RH (RH) Earnings Call Transcript & Summary

Certain furnishings make a house livable, but others invest it with significance. Some places you merely visit; others leave a lasting imprint. Some rooms you simply walk through; others transform you. That is the world of RH. Right now, Albert Einstein's Three Rules of Work feel especially relevant: find simplicity out of clutter, find harmony from discord, and recognize that opportunity lies in the middle of difficulty. Clutter created by tariffs continues to accumulate, global discord has been brought on by war, and the weakest housing market in decades makes it hard to separate signal from noise. It is worth recalling that necessity is the mother of invention. The most important innovations we have produced came to life during the most uncertain periods. Turning a nearly bankrupt Restoration Hardware into RH, North America's leading luxury home brand, was no task for the faint of heart. The external difficulties look somewhat familiar, yet our internal opportunities differ enormously. We aren't shuttering stores and scrambling to survive. We're constructing a brand never seen before, one built to thrive. Before diving into the specifics of our strategy, let's begin with several facts that ought to settle some of the noise. During 2025, RH delivered revenue growth of 8% and 2-year growth of 15%, beating our furniture industry peers by 8 to 30 points by a wide margin. Adjusted EBITDA came to $597 million, or 17.3% of revenues, against $539 million, or 16.9% of revenues, in 2024. Free cash flow came in at $252 million. That compares with negative free cash flow of $214 million in 2024, which works out to a $466 million increase year over year. We achieved those results even though 2025 was our peak investment year — $289 million of adjusted CapEx went toward our global expansion, plus another $37 million to acquire the Michael Taylor, Formations and Dennis & Leen brands, which supported the launch of our new concept, RH Estates. That's a strong performance given the unusual circumstances. Let me turn your attention to our strategy and why we expect growth to speed up across the next several years. Our view is that some have taste without scale, and some have scale without taste. Scaling taste is an expansive, ambitious concept. We think that by aiming to make RH the authority on taste for the home, we will be disruptive and profitable as we work toward creating one of the world's most admired brands. To frame the sizable opportunity before us, we like to ask a straightforward question: which home brand serves the luxury customer — the one who buys LVMH, Hermes, Cartier or Cucinelli? RH has assembled the most compelling collection, shown in the most inspiring spaces around the globe. Our brand attracts the top designers, artisans and manufacturers, scaling their work and increasing its value across our growing global platform. Our offering leads in both category and style, and that enables RH to serve a bigger market than any other brand in this space. Seven core product categories form the structure of our assortment — furniture, upholstery, outdoor, lighting, linens, rugs and decor — and we unite them under 3 leading product styles: traditional, contemporary and modern, which we call RH Estates, RH Interiors, and RH Modern. This spring we launch RH Estates, the newest addition to our brand family, aimed at the traditional market, a segment where the RH brand currently has limited penetration. Luxury homes feature classic or traditional architecture 60% of the time, and that architecture influences most furniture buying decisions. RH Estates is going to launch RH Bespoke Furniture — customizable lines drawn from Michael Taylor, Joseph Jeup, Formations and Dennis & Leen, the to-the-trade brands we acquired not long ago. RH Estates will additionally bring in RH Couture Upholstery by Dmitriy & Co., made-to-order sofas, sectionals and chairs that arguably rank as the finest upholstery you can find anywhere in the world. Designers will have the option to order custom sizes and finishes, along with COM fabrics they specify. With RH Bespoke Furniture and RH Couture Upholstery, interior design firms can now put RH on their most demanding clients' custom projects. RH Estates will further feature collections from numerous of the most gifted designers and artisans in our industry. Let's examine a few of their initiatives. RH Estates is set to debut when RH Milan opens its doors — that gallery on the Corso Venezia, housed in a former palace spanning 70,000 square feet — during Salone, which ranks as the biggest design show globally, with roughly 500,000 attendees expected in the city that week. The RH Estates rollout will feature a dedicated source book, arriving mainly in mid-May, plus an international advertising campaign and standalone Estates Galleries opening early summer in Greenwich, Connecticut and the San Francisco Design District. There's also a West Hollywood Design District location coming in 2027. Our expectation is that RH Estates will grow into our biggest brand extension and the one with the highest margins, fueling meaningful growth across the coming years. Now I'd like to direct your focus toward RH's multidimensional, physical-first worldwide ecosystem. This extends well past what a standard multichannel strategy involves—it encourages customers to dream, design, dine, travel, and live within a world RH has thoughtfully curated, forging an emotional bond unlike anything else offered by competitors in our sector. A question that comes up frequently is: why lead with physical when the world is digital? Here's my explanation. Furniture is still the large retail category that has undergone the least digitization, with stores and online splitting 80 to 20, and luxury furniture estimated at as much as 95.5%. What explains stores continuing to dominate? Comfort, scale, finish and quality are difficult to assess online. We think the physical representation of a brand will stay much more valuable than an unseen internet approach, since most customers who buy on a website still encountered the product in a store. We also think the majority of retail stores are outdated, windowless boxes devoid of any human touch—which is why we don't construct retail stores. We build inspiring spaces. Spaces that mirror human design, a study of balanced symmetry producing harmony. We're making environments where the lines separating residential from retail, indoors from outdoors, and home from hospitality all melt away—places with garden courtyards, rooftop restaurants, wine bars and barista bars. These are spaces that involve every sense, and spaces that just cannot be duplicated online. While most others have been shutting stores or reducing their footprint, we've been constructing some of the biggest and most immersive spaces our industry has ever seen. Let's look at our latest work. < > Our investments in creating entirely distinctive, immersive experiences in Paris, Milan and London, we believe, will lay the groundwork for RH to become a genuinely global luxury brand. It's important to grasp that our galleries contain several strategically significant businesses, among them RH Interior Design, where we've grown into the largest residential interior design firm worldwide, with projects stretching from San Francisco to Sydney, Los Angeles to London, Miami to Milan, and Dallas to Dubai. The design services we provide cover interior architecture, landscape architecture, curation of art and antiques, plus turnkey installations. Within our galleries, another significant operation is RH to the trade — a specialized group that reaches out to and assists interior design firms, offering help with designing, curating, delivering and installing the many projects those firms take on.

RH Hospitality operates beautifully cohesive dining venues plus wine and espresso bars within our galleries, and those generate considerable foot traffic and brand awareness. A few hundred guests may come through our galleries each week, but several thousand are served at our restaurants; we run 26 restaurants at present and anticipate reaching 40 by the end of 2027. Among just 7 luxury restaurant brands worldwide that a company owns and runs with 20 or more sites globally, RH is one. Our galleries, we believe, provide a competitive advantage the likes of which no rival has, one that in all probability will never be duplicated during our lifetime, because building at luxury standards has cost twice as much since COVID. To address that hurdle, we've developed a number of immersive new gallery formats that allow us to scale more quickly and with better capital efficiency. The first and most groundbreaking is what we call an RH design compound, currently being developed in Naples, Miami and Walnut Creek; each compound is made up of 6 to 8 standalone buildings connected by beautifully landscaped garden courtyards, anchored by a sun-filled atrium restaurant. Since there are no multi-story structures that require steel, grand staircases, elevators, complex mechanical systems and lengthy development timelines, we believe design compounds can be constructed far faster and with more capital efficiency than our earlier design galleries. One more new approach for getting the RH brand out there faster while using less capital is what we refer to as a design ecosystem. It's being built right now in Greenwich and Palm Desert, and is moving through development in the West Hollywood Design District. By ecosystem, we mean a brand presence spanning multiple buildings along a street, inside a neighborhood, design district or shopping center. The first one will be located in Greenwich, Connecticut, and it includes our gallery at the Historic Post Office, the new outdoor gallery we opened last year, and our new RH Estates Gallery, which has an integrated restaurant and is opening this summer in the former Ralph Lauren building. Additionally, we've developed a brand-new single-story gallery format — between 15,000 and 20,000 square feet — that includes a striking courtyard restaurant and targets secondary markets. Construction is currently underway in Los Gatos, California, while galleries in Richmond and Milwaukee are in design development. Our first freestanding RH Interior Design office, located in Palm Desert, California, has performed extremely well, and we're extremely pleased with those results; this fall we intend to open a second interior design office, in Malibu. In total, we see an opportunity to expand our presence across 27 existing markets and introduce one of our new design concepts in 48 new markets throughout North America — a $2 billion opportunity. Now let me direct your attention to our business model and balance sheet. Given the uncertainty around interest rates and inflation, we think a conservative plan makes sense for this year. For 2026, we've planned for revenue growth between 4% and 8%, but we do expect that growth will speed up to 10% to 12% in 2027 and hit $5.4 billion to $5.8 billion by 2030. For 2026, we're targeting adjusted EBITDA in the 14% to 16% range, rising to 25% to 28% by 2030. Cash flow should land at $300 million to $400 million in 2026, then $500 million to $600 million in 2027, and that figure includes $200 million to $250 million in asset sales annually. By 2030, we expect cumulative cash flow of $3 billion, again inclusive of those asset sales, and we anticipate being debt-free by 2029. Some people might look at the market discord right now and say RH has been in the wrong place at the wrong time. My view is different: we've spent this period positioning our brand to be in the perfect place at the perfect time. Let me explain why. Two important factors will meaningfully expand the size of our market over the next 10 years. First is the exponential spending by high and ultra-high net worth consumers on the home. Consumers in the ultra-high-net-worth bracket — meaning a net worth north of $20 million — hold an average of 3.7 residences, and billionaires hold 10. Such buyers spend 6.4 times as much on furnishings for their homes as someone who owns just one primary residence does. The second factor is the wealth transfer expected to occur over the coming decade, estimated at $30 trillion to $38 trillion — over twice what moved during the prior 10 years. Beyond that absolute figure doubling, the money is projected to pass from a single individual to roughly 7 people on average. It's conceivable that in the next decade our market could be several times bigger than it was across the previous one. If you factor in what we're doing to improve and grow the product line, take the platform worldwide, and drive meaningful sales plus brand recognition through our immersive hospitality locations, then I'd say the RH brand sits in exactly the right spot at exactly the right moment. And once this stretch of noise, conflict, and hardship passes, we'll come out of it ranked among the best-performing and most respected brands anywhere in the world.

<<operator_script>> Your first question comes from the line of Simeon Gutman with Morgan Stanley.

For my first question, I want to talk about what demand signals we're seeing from the consumer. It's been a transitional stretch for the company. I get that demand is growing faster than at quite a few other home furnishing companies, but that's come at a fairly heavy cost to margin; so my first question concerns what we expect around demand getting better while the margin of the business starts to turn.

Simeon, the pressures on margin are somewhat separate and have nothing to do with the demand. The margin pressure is really driven by the pace at which we're investing to grow the business across Europe, and some of it stems from tariffs — from the standpoint of transition, timing, and resourcing. But essentially you're seeing an inflection point: we're in a peak investment period on the capital, expense, and cost side, given what we're putting into global expansion, North American expansion, and product — namely the launch of RH Estates. Consider the RH Estates rollout in Q2: sourcebook, advertising, and launch expenses will be substantial, while revenue stays minimal until we reach the third and fourth quarters. Keep in mind that Estates is essentially behind schedule—we had originally planned to have it in last year's third and fourth quarters. So there are timing problems. When you factor in the sizable investments we're making on both the capital and expense sides, and given that we're navigating a somewhat unpredictable period. That's why, when you examine the business and the model—if you're considering becoming an investor—you need to take a longer-term perspective rather than a short-term one during periods like these. And in many respects, quite a few companies are cutting back further than we are; as others retreat and focus on managing the margin side of their operations, we're making the largest investment in our history, and that will inevitably produce some timing dislocations on the earnings front.

Moving to my follow-up, then: a few shifts happened in executive leadership — first, a new President, and second, another individual. In the release, you also mentioned possibly helping with monetizing certain real estate. So could you discuss those two hires, what led to them? And what does it indicate about where the business is going?

Well, I believe the press releases cover that. I'm not sure there's anything beyond them. We said — we're very pleased that Dave Stanchak has come back to Team RH. He's — he made a big difference during his time here, both in terms of the North American transformation and the global transformation, and he was really involved in setting up the structure of the real estate for European expansion. So it's great to have Dave back; and Dave, I'd say you're probably the most experienced real estate executive from a retail standpoint, because he's — not — he's not just someone who's only done mall leasing and — which is what you'd typically see with most retailers — Dave has been involved in real estate investments. He's an investor. He's owned his own shopping centers and controls real estate themselves. From an investor standpoint, he brings a significantly broader viewpoint, and given a distinctive operation such as ours—along with the platform we are constructing, which differs from what anyone else is undertaking or has undertaken in terms of quality, site count, and similar factors—you can regard him as a transformative kind of leader. Therefore, I believe there is nothing in the press release that I left unaddressed. And then Veronica came on board at RH. We've had a relationship with her for years—we've had the chance to watch her, to see how she leads, and to see how she's built what we regard as among the top manufacturing operations in North America from an upholstery standpoint. But what we tend to focus on here isn't only the upholstery side of what we do. Consider the finest luxury brands anywhere—Vuitton, Hermes, CHANEL, and others like them. Something really distinctive about how those businesses are structured is how tightly focused their core is: 80% of what they do sits in leather goods and accessories. From a penetration standpoint, it looks a lot like our business—furniture makes up 80% of what we do, and that's normal in home furnishings. So if you carry every category, the mix will trend roughly that way based on how you position those categories. And we see an opportunity, looking at our business on a global scale and building a distinctive platform that's synergistic and suited to the unique platform we're constructing on the selling side. I think we've built—and we keep building—the most distinctive physical selling platform there is anywhere. And in my view it merits, and will benefit from, the creation of the most distinctive manufacturing and sourcing platform anywhere. So when you consider the inefficiencies in manufacturing, when distribution isn't under your control, there are quite a few; so over the long term we believe we can create a distinctive manufacturing platform; and as I noted in the press release, a mix of owned, joint venture and outsourced that could be very distinctive and significantly accretive from — we believe — a revenue, a cost and a margin standpoint; so yes, we're excited. We believe Veronica is the finest person in this industry we've encountered. I'd call her a one-of-a-kind talent leader. By education and experience she is an engineer, and she holds a broad — very broad and rather strategic perspective on manufacturing and sourcing. So this brings a new caliber of talent into the company. Never before have we had anyone with this kind of pedigree, experience and talent, and we believe over the long term she will accomplish some remarkable things.

The following question is from Steven Forbes at Guggenheim Securities.

Gary, since Milan and London are scheduled to launch very soon, I'm curious whether you could update us on RH Paris, or perhaps speak to the revenue contribution you expect from the wider RH International strategy over the period leading to the 2030 reference year you described in your prepared remarks. Clearly, based on where things stand today, is there any color that would help support or build conviction around those longer-term outlooks you presented today?

I'm not certain I'm understanding that question correctly.

When it comes to the 2030 targets, what sort of effect does the international side have — that's how we're framing the growth there.

Yeah. Well, I believe what we've described over the last several quarters—and really since day one—is that opening in Paris, Milan, and London gives the brand a base to build from when you think about growing across Europe. In our view, those three are Europe's most significant cities, and we consider them key for brand positioning and brand awareness. And really, all three of those are, apart from, again, RH England, which is located out in the countryside and was important for brand impression and awareness as well as for how to enter the European market. That said, these are markets where we've put substantial money into how our products are presented and into that hospitality experience—something we believe will matter a great deal over the long run as we build brand awareness across Europe. One important point here isn’t just those key stores. When we look at the business in Europe — and we have from the very beginning — I believe that over the long term, basic distribution and the sources of sales will matter more in suburban areas and second-home markets than in cities. The cities are genuinely going to be essential for brand awareness and for driving, positioning, and shaping the brand, and we expect to generate considerably more revenue in Paris, Milan, and London than in other cities. If we had to rank them, London is obviously going to be our largest market, in our view, and rightly so. That said, the way our business is spread out is heavily weighted toward suburbs and second home markets in North America. Suburbs and second home markets account for 90%, 92% of what we do. And second home markets are sort of similar to a suburb, right? Cities make up roughly 8% of our business, and we expect a comparable split across Europe. If you also consider Apple's real estate approach and how they are distributed across Europe, we saw that as a useful sort of model for us to examine when it comes to a higher-end consumer. If you compared Apple's distribution in North America with ours, and looked at how deeply each of us reaches the suburbs, you'd see parallels. Our penetration in second home markets is actually higher than theirs. Most people keep their phone on them. But I think one of the main reasons Dave joined the company is to carry that leadership forward into Europe, expanding into the suburbs and second home markets so the business is covered. Strategically, we're positioning the business in the key markets you'd expect from a brand and awareness standpoint—not that we think revenues won't exist there. It's just that, in our view, the largest revenues will arrive over the long term when you consider the longer-term plan as we move into the suburbs and particular end markets where people genuinely purchase far more furniture, for indoors and outdoors alike.

Perhaps a brief follow-up question. It's clearly wonderful news that Dave is coming back to the company. You said — you said there would be $250 million of asset sales in each of the next 2 years. This is sort of a two-part question. First, could you address the worth of the non-core assets, or the assets you don't intend to operate in the future, compared with the worth of the assets RH still plans to operate going forward? And then maybe some detail on the timing for the 2026 asset sales, as we think through the possible interest expense savings.

On that mix, I'd characterize the bulk of the asset sales as properties we'll continue to operate under sale-leaseback arrangements, plus a handful of investment properties we held in Aspen. Then there are a few other items we've chosen not to move forward with for various reasons — we own a building in Milan — sorry, Madrid — and we won't be pursuing development there; we're content with the location as it stands today. So really it's about examining our balance sheet and converting those facets into cash, exactly as we told you we'd do. So we've said we have about $0.5 billion of real estate assets that we could monetize. And we're going to begin to monetize those. Dave has got tremendous experience on that end of real estate; so — and he feels very confident in what we're going to be able to do; and some of these are properties that we had purchased and had developed over the last 2 to 3 years, I guess. A lot of our investment timeframes tend to run quite long. Consider some of the galleries we've developed: designing and developing them, then working through approvals, takes considerable time, and construction itself also takes considerable time. So the holding period ends up being fairly lengthy. And I'd say that after COVID, construction expenses rose across the board, especially in the luxury segment. As we mentioned in the video, those things pushed us to create additional, quicker, more adaptable methods for rolling out the brand. Consider the design compounds and where the initial pair are headed in Naples: we're repurposing a site in Walnut Creek that used to be a Nordstrom's, we're repurposing a location that was formerly a Neiman Marcus; and in Miami, we're building on what's essentially a parking-lot-sized, highly visible parcel in Miami that was previously a Bank of America. We view those opportunities as considerably quicker and more efficient with capital. We've largely completed the bigger, more investment-heavy, more capital-intensive portion of the business—we've been reworking the real estate here for 15 years now. So even from a European and global perspective, I'd say we have Sydney on the way, though that's a different model, really being built by the developer; it won't require much capital from RH. But yes, we hold significant assets. We're going to monetize them now, convert them into cash, and then we have some assets in Aspen and other things of that sort that will monetize over time; so yes, a lot of that will come off the balance sheet. I don't know, Jack, do you have anything to add on?

No, Steve — on timing, we'll simply keep you informed. We aren't prepared to lock ourselves into laying out the cadence through 2026, and we'll just give you updates when it makes sense.

Our next question is from Max Rakhlenko at TD Cowen.

So, starting with Estates, could you give us some color on how you plan to scale the collection? We know when the books will land, but what's your thinking on the cadence of rolling the product out into the galleries? How are you approaching it from an inventory standpoint, et cetera? And could you compare and contrast this collection with the Modern and Interiors launches from a couple of years ago?

Sure. So the books land around mid-May, and we will — there are a handful of stores that will receive the initial product, which lets us test it and get some reads, but we feel very confident in this selection. So we went out with a bigger inventory, and much of that is based on the data alone. 60% of luxury homes in America have classic and traditional architecture. So — and it really is the next big trend. When you think about how trends cycle through, a lot of the product you're going to see cycle through with this trend, and that's why we've made some of the acquisitions we made, whether it's the Michael Taylor brand and the famous diamond table and so on and so forth, so that we can really not only have authority, but also hold intellectual property rights for a lot of the key products that are going to come. And so we just think it's going to be a big building trend. But in the second half will be — and how many galleries do we think? 30?

Yeah, I believe so.

Roughly 30 or 40 galleries — the top 30, 40 galleries among the large design galleries — with RH Estates we're going to take over the first floor. So this is a major launch and a major bet.

Understood. That helps. Then a two-part question about margins. Could you break out how you're expecting tariffs to hit in 2026 — both the pace and the size — since I believe you didn't cover that in the letter this time? And then, separately, if we strip out tariffs and a few of the timing shifts you mentioned earlier on the call, how healthy are your product margins, or how healthy is that — when we think about the long-term targets you set out? How much further can product margins rise as you keep adding these new collections that I believe carry much higher margin? So if we focus on the core, where can the business go on the product margin side?

Yes. I think — I mean, we aren't providing a detailed margin forecast; but our margin — our product margins are fairly healthy, aside from some bumps we're working through on the tariff front. I think we've managed to perform reasonably well. If you take out the weight we carry from this investment cycle and the drag from Europe and you look at the business; and I think one thing we're doing, as we think about this business, often with brands as you go through brand history, you have the levels and the transformations you make to get where you want to go; and this next — this cycle we're in right now, it's a key investment cycle. Clearly, we've spent a lot of capital; we've made big investments to position the brand not only in North America, but to position it in Europe for the long term. And once you get past those cycles, we're going to have great leverage. Opening galleries like the ones we're opening and restaurants like the ones we're opening are significant costs, especially when you're doing them in a different country. There's simply more travel, more expense from hiring people and building new organizations and so forth; so from a — I just think, it's not only the product margins, it's really the overall margin structure of the business once we get past the peak here on this investment cycle, both from a capital and from an expense and cost standpoint. I think this business's model is going to look like one of the best models people have ever seen in our industry; so if not the best model, I think it's going to be the best model anyone has seen; so we feel confident about that. I mean, we're also just — from a global perspective, navigating through very uncertain times; and we do have a product mix that is going to be somewhat more cyclical and carry more of a drag. When you're heavily concentrated on furniture rather than home furnishing overall—the wider furnishings category, accessories, tabletop, kitchen, and all the rest—you carry more weight in periods like the current one. That means you have to battle harder for every piece of business. Yet that has been true across our whole history. In periods like these, we have always battled our way through, and we have consistently leaned more promotional rather than less promotional. We believe periods like these bring substantial fallout, and plenty of competitors won't survive them. In furniture, the fallout over the past few years has been larger than at any point in history, as most people are aware. And I think that as long as housing stays difficult, competition will simply be much thinner, and we will be better positioned than at any prior point for the other side of the cycle. As we expand the assortment, particularly in Estates—consider the Estates buildout across really a 5-year horizon from a product standpoint—I would say that over the next 5 years the Estates assortment will grow, will build, and will become more dominant. That wave will keep building across the next 5 to 10 years, correct? So when I think about the entire business model this way, we have great confidence in the long-term model. What I think confuses people is that most public companies go public and then sort of manage the business, right? They follow a simple rollout, doing so many stores a year, with every store identical and everything highly predictable, and most complete their rollout cycle over 5 to 7 to 10 years, however long they remain relevant; then usually it turns into a somewhat dated concept over time. That's why we like to say most retail malls are a graveyard for short-lived ideas. At most retail companies, concepts don't even last through the first term or second term of their leases; so we are moving through one of those investment cycles that will leapfrog this business forward, and you're looking at roughly a peak investment cycle combined with roughly a trough economic cycle, right? And even with both of those, you still end up with a business here carrying roughly a mid-teens EBITDA margin to high teens EBITDA margin. And once you get beyond this cycle, this model has a lot of leverage. So...

Max, let me jump in on tariffs. During Q4, we noted that last year’s tariffs created a 90 basis point drag. And for Q4, we had mentioned $170 million. We finished at $190 million for Q4. What we said on the prior call was that by Q4 you are essentially fully absorbed into the earlier tariff regime. Clearly, the Supreme Court decision has changed things now; but as you know, tariffs come and go. So while in the — let’s say, during the first half, you could see some tailwinds from that comparatively lower rate that exists under Section 122 today. Who knows what will happen in the second half. There is obviously a rush to replace all those tariffs and potentially more, as Trump first said under Section 301 in the back half. So we are just — we are taking it year by year — as you know, we are nimble and dynamic; but as for last year’s tariff impact being essentially fully absorbed at Q4, that is a bit of an indicator of how it plays out in the first half, though obviously the math will tell you there will be some relief there as far as that tariff drag is concerned. So we will keep you updated if there is — as things develop. Obviously, we are watching it just like you guys are watching.

Our next question is from Steven Zaccone at Citi.

I'd like to ask about how the year is paced in terms of revenue growth, since Q1 is obviously guided to a decline, yet for the full year it appears growth speeds up in the back half. Could you walk us through what drives that acceleration? I'm assuming Estates is a major component? What about International — how much does it contribute? Any specifics you can offer would be helpful.

Yes, absolutely — International and Estates, the lapping of Estates across the whole platform, International from the pace of openings and simply our view of growth in the first couple of years. RH England really is our best historical reference point and we understand how that ramps. So we expect the International stores to build over their first several years. But regarding the back half, of course, you have openings in North America and openings in Europe. You have Estates, which — in Q3 and Q4, you'll begin to see revenue flowing from demand in Q2. And you'll see Estates ramp. You'll have a second mailing of the book. You'll have newness in both Interiors and Modern. So taken together, all of that, we believe, amounts to a big step up for the business in the second half. And we had expected more in last year's back half and in this year's first half, since Estates would have formed part of that cadence.