Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

RH, consolidated balance sheet: liabilities and stockholders’ equity

US$ in thousands

	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020	Feb 2, 2019	Feb 3, 2018
Accounts payable	166,082)	242,035)	224,906)	180,714)	183,039)	195,313)
Accrued compensation	76,650)	96,859)	84,860)	64,659)	64,192)	47,534)
Accrued occupancy	28,830)	28,088)	17,671)	12,067)	10,784)	8,612)
Accrued sales taxes	18,900)	24,811)	23,706)	19,618)	18,354)	19,525)
Accrued freight and duty	17,497)	21,888)	29,754)	25,170)	20,787)	23,757)
Accrued interest	14,456)	5,185)	—)	—)	—)	—)
Accrued legal reserves	8,921)	1,398)	—)	—)	—)	—)
Accrued professional fees	7,447)	5,892)	5,383)	4,381)	2,050)	3,555)
Accrued catalog costs	4,596)	4,127)	4,354)	8,267)	10,276)	9,000)
Other accrued expenses	31,570)	12,096)	19,401)	15,433)	10,959)	11,469)
Deferred consideration for asset purchase	—)	—)	14,387)	—)	—)	—)
Accounts payable and accrued expenses	374,949)	442,379)	424,422)	330,309)	320,441)	318,765)
Deferred revenue and customer deposits	325,754)	387,933)	280,641)	162,433)	152,595)	149,404)
Convertible senior notes due 2024, net	—)	3,600)	—)	—)	—)	—)
Convertible senior notes due 2023, net	1,696)	9,389)	2,354)	—)	—)	—)
Convertible senior notes due 2020, net	—)	—)	—)	290,532)	—)	—)
Convertible senior notes due 2019, net	—)	—)	—)	—)	343,789)	—)
Current operating lease liabilities	80,384)	73,834)	71,524)	58,924)	—)	—)
Unredeemed gift card and merchandise credit liability	26,733)	22,712)	19,173)	16,625)	17,192)	24,138)
Current portion of term loans	25,000)	20,000)	—)	—)	—)	—)
Allowance for sales returns	20,747)	25,256)	25,559)	19,206)	19,821)	10,565)
Current finance lease liabilities	17,007)	15,511)	14,671)	9,188)	1,074)	471)
Foreign tax payable	4,365)	—)	—)	—)	—)	—)
Current portion of equipment promissory notes	1,160)	13,625)	22,747)	22,009)	892)	6,033)
Federal and state tax payable	—)	31,364)	49,539)	13,591)	—)	5,391)
Promissory notes on asset under construction	—)	—)	—)	53,000)	—)	—)
Provision for legal settlement	—)	—)	—)	—)	50,000)	—)
Other current liabilities	8,178)	18,155)	11,002)	7,095)	12,368)	4,568)
Other current liabilities	103,190)	146,623)	142,691)	140,714)	101,347)	51,166)
Current liabilities	885,973)	1,063,758)	921,632)	982,912)	918,172)	519,335)
Asset based credit facility	—)	—)	—)	—)	57,500)	199,970)
Term loan B, net	1,936,529)	1,953,203)	—)	—)	—)	—)
Term loan B-2, net	469,245)	—)	—)	—)	—)	—)
Term loan, net	—)	—)	—)	—)	—)	79,499)
Real estate loans	17,909)	—)	—)	—)	—)	—)
Convertible senior notes due 2024, net	41,724)	184,461)	281,454)	264,982)	—)	—)
Convertible senior notes due 2023, net	—)	59,002)	282,956)	266,658)	249,151)	—)
Convertible senior notes due 2020, net	—)	—)	—)	—)	271,157)	252,994)
Convertible senior notes due 2019, net	—)	—)	—)	—)	—)	327,731)
Non-current operating lease liabilities	505,809)	540,513)	448,169)	409,930)	—)	—)
Non-current finance lease liabilities	653,050)	560,550)	485,481)	442,988)	7,720)	7,509)
Deferred tax liabilities	6,315)	—)	—)	—)	—)	—)
Financing obligations under build-to-suit lease transactions	—)	—)	—)	—)	228,928)	229,323)
Deferred rent and lease incentives	—)	—)	—)	—)	53,742)	54,983)
Unrecognized tax benefits	2,962)	3,471)	3,114)	3,020)	2,992)	3,728)
Non-current portion of equipment promissory notes, net	—)	1,129)	14,614)	31,053)	—)	—)
Other non-current obligations	5,112)	4,106)	9,406)	25,500)	39,634)	65,130)
Deferred payroll taxes	—)	—)	4,461)	—)	—)	—)
Other non-current obligations	8,074)	8,706)	31,595)	59,573)	42,626)	68,858)
Non-current liabilities	3,638,655)	3,306,435)	1,529,655)	1,444,131)	910,824)	1,220,867)
Total liabilities	4,524,628)	4,370,193)	2,451,287)	2,427,043)	1,828,996)	1,740,202)
Preferred stock, $0.0001 par value per share, no shares issued or outstanding	—)	—)	—)	—)	—)	—)
Common stock, $0.0001 par value per share	2)	2)	2)	2)	2)	2)
Additional paid-in capital	247,076)	620,577)	581,897)	430,662)	356,422)	860,288)
Accumulated other comprehensive income (loss)	(2,403)	(1,410)	2,565)	(2,760)	(2,333)	(171)
Retained earnings (accumulated deficit)	539,986)	551,108)	(137,438)	(409,253)	(376,810)	152,394)
Treasury stock, at cost	—)	—)	—)	—)	(243)	(1,019,849)
Stockholders’ equity (deficit)	784,661)	1,170,277)	447,026)	18,651)	(22,962)	(7,336)
Total liabilities and stockholders’ equity (deficit)	5,309,289)	5,540,470)	2,898,313)	2,445,694)	1,806,034)	1,732,866)

Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).

Accounts Payable and Related Accrued Expenses: Accounts payable decreased from $195.3 million in early 2018 to $166.1 million in early 2023, showing variability with a peak at $242.0 million in early 2022. Accrued compensation steadily increased until 2022, reaching $96.9 million, but declined to $76.7 million in 2023. Similarly, accrued occupancy rose consistently across the period from $8.6 million to $28.8 million. Other accrued expenses showed fluctuations, with notable increases in 2023 reaching $31.6 million. Overall, accounts payable and accrued expenses increased substantially from $318.8 million in 2018 to a peak of $442.4 million in 2022 before declining to $374.9 million in 2023.
Deferred Revenue and Customer Deposits: Deferred revenue and customer deposits more than doubled from $149.4 million in early 2018 to a peak of $387.9 million in early 2022, then declined to $325.8 million in early 2023. This indicates significant growth in advance customer payments or obligations during the period, with some reversal in the latest year.
Convertible Senior Notes: A varied pattern emerged for convertible senior notes. Notes due in 2019 and 2020 showed large values in earlier years but disappeared in subsequent periods, indicating maturity or redemption. Newer notes due 2023 and 2024 appeared in later years, with substantial issuances, but also showed reductions in 2023, reflecting partial repayments or conversions. Overall, the convertible notes portfolio evolved with shifts in maturity profiles and outstanding balances.
Lease and Finance Liabilities: Current and non-current operating lease liabilities increased substantially from 2020 onward, with non-current operating lease liabilities growing from $410.0 million in 2021 to $540.5 million in 2022, slightly declining to $505.8 million in 2023. Non-current finance lease liabilities expanded dramatically from $7.5 million in 2018 to $653.1 million in 2023, reflecting increasing adoption or recognition of lease-related obligations under applicable accounting standards.
Loan and Credit Facilities: Term loan B was introduced in 2022 with a substantial balance exceeding $1.9 billion, slightly declining in 2023, with an additional tranche (B-2) appearing in 2023 at $469.2 million. Earlier facilities such as the asset-based credit facility and term loan balances diminished or disappeared over time. Real estate loans appeared in 2023 at $17.9 million. Current portion of term loans emerged in recent years, reflecting short-term repayments or scheduled maturities.
Current Liabilities: Current liabilities saw an overall increase from $519.3 million in 2018 to $1.06 billion in 2022, with a decrease to $885.9 million in 2023. Growth was driven by increases in accounts payable, deferred revenue, accrued expenses, and short-term portions of debt, while some liabilities like accrued freight and duty declined in later years.
Non-current Liabilities: Non-current liabilities rose from $1.22 billion in 2018 to $3.64 billion in 2023, indicating substantial long-term obligations growth. This increase reflects expansions in term loans, lease liabilities, convertible notes, and other obligations. The sharp rise after 2021 suggests increased leverage or financing activities in the medium to long term.
Total Liabilities: Total liabilities nearly tripled from $1.74 billion in early 2018 to $4.52 billion in early 2023. The most significant growth occurred from 2021 onward, driven by increases in both current and non-current liabilities, consistent with expanded borrowing and financial commitments.
Stockholders’ Equity: Stockholders’ equity turned positive in 2020 following prior deficits, reaching a peak of $1.17 billion in early 2022 but then declining to $784.7 million in 2023. Retained earnings showed a similar pattern, moving from large deficits in 2019 and 2020 to positive accumulated earnings in 2022 and 2023, indicating recovery or improved profitability. Additional paid-in capital peaked in 2022 at $620.6 million but declined notably to $247.1 million in 2023, which could be associated with transactions affecting equity structure.
Comprehensive Income and Treasury Stock: Accumulated other comprehensive income fluctuated within a narrow range and did not demonstrate clear trends. Treasury stock, recorded only in 2018, showed a large negative balance and was not present in later years, possibly indicating repurchases or retirement of shares during that period.
Summary Insights: Overall, the data depicts a company experiencing increased financial leverage and contractual obligations, particularly through term loans, lease liabilities, and convertible notes. Current liabilities and deferred revenues also showed noteworthy expansion, suggesting increased operating scale or changes in cash flow timing. Equity improved materially after 2019 but showed signs of decline in the most recent period, suggesting variability in profitability or capital transactions. Lease-related liabilities grew substantially due to accounting or operational changes. The financial position indicates a trend toward larger scale and complexity in financing and operations, with substantial obligations to manage going forward.

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RH (NYSE:RH)

Balance Sheet: Liabilities and Stockholders’ Equity