Leading indicator? Marketplace anomaly? Retailer dancing to its own tune?

RH has played all of those roles over the past few years—guessing which one will take center stage on its always-colorful quarterly earnings calls is an industry pastime. But in reporting its third-quarter results on Thursday, the company formerly known as Restoration Hardware was surprisingly drama free. It showed revenue growth basically in line with analyst expectations—9 percent. On the bottom line, RH missed Wall Street earnings forecasts, but saw its net income go up by 9 percent as well.

The drama came from elsewhere. In his shareholder letter accompanying the results, CEO Gary Friedman made sure you knew RH was outperforming its competitors on the top line—going so far as to include a table favorably comparing his revenue growth numbers against the likes of Ethan Allen, West Elm and Arhaus over the past two years. Never shy about touting the strength of RH, he added the results “demonstrated the disruptive nature of our brand.”

RH’s revenue may be growing, but its stock has been slumping. Over the past two years, the company has shed roughly half of its share price—to say nothing of the steep drop from pandemic highs. In his letter, Friedman suggested that Wall Street may have its priorities wrong: “We find it fascinating that the market chooses to reward companies that set remarkably low expectations and slightly beat them, versus setting high expectations, as we do, and at times miss them, while still meaningfully outperforming our industry.”

And of course, there are the wild cards: what Friedman calls “the worst housing market in almost 50 years” and the tariff rollercoaster of the past year. The administration’s ongoing trade war has clearly impacted RH’s margins, and Friedman was blunt on the subject. “Tariffs are disrupting supply chains and driving higher prices. There have been 16 different tariff announcements over the past ten months that have resulted in significant resourcing, product delays, out of stocks and driven multiple rounds of price negotiations and increases,” he wrote. “Despite the chaos, we continue to demonstrate our ability to gain meaningful market share while aggressively investing in strategies that we believe will create long term strategic separation.”

Those strategies include the company’s new gallery in Paris; its ever-expanding hospitality business (the restaurant in RH’s Newport Beach location is apparently clocking more than $20 in annual revenue); and its interior design initiatives, including its first freestanding design studio in Palm Desert, California, which Friedman says is doing $1 million a month against rent of $200,000 a year. (“You can do the math,” he quipped.)

Looking ahead, Friedman once more hinted at the introduction of a new collection—one that he says represents the potential to be worth “a few billion dollars over the next several years.” Without giving away too many specifics, he suggested that the look will make use of RH’s recent acquisition of Michael Taylor’s brand and IP and could debut as early as April at Salone del Mobile.

As it often does, the analyst call went on for more than an hour as Friedman riffed on all things RH, touching on everything from whether he would get into the tabletop business to a story about hosting the opening night party for the NBA’s All-Star Weekend at RH San Francisco. In the meantime, in the first few hours after the release of its earnings, RH’s share price was up nearly 9 percent. Whatever role RH is playing, investors seem to be cheering.

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Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.