RH's liquidation posture as of January 31, 2026 is deeply negative. MFFAIS CLV is reported at -$2.31B, consistent with the balance-sheet arithmetic: total assets of $4.84B carry a liability stack of $4.78B, leaving book equity of only $60.6M. Under liquidation haircuts, the asset side compresses materially while liabilities remain at face. Cash of $41M recovers at par. AR of $63M recovers at ~$59M (93%). Inventory of $819M (gross) recovers at roughly $491M (60%), or ~$515M net of the $35M reserve already applied—a meaningful drag. PP&E gross of $3.07B with $913M accumulated depreciation yields net PP&E of $2.16B; at a 50-70% recovery haircut, realized value is $1.08B-$1.51B. Finance lease ROU assets of $1.18B carry corresponding finance lease liabilities of $740M (face value maintained in liquidation); operating lease ROU assets of $795M are mostly consumed by operating lease liabilities of $815M at face. Goodwill of $144M and indefinite-lived intangibles of $80M recover at zero under the standard liquidation lens. Equity method investments of $120M (real estate and Waterworks JVs) have uncertain realizable value; the Real Estate segment investments are construction-stage and subordinated through VIE structures with third-party real estate loans—recovery is speculative. Total long-lived assets grew to $3.32B from $2.88B YoY, driven largely by $620M in non-North America long-lived assets (up from $366M), reflecting accelerating European gallery build-out. The liability stack is anchored by $2.42B in debt (gross carrying), $815M in operating lease liabilities, $740M in finance lease liabilities, and $339M in deferred revenue/customer deposits—all survive at face in a wind-down and would absorb the vast majority of recoverable asset value. The filing discusses tariff risk (IEEPA tariffs invalidated by Supreme Court in February 2026, new tariffs imposed under alternative authority, 150-day expiry contingent on Congressional authorization) in Note 20 but does not separately XBRL-tag the tariff exposure quantum. The $30M credit card interchange fee settlement received in March 2026 is a subsequent event with no balance-sheet impact at period end. Compared to the prior 10-Q (Q3 FY2025, ended November 1, 2025), the full-year 10-K reflects completion of the fiscal year with inventory building ($819M vs. implied Q3 drawdown), higher total assets, and the ABL credit facility amendment completed July 31, 2025.
▼ Community Notes