What happened

Shares of Restoration Hardware parent company RH (RH 1.32%) were up 18.3% as of 2:45 p.m. EDT Thursday after the home-furnishings retailer announced strong fiscal first-quarter 2019 results and raised its full-year guidance.

Regarding the former, RH's adjusted net revenue climbed 7.4% year over year, to $599 million, significantly accelerating from the slight top-line growth it achieved last quarter. That translated to adjusted (non-GAAP) net income of $45.2 million, or $1.85 per share, up 53% from $1.21 per share in the same year-ago period.

Contemporary room decorated with various Restoration Hardware products.

IMAGE SOURCE: RH.

So what

RH Chairman and CEO Gary Friedman noted that revenue would have climbed 9.4% had it not been for a roughly two-point impact from "eliminating fringe promotions." Moreover, he says the company's strategic decisions to focus on brand elevation and building a unique integrated operating platform meant RH's profit model is "leapfrogging past the home furnishings industry."

RH has also worked to renegotiate product costs, implemented select price increases, and is moving some production and new product development out of China in order to largely mitigate the impact of recently increased tariffs on products imported to the U.S. from China.

Now what

"We remain cautiously optimistic that business momentum will continue despite negative macro trends and increased tariffs," Friedman added, "supported by the recent introduction of RH Beach House, the continued elevation and expansion of our product offering, investments in RH Interior Design, plus the launch of RH Ski House and new galleries opening this fall."

Looking ahead to the full year, RH increased its guidance to call for 2019 revenue of $2.643 billion to $2.663 billion (up from $2.585 billion to $2.635 billion before), and for adjusted earnings per share of $8.76 to $9.27 (up from $8.05 to $8.69 previously). 

RH also reiterated its longer-term goals for annual net revenue growth in the 8% to 12% range, adjusted net income growth of 15% to 20%, and returns on invested capital of more than 50%.