RH (RH) 5 Jun 202020 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to Restoration Hardware's First Quarter 2020 Q&A Call. [Operator Instructions] Now I would like to turn the call over to your speaker today, Allison Malkin with ICR. Please go ahead.

Thank you. Good afternoon, everyone. us first joining conference XXXX for call. you for quarter our Q&A Thank

are and Friedman, and me Gary Joining today Chairman Chief Officer. Jack Financial Chief Preston, Officer; Executive

our results risk this like Before risks description for only I that that undertake and Please statements statements detailed our our the in securities we uncertainties results. our issued are meaning of these the future the involve this for eliminate of note opinions filings other GAAP no reflect impact SEC to make during to in statements press cause our to laws, items. a today legal the to our today disclaimer results within that business the financial remind and Also, or forward-looking more certain date events. information forward-looking we and call, statements of affect results call, of also that the would outlook these you release new of as start, discuss forward-looking press actual publicly Please of referenced could matters including refer which materially. will we today. light number may adjust as or about non-GAAP that release of release the federal differ well measures, our forward-looking revise we obligation of factors any certain may as issued of These our a to revision statements to

Operator, turn to of live GAAP the results and non-GAAP that, we're Investor ready at call additional questions. call non-GAAP session. measures begin Relations the reconciliation over a of press broadcast measures also the regarding is this today's to website these our With in find will our Q&A to of financial available information for release. on section A You ir.rh.com. operator these financial I'll

Lasser go from UBS. your Instructions] with comes ahead. And first question Please Michael [Operator

operating And outlook, taking that, for you my are part get expansion? margin for what frame the lot about what uncertainties Maybe a under Thanks positive expansion question. describe the building made would is what sales world? is margin blocks of to to as being year it to this possible. a evening. positive Good environment particularly of assumption not Gary, sales all – way what in can just operating in light you your be the generating

Well, XXXX kind laid of COVID, before I'd when – think to was operating the about a kind point margins, I that to think reported – you record out bridge. we you results, the look bridge of really our if we at I when we changed nothing's expanding

articulated based than made on we've lower the spending our we and we would some rate our anticipated. expect And to you and there's a Just business as modifications really structure again. had expense then And structure. of reimagine we've as to organizationally, modifications sales tried

was think Restoration If ourself DNA really you XXXX. from edge into raised to a kind of a business basis where least the had and and look pointed was faster. was quality down take else higher yelling could beginning, Hardware so and business other alive. this is products out ourselves completely of, different reimagined way value year they went built times and on in down, we value, money reimagine We've that taking basically selling difficult value, again moved to of and hole completely margin of stay We the said that of very about the if kind and everybody at right? we our try to And the was XXXX operating XXX that the to three of time, when points the so another coming of first at in started at and kind we bankruptcy And prices times, So right? base, our for – we is expansion. just this, dig but had had of foundation kind history, you the

that And least." never teams think Take through can we for for that you can if if The QX, start stores And So outlet We've our things lost retail a of the all is, in be did read business, furniture in a the lot like, teams business of a luxury really there shut there of to stand – no the that, us businesses accelerated, all that zero luxury plus were of year, brand, our about every just like tough It's online difficult say So to about there the We most the world, got very we that in you you back And imagine. at the able right? vendor don't stores time so of the and see rug you So generates we continue closed try of outlet luxury and elevating margins, design true kind to revenue, teams, core the our a yourself the XX% doing is and down, XX.X% kind brands. ask and as can source to of single-source we moving the are of in – And point – like you time know. right? covering what of this, XXX all that were generates basis lot lot you restaurants path whoever, to back lead elevate within we our brands. I the see hit business, key business, has – on right? go category, a have we and direct what, model, just integrated prior if can't lead a luxury margins. a of operating all got brand right? luxury XX% volatile, presenting to a I've that, – the and believe, component. you brand were question, luxury their Half There's were time. that you car we and vertically I there a numbers as productivity restaurant just against, we us brands and as in were So say, have QX. that our There's think kind – if everything seen – – entire a we that forth. – imagine There can margin. pieces: now, able brands word pretty clear are of argue to "at you category. other emerging lot release, you last so reported luxury categories, stores the so things we're only – business like what operating we our brands. business, the to There's apparel it's and take bridge, And kind do. press one. that a would you I'd other like release, the from look jewelry points

luxury a somebody of anywhere a might level You any to be can who businesses. might brand, a business luxury point who the lighting in might really But somebody pieces brand, upholstery brand, not luxury there's world. sofa us have somebody like who on be

a look, we our mountain, say, have right? hike long so – there. the – as way And but And up long I earn to a it's luxury like it's to

believe it. call of extraordinary conference as that name We're of, no for our Most kind a XX.X%, people it's not our from do here have that's still XX.X% people a right? to say like, don't said brand. else's, work kind way the table believe "Oh, to have there just the time the – creating It's right hit it's kind then kind I take this the to the same went And it's think Like really part you at So a everyone, used kind company operator shed year they're many is having the perceptions, not furniture interesting. to they maintain they've you, ago. to of us of stock." said, eroded I to skeptics. our see these I'd people. said, to becomes But different it's we now XX.X% how actually I of couple and at of to they reconsideration came out. I And a probably We our at ago margins "Oh, and I detail can't so I made I Restoration every Hardware can work close, we people are And operating call. had this every going the to that we're a And kind and a was because their XX.X%. right? not tell of way as of it. going maintain it, And this, us something "Can business. I we of even most vision, peak the Ethan not RH. comp that lot than XX.X%. everybody of it and understand of XX.X%. years call." operating even those on over so of unless against reports to to and other it's create X.X%. reports maintain could "Welcome team all But of same right? face generally a anymore. it And there's analyst ourselves. not such actually, Right? of they you going. And anybody Short mean see now, right? Allen in people Williams-Sonoma saying unveils This forced look, And of now us remember itself, we And the our RH We're where not conference introduced you're I have to right? couple store. used think you thing, margins?" a – operating team think, No When at And as really we we're going vision real, old little that mean think, will until you see we're a us prove And then do hard had margins." And was

You have to get on the inside.

try don't it? Why you

Yes. But it's It's I that in out, so right? – you but Like what laid know – mean?

Gary point, $X there. basis XXX It's points said, as in that the upside. we of released were billion we There's at QX upside And about – we talking Michael. in of that QX, letter December. XXXX

At least.

has least. our… that, say when we in there's alluded At – obviously, And Gary to,

if to we least not basis We're going right? points, at had say XXX

Yes.

Understood. Sure.

that galleries So quarter-to-date ask more Or for Has accelerating time? by The results been the have the galleries that are driven and June and have in been been just me sales reopening? you've seen reopening? growth Let design have in long increasing period May of you a grown design that inside quick of a your open very follow-up. notable. by seeing

biggest Yes. were week. what away I The a a don't week business combination a over was. a week XX brain Clearly, gallery, our are this all a business opening stores as closed, go few in week. better retail know that incrementally, week retail way pandemic started closed dead. few mean are and store. people something the building with think as week, mean it's galleries we were or both. our of that with to – our a because even I the was of galleries like Maybe stores is going I

– to, anymore. well, that look, is mean I a nobody store everybody's pointed needs like, So as

It's going this to to their retailers are impossible base that move. an the use So company. actually opportunity shrink the shrink store

day? going me, So open Yes, me, because paper, about Did Instacart that. open on home going going and call. – your like interesting stop? Are Like taste, I so and people anybody this last very Yes, toilet to months or so or back takes – what's three being that this don't with happening you goods, still just to presentation galleries? are to got stores? I had watch a are that." I've I sit to think ordering and mean, and forth, know asking ask on imagination and essential to the and Amazon "So every time or you you people retailing style it. it's things Look anybody still – Are I like humans it's

It certainly has interesting. been

and somewhere, everybody mask? wear go on reports. Like like Is some the so anybody and It's flooded. and Is people? have with Like flooded TV, people so barely it to beaches something, not open anybody dying to house to see like places, get out of you is. Bars they a are your see the waiting are on and forth. certain see

we're digital we soon a got in was a hear RH. to keep do. to it So going we're world which will of places, it. that web that And are And going announcements our getting direct got But name channel. going to because to channel. thing take of that people get part We're of with coming kind about really it. lot annual model. another retailers, my call direct you very it, which And RH, to that into services for times what how retailers. just and you're we our the better shareholder, a retailers, different we're portal as reimagine better – exciting of repeated got capable business. about better a same you keep We've you is Everybody's the at saying whatever optimistic the of we're of here parts think and products, to just business, are We've got platform. we're It's huge web entire far going to get for some as our want spaces

And so galleries think tend to there's – strong. the that to going are we be

the have, I every biggest – back? I second back? the how long lot pent-up shut that, what reasons business. XX[ph] kind got mean mean how kitchen, Wayfair. store-centric a that question And At probably their that. Beyond, up last? spending? lot like And you what huge like think in like two has as think much like? Bed look has, Wayfair Home, as I is shifts the does then you is I A businesses does XX[ph], goes comes are seismic to a All all reopen, And to it's right? much people how clearly, And one & of driven One, the the snapping retailer is kind down from we competitors that Bath of and Wayfair up of driving of furnishings demand things. reopen

think XXX XX have, So if toasters, I of you something I pages like go Wayfair, they or know, to don't that. toasters right, like

was mater, Williams-Sonoma. eating Like much like how nobody spent And to tell going I was restaurants. Nobody she alma so other, you significant that's can't my out, right? my at

a like, all while. house And and clearly, God; traveling. we at going benefiting we're to question think we're for not to it so lifts, They're people is, around not doing not kinds be are Why We're of We're staying their – going but looking these the shifts don't We're better? here going things. look make vacation. – which home. seismic I these okay,

know Does So look There's there's going know happening. data. that is figure any kind in to to tell people What is a really long spending of And a to can't seismic – no of But giveback? homes. that the that there sustainable? shift does any We timing out way are live that. like? We we term; don't of still that.

value the in, For the we're so at going and do way assortment if now, the furniture they're to that and to lighting we the going furnishings and fine. best service, the best we're best still categories and with presented have on forth. no so just pandemic pandemic, buy And or in best

focused – on and the long term. we're And so

in I'm the is we'd people admired that of So pent-up know going that's we Like not world. like, it if anything term, – – I to focused we one we – exactly. the did. yes, know don't and build what know this? demand? about brands I is, do like What I we're I what know. we're to me, if think most All long And like don't ask on. Was different going don't about –

very. you Thank

Thank you.

go ahead. of Your comes with from next Bank Nagle America. question Curtis Please

quickly more Residence maybe And so business. Good Gary, on more just why guess, much you you on developing be into taking looks guess, I partnering, just detail go terms the to concept. Thanks long don't in not homebuilders little bit the kind to or guess, little a RH do think quickly, good – of evening, for the to What how I a maybe maybe just been touch you've afternoon. I about, I for, want now, question. pretty are of love a would bit it? what to Are opportunity. I economics? the vision know, hear big I the with just

out One the It's Yes. business, – what big, long-term do put to kind our that right? is there for we will outlive try of really me. vision

reaching. of vision you this you we think going a in about those and is if there's brand I no scale this the But here a scale When back. sit you it, very everything taste, it's So yes, kind taste, that if start what it's brand people in and idea and scale So we amplifies think multigenerational, a sit of And – with is the here it's all to and right? more idea valuable. very all we silo, have that and for wrote, and not – think way. taste no core elevates all is simple far throws do to probably and large – we're think that a lot connected about And with you with and right? the those it going about company be the and and if of believe, renders

Residences We just the that spaces, most So think is inspiring some about just – already right? space, spaces you we do of If world. the in spaces. build a it's

those the that great think readapt look architecture. great either with it great build you about like, do and spaces we're find we And architecture. obsessed We architecture great If or product. historical-grade what we amplifies architecture And architecture.

design. or great you – our gardens, We look landscape if great rooftops we our have have interior at We architecture.

let for because into step it about those – you me think a second. If categories

office an find architect? architecture? those businesses. think reflective none Do do them – they of there you If are great really. businesses, an have of you Where that's about Not consumer-facing are

there's right? You do where trying know entire architect? dentist, It's even yes, Where manifestation interior can you architecture. of Someone find landscape you great a physical "Oh, Where things a you but And design, house." physical will the do find find a to an those interior to no friend. ask go. you manifestation business. find great don't can, say, have landscape of we great architecture, a – designer? like on And You

a inside interior and pretty great So for with that business take can services develop architecture much business We and very great that design. we logical. We we've interior – great level. good things those had architecture a those success our believe embedding today. design We've had higher architecture, stands business a it. to we're rooms. design great so really design it do at do practice great and build great that We We great and sets landscape things. We seems –

most So services iron business, least been services those it's it we've is the provides used build right, been, The right? that the consumer-facing. a districts, not the able I business are in logical to because that consumer-facing. expanded luxury curtain say, design At showrooms. for hasn't multiple high-end design trade businesses the to to to behind not an why of, part, furniture, have services buildings, design It's RH

designer to to need a into be have and license an places. interior get those You resell

in kind other things same of these So businesses.

X%, architecture"? it's me more than it's today. website landscape the architecture. must design. do "Wow, area. tonight beautiful homebuilders, look landscape design homes real on world. areas, is great to at houses anymore. on sell If they're an estate. would low. development, stamp But X% never. Redfin, great I a go say, organized how second many the a live you that McMansion is everybody that go When in you like you many – uncharted great look you play It's about range and But it a how one like really Go at ask for great Like nice completely This this so XXX interior This whatever you is price if like many of your interior in – tell think how Call a me kind to many says never. there's lot, have architecture. Almost homes. it's a You friends' stamping tell great might homes have you want. Almost How it's great out a completed you providing without call, completely a have not Eri architecture, Zillow, even great really a it's in a no you pick think me interior. out, – but And And it's we go car on, this don't turnkey in they right? at. tonight, go get some if big

it without You tried don't an design you I do got go you a and years this furnished their like, people a out house I me, or X.X yourself. it It's for in don't for and I comes to house. nightmare. interior beautiful Valley or whatever It's living. pain Mercedes I like that have do a a yet. the phone know the nightmare on own a brand to many It's that figure how ago. a buy and have it furnished Napa their It's hard. ass. finished It's interior in remodeling not

you we at, – is. "You the believe the or Selling That's hard know out to out about Williams-Sonoma, and idea valuable lose how used the make things what's sell asset. more idea you not for right, Williams-Sonoma, how about you I money. the of them I at right? right? pan. valuable most that's pizza, does, architecture, And selling how if people Sell is he and an fantastic asset, most build like. the will the not furnishing of what can't what think Howard Lester there's think By just go, I figure good good the good they've the pizza why right? can drill," that really far, that And if okay, can it figure so good you interior apple – to Don't I phone we and you time, to to money, know been – We hole work worked – if really when architecture. them design, we're you pie. at money, hole, because the in say, And we Everybody at your on and drill. really And selling And this drill can at people drill. to landscape bake pasta not think – sell you I at it. we're as the design with know this we sit well, here hole,

save every in you we house designed house. two right? is we I'm just interior furnished. If lot a Beverly knows, Hills. can't it? think test online. was years, one still does is if Why about will was everybody go I get by a of but valuable. immediately in, five So online, just value back, a was furnished And did it buy the He the and you I don't still businesses deliver move house time, good. walked could It if I walked you bought lose use that it's architect more think did and And time in an it seven can your I I I the house. know fully architect by to I video – also done. I the or my designer. And life. in. years That's and going like, completely me become

the and took sold it. a did love. at some redid a the after. Eight that you watch what video look house We – still Palms, Valley. is – in – we needed there. you up the took kind furnished it If and Napa We of We it before it Residence. We test did out and look RH was a And house did video and can completely

try It's those more like have do, anything we coming. it. it. we We'll work we'll it. of So We'll test

it. to got You perfect

is out. our not ecosystem, shouldn't where it'll – really I an So a or We've giant deal Dave we're it's be – yet. to we're – sound Like I these we a an very place big, Residences almost phone we – we we is Gallery, Allison, don't It's But cool people vision like I like stamp do. And did – a the in announce and let's long now. been handful think we'll vision. just not really these want where again, I a working I mean for for the – have that signed to RH first anything. first – have things don't love a like say on Guesthouse the we yes, going the I we'll vision say deal the say the RH RH – And Like and if houses test. on ecosystem of we great time. right can't place. know

I think we're to be six the by have – The residences going five yes. guesthouse. serviced residences, will

housekeeping. So you want

You It's not want on someone connected. to meal forth. and your is so a so This at set not residence vertical. and up cater and a

ones visions for and We'll think But have see do. guesthouses create how new We vertical a are for to We market on and so so forth. privacy we'll and guesthouses our see. our going luxury.

a about very we think you If become big to market. the idea of privacy, think privacy going is

it's the away. And away thing given can the about one that Internet the on has social and If media. thing think everybody it's privacy, back stand taken one you has

You anybody. could Google

York, hospitality Privacy anybody the getting when it's world to a hope can something just yes, today. find luck And see we you You is but we're very become anything. what you read may if I can be guesthouses, think valuable. in with exploited. going doing a so to true, lot you almost heels see a out not like, a then on where I experience It it, about to open we even feels we else. when though pandemic. like But like we fall, in the down open the bad we're thought pandemic, and of New road kicked can have open mean, we it it can the And keeps probably in

mountain. in like if place I us up hospitality guesthouse rung we we're the in and we're close I our And we do XX that legends There's at in want think of hat create I it. tip luxury things – have hospitality. because we respect up best world. to it's and been never Extraordinary. for have have open going all. their So to ordinary another to we seen But extraordinary think, shelter another ideas in got don't all And the month. to where we've Not in got hospitality because that force the think the to something,

an mean we're addressing no it. like new one's it's think I it market. entirely addressing I

talked And so that and about, you put If on residences a XX our looks that restaurant could guesthouse, guesthouse top the Aspen. talked the can have good. our ecosystem news, services, think we we second it's we I right? long work, you of the you restaurant, our that if Yes, second term, services, guesthouses hit I where about in Yes, really have have hey, total guesthouse, about I F&B is? the in think where it room have – model our our It's – works, guesthouse can – have. if second

think businesses to valuable, second render very of Aspen. we'll bathhouse And so will become in successful time you spa And you don't come why creating value believe the And and RH and different more all to other deeply. Aspen, kind So think have our today elevate about you first our and residential ecosystems go each valuable we in time and that's deliver start many because back ways. that showrooms. We basement. that our coming these thinking in is have and guesthouse of amplify, elements together more you XX is to that business in

You to deliveries coordinate don't have everybody. from

time. the much We're much to You much less We're don't simpler. hassle. the have less take friction, have time and

civil a And I look, right We've trade things are can going crazy for ecosystem, pandemic. got we global So is And unrest. to wars. have way, good. a thought, we real all do time already form. the ideas the There We're think got now, shape we – them are in be we of these right? in do. this or we very some We've elements

there all have light of time stuff less of Like on. world unveil We for The a for wasn't going us, kinds kinds for ourselves, inspiration, better crazy thrust. just our long-term and even our – all people. needs It it's more darkness. needs vision, positive to needs it it's if needs hope, a if even just needs

And in, we whether care. usually bring anybody usually it it. believe do really don't things now, in life. pretty And them so believes And well. we We believe I the to we right in

models. curve really when more shape you right we're But are that's begin think learning right right the So to in improvise going a that's once I wrong. where to is, not and a the something, and wrong? lot you wrong. really the start you that's you do some of degree thing. adapt now. more The right is vision the get We've the Because than accelerates, question right and all when residence going And and into and do learning. our direction it you than give They're they got model

degree Going to wrong. be some

think travel, all we're to real space it's well. X/X – we solar we They right cars, right going If going things vision, sit we idea. is vision, this today. and don't the do power, Elon if on do, generally times massive I else, I at work. we're a it's do as I – XX it everything we back We doing is this But to electric them relatively be we're – the on it. go, swing bigger take a tunnels. company Musk half is than look,

don't push possible. to really – what's out ourselves tend I to find think humans we

to in. And extraordinary It's so we in try lifetimes built to what to do we're what our do. to what we it's going believe It's here, live do. we're And work.

it'll so And we we'll out. think And than right be play I wrong. as more prove it,

So…

I pass to Gary. vision, think to Yes, lot but lot a someone I'll to the on, appreciate. chew extrapolating it on and about. guess, a else, yes, thanks on That's for,

Sure.

ahead. Please with Barclays. Adrienne Your Yih next question comes from go

of going Beach. business, back Hi, I timing is, business. taking you you the revolutionary. earlier? is it test did interiors? me doing Crystal my and right, into you then question keep that guess only to piece new a which reminds talked It seems this it think luxury from secondly, services different? of to like what's It brand I'm really a but not the afternoon. of And Hotel, have Thank then that? of at Newport turning did the much. Gary, in learn in this you because Were the is And I Baccarat this How of far that about Cove? was very what that you theme on XXXX term, of services not the launch longer necessarily sort

Hospitality Crystal interiors. Cove do builder. and to was a Newport project the contract division division partnered the Yes, Contract Sure. – Sure. kind really that a of hired project were with Beach our We

partnership. on wasn't and architecture, of the didn't And so so was – there the a control of there design forth. really Kind homes we the and so

So It's Crystal them architecture this on, it's do the there's brand let – little other the landscape use the like of much interior a we that. about aren't interior usually at us. hope architecture, stuff of I more – than in always niche of an a not Cove kind design, and really better guys And believe careful brand. of people like job. people bit. I wanted do too And they can We kind that use that to I'm but

that interior And unveiled. investing elevating and we're the of the design. it heavily design – of we about think will focused think will so why on in When now, that's you launch be Right work. services and the timing highly interior business

we You our saw capability. we're our of And release where interior other it into to we investment and level press back to And going to continue take aggressively can we professionalism way. swung in the think invest pendulum future. another design, the

than and somewhere landscape key people garden and at gardens. It's of a it's in galleries? right Marin. two San gallery? We've sooner test opening like later probably They're Francisco will architecture we San Area, We test here the we in here in about it opening. market. Francisco, we've those Thinking where Maybe in architecture. old now our a we in – got Bay gallery right test big Do a real Do got don't I building, here. antiques, to courtyards. seen was anybody of inspired new most was of the back the the It famous District. And if of has little and Design one Ed middle sellers built the beautiful what years one us beautiful by beautiful it's buildings one collectors Sotheby's rooftop it, years. the Hardy, who this do know built he for of gardens palladium in take

offices And been to that own we a one we're the back that of RH of Interior can't fit have – kind It's building beautiful galleries, we've because the wall. offices that business the and on glass You'll right? We in galleries in it. very part. everything middle very our to its all consumer-facing a you new one a if got represents geez, we through Like building? Design, just see you've of prototypes, and visible into in our our investment. we at so do small put this thinking, hang into services Do own

And architecture. will architecture, eventually, interior landscape become so that RH and design

don't think, really So business services kind and a right, the vision kind people. out offices whole But you business, you gallery the is – can't have to that of don't operate really integrated out of want of to of – a I forward-facing of out that catches space.

on – a make right? will it interface, tools the it won't true a of and and exactly to equipment meet people, of for and enter right, right think fit then kind It's space have the you really so good I people office consumer-facing so that's for forth. connection part office, an and for kind have the and so services the work to –

you'll testing So that. see us

We'll the couple look, – over first residences coming a test testing very quickly, be the out will us ecosystem. in building years. next market be of the see You'll the

and You'll one. will hear market test that the our about one first be more

be You'll about going we out about why here to hear more That's get them. to wanted you'll to vision that. testing the start – hear services because hear business. you're the We'll

communicate like start RH going to thing we – the we've got ready the got And not on the are And to – working And we've deals like got coming sign. thing we're is or How We'll is call? biggest are out then You're details. many Dave short – the two? them. – you're all to – in signed? term, be to look, One International. able biggest signed? is Dave, We the signed one the they're more. see almost

on asked. line. He's He the speaker not

on not speaker He's the line.

Okay. Dave can't like he He's be. – asked to talk.

talking he Okay. He right is – has like probably now.

didn't hear to in Europe the We You has a really for beginning it. into. guys give talk laid can't But Dave strategy an out line incredible him brand.

blowing we for just we're to think to mind it's I – it's going mean us. going I be – incredible.

imagine be x I of be what could open gallery But XXXX other they're further. mind and exciting XXXX, of will We've It incredible. in far England. we're it's but It's most wrong all relatively of a is probably to London. and done, any one we're all only be It with most the those London, stores on good So kind RH to exciting a or complexity I of doing be will in – the I move we'll – it. the the open be London exciting spring first to won't can't XXXX, which retail mean, most integrating just their basically that thing those depends we've XXXX. ways. deal it's want just that done in on own the it. three the – of And will imagine of goes I XXXX. The but that be we or rooftop is The followed latest how quickly. And London. it of going will – ever the two but The restaurant in be both kind next will – summer it's go ones – England, the too with like I blowing. went experiences buildings New can than right be you got beautiful in for is RH consumers. architecture That We've Paris, multiple will to RH by would go don't far. anything. better unless the got even one – But kinds RH with be of could things. XXXX something outside of York minute, followed by in last jinx

hit timing. and I decisions the the point, we'll lay We'll the next Day. it pictures. some an We'll probably – – to of Investor/Analyst – show at one we'll we're So out, stuff you know the going all I do

most impression of kind really, made. themselves it. But into It really So ever will understand everybody ever like first Ever. Europe no incredible a can has brand introduced be this. one's the

the you – about and And what That's of everybody outside model like, opportunity. be just excited business should should the model we're and United our so States. mean else and That's what that that's about that, like. think I the Kering Hermes' XX% like. look business of that LVMH is. what extremely And looks wealth

we and and So those that's really pieces it's it happening, but ourselves. and to And good try about out be we visionary put it's go. as think inspiring no a really else you – be how start for the there. going we one to But big, and time all to why yes, yes, – the – thought, that's so

No, it’s inspiring. I very mean,

watching. walk first So Thank you. that will be we on

you. Thank

comes Gordon Chuck Grom go Your Please from Haskett. ahead. from next question

XXXX? of can outlet your balance afternoon. you to you channels, pace within of guys and just you. Thank Can your but been talked expectations Good the also foot in now, this stores of for remind about XXXX you some And speak reopened? into just then the us, since maybe traffic restaurants Thanks. the gallery – and galleries, they've openings

Sure, sure.

open. retail you we week about are at they've start right We're So the yes, high relatively low-traffic or right? we there, open just now, traffic them a don't operating I in limited only, and except of have restaurants And foot if when only been four two. have half them have restaurants. think, capacity XX% And for we open, capacity. business, they're stores, And – of

in having day, see It's like one that some making galleries. customers – So from not don't our they just we yes, in our a guided care New – making the Starbucks, became the about walk we're Soho operate kind to having fact the hard even New own we But – bar our House, and and why become day It generally the – bar our York having coffee changes are we of the the we'd mall, COVID to people we So say stuff mall WeWork, our company. destination talk wine traffic-counting a to serving and like our better sitting free bit have it not the time experience, really furniture like in people kind reasons and the that hospitality a – is thing seems started traffic. social sell. – and of spend inside business of is distancing. And of to about a And of just way we're barista best the York, free really that all the with by we they're of kind that. you'll the right right? lot creating fewer around to have and free only to a

not talk it's things to business. really focus So what about about That's because our in going We talk we're the much right, actually to so have we're modifying the less – we traffic. about customers. on. And right It's traffic traffic. we really traffic, even right don't

don't opening different a openings – we of June. of the through really we have we at lens. So kind middle look XXXX XXXX, Charlotte it But gallery for and

I to left. we We we and was may phone, Marin with – or got work July. opened and tweak lighting thing the that's Dave, But to restrictions all down shut kind the on you're to end in looks – RH June We've great. little of looks RH that's here go. construction open for last early have night. only crown the But there and around We're merchandise. It have It's then the Francisco amazing. local the The quarter. if fourth Charlotte. except we're moldings. We landscape the got San got – everywhere still like just that. towards ready the – Marin things We a will of

we're up. now so rebooting And

against. year. the forth? construction we've Francisco And get we're to more And certain. we next of see with or getting a going over there happen third unveil that so year this shutdowns? of up is we we'll you'll fourth knows in can Will disruption more the if to line. three San could the going But But another then work kind little so so things What's see late virus that's or knows, cost? of the complexity nobody And everybody smooth. there never back. the two as booting quarter. Is be be breakout yes, some And have to we're and later So on when and any and got up

of And amplify helpful about bit up of would said Thanks. That’s a Could demand on in XQ, the talk color you you're product, think the so in little June. business? guys can you on your what progression part XX then by core maybe Okay. by your far Just down curve region? be XX helpful. a Gary. bit little I you seeing any

lifts things things outside. some on lift. be aren't like sense. bigger furniture. about I They're vacations. the of going and you're general that outdoor that, makes other They probably reading a It's outdoor Yes. which have buy business, things, the there's People that completely spending broadly going mean time

strong outdoor of other And nothing So we're that's business, surprising. having then the parts a season.

and a Our I of don't book. we bestsellers if I it a are think summer, summer are mentioned letter, spring picked everybody I be still the to I up, interesting, book. know interiors but now going the in they're in our kind it what And mail book bestsellers. modern interiors to will guess going be

what closed. we saw We And back offices So the And of the the we was took to books coming then circulation. were right, half. ad thing demand we killed first able how out, back. we we had killed all initially costs that's – books. our in it, Difficult the million because $XX pulled were is

newness we shoot had. that So we couldn't all the

a four we've several anything never We you the into XX couldn't do shot the change up. stay the want mail to kind want of first didn't massive Those So or things we businesses guess, like I everything to weeks, a couple fall, businesses, Yes, much. repaginate had right? that XX we they books. did that demand were of – to sudden, all books, the we're But went we're books. to you weeks, of and down. other running got ahead newness had, headwind to you gotten but pushing we into advertise never Even get points three to of new

never be a that's want why to into you the mail So wind. a book

we enough coming – we the the ago, improvise? but we've business in time? we overcome? they're Can So changed – now said, well, get Because the looks like has books it adapt? got Can there's we mail? Can a do we bit we back, a that have Can and several tailwind. of weeks

And the so just books. we mailed

– I could not books We're the do of mailing they're Now books. okay? to nothing, going millions mean make

not they're And books. volume do zero. to going highest two Our

don't what yes, know – the but So we what the also like, demand exactly what don't like, pent-up curve I Yes. know. looks looks so

going business – be still go open hey, more and XX. or to books could XX up maybe is But me, think Maybe pick ask the XX we could a of XX, slows there's down books. bet, up, So open. go the the our up, going I if it's down. are as the and the to XX all I more And pent-up we're then today, galleries going XX's be, demand. galleries, to – we don't going I to you not I if with Not and had know.

our Our a restaurants customers right of only are drive into And the half opened. restaurants spaces. our lot

optimistic feel lot and than more a we reopening lot world's this so pandemic. through And going way We're more we've learned it. as for a And pessimistic up, right a now, the better excited. lot

through were, imagination at than what Our of out we we're came of better of way this. people kind this XX%, Like because go maybe to that least I and collaborate, how mean like to differently and to how a better and team. we're our are of had operate teams – out just We're through. we the and better way innovation XX% coming

Thanks, luck. Gary. Good

Thank you.

Oppenheimer. Brian go with Please question comes from Nagel You ahead. next

Thank you taking question. afternoon. good Hi, for

bit extent to in what second within this are this new what that in a – QX, quarter. maybe look you trajectory rebound crisis, It's and reaching and trends So improving up seeing, as clearly, helping But core customers Gary, a trajectory here. your prior customer to here business, customer To new really through held – of the extent follow-up your drive question. a stores, a to you the fiscal at nice into really sales? that well

that if I look membership. best mean at I look is – our or at you the way to haven’t – through of kind seen

numbers member in And new renewals, so on that forth. and membership cetera look so and growth, et so the don't different:

kind it's that business. – you an bought People think We're think I only And or very happens when business. So new business a home, redesigning about event-driven our home different their a it home. either a remodeling infrequently. happens of

them We you a in just XX might money they and come get and lot of and might new much spend do job, a bedding that. you Or an some and and business a get our again stuff of come data, not and or and people like like So a homes. it's So customer, in see know very might bought they for is that so towels event-driven not might yes. lot But some another right? business, design years. new

always I've thought this. so And about

we've got As We were shut eight. debated running here, it we down. up

the went in business core Our down business XX.

XXXX this unemployment was you a people thing market a the Do melted part now? you if this disruption of us. it It So furniture? we million? need-based buy furniture? if that permanent, when business, is permanent they didn't right, you're disruption whole a a was million? a is so XX an our – we right? like went the – have impact. interesting like this? I – and No. down. is a have we all what's we years, And that lost we and happened need-based people say, – of not can So good people business, thing points lot that Like Do I down. When now business, a say permanent. – very in I'd is of for business different XX was X.X financial to like business. disruption of XX had about inspire just a – fine a – talk like our – And in Is those It yes, mean million, XXXX, But XX not most need of how to get kind – the we

XX total. in million

mean going We'll XXX% XX the to week a coming coming of after. furloughed back. of million. have next almost And all look, And we've in yes. XX%, is I week brought or they're furloughs, And now back XX% back. people lot be Like the back. back of our you're businesses, we they're coming back. coming many everybody

for outdoor much is them of going forward? to And Wayfair. you've or pulled next is now furniture. like later just forward. pulling I'm they would then how picking not How Like year? now there's customers – Like much you look, sustainable? – to is on buy new demand? might not I this were have much pent-up me, So six But months And how some

on I'm it's a market money. picking think Wayfair. make like we just that's so bigger think that really people ours, I X more Some and cap much interesting than have they times

They're able a to a comp change. going XX. bet a it's year, like they're catch on have is XX. be up Wayfair They're Wayfair. I'm our no be wants points lifetime, up – go I'm next glad to comp going against it XX-something a someone theirs. Like will were be going to We be big not than to If operating this to the way. if us margins and point XX to they going to take higher Or is miracle, but down in

a So like going kind that's membership promotional You these episodic it's of harder. a right? and we all have why on, not things model, model,

Your everybody more to and and And to else toasters we and comp that? that drives see makers got and you cookware as now running all another new next the we're things all night. XX how like need Unless homes. up all at And because XX stuff got all sit now, to really you about complicated something essentials need makers. XX? Like and I it. How not sudden, you're coffee we other a pandemic to only there up money or business is waffle think when Wayfair's do on don't comp and do got new whatever buy there's – do going we and stuff we've every of every our much that Don't like know new stuff that stuff home year for night. or – were spend

think none that's you we get really real rocks? it's we're long trying things in their just right? to and we best So focus new you significant to knew And we a I customers, little different? that this they looks are, all Think know. going us morning a that had a big of at try or kind us hopefully, why it don't different on we do. new when anything yes, it, things be core value little what and the we when sit So about all design around were that. going we they are right? the yes, small if when these just term, do more to was to think the real rocks things did little and big us And home. of all people want wake need create honestly, house. go, at sofa chandelier going look about do going small do those again, rocks. want you customers, some are about there I of What how is think big new move term, up it's to and Yes. opportunities? Like kind be if we rocks, new too to interesting, much how that are we you're they little Like how a to can a be the and the the and people What But we the move – are know if more. important. of better Nothing rocks, are would new data those tracking create big time strategically, sudden do and So value, many of

have You great usually, of things. itself. those care core the at then be And to rest takes

you. Appreciate the color. Thank

Thank you.

Cowen ahead. Your Please go Company. next comes from question Chen and with Oliver

Thanks our a for Hey, this Oliver. for lot Maksim is taking question.

put are what's significantly higher touch driving you that? are about Can secondly, real more on estate you gallery first, product then And affect capital-light thinking a broadly, It's quarter-to-date. in look environment these store that continue current of you. position you the as negotiate does to Does to that? closures. maybe noted you So margins as future developments, full advantageous models? Thank you more

the the again, the product do in lot burn all Yes. accelerated ago. out down The year was bridge with Jack, business, has that's to of that it release, it outlet of, A the margins, product margins? all cycling kind press operating quarter inventory third – a of margins, the laid

that way and all outlet accelerated are inventory be but we down sales quarter the going XXXX, sold closed outlet way. in pushed So we of in up, out an to are Because fourth be and to margins going DC right? the

an you've So there. got impact

relationship various businesses You've that's of taken, price laid just rug price from changes, in collections. the things a increases bridge. were from we've got And done, the impact that an a new to where going kind sourcing we've expanding, the got manufacturing other single-source then relationship direct the you've things out

collections higher work in the thing. and new lift bring bring margin and you goods well, think And you bottom about the more are right? in If as that the We business the if that middle third, top and third they the Bring are in third, whether differentiated the it whole they of top sales third, are you middle, and kind it's down, margins. in everything it they third, things if But things or sales like in bottom or it's perform in margin. lifts happens. the everything up, nothing drags the whether bring that

everybody So got it build, our if teams, goes gallery and of happened like Memorial this better the gallery Do if all so – of have up our – we've from whether do it XX? margins for an things – lifting story. stays "Look, And to screw What leader we're on. inventory view – do a making okay, that calls And are our promotion. we great we've we from down we hard to convertible like, product point team. the will that. worked do. like promote? just if – in said, been view didn't membership? modeling We're business think so thinking we one tell also instance, told coming But smarter you like, and else, What just to point just God, our it's are work just – I'll of – the We investments and And actually one do? our we've that been the Gary, Day. didn't our promote, pandemic right, doing we Like, All with Toronto, going we down this debt leader we model anything of we what XX? to I

And determined the you've design price, the can't combination at that there, it's great Don't the think better keep you right? do if just have quality we're a disciplined that great it. right? the don't the to So said value, and by value can very earn it. we way. if and that the that. It's presented we're a I take do And if way, we – can't yes, and we right got And job. mountain running you to climb going it. with buy got said, We a and quality, a You a go goods right guys margins. better in a is like, do doing We And visual design, just quality value, luxury of markdown." be great the just to crutches, then hard job, you people back great higher design business really

at the do to think really job; we just that model simple. how the do Don't year. mean to to that And most about we're stores, same people ever beautiful in only seen, most dance lot like than have the we the among a around to build. And places, Marcus in I sure Neiman in we're some highest higher deals, I'm as Apple. will except I volume – be places, we're joke look of you're might And We're our last than the It's one a And dance few But want places. a retail that you operating really estate margins. the in than for want it's only margins. yes, strategically. that it's we'll And attractive higher volume lower that inspiring we we department they're think person the we margins development we productive, same and I we're not higher have and accidental many it our Apple. because places, mean, If strategically real does, cases, yes, us higher going the higher the with some I job, volume than than But And even experience. build the good volume experiences not yes. you're building pretty many of most of the going it. right that's category have behind them. the now. galleries to are the in next volume yes, Nordstroms. but be most new in world's at

with So bridge in looks – valuable, component the space them you build hospitality And a puts to almost than the you that's else beautiful, and nothing most that anything everybody a where good that all more do have deal a more it renders is wins. mall. inspiring like in else a productive position

to paid also we why rent. with who that's pay anybody doesn't wants deal but – our do Nobody rent. So a

landlords So to want my nice. be be in to not any I They're lawsuit with a wouldn't going of right now.

Got it. Thanks a lot.

Your go next Steven Securities. question with comes Guggenheim ahead. Please from Forbes

afternoon. Good

I two Gary, topics. to So touch wanted on

revenue demand manufacturing noted then what second first of spread network. Waterworks you really and and just being on the The and sort the the between growth is

it start offering Can about to what on you business behind there? us how in the thinking you're that about time the potential more maybe integration And give Waterworks. an about performed in So less line that. just update with the and

Yes.

the deal getting on on a we're kind did the platform. a we the themselves to when enable – it at focused marketing think it was brand, had on, big We've themselves their we're business but And right many always on to can. where Waterworks It available. right? tried platform of to – the time be build they – lot point and frankly, it And amplify haven't that with we'd about partner something, building. So We did, as it. and love look, business and to best were them acquisition, opportunistic focused we Waterworks how on the wasn't an on focus was integrate time, this we Waterworks made we was so an opportunistic list and acquisition a things our but as to to was quite and will

yet. later about when But that probably and distracted time exactly And been talk and what sometime it. this this so we've that. just talked look that It's busy all not We've deciding trying about year, line a And never to get like. could real how time. it's you do through we'll not

opportunity. So long-term it's a

size the think on – platform I that is it I think the can times multiple today. be look, our business

looked when back. of – factories then a the revenue but China little Kind Factories things, first inventory then it weeks. four really thing to looked like and down better. so and of chain. to right? pulled week hit. it's between that started down. or then other you demand orders And Factories dislocation off. pandemic cut three parts and So traction, people America. by smart shut really in get to we cancel we're Factories And supply and had not got And So laid with do has the when the hard things North you've the those got – cancel spread disrupted, the then and orders in And very and the aggressive shut a of world three four, just for right?

– here some of of what We And business is upholstery business, and have smaller the upholstery a Asia. other in United China – our is biggest which That's It's business XX% domestic. States. is made our really our other XX% and Vietnam few our countries. is, business, upholstery in

And huge that special – Italy. is And you XX% business, a the manufacturing order shut we was Asia; part about some in place, thing, in if then it in shut is outdoor a States manufacturing and of affected have right? order, – business. special it's of have in domestic that of of of kind we special not part in Mexico our the shelter down. shut And is the of Mexico down. an is Mexico, shut our XX% small domestic, So it Same so domestically part order which right? think And United then – it in furniture got down, essential cushion business because and

big, yes, and forth. So big or so back back orders delays, on building, so – time orders

to the an business of to everybody could next And first and in by We try – were pandemic. initially else, have protect cut thought. than the that catch out to demand, trying the – increasing hit balance with the figure happened two up, then get then to so protect we the sheet. and we trying what to three compound orders. and not way how we were missile like weeks wartime, have demand We better to never weak forecasted And and

where And this So take you've that's a big want delivery. piece piece of got this. then have – consumers other to to

and that, they're consumers of now bunch whole a have and we there, maybe we're have not holding so to going reason, a be they whatever deliveries. home And for second

we've of got a building. so revenue couple And up to And on – it. that's We're so then to you've receipts. points trying – catch

even bigger going back we significantly back is getting all orders are the got up, demand compounding So our because get bigger projected they're because to orders and to grow.

– come So easy. not then back. doesn't all up they've coming XXX%. three then a get sudden, It weeks, at they and back online, take factories weeks get back It It's speed. of and back to they're to but got four might that to

numbers think. – I QX, So kind mean is never exactly a like than it our coming is of more this you we in what lot of QX lot a look but think will initial

You to optimistic. tend can be

if don't hit give a if – and the you you they're a harmony gets then going higher all yes. rate point it weeks, back could another ask some and four that I'm if By too in come they we it's we up, don't you But get So – So talking to back lot have we we cancel you in we all time? instead time QX, of with our hit eight do weeks be back I business four to hitting order up factories is order in the takes yet. cancellations. And canceled. think get might see and and where two balance Generally, because a the had the of so weeks, yourself long, more someone may of QX. or notice orders kind then caught dates, back. right, about into know when and some are a back tell that

there's the biggest there. It's dislocation it out. I've wanted a So to – like seen I've but we why never That's had. one ever this. one call big

we'll kind So numbers are to this think But good. pretty I you out. yes, of our continue so as update comes

we'll I XX%, all will of through. think see XX% it flow

be we'll Some canceled. get get think most of today, will it, look But it. the I may majority as QX. we And at

of mean, time, if are then the you to just at And to back from you that today? like I general out Or some quick RH customer and a feel I there's a there? Modern window think and was XXXX sort do of some combinations one, order disruption, right, there are and people feeling of the in you issue, right. explaining understanding the customer appreciation provide

say, fault, to blame the their we most But communicate whole in we I'd mind, We're like with the could to – our had world able not there's, Everybody the be part, So the just right? factory. to try with right? a it's to factory, for now, Right it It's general knows Modern. like was Yes. the understanding stops, and our appreciation. customers. customer,

I issue. same of the – think same some has everybody form the

retailer everywhere. have in that you're retailers to. don't back Furniture orders, tend I many businesses orders order business if cut a business. back a think runs And every

So the going be only I to we're boat. don't one think in this that's

creating probably, in furniture bigger better Ours product is and take kitchenware, big business. got performance housewares, business, super away right, our businesses everything. probably isolate businesses kind kind other because lift strong of the And We of of those bigger lot got the of because our really from kind people, And retailers. that, for of maybe you categories the have a don't online ancillary kind business, really rid right business, if we've are more we all. in at stuff certain that holiday direct of we at least of of of We're like clean. side any of those lighting now, the business, side furniture-based

to you our to in furniture, best in have I compare when people So, numbers us think the going we're category, probably furniture.

sales kind that. have between shipped So of bigger a and of we'll gap because demand probably

more cancellations. it. times, – how we a to one you you that's might lose execute or – is – biggest – the right? got orders have can get like of So having if little a Depends history of the it. issue generally through gaps push where you you if to If have lot bit on we've start but It we two So this.

Thank Gary. you,

Yes.

with question comes next Your John go Baugh Stifel. Please from ahead.

if piece to would just curious, with Thank But all be that Guesthouse the Will how the expect various up. of to in. the margins sort on capital over expansion? Residence Thanks capital-light for relative time you're and you. I RH to taking I'm my your sort operating XX%, to It's invested things, Obviously, of margin weighs going question. quick. very expand go return capital

good a That’s – good really question really question. Yes.

So the answer is yes.

is The first guesthouse no.

kind already that but spent And we've so – of capital. of most

the to something test, in that's to But on. investment. thing There's any you've rearview So something on partner – and to with some got mirror. people got sell new have you've

be it do a Aspen, people we mean we the whole right, to a going we'll control it of with But of or be Baccarat are with have doing profits, Our developer. developer, Bvlgari guesthouse for model doesn't in hotel the with doing JV we doing partner. deal, is to could company it and unlike that development doing hotels in kind the deal, hotel think some flag, with a thing. – that doing won't Hotel have going the other we another the the be instance, some really Hotel But stuff. group a that's branded a right hotel future. a a If are group. we're to interest if way and deals Like and with We're

different deals And so we've got different in places. of kind

is to Aspen going be capital-light.

and share create about – where can one Aspen? And our if it can a the bring business Why also we designed we in to something we're the we in first the were to we value value. for developer had to York, position get York of themselves, Because New capital-heavy. we is sell. think value – something in we able a capital-light New you property that helps

people a first and make few first them. And to well on chance that So depend and impression. it's about second first I going really are a think are the important way few how to all how excited do I the think get

a don't own very – did So Elm watch the like I the different West any what's are other think Hotel – of people hotels. but Shinola, it, this is their that. that people one running than or those

just they're flag And think do really don't I you think deal. I there. a much signing don't –

You furniture, a but it. revenue get kind little a my you it cut of way, design of say, use bit on this

have either. lot don't a you but risk, of have So lot a don't of you upside

different than You We We create said become don't with I that that valuable. that experience. the – more more become believe no more value versus time control really brands valuable. brands control will control will less

brand, by Like be concept was the deal a that have they Kering of a that they them Amazon of put the my experience model. own this stores own brand control control they will everything is I brand, right. Their stores to I are of valuable the you're like unwind brands Those Ralph brands control done strategy. someone And the and think really and And stores. ducks building a the you, render Lauren, Nordstroms mean, where It's think, and their the example. for saw contrast eek, the with one become putting luxury But you've the a same have of their in of think concept brand the valuable if Arnault experience, Think thought department what think love I don't less going you to Nordstrom, right? think right? lucky Hermes, the with can I Ralph a a the he And distribution. like a last really experience long with where – thing. And Bernard customer, I And want from that's bigger don't in rendering that those thing It's I new is all So – because model. brands. he in hard term. product great percentage And same. rent. department brilliant one all this had challenges that. going been Like to LVMH they I a bad business from today brands Amazon sector. right? XX years, who Lauren in out XX that's weaknesses such stores, is shitty over brilliant, bigger be And valuable. then lucky. a all experience. in think so unwinding. the customer, coming to in But from risk worked to and way It's – They It's got to And presentation, version And way, And that Like their from the is XX, about transformation Like lot business to they concept store a control an the brands real not they're I you favorite control sitting done platform. of has they valuable, – invested have around much that to the don't I really goods do they shining brand proven to the they customer, brand they're biggest has don't business good Like of their of through. disrupt for department years, Ralph they I of in a – has today. department model. just less great that ideation don't they're don't of the maybe people meeting someone the lot And I LVMH's want like now shitty distribution. product goods. even been but it's how it's control in today. be or is them but like wouldn't to had the have old it's don't or his or brand Nordstrom estate some lot one you more controlling control are of no their somebody experience that today. – think, significantly having But else Lauren's in cheap control have the to

and And dependent. so they're less less

deal. care it's We if as it's that. be partner you. it. out us, business. it at No a It it. So for your you. guesthouse. might want great restaurant. matter be love doesn't to as heart. from as doesn't much hard one's best to it And kind residence be development we we to – It's to a one's be all matter if it. in want will not of We parts if for it's to It It control much have you're doesn't own a faint licensing it's if matter the the going a can't want to the of And things want it's when you world, you to it the going do, to rent a of point No view, We not great as We is want but ours. everything. of

that. buy can't You

to got build You've that.

note, in capital-heavy. to a and as aren't don't London but and they Are And want I lead the weeds as Any capital-moderate, those on free. Paris deals know you capital-light, details, would and that even into get follow-up there? Gary, complete, – you rate aren't the

Yes. capital-light. say I'd two

maybe these so Apple architect it's and we're world. of three, The so Foster they're capital Like they And capital-light, the like campus. did best first with no, two the in do – first and we're the so mean pass – them, really And good. of four no, kind working one weaving Partners, Their They well, could one it yes, inspiring. I'm just are their – together London many I good. they are offices at have that. to – buildings they like, going do so be, to and what in

more And be really so investment – right? way, it's two making the you in say payback. York, like making New be I'd York to that's And less year good. than be York London, a That's a investment by New – to New be should London. going New in investment, York should two going You a but

will and So think that. I be – like London

these opening and will like or think Think I in anywhere into store Like, it's a market. volume, open or I If up all doing we've money it. Jersey near. all all man, then. makes and York, lot mean, got around London Connecticut new like about New I York there stores entirely we New of I New not took any mushed in – it that having an it

great and argue, So you you something like a a if platform great you and nothing – you Like the that's incredible won't there's well, know. get might us. have Well, I have build business you direct and whole market. don't

Europe. in We have more going have way than more America competition competition America. in Way in to we North are North

don't the know. So in New might in longer to to little They're and on forth, They And and awareness, a Chicago and our they us. they're us. Los know us from so take us. the but get us. shopping brand Palm galleries been main shipping bit Like know cities, Beach. I Angeles They've York in and so

actually of spend thought if Everywhere – a Two So were which anyway, work, most – retailer mixture. to of out – you the ever money. capital-heavy, like it the investment of a Yes. ever you're on money. greater the money point it's we a we that capital that from will bottom we was? capital they of again, want right one's than store, view, made a build invest it and Is in the in – don't billboard. Yes. the New year in they're York, three in you're kind investment? third, want it you to make York? done We another be think have don't do an gallery great make kind make did money, – Was And third we the They than that's It's it more to to money is find headline that that's not capital-light two that is that's are for people spend don't we going right? have But New investment. a store thought strategy. going It's New really we and like York, big right payback flagship right? and

kind London things, to some York takes so courage but the have New like – – to got the courage work. – And you so have investment, if you of investment make where And you do great you most have are to make important top to it? there, be in city third in So it. you're world, three. to Like going if anyway… It's arguably an the not the the going second, a

details. the Thanks. appreciate Good I luck.

you. thank Yes,

Your go next question comes from Tami with ahead. Zakaria JPMorgan. Please

my thank you taking question. a so much Hi, quick have for really I one.

more of million actually And $XXX how any of second announced And the the of April. cost can much little eliminated positions quarter. you in expect given quarter. much a in the talk this bit first permanent about savings is also, recognize you in So how you savings some you back did do

Good Jack, out, break would kind we question. know, of exactly how I don't we if about think can that… that

right, those breakout, some savings million. mentioned, have $XX reinvesting at back, Gary we the I are As Tami, my don't fingertips. of

we maybe So can follow-up.

Yes.

got and Most you've a half. first was chunk You've a in it chunk the the of quarter quarter. first in then got second

upfront. about because those And related will you Yes, be think back employees furloughs, if as compensation to Gary the obviously, few the all you savings furloughed weeks. next mentioned, have in

So those end. were front

we And ad half. And kind put back of then later, had costs then we right? second the back some little savings We're putting a in, Yes. in in. cost just the ad that

question. good a it's yes, So

maybe – And out us bit. a Let little maybe quarter, next in it we'll we'll lay some that. the around work do

the disclose So answer. we everybody in knows way it can that a

with So that question. let's have us. the Yes. out. don't detail We Good figure

Got much, of you best and Thank luck. so it.

Thank you, Tami.

Your next comes Cristina Fernandez question go ahead. Advisory Telsey from Group. with Please

flow cash have cash $XXX two ones. the million $XX a bridge so definitely we've consultations also coming million picture I quarter? convert little pay just digital. a to how then out less bigger Hi, from retail, quarter? free end to also mostly relative virtual can but be the the here July, the us of afternoon. It shift Is you And might at In second in One, bit you've in seen quick the the in in business, rolled that quarter. towards question. design good the your in

your habit and your just consumer that technology or maybe shift, So how Thank spending thoughts impact you. – on business. consumer could

I'll start Cristina. first with question, the So

that going borrowed to asset and on cash which cash it repay means in generated we're cash, both said, we've we've As our baseline.

we to see or the the consider we to you for what to May be were availability repaying I what the as of, the our you have availability that's in of example, of filed And $XXX is line. tomorrow us on if today, debt million line. is on XX-Q going had are guess, XXth, noted, as still So going

obviously, will, we from the so continue to business there. generate And we free cash with flow have, trends

So…

you the $XXX at million pay. on line low after point the

had we point. repaid so low is that cash had repaid would the – on as have with remainder if that Friday would to from hand Assume a last – That available. the think we it ABL. been have I we what that of basically, from If – the is it's have by

we flow cash And from different little July will will that and generate XX. again, here, by so free look a

cash QX flow becomes the quarters. our in positive. Significantly is next Yes, negative all three expectation it – in because becomes positive

Correct.

big towards hired for we're then we who's – going the investments. to kind new a we've And year, shift a lot of trying This hire someone I digital, digital just officer, of been making mean experience chief years. we're to

and internally I have, We're the bring Yes. the resources we've other huge it's going be in about in change joining most collection move website, the will And the got smartest to website best us designers, think years a the with – is impact. reimagining a in from he's investments XX of significant a one to portal. to we of times. I'm And visions – for talent. some best to gentleman us to I'm external And the will sure, also try and with experience. sure soon. and going going best just space, thinkers, to a bring consulted it, completely creative, kind create of some kind And make whole of it joined ago, we're going people to that's we're leapfrog And team going to XXX world's Eri?

we never in That's strategic separation has the to physical that done. been the Something world have equal today.

going screen be is because same that's think I the and – the So do, size. to to size harder right,

we've You're a about we've more and up. in lot talent to thinking we're for investment, time, got a But long been make going of meaningful that the now we a platform. got ideas think we've good democratic right lined and

in habits. the technology shift thoughts or So the habits, in about shift

– to shift the it got that accelerated. think I probably

clearly, habits. world, think a you've e-commerce you in I got mean, If forced about – got you've shift

we the I online maybe so five digital maybe three by shift, to something years. think And years or to shift or accelerated probably

So last business online is what that. year something XX%, like total XX%, what, was

it no, XX%, like faster, on for year. projections total – years three to sustainable get – So business, faster, business online was you years four this like a sustainable the way. something maybe so that in But

it's massive mean a stick for amount think of mean So change. that's change mean shampoo yes, I them is buy you're on I stuff, level a putting this don't you short a I to about massive with Again, this just that's or different. – buy, use, a shift you – stick. you're been of thinking time. not don't you I all think that essential things going it's I think wherever I there's spending. if forced reorder whatever whoever, basic will and thing Amazon and a that or very

it people biggest you're be best retail little for out going will – is the change It's think lot fallout a yes. a the I was, the weak, or – here best don't were that other was a coming – going a people on right? be is this. have just the think to that businesses I of to fringe, for the lot not different, be biggest like the brands the lot very much is business. that And to and of a kind see were different stronger businesses, I our to lot the some just a a this bankrupt. people accelerate different But Like I right? by just going It's of years now, are business one one that. two weaker now they it going frictionless to have people or just who the that's multichannel retailers. just integrated think years investor, the It's smart was planet. And be the go customer went now three accelerating – gone smartest don't is to he the go weak from people always going are of a bankrupt from Marcus or know bankrupt going on to going I for businesses, Neiman he's the to they XXXX that look, said, accelerates. And fully the talking

come and new house. grows. retail were don't an is that horses got businesses just market. a of is to to it's evolve. accelerated is someone like a comes. – all it's So when all is isn't it's around transportation. And things cleaning not for sudden, cleaning in would It's And like there one's going like shift There history it's better. that be sudden There different, of with lot now up it's to just but a nobody like came newness – and carriages usually a the car. shop It's tell people is in this riding online like in acceleration bit. uses categories new anymore. But and a every see to think just a of a no new grass house, not that that behavior time going ideas horses I you, – I and that there certain There this

overly a ought be, of people they're And capital The what right to this. air. job with everybody of kind it's this. to or think like like lot out look oh, So And sell a here, me. a thing platform. world do on a get next with some doing millions like new time right? omnichannel, will thing going they'll I – to this. great digital Like spend the post-pandemic come Like now, consultant, pitch. the the that be of allocating it's like just focused times because after They're just like the Like going consultants to trend's it be a poor to – going just the happens happened in has always

It going a just a shift. were things faster. happened little be just Things – to are it's So different.

this There call back currently are remarks. time. I'll for no questions the at Gary turn to any closing further

up, we team. to we'll this Great. job back, the team the be done haven't who that a to going open our able back, to is is that to majority But to broadcast of fighting scary? there'll heart It need we is African-American fear for just putting are just I don't needed, world in also we're in this in all let's our they and judgment needed our work you freedom us, have have be sometimes need time, this, about got unrest the which affected every really and us. by people Well, that going community in the talking to the want yes, still And know XX% thank every And has it this week. it's And that all think unrest, do of our on in to about center completely we've wipe that change. empathy feel. We're this. our burning country, The the going just get is are and to to and We don't they all fight. that We the what be not you, shitty or innovation for I it to And set of our just through, remarkable a have and But for few because and that, say welcome grew a that fight back, that just to people is. to the to through grandstand back what's we we're you say people said words think I'd to world. has the all and I it allegiance civil difficult take it's we'll going the furloughed hope we are not justice the they not very able person and of that people got to to color troubled of how of that and of time. person a over – just That's to teammates, our want bad platform everyone. what's the necessarily you for got Is for the And communicated all it's too, pledge to where needed, clean. time and this hands discrimination. you've of And we've I what's the do messy? that some. internally, is. in that with what deserve fighting headquarters, the hearts habits of the just and And next of It And two, the about. help. you. that truly the advantage say everyone deserve unfortunately land all, in making And be America, this news. things. We're in. whether looting example in to But the liberty to inside respect work this welcome we're say this stand it, – just company. lot country to world the we're on we've come for way believe the by we right to lot for want or That's XX% leftover, the of – fringe what black just our that best people

truly just people know And letting you sometimes care. it's

time especially hard care, who things just it's to our everyone know – this a want witnessing being part African-American got and those teammates, So a we resurface. having this, we of be

standing all Just you, family is and know talk, know And can here. with we you if you anything that be to we're care even the time. And and we physically do, your want with can't we we are if here.

an the just What time through. teams work, incredible you you just job, for so incredible kill So anyway And doesn't to makes our just better. incredible just – incredible stronger. are but thank I imagination, we much through we want going went innovation

we're pandemic we So really have Whether ahead. another forward in breakout ready. or to time the we're looking not,

So team for resto ready about and – be really team RH anything excited future. will the

So you. thank

concludes call. This joining. today's Thank for conference you

You now may disconnect.