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RH Reports Strong EPS Beat as It Bets on Estates to Expand Market

RH says the Estates collection, together with large-format Compounds and restaurants, is intended to double its addressable market and drive a new growth phase over the next five years.

Overview

  • The company posted adjusted EPS of $2.70 in Q2, a clear beat of analyst expectations, while revenue rose 2.6% to $922.2 million and slightly missed consensus.
  • RH narrowed full-year fiscal 2026 sales guidance to $3.629 billion–$3.681 billion and gave Q3 and Q4 revenue ranges that reflect paced near-term sales with stronger fourth-quarter upside.
  • The Estates collection, launched between late June and mid-July, targets traditional luxury interiors and is billed by management as a product line that could double RH’s total addressable market and reach roughly half the assortment within five years.
  • The quarter included a $55.1 million tariff benefit with an expected $13.9 million more in H2, and RH generated $72.3 million in cash during the period that included a $42 million distribution from an Aspen joint venture.
  • Shares jumped about 9% in premarket trading on Friday as investors reacted to the earnings beat and the company’s strategy to pair higher-priced Estates merchandise with experiential retail like Compounds, restaurants, and a new design service.