In short
- RH reports second quarter fiscal 2026 results on Thursday, September 10, 2026, after market close, with a conference call at 2:00 pm Pacific Time and a shareholder letter from Chairman and Chief Executive Gary Friedman, according to the company’s own announcement dated September 3.
- The quarter ended August 1, 2026, which places it almost entirely inside the old tariff regime and only partly inside the new one. The Section 301 forced-labor duties that replaced the expired Section 122 surcharge took effect on July 24, eight days before the quarter closed.
- RH sources roughly 69% of its product from Asia, including about 39% from Vietnam and 13% from China based on fiscal 2025 purchases, which makes it one of the most tariff-levered names in US specialty retail.
- Wooden upholstered furniture carries a 25% Section 232 duty that is scheduled to rise to 30% on January 1, 2027, while kitchen cabinets and vanities go from 25% to 50% on the same date after a one-year delay announced on December 31, 2025.
- Guidance is the real event, not the print. RH guided second quarter revenue growth of 0.5% to 2.5% and adjusted EBITDA margin of 11.5% to 13.0%, and raised its full-year outlook to 4.5% to 8.0% revenue growth in June. Whether that full-year range survives contact with the January step-up is the question the call has to answer.
What RH actually reports on September 10
RH confirmed on September 3 that it will publish results for the second quarter of fiscal 2026, ended August 1, 2026, after the close on Thursday, September 10. Leadership will host a live call and audio webcast at 2:00 pm Pacific Time, 5:00 pm Eastern.
The company’s disclosure format is unusual for a listed retailer. RH does not lead with a conventional press release full of tables. It publishes a shareholder letter written by Friedman, and that letter historically carries the operating detail, the sourcing commentary and the tariff arithmetic that analysts then spend the call unpacking.
That format matters this quarter. The numbers themselves are close to pre-announced by the guidance range. What is not pre-announced is how RH frames the four months between the print and January 1, 2027.
The consensus bar
Sell-side compilers put second quarter adjusted earnings per share in a narrow band around $0.38 to $0.42. Applying the guided growth range of 0.5% to 2.5% to the year-ago base implies revenue of roughly $904 million to $922 million.
Those are not demanding numbers in isolation. They are demanding in context: RH is guiding to a second half that accelerates sharply, and the second quarter is the last data point before that acceleration has to show up.
What the first quarter set up
First quarter revenue was $800.3 million, down about 1.7% year over year but ahead of the roughly $792.6 million consensus. Adjusted EBITDA margin came in at 7.1%, above the company’s own expectations. The adjusted loss of $1.97 per share was narrower than the $2.09 analysts had modeled.
The more important line was buried in the mechanics. Backorder and special order balances closed the quarter roughly $75 million higher than a year earlier, which RH attributed primarily to tariff-related resourcing. Management said the elevated balances cut about $45 million from reported first quarter revenue.
The demand backdrop
Tariffs are only half the story. RH sells discretionary luxury home furnishings, a category that tracks housing turnover more closely than it tracks general consumer spending. People buy sofas when they move.
Friedman has described the operating environment as the worst housing market in almost 50 years. That framing has been consistent across several quarters, and it is the reason RH has leaned on product cycle and gallery expansion rather than waiting for a cyclical recovery.
The market has been unforgiving. Shares fell roughly 42% in the first quarter of 2026 alone, against a 52-week high near $257, and several brokers cut price targets sharply, with TD Cowen moving to $200 from $265 and Stifel to $133 from $165. Management’s argument is that margin expansion is available whether or not housing improves, because the drag from international pre-opening costs is transitory.
Why this is the cleanest tariff read of the year
Retail earnings in 2026 have been hard to interpret because the underlying duty regime changed three times in six months. Any quarter that straddles a regime change mixes two cost structures in one gross margin line.
RH’s second quarter is unusually clean for the opposite reason. It sits almost entirely inside one regime. The Section 122 balance-of-payments surcharge of 10% ran from February 24 to its statutory expiry at 12:01 am Eastern on July 24, 2026, the full 150 days the statute permits. The replacement Section 301 forced-labor duties began at the same minute, eight days before RH’s quarter closed.
So roughly 92% of the quarter ran under the Section 122 regime and about 8% under the Section 301 regime. That is a much tidier split than most of RH’s peers reported, and it means the gross margin line should be readable rather than blended into meaninglessness.
The legal overhang has not cleared
The Section 122 surcharge was not merely allowed to lapse. The US Court of International Trade held on May 7, 2026, that current economic conditions did not amount to the “large and serious balance-of-payments deficits” the statute requires, and struck the tariff down.
Relief was limited to the three named plaintiffs, the State of Washington, Burlap and Barrel, Inc. and Basic Fun, Inc. The Federal Circuit entered an administrative stay on May 12 and a fuller stay pending appeal on June 11, so collections continued until the tariff expired on its own schedule. The consolidated appeals remain before a merits panel.
The replacement regime is being litigated too. Three separate challenges to the Section 301 forced-labor tariffs are proceeding at the Court of International Trade, and shopappy has covered how the forced-labor tariffs face a September 15 court test on the government’s response deadline, with a three-judge panel scheduled to hear argument on September 30. Any RH commentary about duty accruals has to be read against that unresolved backdrop.
Where RH furniture actually comes from
Country of origin is the single variable that determines RH’s landed cost, and the mix has moved materially over two years of tariff pressure.
The Vietnam pivot
Based on fiscal 2025 purchases, roughly 69% of RH product cost originated in Asia, with about 39% from Vietnam and 13% from China. The 2024 annual report had shown 72% Asia, 35% Vietnam and 23% China.
The direction is unambiguous. RH cut China exposure by roughly ten percentage points in a year and pushed most of that volume into Vietnam. Management has said it resourced the majority of its China production to Vietnam at landed pricing better than the pre-tariff China cost, which is a stronger claim than most importers have been able to make.
The North Carolina factory
RH also moved a meaningful share of China production into its own upholstery factory in North Carolina. Domestic production carries no Section 232 wood duty and no Section 301 exposure, though it does carry higher labor cost and duty on imported components such as frames, foam and textiles.
This is the part of the RH story that is genuinely differentiated. Most furniture retailers do not own manufacturing. RH does, which gives it a lever that Wayfair, Williams-Sonoma and the independent channel simply do not have.
Why the mix still leaves exposure
A 39% Vietnam concentration solved the China problem and created a Vietnam problem. Vietnam sat at a 46% reciprocal rate under the old IEEPA schedule, which was worse than China for a period. Since July 24 it carries a 12.5% Section 301 forced-labor duty on a 0% base rate, a dramatic improvement.
But the Section 232 wood duty applies on top of that and does not care about origin except for the capped jurisdictions. A wooden upholstered sofa from Vietnam still carries 25% under Section 232 before the Section 301 layer is added.
International galleries change the duty map
RH has been opening galleries in the United Kingdom and continental Europe, and that expansion changes the tariff calculus in a way that is easy to miss.
Product sold in a European gallery does not enter US customs territory, so it never touches Section 232 or Section 301. Goods shipped from an Asian factory to a European warehouse face the EU tariff schedule instead, which for furniture is materially lower than the current US stack.
In other words, part of RH’s international expansion functions as an incidental tariff hedge. The company has framed the pre-opening and start-up costs as a negative 270 basis point drag on full-year adjusted EBITDA margin, a negative 450 basis points in the first quarter and a negative 380 basis points expected in the second. Those costs buy revenue that sits outside the US duty regime entirely.
The Section 232 wood tariff schedule and the January cliff
The wood proclamation was signed on September 29, 2025, and took effect for goods entered on or after October 14, 2025. It set three rates and one exclusion, and it built in a step-up that has already been postponed once.
| Product | HTSUS scope | Special code | Rate through Dec 31, 2026 | Rate from Jan 1, 2027 |
|---|---|---|---|---|
| Softwood timber and lumber | 4403 to 4407 | 9903.76.01 | 10% | 10% |
| Upholstered wooden furniture | 9401 | 9903.76.02 | 25% | 30% |
| Kitchen cabinets, vanities and parts | 9403 | 9903.76.03 | 25% | 50% |
| Other cabinet components | 9403.40.9060 and related | 9903.76.04 | 0% | 0% |
| United Kingdom cap | All covered wood | 9903.76.20 | 10% maximum | Cap does not apply |
| EU and Japan cap | All covered wood | 9903.76.21, 9903.76.22 | 15% maximum | Cap does not apply |
The original schedule had upholstered furniture rising to 30% and cabinets to 50% on January 1, 2026. A proclamation issued on December 31, 2025, delayed both increases by a full year, to January 1, 2027, stated as allowing continued negotiations with trading partners. Furniture equities rallied on the news, with RH adding roughly 8% in the first session of the year.
The detail that gets least attention is the treatment of the country caps. The UK 10% ceiling and the EU and Japan 15% ceiling apply to the current rates. They are not written to apply to the delayed 2027 increases. If that holds, European sourcing loses its relative advantage at the same moment Asian sourcing gets more expensive.
What the July 24 Section 301 reset changed
The forced-labor tariffs that took effect on July 24, 2026, cover 60 economies in two tiers. Fifteen jurisdictions, including Canada, the European Union, the United Kingdom and Mexico, face 10%. The remaining 45, including China, India, Japan, Australia, Vietnam, Thailand, Malaysia and the Philippines, face 12.5%.
For furniture importers the practical effect was a large reduction relative to the IEEPA rates that the Supreme Court struck down in February, followed by a smaller but permanent-feeling layer on top of Section 232. The table below sets out an indicative additional duty stack for a wooden upholstered sofa by origin, before any legacy trade-remedy exposure or preference program is applied.
| Origin | Section 232 wood | Section 301 forced labor | Legacy Section 301 list duty | Indicative additional total |
|---|---|---|---|---|
| Vietnam | 25% | 12.5% | None | About 37.5% |
| China | 25% | 12.5% | Up to 25% on covered furniture lines | About 62.5% |
| Italy (EU) | 15% cap | 10% | None | About 25% |
| United Kingdom | 10% cap | 10% | None | About 20% |
| Mexico | 25% | 10% | None | About 35%, subject to USMCA treatment |
| United States (own factory) | None | None | None | Component duty only |
These are indicative stacks, not classification advice. Actual liability turns on the tariff line, the wood species, the share of wood content and whether a preference claim survives the rules of origin. RH has said it operated with 25% China duties through the previous administration, so the legacy layer is not new to its cost base.
The same structural pattern is showing up on the other side of the northern border, where Canada’s counter-tariffs took effect on September 8 with 50% rates on furniture and clothing. RH operates galleries in Canada, so the retaliation schedule is a direct cost item rather than a macro talking point.
The backorder distortion nobody should ignore
The most misread line in RH’s first quarter was not revenue or margin. It was the backorder balance.
When an importer resources a product from one country to another, the new factory has to be qualified, tooled and scheduled. Orders already taken sit in backlog while that happens. Revenue is recognized on delivery, so a resourcing program mechanically pushes revenue into later quarters even when demand is fine.
How much revenue moved
RH quantified it. Backorder and special order balances ended the first quarter about $75 million above the prior year, and the company said this reduced first quarter revenue by roughly $45 million. Management expected the elevated balances to persist through the second quarter before normalizing by the end of 2026.
That has two consequences for the September 10 print. First, second quarter revenue is likely to carry a similar drag, which the 0.5% to 2.5% growth guide already contemplates. Second, the same $75 million becomes a second-half tailwind, which is a meaningful part of why the full-year guide accelerates.
Why it complicates the demand signal
The risk is that a mechanical backlog release gets read as a demand recovery. If RH delivers a strong second half largely by clearing backorders, the underlying run rate may be flatter than the reported growth suggests.
Analysts should therefore watch demand growth, which RH discloses separately from revenue, rather than the revenue line alone. Demand captures orders written in the period and is the cleaner read on whether the luxury home furnishings customer is actually spending.
What the second half has to deliver
RH raised full-year fiscal 2026 guidance in June to revenue growth of 4.5% to 8.0%, adjusted EBITDA margin of 14.2% to 16.0% and adjusted free cash flow of $300 million to $400 million. Reaching the middle of that revenue range from a first half running roughly flat requires a very large second half.
Management has been specific about where the acceleration comes from, which is helpful because each component can be checked.
| Second-half growth driver | Contribution management has indicated | What to verify on the call |
|---|---|---|
| RH Estates product launch | About 5 percentage points, just under $100 million | Gallery rollout pace and early sell-through |
| Backorder normalization | About $75 million | Whether the balance actually fell in Q2 |
| New gallery openings | About 2.5 percentage points | Opening schedule slippage |
| Trade channel program | Not separately quantified | Designer and architect sign-up rates |
RH has said 65% to 80% of the new product book is subject to pending patents, and that by the end of September between 60% and 65% of sales should come from galleries carrying a significant Estates assortment, with the rollout complete by December. Those are checkable milestones, and the September 10 call falls close enough to the end of September to give a real progress update.
The balance sheet is the constraint
RH ended the first quarter with about $53.8 million in cash, generated roughly $13.3 million of free cash flow in the quarter, and carried total net debt of about $2.37 billion, equivalent to roughly 4.3 times trailing EBITDA. Market capitalization stood near $2.80 billion in early September.
That leverage is the reason tariff timing matters more for RH than for a peer with a net cash position. A company at 4.3 times has limited capacity to absorb a duty step-up by holding price, and limited capacity to pre-buy inventory ahead of January without straining liquidity.
Management has committed to $200 million to $250 million of annual asset sales over the next two years, took full control of eight Aspen properties, and has set a target of being debt free by 2029. Progress against the asset sale commitment is a legitimate question for the call.
The refund question
Several tariff-exposed retailers have booked material recoveries from the invalidated IEEPA duties. Those refunds have been flowing unevenly, and shopappy has reported how CBP’s postponement of CAPE Phase 3 stalled $11.4 billion in tariff refunds on finally liquidated entries. RH has not been a prominent name in that refund cohort, and whether it has filed claims through the CAPE process in the Automated Commercial Environment is a reasonable thing to ask.
How RH sits against its earnings-season peers
This has been a season in which tariff line items moved reported profit more than merchandising did. Several retailers reporting in the same window have disclosed duty costs or refunds large enough to swing a quarter.
PVH illustrated the point plainly, and shopappy covered how a roughly $100 million tariff refund carried PVH’s second quarter and was worth several hundred basis points of operating margin. American Eagle carried a reported $20 million incremental tariff cost in its guidance. Signet’s September 9 print is being read against diamond tariff exposure.
RH is different in one important respect. Its exposure is not a one-time refund or a modest cost line. It is a structural duty on the core product category, scheduled to increase on a known date, against a leveraged balance sheet and what Friedman has called the worst housing market in almost 50 years.
Why the comparison flatters RH in the short run
Retailers that booked IEEPA refunds enjoyed a one-time earnings benefit that will not repeat. Their year-ahead comparisons get harder automatically. RH, having taken less of that benefit, faces an easier optical comparison even if its absolute duty burden is heavier.
That asymmetry is worth holding in mind when reading the September 10 numbers against peers. A retailer whose margin was inflated by a refund is not structurally healthier than one whose margin was not.
What to watch on the call
Five things will determine how the print is received, and none of them is the headline earnings per share number.
- Whether the full-year revenue range narrows or holds. A reaffirmation of 4.5% to 8.0% after a flat first half is a strong statement about second-half visibility.
- Whether the backorder balance actually came down. This is the difference between a mechanical second-half tailwind and a demand problem being deferred.
- Any quantified January 1 impact. RH has the sourcing data to model the step-up. Refusing to quantify it would be conspicuous.
- Pre-buy strategy. Importing ahead of a scheduled rate increase is standard practice, but it consumes working capital that a 4.3 times levered balance sheet does not obviously have.
- Price architecture. Whether RH intends to absorb, surcharge or reprice, and on which categories.
There is also a broader framing question. Across the sector the cost narrative has been shifting, and shopappy has documented how fuel and energy have started to outrank tariffs in third quarter retail guidance. RH is one of the few retailers where that rotation should not apply, because its duty exposure is concentrated, scheduled and rising.
What happens after January 1, 2027
The step-up is currently the law. Upholstered wooden furniture moves from 25% to 30% and kitchen cabinets and vanities move from 25% to 50%, unless a further proclamation delays or modifies it.
A second one-year delay is plausible. The December 31, 2025 postponement was framed around ongoing negotiations, and those negotiations have not visibly concluded. Furniture equities priced in relief once and would likely do so again.
The alternative path is that the step-up proceeds and the sector reprices. A 5 percentage point increase on upholstered goods is absorbable for a company with RH’s gross margin structure. A 25 percentage point increase on cabinets and vanities is a different order of problem, and it lands squarely on the kitchen and bath categories that RH has been expanding through its Estates and gallery formats.
The litigation adds a third path. If the Court of International Trade panel that hears argument on September 30 reaches the forced-labor tariffs the way the earlier panel reached Section 122, the 12.5% layer could come off while the Section 232 wood duty stays. Section 232 rests on a different statute and a different record, and nothing currently before the courts threatens it directly.
The pre-buy arithmetic
Importers facing a scheduled increase have one obvious defense: land the goods before the effective date. For cabinets and vanities the incentive is unusually strong, because the difference between 25% and 50% on a container of product is large enough to justify carrying it for months.
The constraint is working capital and warehouse space. Ocean transit from Vietnam to the US west coast runs several weeks, and entry has to be filed and released before January 1 for the lower rate to apply. Practically, orders would need to be placed by roughly the middle of October to be safe.
That timing puts the September 10 call almost exactly at the decision point. Whatever RH says about pre-buying is a live operational disclosure rather than a hypothetical, and it will tell investors how much conviction management has that the step-up actually happens.
FAQ
When exactly does RH report second quarter fiscal 2026 results?
Thursday, September 10, 2026, after market close. The conference call and audio webcast begin at 2:00 pm Pacific Time, which is 5:00 pm Eastern. The quarter ended August 1, 2026. RH confirmed the schedule in an announcement dated September 3, 2026.
What are analysts expecting?
Compilers put adjusted earnings per share in a band of roughly $0.38 to $0.42. Company guidance implies revenue of about $904 million to $922 million, based on the guided growth range of 0.5% to 2.5%, with adjusted EBITDA margin guided to 11.5% to 13.0%.
What tariff rate does RH furniture currently pay?
It depends on the tariff line and origin. Wooden upholstered furniture carries a 25% Section 232 duty, and softwood timber and lumber carry 10%. On top of that, goods from Vietnam and China carry a 12.5% Section 301 forced-labor duty imposed on July 24, 2026, while EU and UK goods carry 10%. China product may also carry legacy Section 301 list duties.
What changes on January 1, 2027?
Section 232 duties on upholstered wooden furniture rise from 25% to 30%, and duties on kitchen cabinets, vanities and their parts rise from 25% to 50%. These increases were originally scheduled for January 1, 2026 and were delayed by one year under a proclamation issued on December 31, 2025.
Do the UK and EU tariff caps survive the increase?
As drafted, the caps of 10% for the United Kingdom and 15% for the European Union and Japan apply to the current rates and are not written to extend to the delayed 2027 increases. Importers relying on European sourcing should confirm the treatment with a licensed customs broker before committing to 2027 orders.
Where does RH source its products?
Based on fiscal 2025 purchases, roughly 69% of product cost came from Asia, including about 39% from Vietnam and 13% from China. That compares with 72% Asia, 35% Vietnam and 23% China in the 2024 annual report. RH also operates its own upholstery factory in North Carolina.
Why did RH’s first quarter revenue miss its own potential?
Backorder and special order balances ended the quarter about $75 million above the prior year because of tariff-related resourcing, which reduced recognized revenue by roughly $45 million. The orders were written but the goods had not shipped, so revenue moved into later quarters rather than disappearing.
How leveraged is RH?
The company reported total net debt of about $2.37 billion at the end of the first quarter, roughly 4.3 times trailing EBITDA, against about $53.8 million of cash. It has committed to $200 million to $250 million of annual asset sales over two years and targets being debt free by 2029.
Could the tariffs be struck down in court?
The Section 301 forced-labor tariffs face three challenges at the US Court of International Trade, with a three-judge panel scheduled to hear argument on September 30, 2026. The Section 232 wood tariffs rest on a separate statute and are not directly challenged in those cases. The earlier Section 122 surcharge was held unlawful in May 2026 but stayed on appeal and expired on schedule in July.