Shares of RH (RH) - Get Report fell sharply Friday after the company formerly known as Restoration Hardware cut its fiscal-year outlook and revenue in its latest fourth quarter missed Wall Street estimates.
RH, the luxury-furniture retailer, said it expects adjusted profit in its fiscal year of $8.41 to $9.08 a share, down from its earlier projection of $9.30 to $10.70 a share. RH said it expects sales of $2.59 billion to $2.64 billion, below its earlier guidance of $2.72 billion to $2.82 billion.
The company said the shortfall was a result of "continued weakness in our core business post the fourth quarter market volatility, the negative trends in the high-end housing market, and our continued efforts to edit unprofitable and non-strategic businesses."
Fourth-quarter earnings were $1.41 a share, up from 1 cent a year earlier when the company recorded impairment charges from Waterworks. Adjusted profit in the fourth quarter was $3 a share vs. $1.69 a share a year earlier. Adjusted revenue in the fourth quarter was $671.8 million.
Analysts had been calling for fourth-quarter adjusted earnings of $2.85 a share on revenue of $687 million.
Stifel Nicolaus on Friday cut its price target on RH to $145 from $180.
The stock declined 16% to $110.77 in trading Friday.
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