RH shares skyrocketed on Tuesday after the luxury home goods retailer reported first-quarter earnings well-above estimates and raised its forecast for the year.

Shares rose more than 34 percent, putting it on pace for its best day since Sept. 7, 2017, when it rose 44.8 percent.

RH was formerly known as Restoration Hardware and has recently shifted its brand to the higher end of the home furnishings marketplace. It also is focusing on a membership model and made changes to its supply chain this quarter. The better-than-expected performance is likely increasing confidence in the company's new model.

RH's membership model prioritizes customer experience by offering easy-access design and installation services. In a letter to shareholders, RH Chief Executive Officer Gary Friedman wrote that RH would be increasing investment into their RH Interior Design brand with hopes of becoming the leading interior design firm in North America.



"We have several new brand extension plans in our development pipeline, and look forward to unveiling them as we pivot back to growth next year," Friedman said.

In the latest quarter, the company reported net income of $28.1 million, or $1.11 per share, up from a loss of $3.4 million, or 9 cents a share, a year earlier.

Excluding items, the company earned $1.33 per share, beating analyst estimates of $1.02 per share from a Thomson Reuters survey.

Still, the company's revenue fell slightly from the year-earlier period, to $557.4 million, and was shy of estimates of $563.1 million.

Despite weak revenue, RH raised its full-year adjusted earnings forecast to a range of $6.34 to $6.83 per share and reiterated its revenue forecast of between $2.53 billion to $2.57 billion.

In the second quarter, the retailer expects to earn $1.70 to $1.77 per share on an adjusted basis, surpassing analysts' forecast of $1.51 per share.

The company recently opened a flagship location in West Palm Beach, Florida, that shows off its new approach. The 80,000-square-foot space includes fountains and an in-store cafe.

RH shares have been on the rise, gaining 76 percent since the start of the year. On Monday, shares traded as high as $152.94.