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Key Takeaways RH is expected to post Q2 revenue growth of 0.5%-2.5% amid housing and sourcing pressures.RH's Q2 adjusted EBITDA margin is guided at 11.5%-13%, hit by 380 bps of startup costs.RH's global expansion may support demand, with larger benefits expected later in fiscal 2026. RH (RH - Free Report) is scheduled to report second-quarter fiscal 2026 (ended Aug. 1, 2026) results on Sept. 10, after the closing bell.In the last reported quarter, the company’s adjusted loss per share of $1.97 was narrower than the Zacks Consensus Estimate of a loss of $2.13 by 7.5%. In the year-ago quarter, RH reported adjusted earnings of 13 cents per share. Net revenues of $800.3 million topped the consensus estimate by 1.1% but declined 1.7% year over year.
RH’s earnings surpassed estimates in only one of the trailing four quarters and missed on the other three occasions, but the average surprise was negative 12.8%.
How Are Estimates Placed for RH Stock?The Zacks Consensus Estimate for the fiscal second quarter indicates earnings of 42 cents per share, which has declined from 79 cents over the past 30 days. In the year-ago period, the company reported earnings of $2.93 per share.
The consensus estimate for revenues is pegged at $914.2 million, indicating a 1.7% year-over-year growth.
Factors Likely to Have Shaped RH’s Q2 PerformanceAssessing the Sales Environment: RH’s fiscal second-quarter revenue performance is likely to have remained constrained by a difficult housing backdrop, tariff-related sourcing disruptions and elevated backorder and special-order balances. Management expects these balances to remain unusually high in the fiscal second quarter before normalizing later in fiscal 2026. Accordingly, RH guided for fiscal second-quarter revenue growth of 0.5% to 2.5%, suggesting only modest top-line improvement during the period.
Despite these pressures, RH’s luxury positioning, international expansion and broader product transformation may have supported demand. The company has been building its presence across key European luxury markets, with Paris and Milan ramping up and London viewed by management as a potential accelerator for the international business. RH also continued expanding its trade platform and introducing higher-end customization through RH Bespoke Furniture and RH Couture Upholstery.
However, the larger benefits from RH Estates, backlog conversion and new-store growth are expected to be weighted toward the second half of fiscal 2026 rather than the fiscal second quarter. Management expects these initiatives to collectively drive a meaningful acceleration later in the year.
Factors Affecting Profitability: Profitability is likely to have remained under pressure from RH’s elevated investment cycle. Management guided for a fiscal second-quarter adjusted EBITDA margin of 11.5% to 13%, including an estimated 380-basis-point negative impact from pre-opening and startup expenses related to international expansion. Management indicated that a meaningful portion of these opening-related costs is transitory and should ease in the second half.
Overall, RH’s second-quarter results are expected to reflect modest revenue growth alongside continued near-term margin pressure from international investments and sourcing disruptions.
What the Zacks Model Says for RHOur proven model predicts an earnings beat for RH this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is exactly the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of +127.49%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Peer ReleasesWilliams-Sonoma, Inc. (WSM - Free Report) posted second-quarter fiscal 2026 adjusted earnings of $2.10 per share, up 5% year over year and came in above the Zacks Consensus Estimate of $2.05 by 2.4%. Net revenues rose 6.7% to $1.96 billion and beat the consensus mark of $1.91 billion by 2.5%.
Williams-Sonoma raised fiscal 2026 guidance after strong year-to-date performance. The company now expects annual net revenues to increase 4.7% to 7.2%, with comparable brand revenue growth of 4.0% to 6.5%. Non-GAAP operating margin is projected to be between 17.8% and 18.2%.
The Home Depot, Inc. (HD - Free Report) has delivered solid second-quarter fiscal 2026 results, with the top and bottom lines surpassing the Zacks Consensus Estimate. Adjusted earnings were $4.92 per share, up 5.1% year over year from $4.68. The figure topped the Zacks Consensus Estimate of $4.71.
Home Depot reaffirmed its fiscal 2026 outlook, calling for total sales growth of 2.5-4.5% and comps growth of flat to 2%. The company anticipates earnings per share to be flat to up 4% from $14.23 in the year-ago quarter. Meanwhile, adjusted earnings per share are also projected to be flat to up 4% from the $14.69 reported in the year-ago quarter.
Lowe’s Companies, Inc. (LOW - Free Report) reported second-quarter fiscal 2026 adjusted earnings of $4.40 per share, up 1.6% year over year, surpassing the Zacks Consensus Estimate of $4.22. Revenues rose 8.3% to $25,956 million but missed the consensus estimate of $26,135 million.
Lowe’s expects fiscal 2026 total sales of $92 billion compared with its prior range of $92-$94 billion. Comparable sales are projected to be flat, versus the previous expectation of flat to up 2%. The revision reflects first-half operating results and current demand trends.