What happened

Shares of RH (RH -4.72%) were climbing this week after the high-end home furnishings retailer formerly known as Restoration Hardware turned in another strong earnings report.

As of the market close on Thursday, the stock was up 13.3% for the week, according to data from S&P Global Market Intelligence.

A modern living room.

Image source: Getty Images.

So what

Reporting earnings after the bell on Wednesday, RH said revenue was up 19% to $1.01 billion, ahead of estimates at $983.9 million, or up 49% from Q3 2019, its fastest two-year growth rate ever.

That impressive performance comes in spite of supply chain challenges that led the company to delay the launch of its RH Contemporary collection, the opening of the first RH Guesthouse and several galleries, and the mailing of its fall source books until next spring.

Profits continued to march higher as adjusted operating margin expanded from 26.7% to 27.7%, and adjusted earnings per share rose 13% to $7.03, beating expectations at $6.63.

The company also hiked its full-year outlook, calling for revenue growth of 32%-33%, up from a previous range of 31%-33%, and adjusted operating margin of 25.3%-25.5%, compared to an earlier forecast of 24.9%-25.5%.

Shares gained 5.5% on Thursday even as growth stocks fell, adding on to gains from earlier in the week.

Now what

With little fanfare, RH has been one of the best-performing consumer stocks on the market in recent years. The stock is up nearly 1,500% over the last five years thanks to the popularity of its niche products, a boom in the luxury sector, a successful pivot to a membership model, and a unique approach to retail through a handful of experiential galleries that showcase its wares.

With retail spending on the rise and consumers flush with cash after the several rounds of government assistance during the pandemic, RH looks well-positioned to continue to outperform.