Operating Profit Margin
since 2013
Calculation
RH, operating profit margin, long-term trends, calculation
| Operating profit margin | = | 100 | × | Income (loss) from operations1 | ÷ | Net revenues1 | |
|---|---|---|---|---|---|---|---|
| Jan 28, 2023 | 20.11% | = | 100 | × | 722,157) | ÷ | 3,590,477) |
| Jan 29, 2022 | 24.67% | = | 100 | × | 927,181) | ÷ | 3,758,820) |
| Jan 30, 2021 | 16.39% | = | 100 | × | 466,858) | ÷ | 2,848,626) |
| Feb 1, 2020 | 13.70% | = | 100 | × | 362,831) | ÷ | 2,647,437) |
| Feb 2, 2019 | 11.54% | = | 100 | × | 289,230) | ÷ | 2,505,653) |
| Feb 3, 2018 | 5.38% | = | 100 | × | 131,301) | ÷ | 2,440,174) |
| Jan 28, 2017 | 2.48% | = | 100 | × | 53,036) | ÷ | 2,134,871) |
| Jan 30, 2016 | 8.80% | = | 100 | × | 185,561) | ÷ | 2,109,006) |
| Jan 31, 2015 | 8.87% | = | 100 | × | 165,726) | ÷ | 1,867,422) |
| Feb 1, 2014 | 3.54% | = | 100 | × | 54,851) | ÷ | 1,550,961) |
| Feb 2, 2013 | -5.79% | = | 100 | × | (69,036) | ÷ | 1,193,046) |
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), 10-K (reporting date: 2017-01-28), 10-K (reporting date: 2016-01-30), 10-K (reporting date: 2015-01-31), 10-K (reporting date: 2014-02-01), 10-K (reporting date: 2013-02-02).
1 US$ in thousands
The financial trajectory from 2013 to 2023 is characterized by a comprehensive transition from operational losses to high-margin profitability. Net revenues exhibited a consistent long-term upward trend, growing from approximately $1.19 billion in 2013 to a peak of $3.76 billion in 2022, before experiencing a slight contraction to $3.59 billion in 2023.
- Initial Recovery and Volatility (2013–2017)
- The operating profit margin began at -5.79% in 2013, reflecting an initial operational loss of $69 million. A recovery phase followed, with margins improving to 8.87% by 2015. However, this progress was interrupted in 2017, when the margin dropped sharply to 2.48%, indicating a temporary misalignment between revenue growth and operating expenses.
- Period of Aggressive Margin Expansion (2018–2022)
- A sustained and accelerating increase in operational efficiency was observed between 2018 and 2022. The operating profit margin climbed steadily from 5.38% in 2018 to a peak of 24.67% in 2022. This period saw income from operations grow exponentially, rising from $131 million to $927 million, suggesting strong operating leverage and effective cost management as the revenue base expanded.
- Recent Performance Correction (2023)
- The most recent data indicates a reversal of the expansion trend. Both net revenues and income from operations declined, with the operating profit margin retreating to 20.11%. Despite this contraction, the margin remains significantly elevated compared to the historical averages observed prior to 2020.
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Comparison to Competitors
RH, operating profit margin, long-term trends, comparison to competitors
| RH | Amazon.com Inc. | Home Depot Inc. | Lowe’s Cos. Inc. | |
|---|---|---|---|---|
| Jan 28, 2023 | 20.11% | 6.41% | 15.27% | 10.47% |
| Jan 29, 2022 | 24.67% | 2.38% | 15.24% | 12.56% |
| Jan 30, 2021 | 16.39% | 5.30% | 13.84% | 10.77% |
| Feb 1, 2020 | 13.70% | 5.93% | 14.37% | 8.75% |
| Feb 2, 2019 | 11.54% | 5.18% | 14.35% | 5.63% |
| Feb 3, 2018 | 5.38% | 5.33% | 14.55% | 9.60% |
| Jan 28, 2017 | 2.48% | 2.31% | 14.19% | 8.99% |
| Jan 30, 2016 | 8.80% | 3.08% | 13.30% | 8.41% |
| Jan 31, 2015 | 8.87% | 2.09% | 12.59% | 8.52% |
| Feb 1, 2014 | 3.54% | 0.20% | 11.63% | 0.00% |
| Feb 2, 2013 | -5.79% | 1.00% | 10.39% | 0.00% |
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), 10-K (reporting date: 2017-01-28), 10-K (reporting date: 2016-01-30), 10-K (reporting date: 2015-01-31), 10-K (reporting date: 2014-02-01), 10-K (reporting date: 2013-02-02).