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Shares of high-end furniture retailer RH rose during extended trading Wednesday after the company beat analysts’ earnings and sales estimates for its fiscal first quarter.
RH also raised its full-year outlook, building on the momentum it sees in the luxury home category, and issued a stronger-than-expected second-quarter sales forecast.
In a letter to shareholders, Chief Executive Officer Gary Friedman said the rest of this year will “definitely be a story of two halves” for retail. But he said “exposing the general public could lead to a Roaring Twenties-type consumer exuberance.”
The company’s share rose by more than 7%.
Here’s how RH fared in the quarter ended May 1 compared to what analysts expected, using Refinitiv estimates:
- Earnings per Share: $4.89 Adjusted vs. $4.10 Expected
- Revenue: $861 million vs. $758 million expected
RH’s net income for the fiscal first quarter grew to $130.7 million, or $4.19 per share, compared to a loss of $3.2 million, or 17 cents per share, a year earlier. Excluding one-time adjustments, it earned $4.89 per share, exceeding expectations of $4.10.
Revenue rose 78% to $861 million, from $483 million a year earlier. That also exceeded expectations for $758 million.
Friedman said a strong housing and renovation market, a record stock market, low interest rates and the reopening of the US economy all bode well for the company in the coming quarters.
RH raised its fiscal 2021 outlook for revenue growth to a range of 25% to 30%, compared to a previous range of 15% to 20%. Analysts had expected an annual increase of 19.7%.
For the fiscal second quarter, RH expects revenue growth of 35% to 37%. Analysts were looking for a 27.2% increase.
The company is gearing up to start its global expansion in the spring of 2022, starting with England. To drive future growth, it is also considering expanding into new services, possibly areas such as landscaping. It currently offers interior design advice.
RH shares are up about 37% so far. The company has a market cap of approximately $13 billion.
Find the full press release on RH’s earnings here.