated fair value of the identifiable net assets acquired. Goodwill is not amortized, but rather is subject to impairment testing annually (on the first day of the fourth quarter), or between annual tests whenever events or changes in circumstances indicate that the fair value of a reporting unit may be below its carrying amount. We first perform a qualitative assessment to evaluate goodwill for potential impairment. If based on that assessment it is more likely than not that the fair value of the reporting unit is below its carrying value, a quantitative impairment test is necessary. The quantitative impairment test requires determining the fair value of the reporting unit. We use the income approach, whereby we calculate the fair value based on the present value of estimated future cash flows, using a discount rate that approximates our weighted average cost of capital. The process of evaluating the potential impairment of goodwill is subjective and requires significant estimates and assumptions about the future such as sales growth, gross margins, employment costs, capital expenditures, inflation and future economic and market conditions. Actual future results may differ from those estimates. If the carrying value of the reporting unit’s assets and liabilities, including goodwill, exceeds its fair value, impairment is recorded for the excess, not to exceed the total amount of goodwill allocated to the reporting unit. As of January 31, 2021 and February 2, 2020, we had goodwill of $85,446,000 and $85,343,000, respectively, primarily related to our fiscal 2017 acquisition of Outward and to our fiscal 2011 acquisition of Rejuvenation, Inc. In fiscal 2020, fiscal 2019 and fiscal 2018, we performed our annual assessment of goodwill impairment and concluded that the fair value of each of our reporting units exceeded its carrying value. We currently do not expect the impact of COVID-19 to significantly affect the long-term estimates or assumptions of revenue and operating income growth, nor the long-term strategies of our brands considered in our goodwill assessment. Accordingly, |
Self-Insured Liabilities | Self-Insured Liabilities We are primarily self-insured for workers’ compensation, employee health benefits, product and other general liability claims. We record self-insurance liability reserves based on claims filed, including the development of those claims, and an estimate of claims incurred but not yet reported, based on an actuarial analysis of historical claims data. Factors affecting these estimates include future inflation rates, changes in severity, benefit level changes, medical costs and claim settlement patterns. Should a different number of claims occur compared to what was estimated, or costs of the claims increase or decrease beyond what was anticipated, reserves may need to be adjusted accordingly. Self-insurance reserves for workers’ compensation, employee health benefits, product and other general liability claims were $24,336,000 and $27,000,000 as of January 31, 2021 and February 2, 2020, respectively. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying values of cash and cash equivalents, accounts receivable, accounts payable and debt approximate their estimated fair values. We use derivative financial instruments to hedge against foreign currency exchange rate fluctuations. The assets or liabilities associated with our derivative financial instruments are recorded at fair value in either other current or long-term assets or other current or long-term liabilities. The fair value of our foreign currency derivative instruments is measured using the income approach, whereby we use observable market data at the measurement date and standard valuation techniques to convert future amounts to a single present value amount. These observable inputs include spot rates, forward rates, interest rates and credit derivative market rates (see Notes L and M for additional information). |
Revenue from Merchandise Sales | Revenue from Merchandise Sales Revenues from the sale of our merchandise through our e-commerce 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 January 31, 2021 and February 2, 2020, we recorded a liability for expected sales returns of approximately $36,115,000 and $25,456,000 within other current liabilities and a corresponding asset for the expected net realizable value of the merchandise inventory to be returned of approximately $11,995,000 and $9,941,000 within other current assets in our Consolidated Balance Sheet. |
Gift Card and Other Deferred Revenue | Gift Card and Other Deferred Revenue We defer revenue when cash payments are received in advance of satisfying performance obligations, primarily associated with our stored-value cards, merchandise sales, customer loyalty programs, and incentives received from credit card issuers. We issue stored-value cards that may be redeemed on future merchandise purchases at our stores or through our e-commerce cards (“breakage”) is For merchandise sales, we record a liability at each period end where we have not fulfilled our obligation to transfer goods or services to the customer, but for which we have already received consideration or have a right to consideration. We have customer loyalty programs, which allow members to earn points for each qualifying purchase. Points earned enable members to receive certificates that may be redeemed on future merchandise purchases at our stores or through our e-commerce months from 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. 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 January 31, 2021 and February 2, 2020, we had recorded $376,456,000 and $292,550,000 for gift card and other deferred revenue in our Consolidated Balance Sheet, substantially all of which will be recognized into revenue within the next 12 months. |
Vendor Allowances | Vendor Allowances We receive allowances or credits from certain vendors for volume rebates. We treat such volume rebates as an offset to the cost of the product or services provided at the time the expense is recorded. These allowances and credits received are recorded in both cost of goods sold and in selling, general and administrative expenses. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold includes cost of goods, occupancy expenses and shipping costs. Cost of goods consists of cost of merchandise, inbound freight expenses, freight-to-store |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses consist of non-occupancy-related |
Stock-Based Compensation | Stock-Based Compensation We account for stock-based compensation arrangements by measuring and recognizing compensation expense for all stock-based awards using a fair value-based method. Restricted stock units are valued using the closing price of our stock on the date prior to the date of grant. The fair value of each stock-based award is amortized over the requisite service period. |
Advertising Expenses | Advertising Expenses Advertising expenses consist of media and production costs related to digital advertising, catalog mailings and other direct marketing activities. All advertising costs are expensed as incurred, or upon the release of the initial advertisement. Total advertising expenses (including digital advertising, catalog advertising and other advertising costs) were approximately $325,994,000, $388,194,000, and $390,115,000 in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. |
Foreign Currency Translation | Foreign Currency Translation Some of our foreign operations have a functional currency other than the U.S. dollar. Assets and liabilities are translated into U.S. dollars using the current exchange rates in effect at the balance sheet date, while revenues and expenses are translated at the average exchange rates during the period. The resulting translation adjustments are recorded as other comprehensive income within stockholders’ equity. Foreign currency exchange gains and losses are recorded in selling, general and administrative expenses, except for those discussed in Note L. |
Earnings Per Share | 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 plus common stock equivalents for the period. Common stock equivalents consist of shares subject to stock-based awards with exercise prices less than or equal to the average market price of our common stock for the period, to the extent their inclusion would be dilutive. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Under this method, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in our Consolidated Financial Statements. We record reserves for our estimates of the additional income tax liability that is more likely than not to result from the ultimate resolution of foreign and domestic tax examinations. At any one time, many tax years are subject to examination by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues. We review and update the estimates used in the accrual for uncertain tax positions as more definitive information becomes available from taxing authorities, upon completion of tax examination, upon expiration of statutes of limitation, or upon occurrence of other events. In order to compute income tax on an interim basis, we estimate what our effective tax rate will be for the full fiscal year and adjust these estimates throughout the year as necessary. Adjustments to our income tax provision due to changes in our estimated effective tax rate are recorded in the interim period in which the change occurs. The tax expense (or benefit) related to items other than ordinary income is individually computed and recognized when the items occur. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of our earnings in various taxing jurisdictions or changes in tax law. |
New Accounting Pronouncements | New Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases, right-of-use In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use 350-40): internal-use 350-40 In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes step-up In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform held-to-maturity. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Schedule of Estimated Useful Lives of Property, Plant And Equipment | Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the following estimated useful lives of the assets: Leasehold improvements Shorter of estimated useful life or lease term (generally Fixtures and equipment 2 – 20 years Buildings and building improvements 10 – 40 years Capitalized software 2 – 10 years |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Schedule of Property and Equipment | Property and equipment consists of the following: In thousands Jan. 31, 2021 Feb. 2, 2020 Leasehold improvements $ 896,865 $ 946,880 Capitalized software 862,429 788,635 Fixtures and equipment 828,344 830,650 Land and buildings 178,586 177,088 Corporate systems projects in progress 58,599 62,059 Construction in progress 1 3,046 7,076 Total 2,827,869 2,812,388 Accumulated depreciation (1,953,975 ) (1,883,350 ) Property and equipment, net $ 873,894 $ 929,038 1 Construction in progress primarily consists of leasehold improvements and furniture and fixtures related to new, expanded or remodeled retail stores where construction had not been completed as of year-end. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Schedule of Components of Earnings Before Income Taxes, By Tax Jurisdiction | The components of earnings before income taxes, by tax jurisdiction, are as follows: In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) United States $ 773,317 $ 353,215 $ 333,594 Foreign 121,149 103,806 95,653 Total $ 894,466 $ 457,021 $ 429,247 |
Schedule of Components of Provision for Income Taxes | The provision for income taxes consists of the following: In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal (53 Current Federal $ 171,821 $ 76,873 $ 43,745 State 39,498 14,205 15,357 Foreign 15,494 12,438 12,822 Total Current $ 226,813 $ 103,516 $ 71,924 Deferred Federal $ (7,575 ) $ (606 ) $ 23,507 State (5,997 ) (870 ) 1,562 Foreign 511 (1,081 ) (1,430 ) Total Deferred $ (13,061 ) $ (2,557 ) $ 23,639 Total provision $ 213,752 $ 100,959 $ 95,563 |
Schedule of Reconciliation of Income Taxes at Federal Statutory Corporate Rate to Effective Rate | A reconciliation of income taxes at the federal statutory corporate rate to the effective rate is as follows: Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Federal income taxes at the statutory rate 21.0% 21.0% 21.0% Re-measurement — — (2.2% ) Transition tax — — (0.6% ) State income tax rate 3.9% 2.9% 3.8% Officer’s compensation under Sec.162(m) 1.1% 1.0% — Change in uncertain tax positions 0.2% 0.5% 4.1% Deferred true u p (0.6% ) (1.3% ) — Rate differential (1.1% ) (1.8% ) (2.3% ) Research and development credits (0.2% ) (0.7% ) (2.1% ) Other (0.4% ) 0.5% 0.6% Total 23.9% 22.1% 22.3% |
Schedule of Components of Deferred Income Tax Accounts | Significant components of our deferred income tax accounts are as follows: In thousands Jan. 31, Feb. 2, Deferred tax asset (liabilities ) Operating lease liabilities $ 319,599 $ 347,693 Compensatio n 20,852 14,350 Merchandise inventories 20,631 22,311 Gift cards 19,345 19,520 Accrued liabilities 13,451 8,440 Stock-based compensation 9,926 9,860 Loyalty rewards 9,609 5,252 Executive deferred compensation 8,647 7,543 State taxe s 7,460 7,546 Federal and state net operating loss 2,609 3,443 Operating lease right-of-use (283,856 ) (309,801 ) Deferred lease incentives (31,672 ) (46,701 ) Property and equipment (54,724 ) (37,309 ) Other (317 ) (3,277 ) Valuation allowance (2,819 ) (3,648 ) Total deferred tax assets, net $ 58,741 $ 45,222 |
Summary of Activity Related to Gross Unrecognized Tax Benefits | The following table summarizes the activity related to our gross unrecognized tax benefits: In thousands Fiscal 2020 Fiscal 2019 Fiscal 2018 Beginning Balance $ 36,638 $ 35,209 $ 18,051 Increases related to current year tax positions 4,593 3,438 4,694 Increases for tax positions for prior years 848 1,405 14,905 Decrease for tax positions for prior years (437 ) (308 ) (1,279 ) Settlements — — (376 ) Lapse in statute of limitations (2,946 ) (3,106 ) (786 ) Ending Balance $ 38,696 $ 36,638 $ 35,209 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Leases [Abstract] | |
Schedule of components of leases costs | The components of our lease costs are as follows: In thousands Fiscal 2020 Fiscal 2019 Operating lease costs $ 263,126 $ 267,883 Variable lease costs 107,477 129,018 Total lease costs $ 370,603 $ 396,901 |
Schedule of supplemental cash flow information related to our leases | Supplemental cash flow information related to our leases are as follows: In thousands Fiscal 2020 Fiscal 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 285,906 $ 285,678 Net additions to right-of-use $ 135,457 $ 150,401 |
Schedule of weighted average remaining operating lease term | Additional information related to our leases is as follows: Fiscal 2020 Fiscal 2019 Weighted average remaining lease term (years) 7.0 7.3 Weighted average incremental borrowing rate 3.6% 3.8% |
Schedule of future minimum lease payments | As of January 31, 2021, the future minimum lease payments under our operating lease liabilities are as follows: In thousands Fiscal 2021 $ 267,760 Fiscal 2022 234,946 Fiscal 2023 198,107 Fiscal 2024 172,068 Fiscal 2025 148,427 Fiscal 2026 and thereafter 406,121 Total lease payments 1,427,429 Less: interest (192,618 ) Total operating lease liabilities 1,234,811 Less: current operating lease liabilities (209,754 ) Total non-current $ 1,025,057 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Reconciliation of Net Earnings and Number of Shares Used In Basic and Diluted Earnings per Share Computations | 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 Earnings Fiscal 2020 (52 Weeks) Basic $ 680,714 77,260 $ 8.81 Effect of dilutive stock-based awards 1,795 Diluted $ 680,714 79,055 $ 8.61 Fiscal 2019 (52 Weeks) Basic $ 356,062 78,108 $ 4.56 Effect of dilutive stock-based awards 1,117 Diluted $ 356,062 79,225 $ 4.49 Fiscal 2018 (53 Weeks) Basic $ 333,684 81,420 $ 4.10 Effect of dilutive stock-based awards 920 Diluted $ 333,684 82,340 $ 4.05 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Summary of Restricted Stock Units Activity | The following table summarizes our restricted stock unit activity during fiscal 2020: Shares Weighted Average Grant Date Fair Value Weighted Average Contractual Term Remaining (Years) Intrinsic Value 1 Balance at February 2, 2020 2,884,194 $ 54.09 Granted 1,145,610 51.67 Granted, with vesting subject to performance conditions 267,000 93.17 Released 2 (1,061,159 ) 53.96 Cancelled (116,761 ) 53.08 Balance at January 31, 2021 3,118,884 $ 56.62 3.05 $ 402,087,000 Vested plus expected to vest at January 31, 2021 2,773,871 $ 56.61 3.42 $ 357,607,000 1 Intrinsic value for outstanding and unvested restricted stock units is based on the market value of our common stock on the last business day of the fiscal year (or $128.92). 2 Excludes 170,308 incremental shares released due to achievement of performance conditions above target. |
Summary of Additional Information About Restricted Stock Units | The following table summarizes additional information about restricted stock units: Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Weighted average grant date fair value per share of awards granted $ 59.51 $ 58.18 $ 49.57 Intrinsic value of awards released 1 $ 74,853,000 $ 65,403,000 $ 34,213,000 1 Intrinsic value for releases is based on the market value on the date of release. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Segment Information | The following table summarizes our net revenues by brand for fiscal 2020, fiscal 2019 and fiscal 2018. We have updated fiscal 2018 results to conform with the current year presentation. In thousands Fiscal 2020 (52 weeks) Fiscal 2019 (52 weeks) Fiscal 2018 (53 weeks) Pottery Barn $ 2,526,241 $ 2,214,397 $ 2,177,344 West Elm 1,682,254 1,466,537 1,292,928 Williams Sonoma 1,242,271 1,032,368 1,056,125 Pottery Barn Kids and Teen 1,042,531 908,561 895,762 Other1 289,892 276,145 249,434 Total2 $ 6,783,189 $ 5,898,008 $ 5,671,593 1 Primarily consists of net revenues from our international franchise operations, Rejuvenation and Mark and Graham. 2 Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $345.7 million, $365.6 million and $346.8 million for fiscal 2020, fiscal 2019 and fiscal 2018, respectively. |
Summary of Long-lived Assets by Geographic Areas | Long-lived assets by geographic location are as follows: In thousands Jan. 31, 2021 Feb. 2, 2020 U.S. $ 2,043,950 $ 2,132,635 International 150,394 165,772 Total $ 2,194,344 $ 2,298,407 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Foreign Currency Forward Contracts Outstanding with Notional Values | As of January 31, 2021, and February 2, 2020, we had foreign currency forward contracts outstanding (in U.S. dollars) with notional values as follows: In thousands Jan. 31, 2021 Feb. 2, 2020 Contracts designated as cash flow hedges $ 28,300 $ 17,200 |
Effect of Derivative Instruments in Consolidated Financial Statements | The effect of derivative instruments in our Consolidated Financial Statements, pre-tax, Fiscal 2020 Fiscal 2019 Fiscal 2018 In thousands Cost of goods sold Selling, general and administrative expenses Cost of goods sold Selling, general and administrative expenses Cost of goods Selling, general and administrative expenses Line items presented in the Consolidated Statement s $ 4,146,920 $ 1,725,572 $ 3,758,916 $ 1,673,218 $ 3,570,580 $ 1,665,060 Gain (loss) recognized in income Derivatives designated as cash flow hedges $ 562 $ — $ 604 $ — $ 478 $ 57 Derivatives not designated as hedging instruments $ — $ 17 $ — $ 28 $ — $ 3,967 |
Fair Values of Derivative Instruments | The fair values of our derivative financial instruments are presented below according to their classification in our Consolidated Balance Sheets. All fair values were measured using Level 2 inputs as defined by the fair value hierarchy described in Note M. In thousands Fiscal 2020 Fiscal 2019 Derivatives designated as cash flow hedges: Other current assets $ 113 $ 138 Other current liabilities $ (692 ) $ — |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Changes in Accumulated Other Comprehensive Income (Loss) by Component, Net of Tax | Changes in accumulated other comprehensive income (loss) by component, net of tax, are as follows: In thousands Foreign Currency Cash Flow Accumulated Other Balance at January 28, 2018 $ (6,227 ) $ (555 ) $ (6,782 ) Foreign currency translation adjustments (5,032 ) — (5,032 ) Change in fair value of derivative financial instruments — 1,098 1,098 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (357 ) (357 ) Other comprehensive income (loss) (5,032 ) 741 (4,291 ) Balance at February 3, 2019 (11,259 ) 186 (11,073 ) Foreign currency translation adjustments (3,334 ) — (3,334 ) Change in fair value of derivative financial instruments — 163 163 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (343 ) (343 ) Other comprehensive income (loss) (3,334 ) (180 ) (3,514 ) Balance at February 2, 2020 (14,593 ) 6 (14,587 ) Foreign currency translation adjustments 8,195 — 8,195 Change in fair value of derivative financial instruments — (315 ) (315 ) Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (410 ) (410 ) Other comprehensive income (loss) 8,195 (725 ) 7,470 Balance at January 31, 2021 $ (6,398 ) $ (719 ) $ (7,117 ) 1 Refer to Note L for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Consolidated Statements of Earnings |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | Mar. 31, 2021 | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Inventory obsolescence reserves | $ 9,827,000 | $ 13,424,000 | ||
Advertising expenses | 325,994,000 | 388,194,000 | $ 390,115,000 | |
Asset impairment charges | 3,303,000 | 9,639,000 | ||
Goodwill | 85,446,000 | 85,343,000 | $ 85,446,000 | |
Goodwill impairment | 0 | 0 | $ 0 | |
Self-insurance reserves | $ 24,336,000 | 27,000,000 | ||
Period of recognition for stored-value card | 4 years | |||
Gift card and other deferred revenue | $ 376,456,000 | 292,550,000 | ||
Total liabilities | 3,010,239,000 | 2,818,182,000 | ||
Retained earnings (accumulated deficit) | 1,019,762,000 | 644,794,000 | ||
COVID19 [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Impairment of operating lease right-of-use assets | 7,865,000 | |||
Impairment of property and equipment | $ 19,204,000 | |||
Machinery and Equipment [Member] | Maximum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Lessee, Operating Lease, Term of Contract | 22 years | |||
Machinery and Equipment [Member] | Minimum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Lessee, Operating Lease, Term of Contract | 2 years | |||
Other Current Liabilities [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Liability for Expected Sales Returns | $ 36,115,000 | 25,456,000 | ||
Other Current Assets [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Merchandise Inventory to be Returned | 11,995,000 | $ 9,941,000 | ||
Accounting Standards Update 2016-02 [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Deferred Rent Receivables Net | 200,000,000 | |||
Operating Lease Right Of Use Asset | 1,200,000,000 | |||
Increase in liabilities for lease obligations | 1,400,000,000 | |||
Total long-term assets | 1,200,000,000 | |||
Total liabilities | 1,200,000,000 | |||
Retained earnings (accumulated deficit) | $ 3,300,000 |
Estimated Useful Lives of Prope
Estimated Useful Lives of Property and Equipment (Detail) | 12 Months Ended |
Jan. 31, 2021 | |
Leasehold Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 5 years |
Leasehold Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 22 years |
Fixtures and Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 2 years |
Fixtures and Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 20 years |
Buildings and Building Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 10 years |
Buildings and Building Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 40 years |
Capitalized Software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 2 years |
Capitalized Software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets, years | 10 years |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 2,827,869 | $ 2,812,388 | |
Accumulated depreciation | (1,953,975) | (1,883,350) | |
Property and equipment, net | 873,894 | 929,038 | |
Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 896,865 | 946,880 | |
Capitalized Software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 862,429 | 788,635 | |
Fixtures and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 828,344 | 830,650 | |
Land and Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 178,586 | 177,088 | |
Corporate Systems Projects in Progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 58,599 | 62,059 | |
Construction in Progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | [1] | $ 3,046 | $ 7,076 |
[1] | Construction in progress primarily consists of leasehold improvements and furniture and fixtures related to new, expanded or remodeled retail stores where construction had not been completed as of year-end. |
Borrowing Arrangements - Additi
Borrowing Arrangements - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Aug. 02, 2020 | Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity under letter of credit facilities including additional borrowing capacity | $ 35,000,000 | |||
Amount outstanding under revolving line | $ 0 | $ 0 | ||
Interest rate description | Interest on unreimbursed amounts under the letter of credit facilities accrues at a base rate as defined in the credit facility, plus an applicable margin based on our leverage ratio. | |||
Letter of credit facilities, maturity date | Aug. 22, 2021 | |||
Outstanding letter of credit facilities | $ 3,843,000 | |||
Latest expiration date possible for future letters of credit | Jan. 19, 2022 | |||
Borrowings under revolving line of credit | $ 487,823,000 | $ 100,000,000 | $ 60,000,000 | |
Standby Letters of Credit | ||||
Debt Instrument [Line Items] | ||||
Amount issued but undrawn under credit facility | $ 12,609,000 | |||
Revolving Credit Facility [Member] | 364-Day Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Current borrowing capacity | $ 200,000,000 | |||
Interest rate description | Under the 364-Day Credit Agreement, the interest rate is variable and may be elected by us as: (i) LIBOR plus an applicable margin based on our leverage ratio ranging from 1.75% to 2.5% or (ii) a base rate as defined in the agreement, plus an applicable margin ranging from 0.75% to 1.5%. During fiscal 2020, we had no borrowings under the 364-Day Credit Agreement. We do not expect to renew the 364-Day Credit Agreement upon its maturity in May 2021. | |||
Base Rate | Maximum | Revolving Credit Facility [Member] | 364-Day Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.50% | |||
Base Rate | Minimum | Revolving Credit Facility [Member] | 364-Day Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.75% | |||
London Interbank Offered Rate (LIBOR) [Member] | Maximum | Revolving Credit Facility [Member] | 364-Day Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 2.50% | |||
London Interbank Offered Rate (LIBOR) [Member] | Minimum | Revolving Credit Facility [Member] | 364-Day Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.75% | |||
Unsecured Revolving Line Of Credit | ||||
Debt Instrument [Line Items] | ||||
Current borrowing capacity | $ 500,000,000 | |||
Revolving line, maturity date | Jan. 8, 2023 | |||
Weighted average interest rate | 2.47% | 3.04% | ||
Interest rate description | Under the Credit Facility Amendment, the interest rate applicable to the credit facility is variable, and may be elected by us as: (i) the LIBOR plus an applicable margin based on our leverage ratio ranging from 0.91% to 1.775% for a revolver borrowing, and 1.75% to 2.5% for the term loan, or (ii) a base rate as defined in the credit facility, plus an applicable margin ranging from 0% to 0.775% for a revolver borrowing, and 0.75% to 1.5% for the term loan. | |||
Maximum borrowing capacity including additional borrowing capacity | $ 250,000,000 | |||
Borrowings under revolving line of credit | 487,823,000 | $ 100,000,000 | ||
Unsecured Revolving Line Of Credit | Maximum | ||||
Debt Instrument [Line Items] | ||||
Additional borrowing capacity | $ 750,000,000 | |||
Unsecured Revolving Line Of Credit | Margin Based On Leverage Ratio | Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.775% | |||
Unsecured Revolving Line Of Credit | Margin Based On Leverage Ratio | Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.91% | |||
Unsecured Revolving Line Of Credit | Base Rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.775% | |||
Unsecured Revolving Line Of Credit | Base Rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.00% | |||
Unsecured Term Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ 300,000,000 | |||
Weighted average interest rate | 2.79% | |||
Long term debt | $ 300,000,000 | |||
Unsecured Term Loan Facility | Margin Based On Leverage Ratio | Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 2.50% | |||
Unsecured Term Loan Facility | Margin Based On Leverage Ratio | Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.75% | |||
Unsecured Term Loan Facility | Base Rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.50% | |||
Unsecured Term Loan Facility | Base Rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.75% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | Jan. 28, 2018 |
Income Taxes [Line Items] | ||||
Unrecognized tax benefits, gross | $ 38,696,000 | $ 36,638,000 | $ 35,209,000 | $ 18,051,000 |
Unrecognized tax benefits, gross, that would, if recognized, affect the effective tax rate | 34,026,000 | |||
Accruals for interest and penalties | 8,225,000 | $ 7,251,000 | ||
Minimum | ||||
Income Taxes [Line Items] | ||||
Gross unrecognized tax benefits, possible decrease in balance within next twelve months | 0 | |||
Maximum | ||||
Income Taxes [Line Items] | ||||
Gross unrecognized tax benefits, possible decrease in balance within next twelve months | $ 15,800,000 |
Components of Earnings Before I
Components of Earnings Before Income Taxes, by Tax Jurisdiction (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Schedule of Income Before Income Tax [Line Items] | |||
United States | $ 773,317 | $ 353,215 | $ 333,594 |
Foreign | 121,149 | 103,806 | 95,653 |
Earnings before income taxes | $ 894,466 | $ 457,021 | $ 429,247 |
Components Of Provision For Inc
Components Of Provision For Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Provision For Income Taxes [Line Items] | |||
Federal, Current | $ 171,821 | $ 76,873 | $ 43,745 |
State, Current | 39,498 | 14,205 | 15,357 |
Foreign, Current | 15,494 | 12,438 | 12,822 |
Total current | 226,813 | 103,516 | 71,924 |
Federal, Deferred | (7,575) | (606) | 23,507 |
State, Deferred | (5,997) | (870) | 1,562 |
Foreign, Deferred | 511 | (1,081) | (1,430) |
Total deferred | (13,061) | (2,557) | 23,639 |
Total provision | $ 213,752 | $ 100,959 | $ 95,563 |
Reconciliation of Income Taxes
Reconciliation of Income Taxes At Federal Statutory Rate to Effective Rate (Detail) | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Reconciliation of Statutory Federal Tax Rate [Line Items] | |||
Federal income taxes at the statutory rate | 21.00% | 21.00% | 21.00% |
Re-measurement of deferred tax assets and liabilities | (2.20%) | ||
Transition tax | (0.60%) | ||
State income tax rate | 3.90% | 2.90% | 3.80% |
Officer's compensation under Sec.162(m) | 1.10% | 1.00% | |
Change in uncertain tax positions | 0.20% | 0.50% | 4.10% |
Deferred true up | (0.60%) | (1.30%) | |
Rate differential | (1.10%) | (1.80%) | (2.30%) |
Research and development credits | (0.20%) | (0.70%) | (2.10%) |
Other | (0.40%) | 0.50% | 0.60% |
Effective tax rate | 23.90% | 22.10% | 22.30% |
Significant Components of Defer
Significant Components of Deferred Income Tax Accounts (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Deferred Income Tax Asset [Line Items] | ||
Operating lease liabilities | $ 319,599 | $ 347,693 |
Compensation | 20,852 | 14,350 |
Merchandise inventories | 20,631 | 22,311 |
Gift cards | 19,345 | 19,520 |
Accrued liabilities | 13,451 | 8,440 |
Stock-based compensation | 9,926 | 9,860 |
Loyalty rewards | 9,609 | 5,252 |
Executive deferred compensation | 8,647 | 7,543 |
State taxes | 7,460 | 7,546 |
Federal and state net operating loss | 2,609 | 3,443 |
Operating lease right-of-use assets | (283,856) | (309,801) |
Deferred lease incentives | (31,672) | (46,701) |
Property and equipment | (54,724) | (37,309) |
Other | (317) | (3,277) |
Valuation allowance | (2,819) | (3,648) |
Total deferred tax assets, net | $ 58,741 | $ 45,222 |
Summary of Activity Related to
Summary of Activity Related to Gross Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Schedule of Unrecognized Tax Benefits [Line Items] | |||
Beginning Balance | $ 36,638 | $ 35,209 | $ 18,051 |
Increases related to current year tax positions | 4,593 | 3,438 | 4,694 |
Increases for tax positions for prior years | 848 | 1,405 | 14,905 |
Decrease for tax positions for prior years | (437) | (308) | (1,279) |
Settlements | (376) | ||
Lapse in statute of limitations | (2,946) | (3,106) | (786) |
Ending Balance | $ 38,696 | $ 36,638 | $ 35,209 |
Leases - Additional Information
Leases - Additional Information (Detail) - Partnership - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Accounting For Leases [Line Items] | |||
Lease expiration date | Jul. 31, 2022 | ||
Rent expense | $ 1,493,000 | $ 1,765,000 | $ 1,689,000 |
Components of Leases Costs (Det
Components of Leases Costs (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Leases [Abstract] | ||
Operating lease costs | $ 263,126 | $ 267,883 |
Variable lease costs | 107,477 | 129,018 |
Total lease costs | $ 370,603 | $ 396,901 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information Related To Our Leases (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 285,906 | $ 285,678 |
Net additions to right-of-use assets | $ 135,457 | $ 150,401 |
Weighted Average Remaining Oper
Weighted Average Remaining Operating Lease Term And Incremental Borrowing Rate (Detail) | Jan. 31, 2021 | Feb. 02, 2020 |
Leases [Abstract] | ||
Weighted average remaining lease term (years) | 7 years | 7 years 3 months 18 days |
Weighted average incremental borrowing rate | 3.60% | 3.80% |
Future Minimum Lease Payments U
Future Minimum Lease Payments Under Our Operating Lease Liabilities (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Fiscal 2021 | $ 267,760 | |
Fiscal 2022 | 234,946 | |
Fiscal 2023 | 198,107 | |
Fiscal 2024 | 172,068 | |
Fiscal 2025 | 148,427 | |
Fiscal 2026 and thereafter | 406,121 | |
Total lease payments | 1,427,429 | |
Less interest | (192,618) | |
Total operating lease liabilities | 1,234,811 | |
Less current operating lease liabilities | (209,754) | $ (227,923) |
Total non-current operating lease liabilities | $ 1,025,057 | $ 1,094,579 |
Reconciliation of Net Earnings
Reconciliation of Net Earnings and Number of Shares Used in Basic and Diluted Earnings Per Share Computations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Earnings Per Share [Line Items] | |||
Net Earnings, Basic | $ 680,714 | $ 356,062 | $ 333,684 |
Net Earnings, Diluted | $ 680,714 | $ 356,062 | $ 333,684 |
Weighted Average Shares, Basic | 77,260 | 78,108 | 81,420 |
Weighted Average Shares, Effect of dilutive stock-based awards | 1,795 | 1,117 | 920 |
Weighted Average Shares, Diluted | 79,055 | 79,225 | 82,340 |
Earnings Per Share, Basic | $ 8.81 | $ 4.56 | $ 4.10 |
Earnings Per Share, Diluted | $ 8.61 | $ 4.49 | $ 4.05 |
Earnings Per Share- Additional
Earnings Per Share- Additional Information (Detail) - shares | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Earnings Per Share [Line Items] | |||
Anti-dilutive stock-based awards excluded from the computation of diluted earnings per share | 9,000 | 46,000 | 31,000 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 73,185,000 | $ 64,163,000 | $ 59,802,000 |
Unamortized expense | $ 101,451,000 | ||
Unamortized expense expected to be recognized over average remaining service period (years) | 2 years | ||
Total current tax benefit associated with the exercise of stock-based awards | $ 15,686,000 | 13,793,000 | 9,927,000 |
Selling, General and Administrative Expenses | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 73,185,000,000 | $ 64,163,000,000 | $ 59,802,000,000 |
Minimum | Non-Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period of awards granted to employees, years | 1 year | ||
Equity Award Programs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate number of shares under the Plan | 36,570,000 | ||
Shares available for future grant | 2,475,000 | ||
Service Based Option Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period of awards granted to employees, years | 4 years | ||
Stock Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards annual grant limit | 1,000,000 | ||
Maximum term of grants of option awards, years | 7 years | ||
Performance Based Stock Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period of awards granted to employees, years | 3 years |
Summary of Restricted Stock Uni
Summary of Restricted Stock Unit Activity (Detail) - USD ($) | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Released, shares | (170,308) | |||
Granted, weighted average grant date fair value | $ 59.51 | $ 58.18 | $ 49.57 | |
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Balance at February 2, 2020 | 2,884,194 | |||
Granted, shares | 1,145,610 | |||
Granted, with vesting subject to performance conditions, shares | 267,000 | |||
Released, shares | [1] | (1,061,159) | ||
Cancelled, shares | (116,761) | |||
Balance at January 31, 2021 | 3,118,884 | 2,884,194 | ||
Vested plus expected to vest at January 31, 2021 | 2,773,871 | |||
Balance at February 2, 2020, weighted average grant date fair value | $ 54.09 | |||
Granted, weighted average grant date fair value | 51.67 | |||
Granted, with vesting subject to performance conditions, weighted average grant date fair value | 93.17 | |||
Released, weighted average grant date fair value | [1] | 53.96 | ||
Cancelled, weighted average grant date fair value | 53.08 | |||
Balance at January 31, 2021, weighted average grant date fair value | 56.62 | $ 54.09 | ||
Vested plus expected to vest at February 2, 2020, weighted average grant date fair value | $ 56.61 | |||
Weighted average contractual term remaining (years) | 3 years 18 days | |||
Vested plus expected to vest at January 31, 2021, weighted average contractual term remaining (years) | 3 years 5 months 1 day | |||
Balance at January 31, 2021,Intrinsic Value | $ 402,087,000 | |||
Vested plus expected to vest at January 31, 2021,Intrinsic Value | $ 357,607,000 | |||
[1] | Excludes 170,308 incremental shares released due to achievement of performance conditions above target. |
Summary of Restricted Stock U_2
Summary of Restricted Stock Unit Activity (Parenthetical) (Detail) | 12 Months Ended |
Jan. 31, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Incremental shares released due to achievement of performance conditions | shares | 170,308 |
Market value on the last business day of the fiscal year | $ / shares | $ 128.92 |
Summary of Additional Informati
Summary of Additional Information about Restricted Stock units (Detail) - USD ($) | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value per share of awards granted | $ 59.51 | $ 58.18 | $ 49.57 | |
Intrinsic value of awards released | [1] | $ 74,853,000,000 | $ 65,403,000,000 | $ 34,213,000,000 |
[1] | Intrinsic value for releases is based on the market value on the date of release. |
Williams-Sonoma, Inc. 401(k) _2
Williams-Sonoma, Inc. 401(k) Plan and Other Employee Benefits - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Employer matching contribution | 50.00% | ||
Defined contribution retirement plan, maximum percentage of salary deferral contributions subject to match by employer | 6.00% | ||
Years of service required to be eligible for company matching contributions | 1 year | ||
Matching contribution, vesting percentage per year during first five years of employment | 20.00% | ||
Contributions to the profit sharing plan | $ 9,990,000 | $ 9,544,000 | $ 9,036,000 |
Deferred compensation liabilities included in other long-term obligations | 34,988,000 | 30,534,000 | |
Cash surrender value of the life insurance policies | $ 36,011,000 | $ 31,886,000 | |
Eligible Employees | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution retirement plan, maximum percentage of salary deferral contributions by employee | 75.00% | ||
Highly-Compensated Employees | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution retirement plan, maximum percentage of salary deferral contributions by employee | 7.00% |
Stock Repurchase Program and _2
Stock Repurchase Program and Dividends - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Nov. 01, 2020 | May 03, 2020 | Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | Mar. 31, 2021 | |
Stock Repurchase Program and Dividend [Line Items] | ||||||
Common stock repurchased, shares | 1,496,100 | 2,341,931 | 5,373,047 | |||
Common stock repurchased, average cost per share | $ 100.26 | $ 63.55 | $ 54.96 | |||
Common stock repurchased, total cost | $ 150,000,000 | $ 148,834,000 | $ 295,304,000 | |||
Stock repurchase program, remaining authorized repurchase amount | 424,982,000 | |||||
Treasure stock, value | 599,000 | 941,000 | ||||
Cash dividend declared | $ 163,316,000 | $ 156,103,000 | $ 144,609,000 | |||
Cash dividends declared per common share | $ 2.02 | $ 1.92 | $ 1.72 | |||
Board of Directors [Member] | ||||||
Stock Repurchase Program and Dividend [Line Items] | ||||||
Cash dividends declared per common share | $ 0.53 | $ 0.59 | ||||
Stock Repurchase Program, Authorized Amount | $ 1,000,000,000 |
Summary of Segment Reporting In
Summary of Segment Reporting Information by Segment (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | ||
Segment Reporting Information [Line Items] | ||||
Net revenues | [1] | $ 6,783,189 | $ 5,898,008 | $ 5,671,593 |
Pottery Bam [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 2,526,241 | 2,214,397 | 2,177,344 | |
West Elm [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 1,682,254 | 1,466,537 | 1,292,928 | |
Williams Sonoma [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 1,242,271 | 1,032,368 | 1,056,125 | |
Pottery Bam Kids and Teen [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 1,042,531 | 908,561 | 895,762 | |
Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | [2] | $ 289,892 | $ 276,145 | $ 249,434 |
[1] | Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $345.7 million, $365.6 million and $346.8 million for fiscal 2020, fiscal 2019 and fiscal 2018, respectively. | |||
[2] | Primarily consists of net revenues from our international franchise operations, Rejuvenation and Mark and Graham. |
Summary of Segment Reporting _2
Summary of Segment Reporting Information by Segment (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Segment Reporting Information [Line Items] | |||
Net revenues related to foreign operations | $ 345.7 | $ 365.6 | $ 346.8 |
Summary of Long-lived Assets by
Summary of Long-lived Assets by Geographic Areas (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 2,194,344 | $ 2,298,407 |
US | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 2,043,950 | 2,132,635 |
Non-US [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 150,394 | $ 165,772 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Derivative [Line Items] | |||
Reclassification from OCI to cost of goods sold | $ 979,000 | ||
Gain or loss recognized for cash flow hedges due to hedge ineffectiveness | $ 0 | $ 0 | $ 0 |
Foreign Currency Forward Contra
Foreign Currency Forward Contracts Outstanding with Notional Values (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Foreign Exchange Contract | Derivatives designated as hedging instruments | Cash Flow Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Contracts designated as cash flow hedges | $ 28,300 | $ 17,200 |
Effect of Derivative Instrument
Effect of Derivative Instruments in Condensed Consolidated Financial Statements (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | |
Derivative [Line Items] | |||
Line items presented in the Consolidated Statements of Earnings in which the effects of derivatives are recorded | $ 4,146,920 | $ 3,758,916 | $ 3,570,580 |
Line items presented in the Condensed Consolidated Statement of Earnings in which the effects of derivatives are recorded | 1,725,572 | 1,673,218 | 1,665,060 |
Cost of Sales [Member] | |||
Derivative [Line Items] | |||
Line items presented in the Consolidated Statements of Earnings in which the effects of derivatives are recorded | 4,146,920 | 3,758,916 | 3,570,580 |
Derivatives designated as cash flow hedges | 562 | 604 | 478 |
Derivatives not designated as hedging instruments | 0 | ||
Selling, General and Administrative Expenses [Member] | |||
Derivative [Line Items] | |||
Line items presented in the Condensed Consolidated Statement of Earnings in which the effects of derivatives are recorded | 1,725,572 | 1,673,218 | 1,665,060 |
Derivatives designated as cash flow hedges | 57 | ||
Derivatives not designated as hedging instruments | $ 17 | $ 28 | $ 3,967 |
Fair Values of Derivative Instr
Fair Values of Derivative Instruments (Detail) - USD ($) $ in Thousands | Jan. 31, 2021 | Feb. 02, 2020 |
Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as cash flow hedges, Assets | $ 113 | $ 138 |
Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as cash flow hedges, Liabilities | $ (692) |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) by Component, Net of Tax (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 31, 2021 | Feb. 02, 2020 | Feb. 03, 2019 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | $ (14,587) | |||
Foreign currency translation adjustments | 8,195 | $ (3,334) | $ (5,032) | |
Change in fair value of derivative financial instruments | (315) | 163 | 1,098 | |
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | (410) | (343) | (357) | |
Ending Balance | (7,117) | (14,587) | ||
Accumulated Foreign Currency Adjustment Attributable to Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (14,593) | (11,259) | (6,227) | |
Foreign currency translation adjustments | 8,195 | (3,334) | (5,032) | |
Change in fair value of derivative financial instruments | 0 | |||
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | [1] | 0 | ||
Other comprehensive income (loss) | 8,195 | (3,334) | (5,032) | |
Ending Balance | (6,398) | (14,593) | (11,259) | |
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | 6 | 186 | (555) | |
Foreign currency translation adjustments | 0 | |||
Change in fair value of derivative financial instruments | (315) | 163 | 1,098 | |
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | [1] | (410) | (343) | (357) |
Other comprehensive income (loss) | (725) | (180) | 741 | |
Ending Balance | (719) | 6 | 186 | |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (14,587) | (11,073) | (6,782) | |
Foreign currency translation adjustments | 8,195 | (3,334) | (5,032) | |
Change in fair value of derivative financial instruments | (315) | 163 | 1,098 | |
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax | [1] | (410) | (343) | (357) |
Other comprehensive income (loss) | 7,470 | (3,514) | (4,291) | |
Ending Balance | $ (7,117) | $ (14,587) | $ (11,073) | |
[1] | Refer to Note L for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Consolidated Statements of Earnings. |