RH Q1 revenue falls 1.7% as gross margin compresses 230bp; $32M settlement offsets SG&A

Filed June 11, 2026 · Period ending May 2, 2026 · Compared to 10-Q Jun 12, 2025 · ~2 min read

Key Changes

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  Net revenues declined 1.7% year-over-year to $800M in Q1 FY26 (vs. 12% growth in prior year), while gross margin compressed 230 basis points to 41.4% driven by higher occupancy costs from new Gallery openings and decreased product margins in outlet and core businesses.

  MD&A: Revenue & Gross Margin verify on EDGAR →
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  Operating income fell 38.7% to $34M from $56M year-over-year, reflecting revenue decline and margin pressure partially offset by a $32M one-time legal settlement related to credit card interchange fees recognized in SG&A.

  MD&A: Operating Income verify on EDGAR →
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  RH filed for $69M in tariff refunds following February 2026 Supreme Court ruling invalidating certain IEEPA tariffs; received $9M to date but will recognize remaining refunds only when realized due to evolving trade policy uncertainty and new tariffs imposed under alternative authority.

  Legal Proceedings & MD&A: Tariffs verify on EDGAR →