RH (RH)
Operating return on assets (Operating ROA)
| Jan 31, 2025 | Feb 3, 2024 | Jan 31, 2024 | Jan 31, 2023 | Jan 28, 2023 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 322,587 | 366,071 | 366,071 | 722,157 | 722,157 |
| Total assets | US$ in thousands | 4,554,690 | 4,143,900 | 4,143,900 | 5,309,290 | 5,309,290 |
| Operating ROA | 7.08% | 8.83% | 8.83% | 13.60% | 13.60% |
January 31, 2025 calculation
Operating ROA = Operating income ÷ Total assets
= $322,587K ÷ $4,554,690K
= 7.08%
Based on the data provided, the operating return on assets (operating ROA) for RH has shown a declining trend over the time period from January 28, 2023, to January 31, 2025. The operating ROA was reported at 13.60% as of January 31, 2023, and remained constant at the same level until February 3, 2024. However, there was a noticeable decrease in the operating ROA to 8.83% as of both January 31, 2024, and February 3, 2024. This decline continued, leading to a further drop to 7.08% as of January 31, 2025.
The declining trend in operating ROA suggests that RH may be experiencing challenges in generating operating profit relative to its total assets. It could indicate inefficiencies in the utilization of assets to generate earnings from operations. Further analysis of the company's operational performance, asset management, and profitability drivers may be warranted to address the decreasing trend in operating ROA and identify areas for improvement.