RH(RH) CNBC·2025-04-03 13:21Core Viewpoint - The luxury furniture retailer RH experienced a significant stock decline of 28% following a poor earnings report and the announcement of new tariffs by President Trump, marking a potential worst day in its 13-year public market history [3][4]. Company Performance - RH reported earnings of 812 million in revenue for the fourth quarter, falling short of analyst expectations of 830 million in revenue [8]. - The company provided weaker guidance for revenue growth, expecting between 12.5% and 13.5% for the current quarter and 10% to 13% for the full year, both below consensus forecasts of 16.2% and 14% respectively [9]. Market Conditions - The housing market is described as the worst in nearly 50 years, with only 4.06 million existing homes sold in 2024 compared to 4.09 million in 1978, despite a population increase from 223 million to 341 million [7]. - The company is facing challenges from tariffs, with significant levies imposed on imports from Vietnam (46%) and Taiwan (32%), and a true tariff rate of 54% on China [5][6]. Strategic Response - Despite the challenges, the CEO indicated that RH has a long-term sourcing strategy that is "big and bold," which may be expedited due to the new tariff policies [10]. - The CEO acknowledged the need for the company to adapt to the changing market conditions and emphasized that many players in the home sector source from Asia, indicating a common industry challenge [4][5].