RH(US:RH)2024-09-13 01:42Financial Data and Key Metrics Changes - Demand increased by 7% in Q2 2024, with July showing a 10% increase and August up 12% [5][6] - Revenue for Q2 2024 was $830 million, a 3.6% increase year-over-year, with an adjusted operating margin of 11.7% and adjusted EBITDA margin of 17.2% [7][8] - The company expects demand growth of 8% to 10% and revenue growth of 5% to 7% for the full year 2024 [18] Business Line Data and Key Metrics Changes - The product transformation plan includes the second mailing of the RH Interiors Sourcebook, which is expected to fuel demand [9] - The company plans to consolidate the RH Contemporary Sourcebook collections into the RH Interiors and RH Modern books to optimize mailing efficiency [9][10] Market Data and Key Metrics Changes - The company is gaining significant market share in North America, outperforming the industry by 15 to 25 points [6] - The anticipated rebound of the housing market is expected to benefit the company once interest rates decline [7] Company Strategy and Development Direction - The company is focused on global expansion, with plans to enter European markets such as Paris and London in 2025 and Milan in 2026 [15] - Investments are being made to elevate the online experience, with significant upgrades planned for the website [15] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges in the housing market but expects demand trends to accelerate throughout fiscal 2024 and into 2025 [16] - The company anticipates an increased backlog of approximately $80 million to $100 million due to revenue lagging demand throughout 2024 [17] Other Important Information - The company plans to open new galleries, including a significant location in Newport Beach, California, which is expected to be a major destination [13][14] - The Waterworks brand is expected to be amplified on the RH platform, with plans for a new showroom and sourcebook [11] Q&A Session Summary Question: Thoughts on product margins for the rest of the year - Management feels positive about product margins, which have inflected positively, and expects continued growth [22][23] Question: Product assortment and newness - The company has a lot of newness coming in the second half of the year and expects to reach 85% new assortment by mid to late next year [27][28] Question: Confidence in demand durability - Management is confident in the durability of initial demand trends and is monitoring the performance of new products [33]