LEASES (Tables)

3 Months Ended

May 03, 2025

LEASES

Summary of lease costs-net

Lease costs—net consisted of the following:

	THREE MONTHS ENDED
	MAY 3,		MAY 4,
	2025		2024
	(in thousands)
Operating lease costs(1)	$	35,446	$	32,881
Finance lease costs
Amortization of leased assets(1)		14,673		12,405
Interest on lease liabilities(2)		8,945		7,407
Variable lease costs(3)		7,187		6,643
Sublease income(4)		(1,182)		(1,154)
Total lease costs—net	$	65,069	$	58,182

(1) Operating lease costs and amortization of finance lease right-of-use assets are included in cost of goods sold or selling, general and administrative expenses on the condensed consolidated statements of income (loss) based on our accounting policy.

(2) Included in interest expense—net on the condensed consolidated statements of income (loss). Amounts include lease cost related to variable lease payments based on an index or rate that were not included in the measurement of the initial lease liability and right-of-use asset for finance leases, which were not material in either period presented.

(3) Represents variable lease payments under operating and finance lease agreements, primarily associated with contingent rent based on a percentage of retail sales over contractual levels of $4.1 million and $3.9 million for the three months ended May 3, 2025 and May 4, 2024, respectively, as well as charges associated with common area maintenance of $3.1 million and $2.7 million for the three months ended May 3, 2025 and May 4, 2024, respectively. Other variable costs, which include single lease cost related to variable lease payments based on an index or rate that were not included in the measurement of the initial lease liability and right-of-use asset for operating leases, were not material in either period presented.

(4) Included in selling, general and administrative expenses on the condensed consolidated statements of income (loss).

Summary of lease right-of-use assets and lease liabilities

		MAY 3,		FEBRUARY 1,
		2025		2025
		(in thousands)
	Balance Sheet Classification
Assets
Operating leases	Operating lease right-of-use assets	$	654,978	$	617,103
Finance leases(1)(2)(3)	Property and equipment—net		992,110		1,007,088
Total lease right-of-use assets		$	1,647,088	$	1,624,191
Liabilities
Current(4)
Operating leases	Operating lease liabilities	$	93,170	$	100,944
Finance leases	Other current liabilities		17,190		21,135
Total lease liabilities—current			110,360		122,079
Non-current
Operating leases	Non-current operating lease liabilities		610,053		573,468
Finance leases	Non-current finance lease liabilities		625,463		630,655
Total lease liabilities—non-current			1,235,516		1,204,123
Total lease liabilities		$	1,345,876	$	1,326,202

(1) Includes capitalized amounts related to our completed construction activities to design and build leased assets, which are reclassified from other non-current assets upon lease commencement.

(2) Recorded net of accumulated amortization of $335 million and $320 million as of May 3, 2025 and February 1, 2025, respectively.

(3) Includes $34 million and $35 million as of May 3, 2025 and February 1, 2025, respectively, related to an RH Design Gallery lease with a landlord that is an affiliate of the managing member of the Aspen LLCs. Refer to Note 5—Variable Interest Entities.

(4) Current portion of lease liabilities represents the reduction of the related lease liability over the next 12 months.

Summary of maturities of lease liabilities

The maturities of lease liabilities were as follows as of May 3, 2025:

	OPERATING		FINANCE
FISCAL YEAR	LEASES		LEASES		TOTAL
	(in thousands)
Remainder of fiscal 2025	$	95,018	$	36,903	$	131,921
2026		135,491		55,781		191,272
2027		124,511		56,588		181,099
2028		89,551		55,773		145,324
2029		77,849		55,462		133,311
2030		68,677		56,323		125,000
Thereafter		392,382		832,418		1,224,800
Total lease payments(1)(2)		983,479		1,149,248		2,132,727
Less—imputed interest(3)		(280,256)		(506,595)		(786,851)
Present value of lease liabilities	$	703,223	$	642,653	$	1,345,876

(1) Total lease payments include future obligations for renewal options that are reasonably certain to be exercised and are included in the measurement of the lease liability. Total lease payments exclude $843 million of legally binding payments under the non-cancellable term for leases signed but not yet commenced under our accounting policy as of May 3, 2025, of which $28 million, $38 million, $47 million, $48 million, $51 million and $51 million will be paid in the remainder of fiscal 2025, fiscal 2026, fiscal 2027, fiscal 2028, fiscal 2029 and fiscal 2030, respectively, and $580 million will be paid subsequent to fiscal 2030.

(2) Excludes an immaterial amount of future commitments under short-term lease agreements.

(3) Calculated using the discount rate for each lease at lease commencement.

Summary of supplemental information related to leases

	THREE MONTHS ENDED
	MAY 3,			MAY 4,
	2025			2024
Weighted-average remaining lease term (years)
Operating leases		9.4		8.5
Finance leases		20.0		19.4
Weighted-average discount rate
Operating leases		6.0	%	5.2	%
Finance leases		5.8	%	5.1	%

Summary of other information related to leases

	THREE MONTHS ENDED
	MAY 3,		MAY 4,
	2025		2024
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	(45,409)	$	(31,920)
Operating cash flows from finance leases		(13,477)		(7,407)
Financing cash flows from finance leases—net(1)		(6,464)		(4,496)
Total cash outflows from leases	$	(65,350)	$	(43,823)
Non-cash transactions
Lease right-of-use assets obtained in exchange for lease obligations—net of lease terminations
Operating leases	$	60,755	$	3,915
Finance leases		—		2,446

(1) Presented net of tenant allowances received subsequent to lease commencement of $1.4 million in the three months ended May 3, 2025. No such amounts were received from landlords in the three months ended May 4, 2024.