It’s the best of times and the worst of times for RH. On one hand, its European expansion has been picking up steam with the recent unveiling of glittering galleries in Paris and Milan and an opening in London on the horizon; meanwhile, a new traditional-leaning collection, Estates, is teed up to bring new customers in the door. On the other hand, tariffs, a brutal housing market, debt, unrest in the Middle East, and the cost of the brand’s international campaign all continue to take a toll on its finances. Both the good and bad reared their heads on the company’s first-quarter earnings call—and so did a surprise olive branch to the trade.

Revenue was down 1.7 percent to $800 million, a number that chairman and CEO Gary Friedman said was affected by backorder delays due to tariff-related resourcing. And on the bottom line, RH lost money—$13.7 million—marking its first quarter in the red since 2024.

However, the company’s performance mostly beat analyst estimates, and its stock briefly popped in after-hours trading before settling down to essentially flat on the closing price of $159. Despite being down for the year, RH has had a good month on Wall Street, regaining much of the ground it lost in a springtime slide down to the five-year low of roughly $106 per share.

Looking ahead, RH nudged up its full-year revenue forecast, from a range of 4 to 8 percent growth to a range of 4.5 to 8 percent growth. The company is predicting a relatively quiet second quarter, followed by a big comeback in the second half of the year—a surge driven by new stores, backlog reduction, and the rollout of Estates. The collection, which will make use of recent acquisitions Michael Taylor Designs, Dennis & Leen, and Formations, is a big swing for an audience that Friedman thinks the company has overlooked in recent years.

“The traditional classic market represents about 60 percent of the luxury home market, and today we’re just vastly underpenetrated in that market,” he said. “RH Estates is, from our view, the first step up to the top of the luxury mountain. It is the highest level of quality and design that exists in the world, unless you’re really buying rare antiques.”

The earnings call touched on familiar topics for RH watchers. Friedman detailed plans to sell off real estate holdings to pay down the company’s $2.4 billion debt; reiterated his distaste for influencer marketing; and predicted that the opening of RH London would ignite sales in Europe. However, the star of the show was something of a twist: the trade.

In his letter to shareholders, Friedman evoked a Cold War analogy, quoting Ronald Reagan’s famous command to Mikhail Gorbachev in Berlin: “Tear down this wall.” In this case, the metaphorical “wall” was the barrier between trade-only brands and the general shopping public. With the comparison, Friedman was making the case that everyday consumers should be able to access companies like the ones he has acquired recently.

If that sounds like a riff that would dismay designers, what came next was a surprise. RH is rolling out a new trade program that “ensures that professionals are compensated for the tremendous value and aesthetic clarity they create for consumers,” said Friedman. “We want to incentivize the world’s best talent to build their canvases using our platform, creating a symbiotic ecosystem where design mastery is both accessible and rewarded at every level.”

In addition, the company announced a forthcoming COM program, as well as custom sizing for both upholstery and case goods. All told, it amounted to a robust pivot toward the trade.

On the call, Friedman sketched out the company’s history with designers, demonstrating an acute awareness of the complexities of the relationship. “Every time I go to High Point, someone comes up to me and says, ‘I love your brand … [but] please let us make money on your brand,’” he said. Later, he pointed out that “interior designers have a markup model and an hourly model, but they kind of need both to make the business work. And I think we haven’t been an open platform like that, and we’re overlooking a super customer. They buy furniture all day long—that’s what they do for a living—so it kind of doesn’t make sense that we’re not doing it.”