RH (formerly Restoration Hardware), a luxury home furnishings retailer, saw its stock plummet over 40% in early April 2025 following President Donald Trump’s “Liberation Day” tariff announcement, which imposed steep levies on imports, including 46% on Vietnam and 54% on China—key sourcing regions for RH. Compounded by disappointing Q4 earnings, the stock hit record lows. However, by June 2025, RH stock has rebounded significantly, driven by a combination of tariff policy shifts, strategic supply chain adjustments, and improved financial performance. This article explores why RH is rallying, leveraging real-time financial data and recent market developments.
RH Stock Rally After April 2025 Tariff Fears: What’s Driving the Recovery?
RH (NYSE: RH), the luxury home furnishings retailer, faced a brutal sell-off in April 2025, with its stock plunging over 40% due to President Donald Trump’s sweeping tariff announcements and a lackluster Q4 earnings report. The Trump border plan, which included aggressive tariffs on imports, hit RH hard, given its reliance on Asian suppliers. Fast forward to June 2025, and RH stock is rallying, with a notable 15% after-hours surge on June 12, 2025, following its latest earnings release. As shown in the finance card above, RH’s stock price closed at $212.56 on June 12, up significantly from its April low of $123.03. Here’s why RH is staging a comeback.
1. Tariff Pause Eases Market Fears
The primary catalyst for RH’s April decline was Trump’s “Liberation Day” tariffs, announced on April 2, 2025, which imposed a 10% baseline tariff on most imports, with higher rates like 46% on Vietnam (35% of RH’s sourcing) and 54% on China (23% of RH’s sourcing). These tariffs raised fears of rising costs and margin pressures for RH, which sources 70% of its products from Asia. The stock plummeted, exacerbated by a weak Q4 earnings report, with CEO Gary Friedman citing “the worst housing market in almost 50 years” and tariff uncertainty as headwinds.
On April 9, 2025, Trump announced a 90-day tariff pause for most countries (except China, where tariffs rose to 125%), reducing levies to 10%. This pause sparked a massive market rally, with RH surging 28.57% on April 9, closing at $192.08. The finance card above shows RH’s year-low of $123.03 in April, reflecting the tariff-driven panic, but the pause provided relief, boosting investor confidence. While uncertainty persists—China’s 125% tariff and potential retaliatory measures remain concerns—the temporary reprieve has given RH breathing room to navigate trade disruptions.
2. Supply Chain Diversification Mitigates Tariff Risks
RH’s proactive supply chain adjustments have been a key driver of its rally. According to its April 4, 2025, investor release, RH has reduced its reliance on China from 40% in 2017 to 23% in 2024, shifting production to Vietnam (35%), India, Indonesia, North America (18%), and Europe (10%). The company has also invested in a North Carolina factory to bolster domestic manufacturing, with plans to fully exit China-based production by the end of fiscal 2025. These moves have positioned RH to absorb tariff impacts better than competitors, as noted in its statement that “no major furniture retailer has material sourcing advantages” over RH.
Analysts, including those at Barclays, initially downgraded RH to neutral due to tariff risks, but the company’s transparency about its sourcing and strategic shifts has reassured investors. Posts on X from June 2025 highlight sentiment that RH’s diversified supply chain makes it less vulnerable to tariffs than perceived in April, fueling the rally.
3. Strong Earnings Beat Sparks Optimism
RH’s latest earnings, reported on June 12, 2025, delivered a significant boost, with a 15% after-hours surge to $212.56, as noted in the finance card above. The company reported an earnings beat, though it missed revenue expectations. CEO Gary Friedman maintained fiscal 2025 guidance, assuming existing tariffs remain unchanged, signaling confidence in RH’s ability to navigate market challenges. The company also reported a 17% increase in total company demand quarter-to-date and 20% for the RH brand, outperforming the furniture industry despite a weak housing market.
This performance contrasts sharply with April’s earnings miss, where RH reported Q4 adjusted profit of $1.58 per share on $812.4 million in revenue, below Wall Street expectations. The timing of the April earnings call, coinciding with Trump’s tariff announcement, amplified the sell-off, with Friedman’s candid “Oh sh–” reaction during the call reflecting the shock. The June earnings beat, coupled with stable guidance, has restored investor faith, driving the rally.
4. Broader Market Recovery and Sector Resilience
The broader market’s response to the tariff pause has supported RH’s recovery. On April 9, 2025, the S&P 500 surged 9.5%, its best day since 2008, and the Nasdaq climbed 12.2%, with consumer cyclical stocks like RH leading gains. While markets dipped again on April 10 due to lingering China tariff concerns, RH’s rally persisted, buoyed by its sector’s resilience. The finance card shows RH’s market cap at $3.29 billion, reflecting renewed investor interest.
Despite a tough housing market, RH’s focus on luxury furnishings has helped it maintain demand. The company’s 19% RH brand demand growth in January 2025 and 20% quarter-to-date in June signal that high-end consumers remain engaged, cushioning tariff impacts. Compared to competitors like Williams-Sonoma and Arhaus, RH’s diversified sourcing and brand strength give it an edge, as noted by analysts on X.
5. Investor Sentiment and Technical Rebound
The April sell-off left RH stock “extremely oversold,” with a price-to-earnings ratio below 17, a historically low level, prompting bargain-hunting investors to buy in. Truist’s Keith Lerner noted that such rebounds are common after sharp declines, as investors with FOMO (fear of missing out) capitalize on undervalued stocks. The finance card shows RH’s stock jumping from $176.87 at close on June 12 to $212.56 after hours, reflecting this momentum. Posts on X, such as @MikeZaccardi’s note on RH’s 13% after-hours gain, underscore bullish sentiment.
However, risks remain. RH’s year-to-date decline of 51% and 73% drop from its 2021 high of $517.94 (per the finance card) highlight ongoing volatility. Tariffs could return after the 90-day pause, and China’s 125% levy poses challenges for RH’s remaining sourcing there. Still, the current rally reflects optimism about RH’s adaptability and market positioning.
What’s Next for RH Stock?
RH’s rally is driven by a combination of tariff relief, supply chain resilience, and a strong earnings beat, but uncertainties linger. Key factors to watch include:
- Tariff Negotiations: Will the 90-day pause lead to permanent trade deals, or will renewed tariffs hit RH’s supply chain?
- Housing Market: Can RH sustain demand growth in a weak housing environment?
- Earnings Trajectory: Will RH’s fiscal 2025 guidance hold, or will macroeconomic pressures force a revision?
For now, RH’s stock rally, as shown in the finance card’s 1-day data spiking to $213.00 on June 12, signals a robust recovery from April’s tariff-driven lows. Investors are betting on RH’s ability to navigate trade challenges and capitalize on its luxury brand strength.
RH’s stock rally in June 2025 marks a dramatic turnaround from the tariff fears that tanked its shares in April. The Trump border plan’s 90-day tariff pause, RH’s diversified supply chain, and a strong earnings beat have fueled investor optimism, driving the stock from a year-low of $123.03 to $212.56. While risks like China’s tariffs and housing market weakness persist, RH’s strategic adjustments and market resilience make it a standout in the luxury retail sector. As trade negotiations unfold, RH’s ability to maintain this momentum will be critical for investors eyeing long-term upside.
Suggested Authoritative Sources
- Reuters: “US stocks surge, dollar gains in dramatic relief rally as Trump pauses tariffs” (April 10, 2025).
- Benzinga: “Trump’s 90-Day Tariff Pause Sends RH Stock Surging” (April 10, 2025).
- RH Investor Relations: “RH Provides Clarifications Related to the Reciprocal Tariffs Announced on April 2, 2025” (April 4, 2025).
- AP News: “‘Oh sh–.’ RH CEO sees stock slide as reciprocal tariffs unveiled” (April 4, 2025).
- Yahoo Finance: “RH stock nosedives on tariff fears, weak earnings report” (April 5, 2025).
