The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how RH (NYSE: RH) and the rest of the home furniture retailer stocks fared in Q2.

Furniture retailers understand that ‘home is where the heart is’ but that no home is complete without that comfy sofa to kick back on or a dreamy bed to rest in. These stores focus on providing not only what is practically needed in a house but also aesthetics, style, and charm in the form of tables, lamps, and mirrors. Decades ago, it was thought that furniture would resist e-commerce because of the logistical challenges of shipping large furniture, but now you can buy a mattress online and get it in a box a few days later; so just like other retailers, furniture stores need to adapt to new realities and consumer behaviors.

The 4 home furniture retailer stocks we track reported a mixed Q2. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.

While some home furniture retailer stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4.7% since the latest earnings results.

RH (NYSE: RH)

Formerly known as Restoration Hardware, RH (NYSE: RH) is a specialty retailer that exclusively sells its own brand of high-end furniture and home decor.

RH reported revenues of $899.2 million, up 8.4% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a miss of analysts’ EBITDA and EPS estimates.

Unsurprisingly, the stock is down 12.5% since reporting and currently trades at $200.22.

Is now the time to buy RH? Access our full analysis of the earnings results here, it’s free.

Best Q2: Arhaus (NASDAQ: ARHS)

With an aesthetic that features natural materials such as reclaimed wood, Arhaus (NASDAQ: ARHS) is a high-end furniture retailer that sells everything from sofas to rugs to bookcases.

Arhaus reported revenues of $358.4 million, up 15.7% year on year, outperforming analysts’ expectations by 7.4%. The business had an exceptional quarter with EBITDA guidance for next quarter exceeding analysts’ expectations and a beat of analysts’ EPS estimates.

Arhaus scored the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 7.6% since reporting. It currently trades at $10.63.

Is now the time to buy Arhaus? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Sleep Number (NASDAQ: SNBR)

Known for mattresses that can be adjusted with regards to firmness, Sleep Number (NASDAQ: SNBR) manufactures and sells its own brand of bedding products such as mattresses, bed frames, and pillows.

Sleep Number reported revenues of $327.9 million, down 19.7% year on year, falling short of analysts’ expectations by 8.3%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates and a miss of analysts’ EBITDA estimates.

Sleep Number delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. As expected, the stock is down 12.9% since the results and currently trades at $7.11.

Read our full analysis of Sleep Number’s results here.

Williams-Sonoma (NYSE: WSM)

Started in 1956 as a store specializing in French cookware, Williams-Sonoma (NYSE: WSM) is a specialty retailer of higher-end kitchenware, home goods, and furniture.

Williams-Sonoma reported revenues of $1.84 billion, up 2.7% year on year. This number was in line with analysts’ expectations. Overall, it was a very strong quarter as it also put up a solid beat of analysts’ gross margin estimates and an impressive beat of analysts’ EBITDA estimates.

The stock is down 1.1% since reporting and currently trades at $195.50.

Read our full, actionable report on Williams-Sonoma here, it’s free.

Market Update

As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.