RH shares are falling after the company lowered its forecast for this year

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high-end furniture series R Wednesday It lowered its forecast for 2022 revenueIt is expected that consumer demand for its products will continue to decline in the second half of the year.

The company is now seeing an annual sales decline of 2% to 5%, compared to a previous forecast of stable sales of 2%. It said it still expects revenue in the second quarter of the fiscal year to fall between 1% and 3% from the previous year’s levels.

RH shares were down about 8% in after-hours trading following the release. The stock was already down about 3% during regular trading, to close at $237.32.

“With mortgage rates doubling last year’s levels, sales of luxury homes down 18% in the first quarter, and the Federal Reserve forecasting a further 175 basis points for the fed funds rate by the end of the year, we expect demand to continue to slow throughout the year,” said CEO Gary Friedman. In a statement.

He added that the next several seasons will pose a short-term challenge for the company, as RH spends a period of increased demand in the days prior to the Covid pandemic.

The company warned in early June that it was seeing a dip in demand linked to the Russian invasion of Ukraine. However, Friedman said at the time that 2022 is preparing to start a new growth chapter for the company.

RH’s total revenue for the three months ended April 30 was $957 million, up from $861 million in the same period last year.

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RH also said Wednesday that it has not repurchased any shares since the June 2 announcement of an expansion of its common stock buyback plan.

The retailer’s shares are down 55% year-to-date, as of the market close on Wednesday.

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