RH 10-Q

ITEM 1. FINANCIAL STATEMENTS RH CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) ASSETS ​ ​ ​ ​ Cash and cash equivalents ​ $ 53,803 ​ $ 41,191 Accounts receivable—net ​ 72,435 ​ 63,447 Merchandise inventories ​ 802,438 ​ 818,550 Prepaid expense and other current assets ​ 195,205 ​ 184,474 Total current assets ​ 1,123,881 ​ 1,107,662 Property and equipment—net ​ 2,219,579 ​ 2,158,718 Operating lease right-of-use assets ​ ​ 835,074 ​ ​ 795,352 Goodwill and intangible assets—net ​ 224,214 ​ 224,016 Deferred tax assets ​ 128,364 ​ 128,375 Equity method investments ​ ​ 119,311 ​ ​ 119,754 Other non-current assets ​ 297,254 ​ 301,833 Total assets ​ $ 4,947,677 ​ $ 4,835,710 LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ ​ ​ Accounts payable and accrued expenses ​ $ 411,554 ​ $ 386,736 Deferred revenue and customer deposits ​ ​ 382,421 ​ 338,504 Operating lease liabilities ​ ​ 110,255 ​ ​ 110,280 Other current liabilities ​ 92,627 ​ 95,086 Total current liabilities ​ 996,857 ​ 930,606 Asset based credit facility ​ 30,000 ​ 20,000 Term loan B—net ​ 1,882,171 ​ 1,886,370 Term loan B-2—net ​ 467,112 ​ 467,299 Real estate loan—net ​ ​ 15,112 ​ ​ 15,199 Non-current operating lease liabilities ​ 733,340 ​ 705,084 Non-current finance lease liabilities ​ ​ 734,159 ​ ​ 718,837 Deferred tax liabilities ​ ​ 17,561 ​ ​ 17,731 Other non-current liabilities ​ 14,438 ​ 13,984 Total liabilities ​ ​ 4,890,750 ​ ​ 4,775,110 Commitments and contingencies (Note 13) ​ ​ ​ ​ Stockholders’ equity ​ ​ ​ ​ Preferred stock—$ 0.0001 par value per share, 10,000,000 shares authorized, no shares issued or outstanding as of May 2, 2026 and January 31, 2026 ​ — ​ ​ — Common stock— $ 0.0001 par value per share, 180,000,000 shares authorized, 18,900,769 shares issued and outstanding as of May 2, 2026; 18,818,976 shares issued and outstanding as of January 31, 2026 ​ 2 ​ 2 Additional paid-in capital ​ 425,102 ​ 410,461 Accumulated other comprehensive income ​ 31,585 ​ 36,202 Accumulated deficit ​ ( 399,762 ) ​ ( 386,065 ) Total stockholders’ equity ​ ​ 56,927 ​ ​ 60,600 Total liabilities and stockholders’ equity ​ $ 4,947,677 ​ $ 4,835,710 ​ The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 3 ​ Table of Contents RH CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands, except share and per share amounts) Net revenues ​ $ 800,328 ​ $ 813,952 Cost of goods sold ​ 469,069 ​ ​ 458,619 Gross profit ​ 331,259 ​ 355,333 Selling, general and administrative expenses ​ 297,016 ​ ​ 299,422 Operating income ​ 34,243 ​ 55,911 Other expenses ​ ​ ​ ​ ​ ​ Interest expense—net ​ ​ 52,663 ​ ​ 56,603 Other (income) expense—net ​ ​ 737 ​ ​ ( 3,653 ) Total other expenses ​ 53,400 ​ ​ 52,950 Income (loss) before income taxes and equity method investments ​ ​ ( 19,157 ) ​ ​ 2,961 Income tax expense (benefit) ​ ​ ( 5,902 ) ​ ​ 3,127 Loss before equity method investments ​ ​ ( 13,255 ) ​ ​ ( 166 ) Share of equity method investments net (income) loss ​ ​ 442 ​ ​ ( 8,205 ) Net income (loss) ​ $ ( 13,697 ) ​ $ 8,039 Weighted-average shares used in computing basic net income (loss) per share ​ ​ 18,845,313 ​ ​ 18,729,005 Basic net income (loss) per share ​ $ ( 0.73 ) ​ $ 0.43 Weighted-average shares used in computing diluted net income (loss) per share ​ ​ 18,845,313 ​ ​ 19,913,234 Diluted net income (loss) per share ​ $ ( 0.73 ) ​ $ 0.40 ​ The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. ​ ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 4 ​ Table of Contents RH CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands) Net income (loss) ​ $ ( 13,697 ) ​ $ 8,039 Net gain (loss) from foreign currency translation ​ ​ ( 4,617 ) ​ ​ 31,609 Comprehensive income (loss) ​ $ ( 18,314 ) ​ $ 39,648 ​ The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. ​ ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 5 ​ Table of Contents RH CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ COMMON STOCK ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ACCUMULATED ​ ​ ​ ​ ​ ​ ​ ​ ​ ADDITIONAL OTHER ​ ​ TOTAL ​ ​ ​ PAID-IN COMPREHENSIVE ACCUMULATED STOCKHOLDERS’ ​ ​ SHARES ​ AMOUNT ​ CAPITAL ​ INCOME (LOSS) ​ DEFICIT ​ EQUITY (DEFICIT) ​ ​ (in thousands, except share amounts) Balances—January 31, 2026 ​ 18,818,976 $ 2 $ 410,461 $ 36,202 $ ( 386,065 ) $ 60,600 Stock-based compensation ​ — ​ ​ — ​ ​ 11,919 ​ ​ — ​ ​ — ​ ​ 11,919 Issuance of restricted stock ​ 13,000 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Vested and delivered restricted stock units ​ 1,389 ​ ​ — ​ ​ ( 18 ) ​ ​ — ​ ​ — ​ ​ ( 18 ) Exercise of stock options ​ 67,404 ​ ​ — ​ ​ 2,740 ​ ​ — ​ ​ — ​ ​ 2,740 Net loss ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 13,697 ) ​ ​ ( 13,697 ) Net loss from foreign currency translation ​ — ​ ​ — ​ ​ — ​ ​ ( 4,617 ) ​ ​ — ​ ​ ( 4,617 ) Balances—May 2, 2026 ​ 18,900,769 $ 2 $ 425,102 $ 31,585 $ ( 399,762 ) $ 56,927 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balances—February 1, 2025 ​ 18,726,116 $ 2 $ 362,348 $ ( 15,087 ) $ ( 510,852 ) $ ( 163,589 ) Stock-based compensation ​ — ​ ​ — ​ ​ 12,374 ​ ​ — ​ ​ — ​ ​ 12,374 Vested and delivered restricted stock units ​ 1,020 ​ ​ — ​ ​ ( 31 ) ​ ​ — ​ ​ — ​ ​ ( 31 ) Exercise of stock options ​ 5,129 ​ ​ — ​ ​ 830 ​ ​ — ​ ​ — ​ ​ 830 Net income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 8,039 ​ ​ 8,039 Net gain from foreign currency translation ​ — ​ ​ — ​ ​ — ​ ​ 31,609 ​ ​ — ​ ​ 31,609 Balances—May 3, 2025 ​ 18,732,265 $ 2 $ 375,521 $ 16,522 $ ( 502,813 ) $ ( 110,768 ) ​ The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. ​ ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 6 ​ Table of Contents RH CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands) CASH FLOWS FROM OPERATING ACTIVITIES ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 13,697 ) ​ $ 8,039 Adjustments to reconcile net income (loss) to net cash provided by operating activities: ​ ​ ​ ​ Depreciation and amortization ​ 38,747 ​ ​ 35,236 Non-cash operating lease cost ​ ​ 27,490 ​ ​ 25,195 Stock-based compensation ​ 11,919 ​ ​ 12,374 Non-cash finance lease interest expense ​ ​ 11,278 ​ ​ 8,945 Share of equity method investments net (income) loss ​ ​ 442 ​ ​ ( 8,205 ) Distribution of return on equity method investment ​ ​ — ​ ​ 4,630 Other non-cash items ​ 2,268 ​ ​ 2,471 Change in assets and liabilities: ​ ​ ​ ​ ​ Accounts receivable ​ ( 8,991 ) ​ ​ ( 191 ) Merchandise inventories ​ 15,367 ​ ​ 18,010 Prepaid expense and other assets ​ ( 11,404 ) ​ ​ 1,273 Landlord assets under construction—net of tenant allowances ​ ( 38,561 ) ​ ​ ( 17,800 ) Accounts payable and accrued expenses ​ 16,583 ​ ​ ( 10,300 ) Deferred revenue and customer deposits ​ 44,067 ​ ​ 53,541 Other current liabilities ​ ( 3,124 ) ​ ​ ( 3,583 ) Current and non-current operating lease liabilities ​ ( 29,070 ) ​ ​ ( 34,933 ) Other non-current liabilities ​ ( 10,813 ) ​ ​ ( 8,061 ) Net cash provided by operating activities ​ 52,501 ​ 86,641 CASH FLOWS FROM INVESTING ACTIVITIES ​ ​ ​ ​ Capital expenditures ​ ( 39,220 ) ​ ​ ( 52,565 ) Equity method investments ​ — ​ ​ ( 374 ) Acquisition of intangible asset ​ ​ — ​ ​ ( 2,769 ) Receipt of promissory note repayment from equity method investee ​ ​ — ​ ​ 1,750 Distribution of return of equity method investment ​ ​ — ​ ​ 7,916 Proceeds from insurance recoveries ​ ​ — ​ ​ 1,000 Net cash used in investing activities ​ ( 39,220 ) ​ ( 45,042 ) ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 7 ​ Table of Contents RH CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands) CASH FLOWS FROM FINANCING ACTIVITIES ​ ​ ​ ​ Borrowings under asset based credit facility ​ ​ 105,000 ​ ​ 185,000 Repayments under asset based credit facility ​ ​ ( 95,000 ) ​ ​ ( 200,000 ) Repayments under term loans ​ ​ ( 6,250 ) ​ ​ ( 6,250 ) Principal payments under finance lease agreements—net of tenant allowances ​ ​ ( 6,971 ) ​ ​ ( 6,464 ) Proceeds from exercise of stock options ​ 2,740 ​ ​ 830 Other financing activities ​ ​ ( 103 ) ​ ​ ( 118 ) Net cash used in financing activities ​ ( 584 ) ​ ( 27,002 ) Effects of foreign currency exchange rate translation on cash ​ ( 85 ) ​ ​ 1,074 Net increase in cash and cash equivalents ​ 12,612 ​ 15,671 Cash and cash equivalents ​ ​ ​ ​ Beginning of period ​ 41,191 ​ 30,413 End of period ​ $ 53,803 ​ $ 46,084 Non-cash transactions ​ ​ ​ ​ Property and equipment additions in accounts payable and accrued expenses at period-end ​ $ 18,132 ​ $ 35,292 Landlord asset additions in accounts payable and accrued expenses at period-end ​ ​ 30,476 ​ ​ 16,177 ​ The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. ​ ​ ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 8 ​ Table of Contents RH NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1—THE COMPANY Nature of Business RH, a Delaware corporation, together with its subsidiaries (collectively, “we,” “us,” “our” or the “Company”), is a leading retailer and luxury lifestyle brand operating primarily in the home furnishings market. Our curated and fully integrated assortments are presented consistently across our sales channels, including our retail locations, websites and Sourcebooks. We offer merchandise assortments across a number of categories, including furniture, lighting, textiles, bathware, décor, outdoor and garden, and baby, child and teen furnishings. As of May 2, 2026, we operated a total of 75 RH Galleries and 43 RH Outlet stores, one RH Guesthouse, one RH Interior Design Studio and 14 Waterworks Showrooms throughout the United States, Canada and Europe. We also have sourcing operations in Shanghai. Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared from our records and, in our senior leadership team’s opinion, include all adjustments, consisting of normal recurring adjustments, necessary to fairly state our financial position as of May 2, 2026, and the results of operations for the three months ended May 2, 2026 and May 3, 2025. Our current fiscal year, which consists of 52 weeks, ends on January 30, 2027 (“fiscal 2026”). The condensed consolidated financial statements include our accounts and those of our wholly owned subsidiaries, as well as the financial information of variable interest entities (“VIEs”) where we represent the primary beneficiary and have the power to direct the activities that most significantly impact the entity’s performance (refer to Note 5— Variable Interest Entities ). Accordingly, all intercompany balances and transactions have been eliminated through the consolidation process. Certain information and disclosures normally included in the notes to annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted for purposes of these interim condensed consolidated financial statements. The preparation of the condensed consolidated financial statements, in conformity with GAAP, requires our senior leadership team to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material to the condensed consolidated financial statements. We have assessed various accounting estimates and other matters, including those that require consideration of forecasted financial information, using information that is reasonably available to us at this time. The accounting estimates and other matters we have assessed include, but were not limited to, sales return reserve, inventory reserve, allowance for doubtful accounts, goodwill, and intangible and other long-lived assets. Our current assessment of these estimates is included in the condensed consolidated financial statements as of and for the three months ended May 2, 2026. As additional information becomes available to us, our future assessment of these estimates, as well as other factors, could change and the results of any such change could materially and adversely impact the condensed consolidated financial statements in future reporting periods. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (the “2025 Form 10-K”). The results of operations for the three months ended May 2, 2026, presented herein, are not necessarily indicative of the results to be expected for the full fiscal year. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 9 ​ Table of Contents NOTE 2—RECENTLY ISSUED ACCOUNTING STANDARDS New Accounting Standards or Updates Adopted Financial Instruments: Measurement of Credit Losses for Accounts Receivable and Contract Assets In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). This new guidance provides all entities with a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the assets. We adopted the ASU as of February 1, 2026 on a prospective basis and utilized the practical expedient, which did not have a material impact on our condensed consolidated financial statements. ​ New Accounting Standards or Updates Not Yet Adopted Income Statement: Disaggregation of Income Statement Expenses In November 2024, the FASB issued ASU 2024-03—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) . This new guidance is designed to improve financial reporting by requiring public business entities to disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods, including amounts and qualitative descriptions of inventory purchases, employee compensation, depreciation and intangible asset amortization, among other requirements. In January 2025, the FASB issued ASU 2025-01—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) : Clarifying the Effective Date , which clarifies that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The guidance is required to be adopted on a prospective basis and early adoption is permitted. We are currently assessing the impact that adopting this ASU will have on our condensed consolidated financial statements. ​ Intangibles—Goodwill and Other—Internal-Use Software: Improvements to Accounting for Internal-Use Software In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). This new guidance amends guidance related to accounting for internal-use software development costs and clarifies the criteria for capitalization. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027. We are currently assessing the impact that adopting this ASU will have on our condensed consolidated financial statements. ​ Interim Reporting: Narrow-Scope Reporting In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Reporting (“ASU 2025-11”). This new guidance clarifies and improves interim reporting guidance. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027. We expect to comply with the amendments in this ASU beginning on the effective date. ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 10 ​ Table of Contents NOTE 3—PREPAID EXPENSE AND OTHER ASSETS Prepaid expense and other current assets consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) Value added tax (VAT) receivable ​ $ 49,227 ​ $ 39,169 Prepaid expenses ​ ​ 33,740 ​ ​ 30,355 Vendor deposits ​ ​ 21,672 ​ ​ 26,230 Capitalized catalog costs ​ ​ 19,648 ​ ​ 23,274 Federal and state tax receivable ​ ​ 17,297 ​ ​ 11,528 Current portion of capitalized cloud computing costs ​ ​ 12,214 ​ ​ 11,344 Right of return asset for merchandise ​ 6,096 ​ 6,423 Tenant allowance receivable ​ ​ 5,811 ​ ​ 5,633 Promissory note receivable, including interest (1) ​ 1,173 ​ 1,164 Other current assets ​ ​ 28,327 ​ ​ 29,354 Total prepaid expense and other current assets ​ $ 195,205 ​ $ 184,474 ​ (1) Represents a promissory note, including principal and accrued interest, due from an affiliate of the managing member of the Aspen LLCs. Refer to Note 5— Variable Interest Entities . Other non-current assets consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) Landlord assets under construction—net of tenant allowances ​ $ 163,896 ​ $ 156,252 Initial direct costs prior to lease commencement ​ ​ 70,093 ​ ​ 81,066 Capitalized cloud computing costs—net (1) ​ ​ 32,496 ​ ​ 31,224 Other deposits ​ ​ 9,568 ​ ​ 12,234 Vendor deposits—non-current ​ 3,695 ​ 3,336 Deferred financing fees ​ 3,040 ​ 3,377 Other non-current assets ​ 14,466 ​ 14,344 Total other non-current assets ​ $ 297,254 ​ $ 301,833 (1) Presented net of accumulated amortization of $ 47 million and $ 43 million as of May 2, 2026 and January 31, 2026, respectively. ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 11 ​ Table of Contents NOTE 4—GOODWILL, TRADENAMES, TRADEMARKS AND OTHER INTANGIBLE ASSETS Goodwill, tradenames, trademarks and other intangible assets for the RH Segment and Waterworks consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ RH SEGMENT ​ ​ ​ WATERWORKS ​ ​ ​ ​ TRADENAMES, ​ ​ ​ TRADENAMES, ​ ​ ​ ​ ​ TRADEMARKS AND ​ ​ ​ ​ TRADEMARKS AND ​ ​ ​ ​ ​ OTHER INTANGIBLE ​ ​ ​ ​ OTHER INTANGIBLE ​ ​ GOODWILL ​ ASSETS ​ GOODWILL (1) ​ ASSETS (2) ​ ​ (in thousands) January 31, 2026 ​ $ 144,239 ​ $ 62,777 ​ $ — ​ $ 17,000 Additions ​ — ​ ​ 225 ​ ​ — ​ ​ — Other (3) ​ ​ — ​ ​ ( 30 ) ​ ​ — ​ ​ — Foreign currency translation ​ ​ 3 ​ ​ — ​ ​ — ​ ​ — May 2, 2026 ​ $ 144,242 ​ $ 62,972 ​ $ — ​ $ 17,000 (1) Waterworks reporting unit goodwill of $ 51 million recognized upon acquisition in fiscal 2016 was fully impaired as of fiscal 2018. (2) Presented net of an impairment charge of $ 35 million recognized in prior fiscal years. (3) Represents amortization of patents. There are no goodwill, tradenames, trademarks and other intangible assets for the Real Estate segment. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 12 ​ Table of Contents NOTE 5—VARIABLE INTEREST ENTITIES Consolidated Variable Interest Entities and Noncontrolling Interests In fiscal 2022, we formed eight privately-held limited liability companies (each, a “Member LLC” and collectively, the “Member LLCs” or the “consolidated variable interest entities”) with a third-party real estate developer affiliated with the managing member of the Aspen LLCs (as defined in “Equity Method Investments” below) for real estate development activities related to our Gallery transformation and global expansion strategies. In fiscal 2024, one Member LLC became a wholly owned subsidiary and is no longer a VIE. As of May 2, 2026 and January 31, 2026, of the remaining seven Member LLCs, we hold a 50 percent membership interest in six of the Member LLCs, and the remaining noncontrolling interest of 50 percent in each Member LLC is held by the same developer. In one Member LLC, we hold approximately 75 percent membership interest with the remaining noncontrolling interest of approximately 25 percent held by the same developer. The carrying amounts and classification of the VIEs’ assets and liabilities included in the condensed consolidated balance sheets were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) ASSETS ​ ​ ​ ​ Cash and cash equivalents ​ $ 1,472 ​ $ 1,414 Prepaid expense and other current assets ​ 1,142 ​ 1,085 Total current assets ​ 2,614 ​ 2,499 Property and equipment—net (1) ​ 288,142 ​ 290,077 Other non-current assets ​ ​ 7 ​ 7 Total assets ​ $ 290,763 ​ $ 292,583 LIABILITIES ​ ​ ​ ​ Accounts payable and accrued expenses ​ $ 1,272 ​ $ 1,262 Other current liabilities ​ ​ 455 ​ ​ 367 Total current liabilities ​ ​ 1,727 ​ ​ 1,629 Real estate loan—net (2) ​ ​ 15,112 ​ ​ 15,199 Other non-current liabilities ​ ​ 1,018 ​ 1,026 Total liabilities ​ $ 17,857 ​ $ 17,854 (1) Includes $ 21 million of construction in progress as of both May 2, 2026 and January 31, 2026. (2) On September 9, 2022, a Member LLC as the borrower executed a Promissory Note (the “Promissory Note”) with a third-party bank in an aggregate principal amount equal to $ 16 million with a maturity date of September 9, 2032. The Promissory Note bears interest at a fixed rate per annum equal to 5.37 % until September 15, 2027, on which date the interest rate will reset based on the five-year treasury rate plus 2.00 % , subject to a total interest rate floor of 3.00 % . The Promissory Note is secured by the assets of the Member LLC and the creditor does not have recourse against RH’s general assets. Equity Method Investments Equity method investments primarily represent our membership interests in three privately-held limited liability companies in Aspen, Colorado (each, an “Aspen LLC” and collectively, the “Aspen LLCs” or the “equity method investments”) that were formed for the purpose of acquiring, developing, operating and selling certain real estate projects in Aspen, Colorado. Additionally, Waterworks has membership interests in two European entities that are equity method investments. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 13 ​ Table of Contents In March 2025, the Aspen LLC in which we hold a 70 percent interest sold its sole real estate property. Subsequent to the property sale, we received $ 15 million from the Aspen LLC, which consisted of $ 2.9 million for the repayment of its outstanding promissory note to us, including accrued interest, and a capital distribution of $ 13 million. The capital distribution of $ 13 million represented a return of our contributed capital of $ 7.9 million and a return on investment of $ 4.6 million. Other than as described above, we did not receive any distributions or have any undistributed earnings of equity method investments during the three months ended May 2, 2026 and May 3, 2025. Our maximum exposure to loss is the carrying value of each of the equity method investments as of May 2, 2026. NOTE 6—ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accounts payable and accrued expenses consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) Accounts payable ​ $ 202,977 ​ $ 197,740 Accrued compensation ​ 64,960 ​ 54,933 Accrued sales, use and other indirect tax ​ 35,646 ​ 35,254 Accrued occupancy ​ 26,440 ​ 27,264 Accrued freight and duty ​ 23,684 ​ 22,877 Accrued professional fees ​ 11,684 ​ 7,811 Accrued legal contingencies (1) ​ ​ 2,938 ​ ​ 2,914 Other accrued expenses ​ 43,225 ​ 37,943 Total accounts payable and accrued expenses ​ $ 411,554 ​ $ 386,736 (1) Refer to Note 13— Commitments and Contingencies. ​ Other current liabilities consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ (in thousands) Current portion of term loans ​ $ 25,000 ​ $ 25,000 Allowance for sales returns ​ ​ 24,336 ​ ​ 24,821 Finance lease liabilities ​ ​ 21,943 ​ ​ 21,249 Unredeemed gift card and merchandise credit liability ​ ​ 15,422 ​ ​ 18,138 Foreign tax payable ​ ​ 2,552 ​ ​ 2,902 Other current liabilities ​ 3,374 ​ 2,976 Total other current liabilities ​ $ 92,627 ​ $ 95,086 ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 14 ​ Table of Contents Supplier Finance Program We facilitate a voluntary supply chain financing program (the “Financing Program”) with a third-party financial institution (the “Bank”) to provide participating suppliers with the opportunity to receive early payment on invoices, net of a discount charged to the supplier by the Bank. As of May 2, 2026 and January 31, 2026, we had $ 37 million and $ 31 million, respectively, of payment obligations outstanding under the Financing Program included in accounts payable and accrued expenses on the condensed consolidated balance sheets. Contract Liabilities We defer revenue associated with merchandise delivered via the home-delivery channel. We expect that substantially all of the deferred revenue and customer deposits as of May 2, 2026 will be recognized within the next six months as the performance obligations are satisfied. In addition, we defer revenue when cash payments are received in advance of performance for unsatisfied obligations related to our gift cards. During the three months ended May 2, 2026 and May 3, 2025, we recognized $ 5.7 million and $ 6.5 million, respectively, of revenue related to previous deferrals related to our gift cards . We expect that approximately 75 percent of the remaining gift card liabilities will be recognized when the gift cards are redeemed by customers. NOTE 7—LEASES Lease costs—net consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ ​ MAY 2, ​ ​ ​ MAY 3, ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ (in thousands) Operating lease costs (1) ​ ​ $ 40,174 ​ $ 35,446 Finance lease costs ​ ​ ​ ​ ​ ​ ​ Amortization of leased assets (1) ​ ​ ​ 17,206 ​ ​ 14,673 Interest on lease liabilities (2) ​ ​ ​ 11,278 ​ ​ 8,945 Variable lease costs (3) ​ ​ ​ 7,074 ​ ​ 7,187 Sublease income (4) ​ ​ ​ ( 1,176 ) ​ ​ ( 1,182 ) Total lease costs—net ​ ​ $ 74,556 ​ $ 65,069 (1) Operating lease costs and amortization of finance lease right-of-use assets are included in cost of goods sold or selling, general and administrative expenses on the condensed consolidated statements of income (loss) based on our accounting policy. (2) Included in interest expense—net on the condensed consolidated statements of income (loss). Amounts include lease cost related to variable lease payments based on an index or rate that were not included in the measurement of the initial lease liability and right-of-use asset for finance leases, which were not material in either period presented. (3) Represents variable lease payments under operating and finance lease agreements, primarily associated with contingent rent based on a percentage of retail sales over contractual levels of $ 3.7 million and $ 4.1 million for the three months ended May 2, 2026 and May 3, 2025, respectively, as well as charges associated with common area maintenance of $ 3.4 million and $ 3.1 million for the three months ended May 2, 2026 and May 3, 2025, respectively. Other variable costs, which include single lease cost related to variable lease payments based on an index or rate that were not included in the measurement of the initial lease liability and right-of-use asset, were not material in either period presented. (4) Included in selling, general and administrative expenses on the condensed consolidated statements of income (loss). ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 15 ​ Table of Contents Lease right-of-use assets and lease liabilities consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ JANUARY 31, ​ ​ BALANCE SHEET CLASSIFICATION ​ ​ 2026 ​ ​ 2026 ​ ​ ​ ​ (in thousands) ASSETS ​ ​ ​ ​ ​ ​ ​ ​ Operating leases (1) ​ Operating lease right-of-use assets ​ $ 835,074 ​ $ 795,352 Finance leases (2)(3)(4) ​ Property and equipment—net ​ ​ 1,228,467 ​ ​ 1,181,339 Total lease right-of-use assets ​ ​ ​ $ 2,063,541 ​ $ 1,976,691 LIABILITIES ​ ​ ​ ​ ​ ​ ​ ​ Current (5) ​ ​ ​ ​ ​ ​ ​ ​ Operating leases ​ Operating lease liabilities ​ $ 110,255 ​ $ 110,280 Finance leases ​ Other current liabilities ​ ​ 21,943 ​ ​ 21,249 Total lease liabilities—current ​ ​ ​ ​ 132,198 ​ ​ 131,529 Non-current ​ ​ ​ ​ ​ ​ ​ ​ Operating leases ​ Non-current operating lease liabilities ​ ​ 733,340 ​ ​ 705,084 Finance leases ​ Non-current finance lease liabilities ​ ​ 734,159 ​ ​ 718,837 Total lease liabilities—non-current ​ ​ ​ ​ 1,467,499 ​ ​ 1,423,921 Total lease liabilities ​ ​ ​ $ 1,599,697 ​ $ 1,555,450 (1) Includes $ 41 million as of both May 2, 2026 and January 31, 2026 related to a future RH Design Gallery lease where the landlord is one of the Aspen LLCs. Refer to Note 5— Variable Interest Entities . (2) Includes capitalized amounts related to our completed construction activities to design and build leased assets, which are reclassified from other non-current assets upon lease commencement. (3) Recorded net of accumulated amortization of $ 401 million and $ 384 million as of May 2, 2026 and January 31, 2026, respectively. (4) Includes $ 32 million and $ 33 million as of May 2, 2026 and January 31, 2026, respectively, related to an RH Design Gallery lease with a landlord that is an affiliate of the managing member of the Aspen LLCs. Refer to Note 5— Variable Interest Entities . (5) Current portion of lease liabilities represents the reduction of the related lease liability over the next 12 months. ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 16 ​ Table of Contents The maturities of lease liabilities were as follows as of May 2, 2026: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ OPERATING ​ FINANCE ​ ​ FISCAL YEAR ​ ​ ​ ​ LEASES ​ ​ LEASES ​ ​ TOTAL ​ ​ ​ ​ (in thousands) Remainder of fiscal 2026 ​ ​ ​ $ 126,011 ​ $ 47,850 ​ $ 173,861 2027 ​ ​ ​ ​ 149,854 ​ ​ 64,939 ​ ​ 214,793 2028 ​ ​ ​ ​ 118,963 ​ ​ 64,090 ​ ​ 183,053 2029 ​ ​ ​ ​ 107,145 ​ ​ 63,786 ​ ​ 170,931 2030 ​ ​ ​ ​ 98,390 ​ ​ 64,819 ​ ​ 163,209 2031 ​ ​ ​ ​ 79,923 ​ ​ 61,877 ​ ​ 141,800 Thereafter ​ ​ ​ ​ 595,362 ​ ​ 1,170,881 ​ ​ 1,766,243 Total lease payments (1)(2) ​ ​ ​ ​ 1,275,648 ​ ​ 1,538,242 ​ ​ 2,813,890 Less—imputed interest (3) ​ ​ ​ ​ ( 432,053 ) ​ ​ ( 782,140 ) ​ ​ ( 1,214,193 ) Present value of lease liabilities ​ ​ ​ $ 843,595 ​ $ 756,102 ​ $ 1,599,697 (1) Total lease payments include future obligations for renewal options that are reasonably certain to be exercised and are included in the measurement of the lease liability. Total lease payments exclude $ 578 million of legally binding payments under the non-cancellable term for leases signed but not yet commenced under our accounting policy as of May 2, 2026, of which $ 17 million, $ 29 million, $ 32 million, $ 34 million, $ 35 million and $ 35 million will be paid in the remainder of fiscal 2026, fiscal 2027, fiscal 2028, fiscal 2029, fiscal 2030 and fiscal 2031, respectively, and $ 396 million will be paid subsequent to fiscal 2031. (2) Excludes an immaterial amount of future commitments under short-term lease agreements. (3) Calculated using the discount rate for each lease at lease commencement. Supplemental information related to leases consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ ​ ​ ​ MAY 2, ​ ​ ​ MAY 3, ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Weighted-average remaining lease term (years) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating leases ​ ​ ​ ​ ​ 11.4 ​ ​ ​ 9.4 ​ Finance leases ​ ​ ​ ​ ​ 21.7 ​ ​ ​ 20.0 ​ Weighted-average discount rate ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating leases ​ ​ ​ ​ ​ 6.6 % ​ ​ 6.0 % Finance leases ​ ​ ​ ​ ​ 6.5 % ​ ​ 5.8 % ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 17 ​ Table of Contents Other information related to leases consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ ​ MAY 2, ​ MAY 3, ​ ​ ​ 2026 ​ 2025 ​ ​ ​ (in thousands) Cash paid for amounts included in the measurement of lease liabilities ​ ​ ​ ​ ​ ​ ​ Operating cash flows from operating leases ​ ​ $ ( 40,990 ) ​ $ ( 45,409 ) Operating cash flows from finance leases ​ ​ ​ ( 11,278 ) ​ ​ ( 13,477 ) Financing cash flows from finance leases—net (1) ​ ​ ​ ( 6,971 ) ​ ​ ( 6,464 ) Total cash outflows from leases ​ ​ $ ( 59,239 ) ​ $ ( 65,350 ) Non-cash transactions ​ ​ ​ ​ ​ ​ ​ Lease right-of-use assets obtained in exchange for lease obligations—net of lease terminations ​ ​ ​ ​ ​ ​ ​ Operating leases ​ ​ $ 57,667 ​ $ 60,755 Finance leases ​ ​ ​ 20,606 ​ ​ — Reclassification from other non-current assets to finance lease right-of-use assets ​ ​ ​ 47,099 ​ ​ — Reclassification from other non-current assets to operating lease right-of-use assets ​ ​ ​ 11,979 ​ ​ — (1) Presented net of tenant allowances received subsequent to lease commencement of $ 1.4 million in the three months ended May 3, 2025. No such amounts were received from landlords in the three months ended May 2, 2026. ​ NOTE 8—CREDIT FACILITIES The outstanding balances under our credit facilities were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ ​ ​ ​ ​ UNAMORTIZED ​ ​ ​ ​ ​ UNAMORTIZED ​ ​ ​ ​ ​ ​ ​ ​ ​ DEBT ​ NET ​ ​ ​ ​ DEBT ​ NET ​ ​ INTEREST ​ OUTSTANDING ​ ISSUANCE ​ CARRYING ​ OUTSTANDING ​ ISSUANCE ​ CARRYING ​ ​ RATE ​ ​ ​ AMOUNT ​ ​ ​ COSTS ​ ​ ​ AMOUNT ​ ​ ​ AMOUNT ​ ​ ​ COSTS ​ ​ ​ AMOUNT ​ ​ (dollars in thousands) Asset based credit facility (1) ​ 5.26 % ​ $ 30,000 ​ $ — ​ $ 30,000 ​ $ 20,000 ​ $ — ​ $ 20,000 Term loan B (2) ​ 6.27 % ​ ​ 1,910,000 ​ ​ ( 7,829 ) ​ ​ 1,902,171 ​ ​ 1,915,000 ​ ​ ( 8,630 ) ​ ​ 1,906,370 Term loan B-2 (3) ​ 7.00 % ​ ​ 482,500 ​ ​ ( 10,388 ) ​ ​ 472,112 ​ ​ 483,750 ​ ​ ( 11,451 ) ​ ​ 472,299 Total credit facilities ​ ​ ​ $ 2,422,500 ​ $ ( 18,217 ) ​ $ 2,404,283 ​ $ 2,418,750 ​ $ ( 20,081 ) ​ $ 2,398,669 (1) Deferred financing fees associated with the asset based credit facility as of May 2, 2026 and January 31, 2026 were $ 3.0 million and $ 3.4 million, respectively, and are included in other non-current assets on the condensed consolidated balance sheets. The deferred financing fees are amortized on a straight-line basis over the life of the revolving line of credit. In July 2025, Restoration Hardware, Inc. entered into an amendment to the ABL Credit Agreement (defined below), which extended the maturity date of the revolving line of credit from July 29, 2026 to the earlier of (a) July 31, 2030 and (b) the date which is 91 days prior to the final stated maturity of the Term Loan Credit Agreement and any refinancing thereof. (2) Represents the Term Loan Credit Agreement (defined below), of which outstanding amounts of $ 1,890 million and $ 1,895 million were included in term loan B—net on the condensed consolidated balance sheets as of May 2, 2026 and January 31, 2026, respectively, and $ 20 million of current maturities of long-term debt was included in other current liabilities on the condensed consolidated balance sheets as of both May 2, 2026 and January 31, 2026. (3) Represents the outstanding balance of the Term Loan B-2 (defined below) under the Term Loan Credit Agreement, of which outstanding amounts of $ 478 million and $ 479 million were included in term loan B-2—net on the condensed consolidated balance sheets as of May 2, 2026 and January 31, 2026, respectively, and $ 5.0 million of current maturities of long-term debt was included in other current liabilities on the condensed consolidated balance sheets as of both May 2, 2026 and January 31, 2026. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 18 ​ Table of Contents Asset Based Credit Facility On August 3, 2011, Restoration Hardware, Inc. (“RHI”), a wholly owned subsidiary of RH, along with its Canadian subsidiary, Restoration Hardware Canada, Inc., entered into the Ninth Amended and Restated Credit Agreement (as amended prior to June 28, 2017, the “Original Credit Agreement”) by and among RHI, Restoration Hardware Canada, Inc., certain other subsidiaries of RH named therein as borrowers or guarantors, the lenders party thereto and Bank of America, N.A., as administrative agent and collateral agent (the “ABL Agent”). On July 31, 2025, RHI entered into an Amendment (the “Amendment”) to the Original Credit Agreement, as it had been subsequently amended (as amended by the Amendment, the “ABL Credit Agreement”). The Amendment, among other things, amends the Original Credit Agreement to extend the maturity date of the ABL Credit Agreement to be the earlier of (a) July 31, 2030 and (b) the date which is 91 days prior to the final stated maturity of the Term Loan Credit Agreement and any refinancing thereof. Under the ABL Credit Agreement, RHI has a revolving line of credit with initial availability of up to $ 600 million, of which (i) $ 10 million is available to the RH subsidiary, Restoration Hardware Canada, Inc., and (ii) $ 100 million is available to the RH subsidiary, RH Geneva Sàrl. The ABL Credit Agreement includes a $ 300 million accordion feature under which the revolving line of credit may be expanded by agreement of the parties from $ 600 million to up to $ 900 million if and to the extent the lenders revise their credit commitments to encompass a larger facility. The ABL Credit Agreement provides that the $ 300 million accordion, or a portion thereof, may be added as a first-in, last-out term loan facility if and to the extent the lenders revise their credit commitments for such facility. The ABL Credit Agreement further provides that the borrowers may request a European sub-credit facility under the revolving line of credit or under the accordion feature for borrowing by certain European subsidiaries of RH Global Holdings, Inc. if certain conditions set out in the ABL Credit Agreement are met. The availability of credit at any given time under the ABL Credit Agreement will be constrained by its terms and conditions, including the amount of collateral available, a borrowing base formula based upon numerous factors, including the value of eligible inventory and eligible accounts receivable, and other restrictions contained in the ABL Credit Agreement. All obligations under the ABL Credit Agreement are secured by substantial assets of the loan parties, including inventory, receivables and certain types of intellectual property. As a result, actual borrowing availability under the revolving line of credit could be less than the stated amount of the revolving line of credit (as reduced by the actual borrowings and outstanding letters of credit under the revolving line of credit). Borrowings under the revolving line of credit (other than swing line loans, which are subject to interest at the base rate) bear interest, at the borrower’s option, at either the base rate or the Secured Overnight Financing Rate (“SOFR”) subject to a 0.00 % SOFR floor (or, in the case of the Canadian borrowings, the “BA Rate” or the “Canadian Prime Rate”, as such terms are defined in the ABL Credit Agreement, for the Canadian borrowings denominated in Canadian dollars, or the “U.S. Index Rate”, as such term is defined in the ABL Credit Agreement, or SOFR for Canadian borrowings denominated in U.S. dollars) plus an applicable interest rate margin, in each case. The ABL Credit Agreement contains various restrictive and affirmative covenants, including required financial reporting, limitations on granting certain liens, limitations on making certain loans or investments, limitations on incurring additional debt, restricted payment limitations limiting the payment of dividends and certain other transactions and distributions, limitations on transactions with affiliates, along with other restrictions and limitations similar to those frequently found in credit agreements of a similar type and size. The ABL Credit Agreement does not contain any significant financial ratio covenants or coverage ratio covenants other than a consolidated fixed charge coverage ratio (“FCCR”) covenant based on the ratio of (i) consolidated EBITDA to the amount of (ii) debt service costs plus certain other amounts, including dividends and distributions and prepayments of debt as defined in the ABL Credit Agreement (the “FCCR Covenant”). The FCCR Covenant only applies in certain limited circumstances, including when the unused availability under the ABL Credit Agreement drops below the greater of (A) $ 40 million and (B) an amount based on 10 % of the total borrowing availability at the time. The FCCR Covenant ratio is set at 1.0 and measured on a trailing twelve-month basis. As of May 2, 2026, RHI was in compliance with the FCCR Covenant. The ABL Credit Agreement requires a daily sweep of all cash receipts and collections to prepay the loans under the agreement while (i) an event of default exists or (ii) when the unused availability under the ABL Credit Agreement drops below the greater of (A) $ 40 million and (B) an amount based on 10 % of the total borrowing availability at the time. The ABL Credit Agreement contains customary representations and warranties, events of default and other customary terms and conditions for an asset based credit facility. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 19 ​ Table of Contents As of May 2, 2026, RHI had $ 30 million in outstanding borrowings and $ 361 million of availability under the revolving line of credit, net of $ 44 million in outstanding letters of credit. As a result of the FCCR Covenant that limits the last 10 % of borrowing availability, actual incremental borrowing available to RHI and the other affiliated parties under the revolving line of credit would be $ 301 million as of May 2, 2026. Term Loan Credit Agreement On October 20, 2021, RHI entered into a Term Loan Credit Agreement (the “Term Loan Credit Agreement”) by and among RHI as the borrower, the lenders party thereto and Bank of America, N.A. as administrative agent and collateral agent (in such capacities, the “Term Agent”) with respect to an initial term loan (the “Term Loan B”) in an aggregate principal amount equal to $ 2,000 million with a maturity date of October 20, 2028. Through July 31, 2023, the Term Loan B bore interest at an annual rate based on LIBOR subject to a 0.50 % LIBOR floor plus an interest rate margin of 2.50 % (with a stepdown of the interest rate margin if RHI achieves a specified public corporate family rating). LIBOR is a floating interest rate that reset periodically during the life of the Term Loan B. At the date of borrowing, the interest rate was set at the LIBOR floor of 0.50 % plus 2.50 % and the Term Loan B was issued at a discount of 0.50 % to face value. Effective August 1, 2023, the Term Loan B bears interest at an annual rate based on SOFR subject to a 0.50 % SOFR floor plus an interest rate margin of 2.50 % plus a credit spread adjustment. On May 13, 2022, RHI entered into a 2022 Incremental Amendment (the “2022 Incremental Amendment”) with Bank of America, N.A., as administrative agent, amending the Term Loan Credit Agreement (the Term Loan Credit Agreement as amended by the 2022 Incremental Amendment, the “Amended Term Loan Credit Agreement”). Pursuant to the terms of the 2022 Incremental Amendment, RHI incurred incremental term loans (the “Term Loan B-2”) in an aggregate principal amount equal to $ 500 million with a maturity date of October 20, 2028. The Term Loan B-2 constitutes a separate class from the Term Loan B under the Term Loan Credit Agreement. The Term Loan B-2 bears interest at an annual rate based on SOFR subject to a 0.50 % SOFR floor plus an interest rate margin of 3.25 % plus a credit spread adjustment of 0.10 %. Other than the terms relating to the Term Loan B-2, the terms of the Amended Term Loan Credit Agreement remain substantially the same as the terms of the existing Term Loan Credit Agreement, including representations and warranties, covenants and events of default. All obligations under the Term Loan B are guaranteed by certain domestic subsidiaries of RHI. Further, RHI and such subsidiaries have granted a security interest in substantially all of their assets (subject to customary and other exceptions) to secure the Term Loan B. Substantially all of the collateral securing the Term Loan B also secures the loans and other credit extensions under the ABL Credit Agreement. On October 20, 2021, in connection with the Term Loan Credit Agreement, RHI and certain other subsidiaries of RH party to the Term Loan Credit Agreement and the ABL Credit Agreement, as the case may be, entered into an Intercreditor Agreement (the “Intercreditor Agreement”) with the Term Agent and the ABL Agent. The Intercreditor Agreement establishes various customary inter-lender terms, including, without limitation, with respect to priority of liens, permitted actions by each party, application of proceeds, exercise of remedies in case of default, releases of liens and certain limitations on the amendment of the ABL Credit Agreement and the Term Loan Credit Agreement without the consent of the other parties. The borrowings under the Term Loan Credit Agreement may be prepaid in whole or in part at any time, subject to a prepayment premium of 1.0 % in connection with any repricing transaction within the six months following the closing date of the Term Loan Credit Agreement. The Term Loan Credit Agreement contains various restrictive and affirmative covenants, including required financial reporting, limitations on granting certain liens, limitations on making certain loans or investments, limitations on incurring additional debt, restricted payment limitations limiting the payment of dividends and certain other transactions and distributions, limitations on transactions with affiliates, along with other restrictions and limitations similar to those frequently found in credit agreements of a similar type and size, but provides for unlimited exceptions in the case of incurring indebtedness, granting of liens and making investments, dividend payments, and payments of material junior indebtedness, subject to satisfying specified leverage ratio tests. The Term Loan Credit Agreement does not contain a financial maintenance covenant. The Term Loan Credit Agreement contains customary representations and warranties, events of default and other customary terms and conditions for a term loan credit agreement. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 20 ​ Table of Contents NOTE 9—FAIR VALUE MEASUREMENTS Fair Value Measurements—Recurring Amounts reported as cash and equivalents, receivables, and accounts payable and accrued expenses approximate fair value due to the short-term nature of activity within these accounts. The estimated fair value of the asset based credit facility approximates cost as the interest rate associated with the facility is variable and resets frequently (Level 2). The estimated fair value and carrying value of the Term Loan Credit Agreement and the real estate loan were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAY 2, ​ JANUARY 31, ​ ​ 2026 ​ 2026 ​ ​ ​ ​ ​ ​ ​ ​ PRINCIPAL ​ ​ ​ ​ ​ ​ ​ PRINCIPAL ​ ​ FAIR ​ CARRYING ​ FAIR ​ CARRYING ​ ​ VALUE ​ VALUE (1) ​ VALUE ​ VALUE (1) ​ ​ (in thousands) Term loan B ​ $ 1,876,575 ​ $ 1,910,000 ​ $ 1,881,488 ​ $ 1,915,000 Term loan B-2 ​ 477,072 ​ ​ 482,500 ​ 480,122 ​ 483,750 Real estate loan ​ ​ 15,135 ​ ​ 15,500 ​ ​ 15,343 ​ ​ 15,585 (1) The principal carrying values of the Term Loan B and Term Loan B-2 represent the outstanding amount under each class and exclude discounts upon original issuance and third-party offering costs. The principal carrying value of the real estate loan represents the outstanding principal balance and excludes debt issuance costs. The fair values of the Term Loan B and Term Loan B-2 were derived from observable bid prices (Level 1). The fair value of the real estate loan was derived from discounted cash flows using risk-adjusted rates (Level 2). NOTE 10—INCOME TAXES Our income tax expense (benefit) and effective tax rates were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ ​ MAY 2, ​ ​ ​ MAY 3, ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ (dollars in thousands) Income tax expense (benefit) ​ ​ $ ( 5,902 ) ​ ​ $ 3,127 ​ Effective tax rate ​ ​ ​ 30.8 % ​ ​ 28.0 % ​ The increase in our effective tax rate for the three months ended May 2, 2026 compared to the three months ended May 3, 2025 is primarily attributable to the net loss in the current period, as well as the discrete tax impact of the favorable legal settlement associated with credit card interchange fees and net excess tax windfalls from stock-based compensation in the three months ended May 2, 2026 as compared to net tax shortfalls in the three months ended May 3, 2025. ​ On July 4, 2025, the United States enacted tax legislation through the H.R.1 Reconciliation Act, commonly referred to as the One Big Beautiful Bill Act (the “OBBBA”), which implemented several corporate tax law changes taking effect in fiscal 2025 and others through fiscal 2027. The impacts of the OBBBA are reflected in our results for the quarter ended May 2, 2026. We will continue to monitor any future changes in our business or interpretations of the new tax law that could affect our tax position in subsequent periods. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 21 ​ Table of Contents NOTE 11—NET INCOME (LOSS) PER SHARE The weighted-average shares used for net income (loss) per share were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ ​ MAY 3, ​ ​ ​ ​ 2026 (1) ​ ​ ​ ​ 2025 Weighted-average shares—basic ​ ​ 18,845,313 ​ ​ 18,729,005 Effect of dilutive stock-based awards ​ — ​ ​ 1,184,229 Weighted-average shares—diluted ​ 18,845,313 ​ 19,913,234 (1) As we reported a net loss for the three months ended May 2, 2026, the weighted-average shares outstanding for basic and diluted are the same for the corresponding period. The following number of options and restricted stock units were excluded from the calculation of diluted net income (loss) per share because their inclusion would have been anti-dilutive: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ ​ MAY 3, ​ ​ ​ ​ 2026 ​ ​ ​ ​ 2025 Options ​ ​ 3,370,702 ​ ​ 1,947,777 Restricted stock units ​ 19,969 ​ ​ 8,632 ​ ​ ​ NOTE 12—STOCK-BASED COMPENSATION We maintain two stock incentive plans, the 2012 Stock Incentive Plan and the 2023 Stock Incentive Plan (collectively, the “Plans”), that provide for the grant of incentive stock options to our employees and the grant of non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights and any combination thereof to our employees, directors and consultants and our parent and subsidiary corporations’ employees, directors and consultants. As of May 2, 2026, there were a total of 1,415,103 shares issuable under the 2023 Stock Incentive Plan. Equity Awards Under the Plans Options outstanding, vested or expected to vest, and exercisable as of May 2, 2026 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ WEIGHTED- ​ WEIGHTED- ​ AGGREGATE ​ ​ ​ ​ AVERAGE ​ AVERAGE ​ INTRINSIC ​ ​ ​ ​ EXERCISE ​ REMAINING TERM ​ VALUE ​ ​ ​ SHARES ​ ​ ​ PRICE ​ ​ ​ (in years) ​ ​ ​ (in thousands) Options outstanding ​ ​ 4,289,594 ​ $ 200.70 ​ ​ 5.3 ​ $ 88,420 Options vested or expected to vest ​ ​ 3,845,699 ​ ​ 201.71 ​ ​ 4.8 ​ ​ 88,256 Options exercisable ​ ​ 2,542,754 ​ ​ 194.02 ​ ​ 3.1 ​ ​ 87,854 ​ Stock-based compensation, which is included in selling, general and administrative expenses on the condensed consolidated statements of income (loss), was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands) Stock-based compensation ​ $ 11,919 ​ $ 12,374 ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 22 ​ Table of Contents No stock-based compensation has been capitalized in the accompanying condensed consolidated financial statements. As of May 2, 2026, the total unrecognized stock-based compensation and weighted-average remaining term of unvested awards were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ UNRECOGNIZED ​ ​ WEIGHTED- ​ ​ STOCK BASED ​ ​ AVERAGE ​ ​ COMPENSATION ​ ​ REMAINING TERM ​ ​ (in thousands) ​ ​ (in years) Unvested options ​ $ 153,591 ​ ​ 5.3 Unvested restricted stock and restricted stock units ​ ​ 6,486 ​ ​ 1.6 Total ​ $ 160,077 ​ ​ ​ ​ NOTE 13—COMMITMENTS AND CONTINGENCIES Commitments We had no material off-balance sheet commitments as of May 2, 2026. Contingencies We are subject to contingencies, including in connection with lawsuits, claims, investigations and other legal proceedings incident to the ordinary course of our business. These disputes are increasing in number as we expand our business and provide new product and service offerings, such as restaurants and hospitality, and as we enter new markets and legal jurisdictions and face increased complexity related to compliance and regulatory requirements. In addition, we are subject to governmental and regulatory examinations, information requests, and investigations from time to time at the state and federal levels. We currently face certain legal proceedings that involve complex litigation, including class action cases, matters related to our employment practices, the application of state wage-and-hour laws, product liability and other causes of action. We have faced similar litigation in the past. Due to the inherent difficulty of predicting the course of complex legal actions, including class-action allegations, such as the eventual scope, duration or outcome, we may be unable to estimate the amount or range of any potential loss that could result from an unfavorable outcome arising from such matters. Our assessment of these legal proceedings, as well as other lawsuits, could change based upon the discovery of facts that are not presently known or developments during the course of the litigation. We have settled certain class action and other cases but continue to defend a variety of legal actions and our estimates of our exposure in such cases may evolve over time. Accordingly, the ultimate costs to resolve litigation, including class action cases, may be substantially higher or lower than our estimates. With respect to such contingencies, we review the need for any loss contingency reserves and establish reserves when, in the opinion of our senior leadership team, it is probable that a matter would result in liability, and the amount of loss, if any, can be reasonably estimated. Loss contingencies determined to be probable and estimable are recorded in accounts payable and accrued expenses on the condensed consolidated balance sheets (refer to Note 6— Accounts Payable, Accrued Expenses and Other Current Liabilities ). These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to each matter. In view of the inherent difficulty of predicting the outcome of certain matters, particularly in cases in which claimants seek substantial or indeterminate damages, it may not be possible to determine whether a liability has been incurred or to reasonably estimate the ultimate or minimum amount of that liability until the case is close to resolution, in which case no reserve is established until that time. When and to the extent that we do establish a reserve, there can be no assurance that any such recorded liability for estimated losses will be for the appropriate amount, and actual losses could be higher or lower than what we accrue from time to time. Although we believe that the ultimate resolution of our current legal proceedings will not have a material adverse effect on the condensed consolidated financial statements, the outcome of legal matters is subject to inherent uncertainty. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 23 ​ Table of Contents Although we are self-insured or maintain deductibles in the United States for workers’ compensation, general liability and product liability up to predetermined amounts, above which third-party insurance applies, depending on the facts and circumstances of the underlying claims, coverage under these or other of our insurance policies may not be available. We may elect not to renew certain insurance coverage or renewal of coverage may not be available or may be prohibitively expensive. Even if we believe coverage does apply under our insurance programs, our insurance carriers may dispute coverage based on the underlying facts and circumstances. The outcome of any contingencies, including lawsuits, claims, investigations and other legal proceedings, could result in unexpected expenses and liability that could adversely affect our operations. In addition, any legal proceedings in which we are involved or claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of our senior leadership team’s time, result in the diversion of significant operational resources, and require changes to our business operations, policies and practices. Legal costs related to such matters are expensed as incurred. Gain Contingencies Settlement In February 2026, we entered into a settlement agreement to resolve litigation pertaining to credit card interchange fees in which we received $ 32 million, net of legal costs, in March 2026. We recognized this settlement as a gain within selling, general and administrative expenses on the condensed consolidated statements of income (loss) for the three months ended May 2, 2026. Tariffs In February 2026, the U.S. Supreme Court invalidated certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”). Subsequently, new tariffs were imposed pursuant to alternative statutory authority and are scheduled to expire after 150 days absent Congressional authorization. In April 2026, the IEEPA refund process was launched at which time we filed for refunds for tariffs previously paid in an aggregate amount of $ 69 million. We began to receive tariff refunds in the second quarter of fiscal 2026, and, to date, have received refunds of approximately $ 9 million, inclusive of interest. Given the evolving trade policy environment and uncertainty related to the recoverability or timing of refunds we believe may be due to us, we plan to recognize such refunds once they are realized or realizable and are evaluating the impact of these actions on our condensed consolidated financial statements. NOTE 14—SEGMENT REPORTING We define reportable and operating segments on the same basis that we use to evaluate our performance internally by the chief operating decision maker (“CODM”), which we have determined is our Chief Executive Officer. We have three operating segments: RH Segment, Waterworks and Real Estate. The RH Segment and Waterworks operating segments (the “retail operating segments”) include all sales channels accessed by our customers, including sales through retail locations and outlets, including hospitality, websites, Sourcebooks, and the Trade and Contract channels. The Real Estate segment represents operations associated with certain of our equity method investments and consolidated VIEs that have operations not directly related to the activities of the retail operating segments. The retail operating segments are strategic business units that offer products for the home furnishings customer. While RH Segment and Waterworks have a shared senior leadership team and customer base, we have determined that their results cannot be aggregated as they do not share similar economic characteristics, as well as due to other quantitative factors. Segment Information The CODM uses segment adjusted operating income to evaluate segment profitability for the retail operating segments and to allocate resources and analyze variances of actual performance to our forecasts when making decisions. Operating income is defined as net income (loss) before interest expense—net, other (income) expense—net, income tax expense (benefit) and our share of equity method investments net (income) loss. Segment adjusted operating income (loss) excludes (i) legal settlement—net and (ii) non-cash compensation amortization related to an option grant made to Mr. Friedman in October 2020, which stock-based compensation for this award was fully recognized as of the first quarter of fiscal 2025. These items are excluded from segment adjusted operating income (loss) in order to provide better transparency of segment operating results. Accordingly, these items are not presented by segment because they are excluded from the segment profitability measure that the CODM and our senior leadership team review. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 24 ​ Table of Contents Segment net revenues, which represent our disaggregated net revenues in accordance with Accounting Standards Codification 606, significant segment expenses and segment adjusted operating income (loss), by reportable segment, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ ​ ​ 2026 ​ 2025 ​ ​ RH SEGMENT ​ WATERWORKS ​ TOTAL (1) ​ RH SEGMENT ​ WATERWORKS ​ TOTAL (1) ​ ​ (in thousands) Net revenues ​ $ 752,202 ​ $ 48,126 ​ $ 800,328 ​ $ 764,998 ​ $ 48,954 ​ $ 813,952 Cost of goods sold ​ ​ 446,180 ​ ​ 22,889 ​ ​ 469,069 ​ ​ 435,204 ​ ​ 23,415 ​ ​ 458,619 Advertising expense ​ ​ 51,181 ​ ​ 938 ​ ​ 52,119 ​ ​ 48,723 ​ ​ 655 ​ ​ 49,378 Other segment expenses (2) ​ ​ 255,882 ​ ​ 20,683 ​ ​ 276,565 ​ ​ 229,616 ​ ​ 19,577 ​ ​ 249,193 Segment adjusted operating income (loss) ​ $ ( 1,041 ) ​ $ 3,616 ​ $ 2,575 ​ $ 51,455 ​ $ 5,307 ​ $ 56,762 Legal settlement—net ​ ​ ​ ​ ​ ​ ​ ( 31,668 ) ​ ​ ​ ​ ​ ​ ​ — Non-cash compensation ​ ​ ​ ​ ​ ​ ​ — ​ ​ ​ ​ ​ ​ ​ 851 Operating income ​ ​ ​ ​ ​ 34,243 ​ ​ ​ ​ ​ ​ ​ 55,911 Interest expense—net ​ ​ ​ ​ ​ 52,663 ​ ​ ​ ​ ​ ​ ​ 56,603 Other (income) expense—net ​ ​ ​ ​ ​ ​ ​ 737 ​ ​ ​ ​ ​ ​ ​ ( 3,653 ) Income (loss) before income taxes and equity method investments ​ ​ ​ ​ ​ ​ ​ $ ( 19,157 ) ​ ​ ​ ​ ​ ​ ​ $ 2,961 (1) All intercompany transactions are not material and have been eliminated. (2) Other segment expenses primarily include compensation and occupancy costs classified as selling, general and administrative expenses, and other general and administrative expenses. In the three months ended May 2, 2026 and May 3, 2025, the Real Estate segment share of equity method investments, which is the measure of segment profitability reviewed by the CODM to evaluate performance internally for the Real Estate segment, was a loss of $ 0.6 million and income of $ 8.3 million, respectively. The share of (income) loss from equity method investments for the Waterworks segment was immaterial in both fiscal periods presented. Depreciation and amortization for our segments was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ THREE MONTHS ENDED ​ ​ MAY 2, ​ MAY 3, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ (in thousands) RH Segment ​ $ 37,127 ​ $ 33,861 Waterworks ​ ​ 1,620 ​ ​ 1,375 Real Estate (1) ​ ​ — ​ ​ — Total depreciation and amortization $ 38,747 $ 35,236 (1) There is no depreciation and amortization for the Real Estate segment since all assets represent construction in progress. ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 25 ​ Table of Contents Balance sheet information for our segments consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ TRADENAMES, ​ ​ ​ ​ ​ ​ ​ ​ ​ TRADEMARKS AND ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ OTHER INTANGIBLE ​ EQUITY METHOD ​ TOTAL ​ ​ GOODWILL (1) ​ ASSETS (2) ​ INVESTMENTS ​ ASSETS ​ ​ (in thousands) January 31, 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ RH Segment ​ $ 144,239 ​ $ 62,777 ​ $ — ​ $ 4,499,349 Waterworks ​ ​ — ​ ​ 17,000 ​ ​ 4,363 ​ ​ 184,203 Real Estate ​ — ​ ​ — ​ ​ 115,391 ​ ​ 152,158 Total ​ $ 144,239 ​ $ 79,777 ​ $ 119,754 ​ $ 4,835,710 May 2, 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ RH Segment ​ $ 144,242 ​ $ 62,972 ​ $ — ​ $ 4,604,750 Waterworks ​ ​ — ​ ​ 17,000 ​ ​ 4,538 ​ ​ 191,329 Real Estate ​ ​ — ​ ​ — ​ ​ 114,773 ​ ​ 151,598 Total ​ $ 144,242 ​ $ 79,972 ​ $ 119,311 ​ $ 4,947,677 (1) The Waterworks reporting unit goodwill of $ 51 million recognized upon acquisition in fiscal 2016 was fully impaired as of fiscal 2018. (2) The Waterworks reporting unit tradename is presented net of an impairment charge of $ 35 million recognized in prior fiscal years. We are domiciled in the United States and primarily operate our retail locations and outlets in the United States. As of May 2, 2026, we operated the following number of retail locations and outlets outside the United States: ​ ​ ​ ​ ​ ​ COUNT Canada ​ 6 United Kingdom ​ 3 Germany ​ 2 Belgium ​ 1 France ​ 1 Italy ​ 1 Spain ​ 1 Total (1) ​ 15 (1) Geographic revenues generated outside of the United States did not exceed 10% of total consolidated net revenues in either fiscal period presented. NOTE 15—SUBSEQUENT EVENT In May 2026, we received a $ 50 million cash distribution related to our membership interests in the Aspen LLCs, which resulted from a series of transactions whereby ownership of certain real estate properties held by the Aspen LLCs were transferred to entities wholly owned by the managing member of the Aspen LLCs and one property, which we plan to open as an RH Guesthouse, was transferred to an entity wholly owned by us. Following this distribution, we repaid $ 32 million of outstanding debt on the wholly owned property transferred to us. Additionally, we received $ 10 million of deemed non-cash capital contributions in an Aspen LLC. Concurrently with these transactions, the membership interests in the seven Member LLCs that were previously held by a third-party real estate developer affiliated with the managing member of the Aspen LLCs were withdrawn, and, as a result, we wholly own such Member LLCs. We are evaluating the effect these transactions will have on our condensed consolidated financial statements. ​ ​ PART I. FINANCIAL INFORMATION 2026 FIRST QUARTER FORM 10-Q | 26 ​ Table of Contents