Investors in RH (RH) had a rough evening Tuesday. Shares of the luxury home furnishings retailer tanked in extended trading after the company released fourth-quarter results that missed expectations on both the top and bottom lines.
Here's what went wrong. RH reported quarterly earnings of $1.53 per share. That's a significant miss—it came in 30.99% below the analyst estimate of $2.22 per share. Revenue didn't fare much better, coming in at $842.62 million versus the Street consensus of $873.32 million.
The company pointed to a couple of specific headwinds. It said net revenues took an approximately $30 million hit from higher-than-expected backorder and special order balances, which it tied to tariff-related resourcing challenges. Another roughly $10 million was lost due to adverse weather conditions. That's a combined $40 million drag right there.
Looking ahead, the outlook didn't provide much comfort either. RH expects fiscal 2026 revenue in a range of $3.58 billion to $3.72 billion. The problem? The analyst estimate is sitting at $3.78 billion, so even the high end of the company's guidance is below where the Street thought it would be.
The market's reaction was swift and severe. According to market data, RH stock fell 19.15% to $113.40 in Tuesday's extended trading session. When you miss on earnings, miss on revenue, and guide below expectations, that's the kind of one-two-three punch that tends to leave a mark on the share price.
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