Following the announcement of a one-year delay in planned tariff increases on imported upholstered furniture, kitchen cabinets and vanities, shares of RH jumped by 9.5% in intraday trading. The White House fact sheet confirmed that the current 25% duty imposed in September will remain in place until January 1, 2027, instead of rising to 30% on upholstery and 50% on cabinets and vanities as previously scheduled. This unexpected reprieve provided immediate relief to RH’s supply chain and inventory planning, reversing a sell-off that had left the stock down more than 75% from its pandemic-era highs.

On its most recent earnings call, RH management disclosed that the initial tariff wave imposed last autumn had already eroded operating margins by approximately 90 basis points. CEO Gary Friedman highlighted how multiple tariff announcements over a 10-month span led to supply-chain disruptions, product delays, out-of-stocks and successive rounds of price negotiations. With a current gross margin of just over 44%, the company had warned that further increases in import duties scheduled for January would exacerbate cost pressures and potentially force additional price hikes for end customers.

Beyond the tariff relief, investors are watching RH’s longer-term recovery prospects. The company reported a market capitalization of $3.4 billion and average daily trading volume near 1 million shares before Friday’s move. RH’s performance has historically tracked new housing starts and discretionary remodeling spending, both of which have begun to show modest upticks in key markets. Management had accumulated leverage to fund a stock buyback program during the housing boom—an approach that, if paired with renewed top-line growth and stabilization of import costs, could transform RH into a compelling turnaround candidate over the next 12–18 months.