For some time now, Williams-Sonoma has held steady at the top of the home furnishings industry. Its latest numbers weren’t a nosedive, but they bring the brand a little closer to earth—this week’s earnings report continued the trend of upscale home retailers reporting lower sales for their most recent quarters, as the industry’s post-pandemic hangover remains very much a fact of life.

The multibrand retailing company—its banners include Pottery Barn, West Elm and Rejuvenation, as well as its namesake kitchenware unit—did beat analysts’ forecasts on its fourth-quarter profits, and goosed its stock by upping its dividend by 26 percent and announcing a $1 billion stock repurchase authorization. Wall Street loved it, driving the share price up more than 45 percent after the report on Wednesday morning.

In fact, while the top-line numbers had to be a disappointment following Sonoma’s extraordinary run over the past few years, its overall finances looked pretty good. Net profits for the quarter as a percentage of revenues were up, though they did show a small decline for the year. The retailer also registered increases in gross margins and a decline in inventory levels—two good signs.

“We outperformed in 2023 despite the slowest housing market in several decades and geopolitical unrest,” president and CEO Laura Alber said when announcing the results. “Although this pressured our top-line trend, we stayed focused on full-price selling, supply chain efficiencies and best-in-class customer service. We have transformed our business model, and as a result, we delivered an operating margin well ahead of our pre-pandemic profitability.”

A brand breakdown shows a clearer story of Sonoma’s performance. Its eponymous division, which generally does well during the quarter of holiday gift-giving and gatherings, was the only one not to show a revenue decline. (Other brands, including Rejuvenation and the new GreenRow eco-friendly unit, did show a small gain, but they represent a small segment of the company.)

Meanwhile, the heavy hitters lost ground. West Elm had the biggest drop in its revenues at 15.3 percent for the fourth quarter, while Pottery Barn—the conglomerate’s biggest division—showed a 9.6 percent decline for the period.

For the full year, revenues for the entire company declined a little more than 10 percent. In forecasting its new fiscal year, Sonoma said it is looking at revenues to fall plus or minus 3 percent. Longer term, “We continue to expect mid-to-high single-digit annual net revenue growth with an operating margin in the mid-to-high teens.”

The company has consistently outperformed most of its competition, both during and after the pandemic, and also tends to be the most optimistic in its outlook. This quarter’s and the full-year results confirmed that. RH, by contrast, fell short of analyst forecasts in December 2023 when reporting its third quarter, which showed a nearly 14 percent drop in revenues—marking the first loss it had experienced in some time. It also had the most negative business forecast.

Ethan Allen, which reported its second quarter in January, had a bigger drop on its top line, falling 19 percent. It did finish in the black, however, and CEO Farooq Kathwari told analysts: “We believe that now consumers have again started to focus on their homes, which gives us an opportunity to continue our progress. We are positioned well and remain cautiously optimistic.”

Havertys, the Southeast-based furniture chain, reported its fourth-quarter and fiscal-year results last month, showing the biggest decline in revenues among the larger public companies, with quarterly sales down 24.9 percent, even as it showed a small profit for both the quarter and the year. CEO Clarence Smith said he expected Havertys to pick up market share and grow its business “in the near term and into the future.”

Even Arhaus—the smallest of the public furniture retailers and the one that had most recently bucked the downward trend—came back down to earth in its fourth quarter, showing a 6.8 percent falloff in sales for the quarter, though for the full year, it did have a small top-line gain of 1.4 percent. It was profitable for both periods, and going forward, CEO John Reed pointed to new stores as revenue drivers. He said Arhaus plans to open nine to 11 new showrooms over the coming year, increasing overall brand awareness.

Of course, for all of these retailers, the forecasts are very much dependent upon something totally beyond their control: mortgage rates and their impact on the overall housing market. Right now there are signs that the Federal Reserve is (maybe) getting closer to dialing back interest rates, which would mean lower mortgage costs, leading to increased activity in both housing resales and new construction.

Those cuts are what the home furnishings industry has been breathlessly anticipating for much of the past year. However, as two wars and an extremely contentious presidential election cycle continue to impact consumer psyches, the number of variables influencing home retail are virtually incalculable.

While it does seem the worst is over for the industry, better times seem to always be around the next corner …

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Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.