Core Viewpoint - RH's shares surged over 15% in extended trading after the company reaffirmed its sales forecast and outlined measures to mitigate tariff-related costs [1] Financial Performance - For the fiscal first quarter ending May 3, RH reported a net income of $8.04 million, or 40 cents per share, compared to a loss of $3.63 million, or 20 cents per share, in the same period last year [1] - The company expects full-year revenue growth of 10% to 13% [1] - Adjusted earnings per share were 13 cents, surpassing the expected loss of 9 cents, while revenue was $814 million, slightly below the expected $818 million [6] Challenges Faced - RH is facing significant challenges from a sluggish real estate market and increased tariffs, with CEO Gary Friedman describing the housing market as the toughest in nearly 50 years [2] - The company's stock fell approximately 40% in April due to tariff announcements and weak quarterly performance [3] Strategic Responses - To counteract tariff impacts, RH is shifting production away from China, expecting receipts from the country to decrease from 16% in Q1 to 2% in Q4 [4] - By the end of the fiscal year, RH anticipates that 52% of its upholstered furniture will be produced in the U.S. and 21% in Italy [4] - The launch of a new concept has been delayed until spring 2026 to gain more clarity on tariffs, having been initially planned for the second half of this year [4] Expansion Plans - RH continues to pursue international expansion, with plans to open a store on Paris' Champs Élysées in early September [5] - Year-to-date, RH shares have declined nearly 55%, underperforming the S&P 500, which has gained approximately 3% during the same period [5]
Shares of RH jump as luxury retailer takes steps to blunt tariff impact