Company Overview - CEO Gary Friedman has built RH into a luxury home furnishings brand with a net worth of 3.8 billion in fiscal 2021 but declined to 727 million, down 2% from 3.6 million loss compared to a 230 a share, down from nearly 400 in August [11] Strategic Initiatives - RH is expanding internationally with new Design Galleries in Madrid, Brussels, and Palm Desert, CA, increasing effective new store selling months from 12 to 48 [13] - The company plans to double its Sourcebook circulation and expand its Waterworks subsidiary into the to-the-trade market [12] - RH is introducing new collections in Outdoor, Modern, Interiors, and a second Contemporary line, aiming to lift the business by focusing on the top third of its assortment [17] Challenges and Missteps - The RH Contemporary collection, launched in June 2022, has been a disappointment due to overestimating demand and overpricing [16] - Friedman admitted that markdowns are necessary in a down market, which can negatively impact the brand's luxury reputation [18] - International expansion is still in its early stages, with limited sales reported and muted results from the Aynho Park venture [19][20] Future Outlook - RH maintains full-year guidance with demand growth expected in the 12% to 14% range and revenues up 8% to 10% [14] - Adjusted operating margin is projected to range between 13% and 14%, with adjusted EBITDA margin between 18% and 19% [14] - Friedman remains confident in the company's long-term strategy, emphasizing investments in product transformation and platform expansion [12]
RH Remains Stalled In Its Climb Up ‘Luxury Mountain'