Track market-moving stories before they get noisy

CORTE MADERA, Calif.--(BUSINESS WIRE)--RH (NYSE: RH) announced today the appointment of Ryan Hassanein as Chief Legal & Compliance Officer. Mr. Hassanein will oversee all areas of the Company's legal and compliance functions, including product safety and vendor compliance. Prior to joining RH, Mr. Hassanein spent over ten years at McKesson Corporation, one of the largest healthcare companies in the world, where he was a member of the Chief Legal Officer's leadership team with responsibiliti.

On July 22, 2026, RH (RH) shares fell 3.0%, closing at $175.09. The stock has seen a 52-week range between $106.30 and $257.00, reflecting significant volatilit

Director Mark S. Demilio reported a sale of 2,445 shares of RH (RH +7.56%) on July 10, 2026, according to an SEC Form 4 filing.

Transaction summaryMetricValueShares sold (indirectly held)2,445Transaction value~$412,000Post-transaction shares57,698Post-transaction shares (directly held)12,593Post-transaction shares (indirectly held)45,105Post-transaction value$9.54 millionKey questionsWhat was the impact of this transaction on the director's total equity exposure?
The sale of 2,445 shares represented 5% of the indirect holdings and 4% of the total equity position. Following the transaction, the aggregate stake decreased from 60,143 shares to 57,698 shares.How is the remaining ownership structured across different entities?
The current position is divided between 12,593 shares held directly and 45,105 shares held indirectly. The indirect holdings are distributed between The Mark S. Demilio Revocable Trust, which holds 25,680 shares, and The Theresa E. Demilio 2012 Family Trust, which holds 19,425 shares.How did the execution price compare to the market valuation on the date of the trade?
The transaction was executed at a weighted average price of $168.44 per share, which was a premium to the $165.35 market close recorded on the July 10, 2026 transaction date.What is the company's current market scale and recent financial profile?
As of the July 10 market close, the company had a market capitalization of $3.1 billion. In the trailing 12 months, the firm generated $3.4 billion in revenue and $103.1 million in net income.Company OverviewMetricValueShare Price (as of market close 2026-07-10)$165.35Market Capitalization$3.1 billionRevenue (TTM)$3.4 billionNet Income (TTM)$103.1 millionCompany SnapshotRH operates as a specialized home furnishings retailer offering an extensive portfolio that includes furniture, lighting, textiles, bathware, decor, outdoor and garden essentials, and specialized furnishings for children and teens.The company generates revenue through a diversified omnichannel distribution model encompassing distinctive retail galleries, curated Source Books catalogs, and a comprehensive digital platform.RH targets affluent consumers seeking premium home furnishings and design solutions, positioning itself as a curator of high-end residential and lifestyle products.RH is a prominent specialty retailer in the consumer cyclical sector with a market capitalization of $3.1 billion. The company has generated $3.4 billion in TTM revenue with net income of $103.1 million, reflecting its position as a significant player in the premium home furnishings market. RH's competitive advantage derives from its curated product selection, distinctive retail experience across multiple channels, and strong brand positioning in the high-end home furnishings segment.

What this transaction means for investorsDemilio trimmed a small block from his indirect holdings and still controls 57,698 shares split across a revocable trust, a family trust, and a direct stake. A long-tenured director shaving 4% off a position mostly held in trust vehicles is the kind of estate-planning move that says nothing about where RH is headed. Worth a small note, though: there's no 10b5-1 plan mentioned, so the timing was discretionary, and he did sell at $168.44, a premium to that day's close.

Coincidentally enough, CEO Gary Friedman reported the sale of “a small portion” of his common stock — 24% of his holdings — earlier this month, prompting a release from the company, which said the move was to help fund improvements to personal residences and the repayment of debt. Shares surged nearly 8% on Tuesday (just four days after the transaction), so it’s clear the stock is in a volatile position, with shares still down about 14% in the year ending Tuesday.

The business is in a similarly tricky but improving spot. Fiscal first-quarter revenue slipped 1.7% to $800.3 million, hurt by roughly $45 million in tariff-related backorders, but RH raised its full-year outlook to 4.5% to 8% revenue growth. Friedman told investors he expects growth to accelerate from roughly flat in the first half to around 12% in the second half as backlog clears. For long-term investors, the insider sale is minor. The real questions are whether that second-half acceleration shows up, and whether RH's debt-heavy balance sheet can carry its costly international expansion.

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About the Author

Jonathan Ponciano is a contributing stock market analyst at The Motley Fool. He has nearly a decade of experience as a financial journalist, most recently as an editor and senior reporter at Forbes focused on markets, technology, and entrepreneurship. Jonathan has also written for Investopedia and the Los Angeles Business Journal. He holds a dual B.A. in Business Journalism and Economics from the University of North Carolina at Chapel Hill and an M.B.A. from Columbia Business School. A North Carolina native now based in New York City, Jonathan has also lived in Mexico City and Los Angeles.

CORTE MADERA, Calif.--(BUSINESS WIRE)--RH (NYSE: RH) announced today that Chairman & Chief Executive Officer Gary Friedman sold an aggregate of 125,000 shares of RH common stock from July 6, 2026 through July 8, 2026. Following this sale, Mr. Friedman retains beneficial ownership of 4,926,337 shares, representing beneficial ownership of approximately 23.88%(1) of RH's common stock. Mr. Friedman reported that the current sale of shares was made in order to fund (1) improvements to personal r.

CORTE MADERA, Calif. & BRACKLEY, England--(BUSINESS WIRE)--RH (NYSE: RH), the leading luxury home furnishings brand in the world, and the Mercedes-AMG PETRONAS Formula One Team announced today a multi-year collaboration that will bring RH's distinctive design perspective to destinations across the team's global footprint. As the Global Interior Design and Luxury Furnishings Curator of the Mercedes-AMG PETRONAS Formula One Team, RH will reimagine the team's hospitality environments across key Fo.

CORTE MADERA, Calif.--(BUSINESS WIRE)--RH announced today the unveiling of RH Estates, making the work of the world's most legendary designers and ateliers accessible to consumers for the first time. The collection is inclusive of: The iconic designs of Michael Taylor, recognized globally as the godfather of the California look and called “One of the 20 greatest interior designers of all time” by Architectural Digest, the meticulous reproductions of Formations and the classical grandeur of Denn.

Investors in RH (RH - Free Report) need to pay close attention to the stock based on moves in the options market lately. That is because the June 18, 2026 $85.00 Call had some of the highest implied volatility of all equity options today.

What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

What do the Analysts Think?Clearly, options traders are pricing in a big move for RH shares, but what is the fundamental picture for the company? Currently, RH is a Zacks Rank #4 (Sell) in the Consumer Products - Staples industry that ranks in the Bottom 36% of our Zacks Industry Rank. Over the last 60 days, no analysts have increased their earnings estimates for the current quarter, while two analysts have revised their estimates downward. The net effect has taken our Zacks Consensus Estimate for the current quarter from $2.01 per share to $1.50 in that period.

Given the way analysts feel about RH right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.

Key Takeaways Tariff-related sourcing shifts increased backorders and reduced reported Q1 revenue by about $45M.RH is expanding in Europe with new locations in Paris, Milan and London to build global brand reach.International expansion and strategic investments are pressuring margins as execution remains critical. RH (RH - Free Report) is navigating several shifts at once: tariff disruption, global sourcing changes, experiential retail, European expansion and digital upgrades. These trends are reshaping how the luxury home furnishings retailer manages growth.

The challenge is that strategic change is arriving while housing demand remains weak and margins are under pressure. That makes execution, not just brand ambition, the key issue.

How RH Tariffs Are Reshaping Sourcing DecisionsRH’s supply chain remains highly global. Based on fiscal 2025 purchases, 69% of its products were sourced from Asia, including 39% from Vietnam and 13% from China. Another 21% came from North America, 13% from the United States and 10% from Europe and other countries.

That exposure makes tariffs a direct operating issue. Tariff-related resourcing lifted backorder and special-order balances by about $75 million year over year in the first quarter of fiscal 2026, reducing reported revenues by roughly $45 million.

RH is responding with pricing actions, vendor diversification toward lower-duty jurisdictions and logistics rerouting. These are no longer temporary fixes. They are becoming part of the company’s playbook for managing costs, product availability and quarterly revenue timing.

Why RH Keeps Betting on Experiential RetailRH continues to treat physical retail as central to its luxury model. Its Galleries, hospitality experiences, design services, websites and Sourcebooks are designed to work together rather than operate as separate channels.

The company argues that luxury furniture remains a category where in-person engagement matters. Larger-format Galleries can display more of the assortment, support design services and create a brand experience that is harder to replicate online.

Williams-Sonoma, Inc. (WSM - Free Report) offers investors another lens on the premium home category through brands such as Pottery Barn and West Elm. Arhaus, Inc. (ARHS - Free Report) is also relevant because it competes for design-led, discretionary furniture spending.

Where RH Europe Expansion Could Change the StoryRH is pushing deeper into Europe through high-profile openings. RH Paris opened in September 2025, RH Milan opened in April 2026 and RH London is expected to open in June 2026. These locations are meant to build international brand equity and support a broader global luxury platform. Management views London as an important accelerator because of higher brand awareness and global visitation, while Paris and Milan serve as design and fashion halo markets.

The trade-off is margin pressure. Pre-opening and startup costs tied to international expansion are expected to reduce adjusted EBITDA margin by about 270 basis points in fiscal 2026.

How RH Digital Efforts Support the Luxury FunnelRH’s digital reimagination is not about replacing Galleries. It is about improving the path from discovery to design engagement.

The company is upgrading The World of RH with better content, navigation and search. Internally, it is using design data and visuals to improve product ideation and presentation.

The digital platform also supports RH Estates, which is rolling through Galleries and Sourcebooks. Better search, appointment generation and design tools could help customers navigate a wider assortment as RH expands into bespoke furniture and couture upholstery.

How RH Scores Fit This Trend-Driven ThesisThe bottom line is that RH has a credible trend story, but investors still need to see these initiatives translate into steadier revenue conversion, margin recovery and cash generation. Tariffs, sourcing shifts and European expansion are changing the model, but they also add execution risk.

RH currently carries a Zacks Rank #4 (Sell). Its Style Scores are a Value Score of B, Growth Score of C, Momentum Score of D and VGM Score of B. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Value Score of B and VGM Score of B point to some relative appeal, but the Momentum Score of D signals weak near-term price action. Combined with the Zacks Rank #4, the stock still leans defensive until RH shows that its strategic trends are becoming financial results.

The past five years have been a difficult stretch for the stock of luxury furniture company RH (RH 2.32%), which is down more than 75% in that span. The home furnishing industry has been hit with a perfect storm of prior demand pull-forward due to COVID restrictions, low housing turnover, and tariffs.

Despite delivering first-quarter revenue results that topped its prior guidance, RH stock slid as it issued a cautious second-quarter forecast. Let's take a close look at RH's results and prospects to see if a turnaround could be in store.

Today's Change

(

-2.32

%) $

-3.54

Current Price

$

149.50

Making bold moves Despite facing an incredibly difficult furnishing environment, RH has been putting up respectable results as it expands its brand to Europe through the opening of grandiose galleries.

It's also making one of its boldest brand extensions ever with RH Estates, as it introduces a more traditional furniture line that tends to be preferred by many luxury homeowners. This will include ultra-high-end, fully customizable furniture catering to both wealthy consumers and design professionals, and is expected to help propel growth starting in the second half of the year.

For its fiscal Q1, RH reported a 1.7% decrease in revenue to $800.3 million, which was above its prior guidance for revenue to decline by 2% to 4%. Adjusted earnings per share, meanwhile, had a loss of $1.97, versus a profit of $0.13 a year ago. That was better than the $2.07 loss expected by analysts.

Looking ahead, RH raised its full-year revenue forecast, taking it to growth of between 4.5% and 8%, up slightly from a prior outlook of 4% to 8% growth. For Q2, it projected revenue to grow by between 0.5% to 2.5%, before accelerating to 12% growth in the second half. The second-half growth acceleration is expected to be led by a combination of backlog reduction (4.5%), new store growth (2.5%), and RH Estates (5%).

RH has also been selling some assets, like its Aspen real estate portfolio. Management thinks that the combination of improved sales, reduced spending, and asset sales will lead to significant free cash flow generation and help it become debt-free by 2029.

Image source: Getty Images.

Is it time to buy the stock? If RH can accelerate sales and reduce debt, the stock could have a lot of upside from here. It's making some big bets with Europe and RH Estates, so it certainly isn't sitting still. The stock only trades at a forward price-to-earnings ratio (P/E) of 16 based on next fiscal year analyst estimates, but its leverage and sales growth have been keeping the stock back.

I think the stock looks like an interesting speculative bet at current levels, with some nice potential over the next few years if its strategy works.

Key Takeaways RH is a premier luxury home furnishings retailer.Tariffs are causing cost pressures. RH's performance is deeply tethered to the struggling housing market. Restoration Hardware Company OverviewZacks Rank #5 (Strong Sell) company RH ((RH - Free Report) ) is a leading luxury retailer in the home furnishing space. The company offers dominant merchandise assortments across a growing number of categories, including furniture, lighting, textiles, bathware, décor, outdoor and garden, tableware and child and teen furnishings.RH’s business is fully integrated across its multiple channels of distribution, consisting of stores, Source Books and websites. RH positions its Galleries as showrooms for its brand, while websites and Source Books act as virtual extensions of its physical spaces. RH has an integrated RH Hospitality experience in ten of the Design Gallery locations, which include restaurants and wine bars.

RH Faces Tariff Uncertainty & Rising Cost PressuresRH faces significant headwinds from tariffs that continue to disrupt operations and weigh on financial visibility. With about 16 different tariff announcements over the past 10 months, RH has been facing significant resourcing challenges, product delays and out-of-stocks, along with multiple rounds of price negotiations and increases. Tariff-related resourcing has also impacted key categories such as furniture, lighting and rugs, which are more complex to shift across manufacturing locations. The elevated tariffs of 50% on imported steel and aluminum, with a new investigation into furniture imports, burden the company’s cost structure. These cost burdens not only threaten margins but also create timing distortions in revenue recognition. In the fourth quarter of fiscal 2025, tariffs remained a key driver of margin pressure, with an impact of around 90 basis points.

RH: Dependent on Housing MarketRH and other industry peers are highly dependent on housing market demand. The housing industry is cyclical and affected by consumer confidence levels, prevailing economic conditions and interest rates. The federal government’s actions related to economic stimulus, taxation and borrowing limits could affect consumer confidence and spending levels, which could hurt both the economy and the housing market.

Bottom Line

While RH maintains a sophisticated, fully integrated luxury brand identity and continues to innovate through its unique blend of retail and hospitality, its near-term outlook is increasingly challenged by external economic pressures. The convergence of persistent tariff burdens, supply chain bottlenecks, and an unpredictable, interest-rate-sensitive housing market presents a demanding operating environment. Moving forward, RH's ability to maintain its premium margins and sustain revenue growth will heavily depend on how effectively it navigates these macroeconomic headwinds and mitigates ongoing cost volatility.

Q1: 2026-06-11 Earnings SummaryEPS of -$1.97 beats by $0.10

 |

Revenue of

$800.33M

(-1.67% Y/Y)

beats by $7.94M

RH (RH) Q4 2025 Earnings Call March 30, 2026 8:00 PM EDT

Company Participants

Gary Friedman - Chairman & CEO

Presentation

Gary Friedman
Chairman & CEO

Albert Einstein's 3 rules of work. Out of clutter, find simplicity. From discord, find harmony. In the middle of difficulty lies opportunity. Seem especially relevant at this moment. Where compounding clutter from tariffs, global discord as a result of war and the most dire housing market in decades can make it difficult to separate the signal from the noise.

It's important to remember, necessity is the mother of invention, and our most important innovations were birthed during the most uncertain times. Transforming a nearly bankrupt Restoration Hardware into RH, the leading luxury home brand in North America was not a feat for the faint of heart. While the external challenges are somewhat familiar, our internal opportunities are massively different. We're not closing stores and fighting to survive. We're building a never seen before brand that's positioned to thrive. Before we get into the details of our strategy, let's start with a few facts that should quiet some of the noise.

In 2025, RH achieved revenue growth of 8% and 2-year growth of 15%, far outpacing our furniture industry peers by 8 to 30 points. Adjusted EBITDA reached $597 million or 17.3% of revenues versus $539 million or 16.9% of revenues in 2024. Free cash flow of $252 million versus negative free cash flow of $214 million in 2024, an increase of $466 million year-over-year. Those results were despite 2025 being our peak investment year with $289 million of adjusted CapEx to support our global expansion, plus an additional $37 million to purchase the Michael Taylor, Formations and Dennis & Lean brands to support the launch of our new concept, RH Estates. A strong performance considering the unusual circumstances.

Restoration Hardware remains a buy despite a 2% stock decline and recent underperformance versus the benchmark. RH delivered a double beat on earnings and reiterated revenue growth, reinforcing my bullish thesis on sustained expansion. I see favorable catalysts developing for RH, though a quick turnaround is unlikely given its history of earnings misses.

On June 12, 2026, RH RH shares fell 3.9% to a current price of $153.04. The stock has experienced a volatile year, with a 52-week high of $257.00 and a low of $106.30. Over the past month, RH has seen a positive trend, gaining 16.6%, although it remains down 14.6% year-to-date.

GF Value™ verdict: Current price $153.04 vs GF Value™ of $324.46, indicating a 52.8% upside potential.GF Score™ of 73/100 suggests the stock is above average based on its key financial metrics.Notable signal: Insiders sold $3.4 million worth of shares in the last three months, indicating potential caution. Is RH Overvalued or Undervalued? With a current price of $153.04 and a GF Value™ estimate of $324.46, RH appears significantly undervalued, representing a 52.8% margin of safety. The GF Value™ methodology assesses intrinsic value based on historical trading multiples, past business growth, and future performance estimates. While this undervaluation may suggest a buying opportunity, caution is warranted given the GF Valuation label of "Possible Value Trap, Think Twice." This label implies that while the stock may seem attractive based on its current price relative to the GF Value™, underlying issues might hinder its ability to reach that intrinsic value.

Investors should consider the potential risks associated with the company's financial health, as indicated by a Financial Strength rating of only 3/10. The combination of a high GF Value™ and low financial strength could signal that this opportunity may not be as straightforward as it seems, requiring further analysis before making any investment decisions.

How Does RH's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 29.5x 29.6x Forward P/E 28.1x N/A RH's current P/E (TTM) of 29.5x is virtually unchanged from its 5-year median P/E of 29.6x, indicating that the stock is trading in line with its historical valuation metrics. The forward P/E of 28.1x also supports this stance, suggesting that there may not be immediate expectations for significant earnings growth. This P/E analysis aligns with the GF Value™ verdict, reinforcing the notion that RH's stock is undervalued based on its intrinsic worth, yet it also suggests that the stock is not trading at a significant discount compared to its historical valuation.

What Does RH's GF Score™ Tell Us? Metric Rating GF Score™ 73/100 Financial Strength 3/10 Profitability 8/10 Growth 8/10 Valuation 2/10 Momentum 5/10 The GF Score™ of 73/100 indicates that RH is performing above average relative to its peers, driven primarily by strong Profitability and Growth ranks of 8/10. However, the weak Valuation rank of 2/10 raises concerns about whether the stock is appropriately priced, suggesting that it may not offer a compelling value proposition despite its growth potential. The Financial Strength score of 3/10 highlights vulnerabilities that could impact the company's stability, while the Momentum rank of 5/10 suggests a mixed outlook in terms of price trends.

What Are Insiders Doing with RH Stock? In the past three months, insiders have sold $3.4 million worth of RH shares, with no reported insider buying during this period. This selling activity may indicate a lack of confidence in the company's short-term prospects among those with inside knowledge, which could be a red flag for potential investors. It is essential to monitor insider activity as it can reflect management's outlook and sentiment about the company’s future performance.

What This Means for Investors Based on the current GF Value™ assessment, RH appears to be undervalued at its present price of $153.04, compared to a GF Value™ of $324.46. However, investors should approach this opportunity with caution due to the company's low financial strength and the possibility of it being a value trap.

For the complete analysis, visit the RH RH stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.

Frequently Asked Questions What is RH's GF Score™?

RH's GF Score™ is 73/100, indicating that the stock is above average based on several financial metrics that assess its potential for long-term returns.

Is RH overvalued or undervalued?

RH is deemed undervalued with a GF Value™ of $324.46, suggesting a significant upside potential from its current price.

What is RH's P/E ratio?

RH's P/E (TTM) is 29.5x, which is in line with its 5-year median P/E of 29.6x, indicating that the stock is not trading at a significant discount relative to its historical valuation.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

The stock has key technical support as record short interest creates fuel for further upside

Jun 5, 2026 at 2:14 PM

We recommended an RH call option last week

Subscribers to Schaeffer's Weekend Trader options recommendation service received this RH commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.

Furniture retailer RH (NYSE:RH) last week broke out and above the upper boundary of a three-month basing pattern that followed a multi-year low in April. This low was a fake-out move below the April 2025 lows, and just two weeks ago the equity crossed above the 50-day moving average. This crossover tends to have historically bullish returns, per our quantitative data. Previously, a cross below this trendline was a sell signal.

RH had also cleared the pre-earnings close in late-March that preceded a gap lower, which marked a low in the shares. Short interest is at a record high as well. The security has surged more than 30% since its April post-earnings low, and with the shares clearing the pre-earnings close last week, it could ignite short covering in the weeks ahead.

  Our recommended call option has a leverage ratio of 4.0 and will double on a 29.8% rise in the underlying equity.

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RH (NYSE:RH) will release earnings for its first quarter after the closing bell on Thursday, June 11.

Analysts expect the Corte Madera, California-based company to report a quarterly loss of $2.07 per share, versus a profit of 13 cents per share in the year-ago period. The consensus estimate for RH's quarterly revenue is $792.38 million (it reported $813.95 million last year), according to Benzinga Pro.

On March 31, RH reported worse-than-expected fourth-quarter financial results and issued FY26 sales guidance below estimates.

RH shares fell 0.9% to close at $148.69 on Wednesday.

Benzinga readers can access the latest analyst ratings on the Analyst Stock Ratings page. Readers can sort by stock ticker, company name, analyst firm, rating change or other variables.

Let's have a look at how Benzinga's most-accurate analysts have rated the company in the recent period.

Considering buying RH stock? Here’s what analysts think:

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© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Live Updates Yesterday

That wraps up our initial coverage of RH’s Q1 results. Thank you for stopping by!

Check out management’s earnings call at 5 PM EST for more updates.

Yesterday

RH raised its fiscal 2026 outlook after reporting first-quarter results that exceeded management’s expectations. The luxury furniture retailer now expects fiscal 2026 revenue growth of 4.5-8.0%, adjusted EBITDA margins of 14.2-16.0%, and adjusted free cash flow of $300-$400 million.

Management identified RH Estates, alongside backlog conversion and new gallery openings, as key factors supporting its expectation for revenue growth to accelerate in the second half of fiscal 2026.

Management said tariff-related sourcing disruptions delayed approximately $45 million of revenue in the quarter, but expects much of that business to be recognized later this year.

Yesterday

RH just reported earnings, with shares initially up about 9% following the report. Here are the key numbers:

Revenue: $800.3 million Adjusted EBITDA: $56.9 million (7.1% margin) Free Cash Flow: $13.3 million Guidance:

FY2026 Revenue Growth: 4.5% to 8.0% FY2026 Adjusted EBITDA Margin: 14.2% to 16.0% FY2026 Adjusted Free Cash Flow: $300 million to $400 million Q2 2026 Revenue Growth: 0.5% to 2.5% Q2 2026 Adjusted EBITDA Margin: 11.5% to 13.0% Quick read:

RH exceeded the high end of management’s expectations in Q1 despite tariff-related sourcing issues that delayed roughly $45 million of revenue.

Management raised its full-year outlook and expects backlog normalization to drive a meaningful revenue acceleration in the second half of 2026.

Investors appear encouraged that RH’s recovery thesis remains intact, with management pointing to backlog reduction, new store openings, and the launch of RH Estates as key growth drivers for the back half of the year.

Yesterday

With RH’s (NYSE:RH | RH Price Prediction) first-quarter results at 4:05 PM ET approaching, here are some key topics analysts will be watching for:

Key Topics Management Must Address Whether the 420 bps international drag is tracking to plan after Paris “exceeded RH New York” traffic. RH Estates rollout across the top 30-40 galleries and the mid-May sourcebook reception. Progress on the $0.5 billion real estate monetization plan. Macro Signals to Weigh Consumer sentiment at 49.8, a fresh 12-month low. Housing starts slipping to 1.47M in April. Red Flags Any softening of the $300M to $400M FCF range, or evasive answers on pending securities probes. Yesterday

With the bar set at -$2.05 non-GAAP EPS, the surprise risk lies in factors beyond the headline beat.

Tariff backorder unwind. Q4 lost ~$30 million in revenue to resourcing. Faster-than-expected resolution as China sourcing moves toward the 2% target could flip the guided -2% to -4% revenue decline. FX exposure. Euro and GBP swings now matter materially with RH Paris live and RH London/Milan launching Spring 2026. Housing inflection. Starts rebounded to 1,465 thousand units in April, the 81.8th percentile historically, challenging Friedman’s “worst in 50 years” framing. Litigation overhang. Investor law firms probing the Q4 miss adds sentiment risk absent from sell-side models. Earnings results are expected at 4:05 PM ET, while the earnings call will be at 5:00 PM ET.

Yesterday

What the Crowd Is Pricing In Polymarket traders are betting heavily on a beat. The active market “Will RH (RH) beat quarterly earnings?” shows a 98.5% implied probability of RH (NYSE:RH) topping the non-GAAP EPS threshold of -$2.05, with 9,614.76 contracts traded. Conviction has surged, with the “Yes” price climbing +48% over the past week and +53% in the last day.

The low bar matters. A negative consensus makes the hurdle easy to clear, even though RH missed in both Q3 and Q4 2025. History suggests the stakes are high: misses have averaged a -12.93% same-day move, while the lone beat delivered +6.93%. Shares trade at $153.23 into the earnings report, down 17% year-to-date.

Yesterday

Luxury home furnishings retailer RH (NYSE:RH) reports Q1 FY2026 results tonight at 4:05 PM ET. With shares at $153.14 and Polymarket pricing a 98.5% probability of beating the -$2.05 non-GAAP EPS bar, here is what to listen for on the 5:00 PM ET call.

Top 5 Analyst Questions How quickly is China sourcing tracking toward the 2% target from 16%? Is the $250M-$350M free cash flow range still intact? RH Paris productivity and RH Milan Spring 2026 readiness? Demand cadence versus the guided 2% to 4% revenue contraction? Path to deleveraging from 4.6x net debt/EBITDA? Key Topics & Buzzwords Listen for “strategic separation,” “climbing the luxury mountain,” and “demand vs. revenue.” Brand extension launch timing, hospitality (Guesthouses, RH One/Two/Three). Red Flags Full-year guide cut, widening negative shareholders’ equity beyond -$110.8 million, or fresh tariff backorder commentary. Yesterday

RH enters earnings under pressure after a difficult year marked by weak housing activity, tariff concerns, and investor skepticism around the company’s spending plans.

The company finished fiscal 2025 with roughly $2.6 billion in debt and net debt running at about 4.0x EBITDA, leaving little room for disappointment. Management has argued that current investments, including the RH Estates strategy, will drive long-term growth, but investors want evidence that the payoff is beginning to materialize.

Tonight’s report will be closely watched for signs that demand is stabilizing, luxury consumers remain engaged, and tariff pressures are easing. If RH can deliver on those fronts, there’s a potential for the recovery narrative to quickly regain momentum.

RH (NYSE: RH) reports first-quarter fiscal 2026 results today, June 11, at 4:05 PM ET. After two straight misses and a stock down 21.49% over the past year, this report carries unusual weight.

Proving the Investment Cycle Is Worth It Last quarter, RH posted adjusted EPS of $1.53, below the $2.20 consensus, and revenue of $842.6 million, below the $873.3 million consensus. Management blamed roughly $30 million in tariff-related backorders and $10 million in weather disruption. The stock dropped 19.5% intraday on the earnings report.

For the quarter ahead, CEO Gary Friedman guided to a revenue decline of 2% to 4% and an adjusted EBITDA margin of 5.5% to 6.5%, which incorporates roughly a 420-basis-point negative margin impact from international pre-opening costs. RH Paris opened on the Champs-Élysées last September, with RH London and RH Milan slated for Spring 2026. Shares have rebounded 15.09% over the past month to $153.50, suggesting some traders see the bar as already low enough. However, shares are up 3% today heading into Q1 earnings.

Consensus Estimates Metric Q1 FY2026 Consensus Full Year FY2026 Guide Adjusted EPS $(2.05) Implied from 14% to 16% EBITDA margin Revenue ~$792M 4% to 8% growth Adjusted Free Cash Flow Not guided $300M to $400M Estates Launch and Europe Will Decide Tonight’s Tone Tonight, I will be watching three things. First, the launch of RH Estates, the brand extension delayed from Fall 2025 to Spring 2026. Friedman told investors it will “become our largest and highest margin brand extension” and premiered at RH Milan during Salone.

Second, Europe. Friedman said Paris traffic in the first six days exceeded RH New York, and RH England demand ran +76% in Q2 and +47% in Q1. Investors will watch whether that comp momentum held through the London and Milan ramp, as international costs are eating into margins right now.

Third, tariffs and sourcing. CFO Jack Preston flagged “some tailwinds from the relatively lower rate that exists under Section 122 today” in the first half. RH has shifted its China sourcing target from 16% to 2% and aims for 52% U.S.-made upholstery. The macro backdrop helps modestly: housing starts hit 1.47 million in April, near the high end of the healthy range.

Polymarket traders are pricing a 98.5% probability of a beat against that loss estimate, signaling the bar may be low.

The furniture retailer said it now expects revenue growth of 4.5% to 8% for the fiscal year, raising the lower end of its prior range of 4% to 8%.

Arhaus Stock Drops to 52-Week Low After Q1 EarningsRH NYSE: RH raised its fiscal 2026 outlook after first-quarter revenue and adjusted EBITDA margin exceeded the high end of its expectations, even as the luxury home furnishings company said tariff-related resourcing kept back orders and special orders elevated.

Chairman and Chief Executive Officer Gary Friedman said first-quarter revenue was $800.3 million and adjusted EBITDA margin was 7.1%. He said results came despite back order and special order balances that were approximately $75 million higher than a year earlier, primarily due to tariff-related resourcing.

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MarketBeat Week in Review – 04/27 - 05/01“As a result of our better-than-expected first quarter results, we are raising our outlook for fiscal year 2026,” Friedman said while reading the company’s shareholder letter.

RH Raises Fiscal 2026 Outlook For fiscal 2026, RH now expects:

Revenue growth of 4.5% to 8%. Adjusted EBITDA margin of 14.2% to 16%. Adjusted free cash flow of $300 million to $400 million. Could RH’s Recent 40% Slide Represent a Buying Opportunity?The company said the full-year outlook includes an approximate 270-basis-point negative impact to adjusted EBITDA margin from pre-opening and start-up costs tied to international expansion.

For the second quarter, RH guided for revenue growth of 0.5% to 2.5% and adjusted EBITDA margin of 11.5% to 13%. That outlook includes an approximate 380-basis-point negative adjusted EBITDA margin impact from pre-opening and start-up costs to support international expansion.

Friedman said the company expects its business to accelerate from roughly flat revenue growth in the first half to about 12% growth in the second half. He identified three elements behind that expected acceleration: backlog reduction contributing 4.5 percentage points, new store growth adding 2.5 percentage points and new concept growth from RH Estates contributing five points.

Chief Financial Officer Jack Preston clarified during the question-and-answer session that the $75 million backlog figure represents back orders and special orders above the company’s normal rate. “This is elevated because of unnatural things happening,” Preston said, citing resourcing and transportation impacts.

RH Estates Takes Center Stage Much of the call focused on RH Estates, a new concept Friedman described as a major step in the company’s effort to build a global luxury brand. Friedman said the concept is intended to bring high-end, trade-only design and craftsmanship to a broader audience through RH’s platform.

Friedman said the company has aggregated brands and ateliers including Dmitriy & Co, Joseph Jeup, Dennis & Leen, Formations, Waterworks and Michael Taylor. He characterized RH Estates as an effort to remove barriers that have historically limited consumer access to certain categories of luxury home design.

“With the launch of RH Estates, we are removing the barriers that have segregated taste from scale,” Friedman said. “We are amplifying the work of the world’s most elite designers, artisans, and manufacturers on our global platform.”

Friedman also outlined new customization capabilities, including RH Bespoke Furniture and RH Couture Upholstery. He said RH Bespoke will allow interior designers and architects to specify dimensions for case goods such as dressers, dining tables, sideboards and cabinets. RH Couture Upholstery will include custom sizing and customer’s own material, or COM, for sofas, sectionals, chairs, ottomans and beds.

In response to a question from Guggenheim analyst Steven Forbes about the addressable market, Friedman said the traditional classic market represents roughly 60% of the luxury home market and that RH is “vastly under-penetrated” in that category. He said the company now views its business around three major aesthetic segments: Estates, Interiors and Modern.

Trade Program Aimed at Designers and Architects RH also plans to introduce an exclusive program for interior designers, architects and trade members. Friedman said the program is designed to compensate professionals for the value they create for consumers and to encourage them to use RH’s platform.

During the call, Friedman said RH already has a large trade business and provides services such as design support, renderings, presentations, delivery and installation assistance. He said the company has not historically offered the same kind of incentive structure to the design trade that some professionals use in their business models.

“Interior designers have a markup model, right? An hourly model. They kind of need both to make the business work,” Friedman said. He added that RH Estates makes this the right time to more directly engage high-end designers because the new assortment is aimed at the top of the market.

When Jefferies analyst Jonathan Matuszewski asked why now was the right time to pursue a loyalty program that compensates trade clients, Friedman said the timing is tied to Estates. “Estates opens up the very top of the market for this brand,” he said.

International Expansion Remains a Major Investment Friedman described RH Paris, Milan and London as key foundational openings for the company’s global luxury ambitions. He said the three markets are important to earning recognition from European, U.K. and global customers.

Asked by Wells Fargo analyst Zach Fadem about the initial response from Milan and expectations for Paris, Milan and London, Friedman said the company is still building brand awareness, customer relationships and design books in Europe. He said London is expected to be an accelerator for the broader international platform.

“London is the accelerator for all of it,” Friedman said. “Because everybody goes to London.” He said London has higher brand awareness for RH than some other international markets, citing expats and customer familiarity with the brand.

Preston said first-quarter pre-opening costs ended up at about 450 basis points of margin impact, compared with prior commentary of 420 basis points. He said the second-quarter guide includes a 380-basis-point impact, while the full-year figure is expected to be 270 basis points.

Margins, Cash Flow and Balance Sheet Executives said RH expects margin leverage as investments peak and sales improve. Friedman said the company is not assuming a recovery in the housing market in its guidance and said he would be surprised if RH did not beat the numbers if the market worsened, absent more severe macroeconomic disruption.

On tariffs, Preston said the free cash flow guidance does not assume any additional tariff refunds. “The refunds started coming, but they’ve been kind of paused,” he said.

On the balance sheet, Morgan Stanley analyst Simeon Gutman asked about RH’s goal of becoming debt-free by 2029. Friedman said debt reduction remains a priority and pointed to planned asset sales of $200 million to $250 million per year over the next two years. He said RH recently completed a transaction related to its Aspen real estate that gave the company 100% control of eight properties, which he said could help monetization efforts.

Preston said free cash flow is expected to build over time and reiterated that making progress on debt reduction remains a focus. Friedman added that as spending declines and sales rise, the company expects asset sales and business performance to support the balance sheet.

Friedman closed the call by thanking RH employees and saying the company is entering “one of the most important times in the history of RH,” driven by new products, international galleries and the company’s broader luxury positioning.

About RH NYSE: RHRH, formerly Restoration Hardware, is a design-driven luxury retailer specializing in high-end home furnishings, décor, textiles, lighting and outdoor living products. The company offers a curated collection of furniture pieces—including seating, casegoods, beds and dining items—alongside rugs, art and decorative accessories. RH's product lines are organized into distinct collections, each reflecting a cohesive design philosophy and premium craftsmanship aimed at the residential and hospitality markets.

Founded in 1979 in Eureka, California, by Stephen Gordon, Restoration Hardware began as a small warehouse in Northern California.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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RH RH is experiencing a decline in stock value following its Q1 report, where below-consensus Q2 guidance overshadowed better-than-expected results. The luxury home furnishings retailer posted an adjusted loss of $1.97 per share, with revenue decreasing by 1.7% year-over-year to $800.3 million. For Q2, RH anticipates revenue growth of only 0.5-2.5%, amounting to approximately $904-922 million, which falls short of market expectations. The company did increase the lower end of its FY26 revenue outlook, now forecasting growth of 4.5-8.0%, or around $3.59-3.73 billion, but this projection is contingent on a significant acceleration in the latter half of the year.

Revenue Timing: Q1 revenue was negatively impacted by about $45 million due to high backorder and special order balances, which were approximately $75 million above last year, largely due to tariff-related resourcing. RH expects these balances to stay elevated in Q2 before normalizing by year-end. Second-Half Bridge: Management forecasts revenue growth to shift from roughly flat in the first half to around 12% in the second half. This growth includes 4.5 points from backlog reduction, 2.5 points from new store openings, and 5.0 points from new concept growth, primarily RH Estates. Margin Framework: Margins faced pressure, with the adjusted EBITDA margin dropping to 7.1% from 13.1% last year due to gross margin compression and expense deleverage. RH projects a Q2 adjusted EBITDA margin of 11.5-13.0% and an FY26 adjusted EBITDA margin of 14.2-16.0%, indicating a significant recovery from Q1 levels, although international pre-opening and startup costs continue to be a burden. Platform Expansion: RH is focused on establishing a global luxury brand, with Paris, Milan, and London serving as key galleries for international visibility. Initiatives like RH Estates, RH Bespoke Furniture, and RH Couture Upholstery are part of this strategy to enter more customized, designer-led categories. Despite RH's Q1 results exceeding expectations, investor attention is shifting to the weaker Q2 guidance and the ambitious second-half growth implied by the FY26 outlook. The company suggests that some immediate challenges stem from timing issues related to elevated backorder and special order balances. However, transitioning from flat first-half revenue growth to approximately 12% in the second half remains a significant challenge, given the ongoing difficulties in the housing market and uneven demand for luxury home furnishings. While RH anticipates revenue growth in Q2, the 0.5-2.5% growth forecast is considerably below expectations, and the adjusted EBITDA margin still needs substantial improvement from Q1 levels to align with the full-year framework. Nevertheless, RH's long-term vision surrounding international galleries, RH Estates, Bespoke Furniture, and Couture Upholstery remains appealing, as it aims to create a broader luxury platform that extends beyond the housing cycle. However, with Q2 guidance disappointing, international startup costs impacting profitability, and a recovery that heavily relies on second-half performance, investor concerns regarding the timing and sustainability of the rebound persist.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].