RH (RH) risk factors, FY2025 10-K

Risks Related to Our Business

1. 01We are undertaking a large number of business initiatives at the same time, including international expansion and exploring opportunities to expand into new categories and complementary businesses. If these initiatives are not successful, they may have a negative impact on our results of operations
2. 02We can provide no assurances that customers will respond favorably to, or that we will successfully execute on, such business initiatives or that we will be successful in expanding our operations into any new geographies, businesses and product lines
3. 03We have experienced significant fluctuations in the growth of our business and we may not experience high rates of growth in future periods
4. 04Changes in consumer spending and factors that influence spending of the specific categories of consumers that purchase from us may significantly impact our revenue and results of operations
5. 05If we fail to successfully and timely deliver merchandise to our customers and manage our supply chain commensurate with demand, our results of operations may be adversely affected
6. 06Merchandise purchased from our vendors that is defective or otherwise does not meet our product quality standards could damage our reputation and brand image and harm our business, and we may not have adequate remedies against our vendors for such merchandise
7. 07Our business depends on the strength of our brand and continuing investments in our brand will be an important requirement for our future success
8. 08Competition in the home furnishings sector may adversely affect our future financial performance
9. 09We are subject to risks associated with our dependence on foreign manufacturing and imports for our merchandise
10. 10Our results may be adversely affected by fluctuations in raw materials, energy and transportation costs and currency exchange rates
11. 11We currently rely upon independent third-party transportation providers for the majority of our product shipments, which subjects us to certain risks
12. 12Our business is dependent on certain key personnel; if we lose key personnel or are unable to hire additional qualified personnel, our business may be harmed
13. 13We face product-related liability risks and certain of our products may be subject to recalls or other actions by regulatory authorities, and any such recalls or similar actions could have a material adverse effect on our business and reputation
14. 14We are involved in legal and regulatory proceedings from time to time that may affect our Company and/or our senior leadership, including litigation, claims, investigations and regulatory and other proceedings, which could distract senior leadership from our business activities and result in significant liability
15. 15Compliance with laws, including laws relating to our business activities outside of the U.S., may be costly, and changes in laws could make conducting our business more expensive or otherwise change the way we do business
16. 16We may be unsuccessful in identifying attractive acquisition opportunities or, to the extent that we pursue attractive acquisition opportunities, we may be unsuccessful in completing or realizing the expected benefits of such acquisitions

Risks Related to Ownership of Our Common Stock

1. 17Our common stock price may be volatile or may decline regardless of our operating performance
2. 18global economic, legal and regulatory changes unrelated to our performance
3. 19Anti-takeover provisions in our charter documents and Delaware law might discourage or delay acquisition attempts for us that you might consider favorable
4. 20establish advance notice, disclosure and other procedural requirements for stockholder nominations for elections to our board of directors or for stockholder proposals regarding matters that can be acted upon by stockholders at stockholder meetings
5. 21We do not expect to pay any cash dividends for the foreseeable future
6. 22We face various risks in connection with our share repurchase program
7. 23The terms of our outstanding indebtedness may delay or hinder an otherwise beneficial takeover attempt of our Company

General Risks

1. 24Changes to accounting rules or regulations may adversely affect our results of operations
2. 25Expectations of our Company relating to environmental, social and governance factors may impose additional costs and expose us to new risks
3. 26Labor organizing and other activities could negatively impact us
4. 27Fluctuations in our tax obligations and effective tax rate and realization of our deferred tax assets, including net operating loss carryforwards, may result in volatility of our results of operations
5. 28Our operations are subject to risks of natural or man-made disasters, acts of war, terrorism or widespread illness, any one of which could result in a business stoppage and negatively affect our results of operations