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Home furnishing retailers are digesting a fresh round of tariff announcements from President Trump today. The measures include a 50% tariff on kitchen cabinets, bathroom vanities, and related products, along with a 30% tariff on upholstered furniture. These come on top of existing tariffs on China, Vietnam, India, and other countries. While shares of domestic manufacturers are seeing a lift on the headlines, the sector overall faces renewed uncertainty given its heavy reliance on global supply chains.

• RH (RH -4.2%) had announced a growing impact of tariffs in its Q2 (Jul) report, including a $30 mln incremental tariff cost, leading to a reduction in its revenue guidance and operating margin. While the company is working on shifting upholstered production to NC, Italy, and Mexico, it had warned on its call that incremental tariffs would be an additional challenge.
• William Sanoma (WSM -1.3%) noted that topline growth would be offset by margin pressure from incremental tariff costs, as it reported on its Q2 (Jul) call that tariff rates had doubled from Q1. Some offstting measures include vendor concessions, resourcing initiatives, and selective pricing.
• Wayfair (W +0.9%) is up modestly on the headlines. The company has emphasized that its inventory-light model and broad supplier base provide flexibility, helping keep pricing relatively stable.
• Ethan Allen (ETD +1.7%) and La-Z-Boy (LZB +1.8%) are among the biggest winners today given their U.S.-centric manufacturing. ETD produces about 70% of its products in North America, while LZB makes roughly 90% of its upholstered units domestically.

Briefing.com Analyst Insight

Tariffs remain a highly disruptive force for the home furnishing space. Retailers with globalized sourcing strategies are confronting higher costs, margin compression, and complex shifts in supply chain planning. While some are actively resourcing production to the U.S. or North America, the process is lengthy and expensive, and not all product categories can be easily transitioned. Combined with a still-sluggish housing market, the tariff landscape adds another layer of risk to near-term demand and profitability.