RH (RH) earns its revenues both from direct sales and store sales. By the end of 3Q17, the company operated 84 stores, compared with 85 at the end of 3Q16. Store sales generated 58% of total revenues, compared with 42% from direct sales.
In 3Q17, RH posted revenues of $592.47 million, which represents a 7.9% YoY (year-over-year) rise over its $549.3 in 3Q16. in 3Q17, store sales rose 11.9% YoY, from $306.8 million in 3Q16 to $343.2 million in 3Q17. Direct sales rose 2.8%, from $242.5 million to $249.3 million, while comparable brand sales rose 6.0% YoY.
RH segment-wise revenues rose 8.1% to $563.2 million in 3Q17, driven by the introduction of new product categories, the expansion of existing product categories, the strong performance from new Design Galleries, the rise in retail weighted-average leased selling square footage, and growth in contract business sales, which included sales to commercial customers.
By the end of 3Q17, the company had ~380,000 active RH members, and its revenues from membership fees rose 37% YoY. Since April 2017, the company has been including revenues from its membership fee in its comparable brand sales growth. The company’s outlet sales rose by $5.1 million during 3Q17.
HR’s Waterworks, which was acquired by RH on May 27, 2016, saw its revenues rise 3.5% to $29.3 million in 3Q17. However, some of RH’s revenue growth was offset by the closing of stores and lost sales due to hurricanes.
It’s estimated that Hurricanes Harvey and Irma lowered HR’s total sales by 1.0%. It stated that the postponing of the opening of its New York Design Gallery has negatively impacted its revenues by $9 million.