'Oh sh--.' RH CEO sees stock slide as reciprocal tariffs unveiled during Q4 earnings conference call

A real-time reaction to the impact of President Donald Trump's tariff actions and lackluster earnings has the CEO of luxury furniture maker RH in the spotlight.

On Wednesday RH, previously known as Restoration Hardware, reported a fiscal fourth-quarter adjusted profit of $1.58 per share on revenue of $812.4 million. Analysts polled by Zacks Investment Research predicted a higher profit of $1.91 per share on revenue of $827.3 million.

That same day, Trump said that he was placing elevated tariff rates on dozens of nations that run meaningful trade surpluses with the United States, while imposing a 10% baseline tax on imports from all countries in response to what he called an economic emergency.

The action amounts to a historic tax hike that could push the global order to a breaking point. It kick-starts what could be a painful transition for many Americans as middle-class essentials such as housing, autos and clothing are expected to become more costly.

During the earnings call for RH, CEO Gary Friedman saw the company's stock tumble as Trump's policy was being announced at the White House.

“Oh, sh—, OK. OK. I just looked at the screen. I had to look at it. It got hit when I think the tariff came out,” he said. “And everybody can see in our 10-K where we’re sourcing from, so it’s not a secret and we’re not trying to disguise it by putting everything in an Asia bucket.” The 10-K refers to the company's annual report filed with securities regulators.

In its earnings report, the Corte Madera, California-based chain said, “While we expect a higher risk business environment this year due to the uncertainty caused by tariffs, market volatility and inflation risk, we believe it’s important to separate the signal from the noise. The fact is, we’ve been operating in the worst housing market in almost 50 years.”

The company said, “As it relates to reciprocal and other tariffs that will be announced today, as we’ve done with prior tariffs, we will be working with our manufacturing partners to mitigate the impact to both our margins and costs to our customers.”

It forecast revenue growth of up to 13% this fiscal year.

“While we ended the year with meaningful debt, mostly due to our stock repurchases of $2.2 billion, we also ended the year with incredible business momentum and meaningful assets.”

Stock markets worldwide are careening even lower Friday after China matched Trump’s big raise in tariffs in an escalating trade war.

Shares of RH slid more than 7% in midday trading. In the year to date, the stock has declined 62%.