Arhaus Reports Third Quarter 2026 Financial Results

BOSTON HEIGHTS, Ohio, Nov. 05, 2026 (GLOBE NEWSWIRE) -- Arhaus, Inc. (“Arhaus” or the “Company”) (NASDAQ: ARHS), a premium home furnishing brand known for responsibly sourced, artisan-crafted products and heirloom-quality design, reported third quarter results for the period ended September 30, 2026.

Third Quarter 2026 Highlights
Compared to the third quarter of 2025:

• Net revenue increased 6.8% to $368 million
• Gross margin increased 8.2% to $144 million
• Selling, general and administrative expenses increased 14.8% to $134 million
• Net and comprehensive income decreased 36.0% to $8 million
• Adjusted EBITDA decreased 12.3% to $27 million
• Comparable Delivered Sales⁽¹⁾ increased 2.6%
• Comparable Written Sales⁽²⁾ increased 13.9%
  
  

John Reed, Co-Founder and Chief Executive Officer, said:

“For 40 years, Arhaus has been defined by exceptional craftsmanship, timeless design, and distinctive products. Our continued investment in compelling new collections and expanded customization is resonating with clients, as reflected in third-quarter Comparable Written Sales⁽²⁾ growth of 13.9%. As we celebrate our 40th anniversary, we remain excited about the opportunity to bring our unique product offering to more clients and build on our momentum.”

Michael Lee, Chief Financial Officer, said:

“We are pleased with our third-quarter performance, which reflects strong client demand, disciplined execution, and continued progress across our strategic priorities. Our investments in our people, infrastructure, and technology are strengthening our foundation and positioning Arhaus for sustainable, profitable long-term growth. I want to thank our entire Arhaus team for their dedication, passion, and continued commitment to delivering an exceptional client experience.”

Business Highlights

Third quarter net revenue was $368 million, an increase of 6.8% year-over-year and within the Company’s guidance range.

Comparable Delivered Sales⁽¹⁾ increased 2.6% in the third-quarter, within the Company’s guidance range, bringing year-to-date Comparable Delivered Sales⁽¹⁾ to 1.8%. Comparable Written Sales⁽²⁾ increased 13.9% in the third-quarter, bringing year-to-date Comparable Written Sales⁽²⁾ to 6.7%.

Showroom Highlights

At the end of the third quarter of 2026, Arhaus operated 109 Showrooms across 31 states. During the quarter, the Company completed 2 Total Showroom Projects⁽³⁾, including 1 relocated Showroom in Charlotte, North Carolina, and 1 renovated Showroom in Atlanta, Georgia.

Notable updates include:

• Charlotte, North Carolina – The Company relocated its Traditional Showroom in The Village at SouthPark. Spanning approximately 35,000-square-feet, the freestanding location is now Arhaus’ second-largest Traditional Showroom after Pasadena, California, offering an expanded destination to experience the brand’s artisan-crafted collections, and personalized interior design services.
  

For 2026, the Company continues to expect to complete approximately 10 to 14 Total Showroom Projects⁽³⁾, consisting of 4 to 6 new openings and 6 to 8 relocations, renovations, or expansions, representing Net Unit Growth⁽⁴⁾ of mid-single-digits for the year.

Balance Sheet and Liquidity

As of September 30, 2026, the Company reported the following:

• No long-term debt.
• Cash and cash equivalents totaled $318 million, a 25.5% increase from December 31, 2025.
• Net merchandise inventory of $360 million, a 6.4% increase from December 31, 2025.
• Client deposits of $325 million, a 37.7% increase from December 31, 2025.
• Net cash provided by operating activities totaled $173 million for the nine months ended September 30, 2026.
• Net cash used in investing activities was $58 million for the nine months ended September 30, 2026. Company-funded capital expenditures⁽⁵⁾ were $46 million and landlord contributions were $12 million.

Outlook

The Company is raising its full-year Net revenue and Comparable Delivered Sales⁽¹⁾ outlook, reflecting strength in client demand and momentum in Comparable Written Sales⁽²⁾. The Company is maintaining its full-year Net Income and Adjusted EBITDA outlook, following an increase last quarter, reflecting continued fuel and transportation cost pressures and the strategic investment into expanded marketing initiatives to support future growth. The Company remains focused on disciplined expense management, operational efficiencies, and long-term profitable growth.

		Full-Year 2026		Q4 2026
Net revenue		$1.465 billion to $1.485 billion		$398 million to $418 million
Net revenue growth		6.2% to 7.7%		9.1% to 14.6%
Comparable delivered sales(1)		2.5% to 4%		6% to 12%
Net income(6)		$71 million to $80 million		$21 million to $30 million
Adjusted EBITDA(7)		$160 million to $171 million		$44 million to $55 million
Other Estimates
Company-funded capital expenditures(5)		$70 million to $90 million
Depreciation & amortization		$50 million to $55 million
Fully diluted shares		~ 142 million
Effective tax rate		~ 29.0%
Showroom openings		4 to 6 new Showrooms
Total Showroom Projects(3)		10 to 14 Showroom Projects
Net Unit Growth(4)		Mid-Single-Digit

^{(1) Comparable Delivered Sales is a key performance indicator and is defined as the year-over-year percentage change of the dollar value of orders delivered (based on purchase price), net of the dollar value of returns (based on amount credited to client), from our comparable Showrooms and eCommerce, including through our catalogs and other mailings.
(2) Comparable Written Sales is a key performance indicator and is defined as the year-over-year percentage change of written sales from our comparable Showrooms and eCommerce, including through our catalogs and other mailings.
(3) Total Showroom Projects is defined as the number of Showroom projects completed during the period, including new Showroom openings, relocations, remodels, and expansions. The Company considers all Showroom projects integral to its long-term growth strategy, with each evaluated based on strategic relevance and expected return on investment.
(4) Net Unit Growth reflects the percentage change in total Showroom count during the period, calculated as new Showroom openings net of Showroom closures or relocations that do not increase total unit count.
(5) Company-funded capital expenditures is defined as total net cash used in investing activities less landlord contributions.
(6) U.S. GAAP net income (loss).
(7) We have not reconciled guidance for Adjusted EBITDA to the corresponding GAAP financial measure because we do not provide guidance for the various reconciling items. These items include, but are not limited to, future share-based compensation expense, income taxes, interest income, and transaction costs. We are unable to provide guidance for these reconciling items because we cannot determine their probable significance, as certain items are outside of our control and cannot be reasonably predicted due to the fact that these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP financial measure is not available without unreasonable effort}

Conference Call

You are invited to listen to Arhaus’ conference call to discuss the third quarter 2026 financial results scheduled for today, November 5, 2026, at 8:30 a.m. Eastern Time. The call will be available over the Internet on our website (http://ir.arhaus.com) or by dialing (877) 407-3982 within the U.S., or 1 (201) 493-6780, outside the U.S. The conference ID number is 13758508.

A recorded replay of the conference call will be available within approximately three hours of the conclusion of the call and can be accessed online at http://ir.arhaus.com for approximately twelve months.

About Arhaus

Founded in 1986 by Chief Executive Officer John Reed and his father, Arhaus is a premium home furnishings brand built on a simple idea: furniture and décor should be responsibly sourced, lovingly made, and built to last. Arhaus operates a vertically integrated model, designing and sourcing products directly from skilled artisans and carefully selected manufacturing partners around the world, including domestic upholstery production at its own North Carolina manufacturing facility. This approach enables Arhaus to offer a highly exclusive and customizable assortment of heirloom-quality furniture and décor designed to be used and enjoyed for generations.

With more than 100 Showroom locations across the United States, Arhaus’ integrated omni-channel model connects every client touchpoint, from Showroom and interior design to eCommerce and catalog, allowing Arhaus to meet clients wherever and however they choose to shop while delivering a highly personalized client-first experience from discovery through delivery.

For more information, please visit www.arhaus.com.

Investor Contact:

Tara Atwood Saja
Vice President, Investor Relations
(440) 439-7700
[email protected]

Non-GAAP Financial Measures

In addition to the results provided in accordance with U.S. GAAP, this press release and related tables include adjusted EBITDA, adjusted EBITDA as a percentage of net revenue, and Free Cash Flow, which present operating results on an adjusted basis.

We use non-GAAP measures to help assess the performance of our business, identify trends affecting our business, formulate business plans and make strategic decisions. In addition to our results determined in accordance with U.S. GAAP, we believe that providing these non-GAAP financial measures is useful to our investors as they present an informative supplemental view of our results from period to period by removing the effect of non-recurring items. However, our inclusion of these adjusted measures should not be construed as an indication that our future results will be unaffected by unusual or infrequent items or that the items for which we have made adjustments are unusual or infrequent or will not recur. These non-U.S. GAAP measures are not a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. Because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. These measures should only be read together with the corresponding U.S. GAAP measures. Please refer to the reconciliations of adjusted EBITDA and Free Cash Flow to the most directly comparable financial measures prepared in accordance with U.S. GAAP below.

Forward-Looking Statements

Certain statements contained herein, including statements under the heading “Outlook” are not based on historical fact and are “forward-looking statements” within the meaning of applicable securities laws.

Forward-looking statements can generally be identified by the use of forward-looking terminology, including, but not limited to, “may,” “could,” “seek,” “guidance,” “predict,” “potential,” “likely,” “believe,” “will,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “forecast,” or variations of these terms and similar expressions, or the negative of these terms or similar expressions. Past performance is not a guarantee of future results or returns and no representation or warranty is made regarding future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond our control that could cause our actual results, performance or achievements to be materially different from the expected results, performance or achievements expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: our ability to manage and maintain the growth rate of our business; our ability to obtain quality merchandise in sufficient quantities; challenges with the planning or implementation of our technology upgrades, including a new enterprise resource planning system; disruption in our receiving and distribution system, including delays in the integration of our distribution centers and the possibility that we may not realize the anticipated benefits of multiple distribution centers; effects of new or proposed tariffs and changes to international trade policies and agreements; the possibility of cyberattacks and our ability to maintain adequate cybersecurity systems and procedures; loss, corruption and misappropriation of data and information relating to clients and employees; changes in and compliance with applicable data privacy rules and regulations; risks as a result of constraints in our supply chain or disruptions due to geopolitical events such as acts of war and/or terrorism or other hostilities; a failure of our vendors to meet our quality standards; declines in general economic conditions that affect consumer confidence and consumer spending that could adversely affect our revenue; our ability to anticipate changes in consumer preferences; risks related to maintaining and increasing Showroom traffic and sales; our ability to compete in our market; our ability to adequately protect our intellectual property; compliance with applicable governmental regulations; effectively managing our eCommerce sales channel and digital marketing efforts; our reliance on third-party transportation carriers and risks associated with freight and transportation costs; and compliance with SEC rules and regulations as a public reporting company. These factors should not be construed as exhaustive. Further information on potential factors that could affect the financial results of the Company and its forward-looking statements is included in the Company’s filings with the Securities and Exchange Commission. The Company assumes no obligation to update any forward-looking statement, except as may be required by law. These forward-looking statements speak only as of the date of this release. All forward-looking statements are qualified in their entirety by this cautionary statement.

Arhaus, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited, amounts in thousands, except share and per share data)
	September 30, 2026			December 31, 2025
Assets
Current assets
Cash and cash equivalents	$	318,039		$	253,356
Restricted cash		1,320			3,124
Accounts receivable, net		320			663
Merchandise inventory, net		360,496			338,806
Prepaid and other current assets		30,692			25,425
Total current assets		710,867			621,374
Operating right-of-use assets		427,812			391,274
Financing right-of-use assets		31,623			33,275
Property, furniture and equipment, net		338,081			316,216
Deferred tax assets		16,402			19,545
Goodwill		10,961			10,961
Other noncurrent assets		2,992			2,101
Total assets	$	1,538,738		$	1,394,746
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	71,581		$	78,360
Accrued taxes		8,366			10,322
Accrued wages		28,164			20,879
Accrued other expenses		50,944			46,781
Client deposits		324,988			235,943
Current portion of operating lease liabilities		63,295			60,115
Current portion of financing lease liabilities		976			862
Total current liabilities		548,314			453,262
Operating lease liabilities, long-term		508,555			467,226
Financing lease liabilities, long-term		51,692			52,374
Other long-term liabilities		4,983			3,656
Total liabilities	$	1,113,544		$	976,518
Commitments and contingencies (Note 9)
Stockholders’ equity
Class A shares, par value $0.001 per share (600,000,000 shares authorized, 55,469,464 shares issued and 54,637,146 outstanding as of September 30, 2026; 54,565,242 shares issued and 53,969,149 outstanding as of December 31, 2025)		55			54
Class B shares, par value $0.001 per share (100,000,000 shares authorized, 87,115,600 shares issued and outstanding as of September 30, 2026; 87,115,600 shares issued and outstanding as of December 31, 2025)		87			87
Retained earnings		210,020			210,365
Additional paid-in capital		215,032			207,722
Total stockholders’ equity		425,194			418,228
Total liabilities and stockholders’ equity	$	1,538,738		$	1,394,746

Arhaus, Inc. and Subsidiaries  Condensed Consolidated Statements of Comprehensive Income  (Unaudited, amounts in thousands, except share and per share data)
	Nine months ended								Three months ended
	September 30,								September 30,
		2026				2025				2026				2025
Net revenue	$	1,067,289			$	1,014,377			$	368,116			$	344,570
Cost of goods sold		636,361				617,142				223,696				211,149
Gross margin		430,928				397,235				144,420				133,421
Selling, general and administrative expenses		364,342				328,534				134,340				117,014
Loss (gain) on disposal of assets		116				81				12				(27	)
Income from operations	$	66,470			$	68,620			$	10,068			$	16,434
Interest income, net		(2,527	)			(2,137	)			(1,009	)			(820	)
Other income		(1,514	)			(354	)			(622	)			(118	)
Income before taxes		70,511				71,111				11,699				17,372
Income tax expense		20,823				18,945				3,880				5,154
Net and comprehensive income	$	49,688			$	52,166			$	7,819			$	12,218
Net and comprehensive income per share, basic
Weighted-average number of common shares outstanding, basic		141,353,368				140,635,317				141,619,661				140,829,409
Net and comprehensive income per share, basic	$	0.35			$	0.37			$	0.06			$	0.09
Net and comprehensive income per share, diluted
Weighted-average number of common shares outstanding, diluted		141,943,580				141,310,742				142,275,176				141,676,722
Net and comprehensive income per share, diluted	$	0.35			$	0.37			$	0.05			$	0.09

Arhaus, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited, amounts in thousands)
	Nine months ended
	September 30,
		2026				2025
Cash flows from operating activities
Net income	$	49,688			$	52,166
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		39,384				34,716
Amortization of operating lease right-of-use asset		36,752				31,358
Amortization of interest on operating leases		24,534				21,842
Equity based compensation		8,483				6,344
Deferred tax assets		3,143				10,395
Amortization of cloud computing arrangements		2,450				1,905
Loss on disposal of assets		116				81
Insurance proceeds		1,899				—
Gain on insurance claims		(2,675	)			—
Changes in operating assets and liabilities
Accounts receivable		343				181
Merchandise inventory		(21,690	)			(31,718	)
Prepaid and other assets		(9,164	)			(19	)
Other noncurrent liabilities		1,328				(92	)
Accounts payable		(7,800	)			556
Accrued expenses		9,727				9,150
Operating lease liabilities		(52,603	)			(42,427	)
Client deposits		89,045				33,100
Net cash provided by operating activities		172,960				127,538
Cash flows from investing activities
Purchases of property, furniture and equipment		(59,391	)			(59,751	)
Insurance proceeds		1,193				—
Proceeds from the sale of property, furniture and equipment		59				54
Net cash used in investing activities		(58,139	)			(59,697	)
Cash flows from financing activities
Principal payments under finance leases		(671	)			(530	)
Repurchase of shares for payment of withholding taxes for equity based compensation		(1,681	)			(2,045	)
Cash dividend payments		(49,590	)			(340	)
Net cash used in financing activities		(51,942	)			(2,915	)
Net increase in cash, cash equivalents and restricted cash		62,879				64,926
Cash, cash equivalents and restricted cash
Beginning of period		256,480				200,929
End of period	$	319,359			$	265,855
Supplemental disclosure of cash flow information
Interest paid in cash	$	3,925			$	3,773
Interest received in cash		6,585				6,226
Income taxes paid in cash		17,577				14,046
Noncash investing activities:
Purchases of property, furniture and equipment in current liabilities		11,715				7,583

Arhaus, Inc. and Subsidiaries Reconciliation of Net Income to Adjusted EBITDA (Unaudited, amounts in thousands)
		Nine months ended								Three months ended
		September 30,								September 30,
			2026				2025				2026				2025
Net and comprehensive income		$	49,688			$	52,166			$	7,819			$	12,218
Interest income, net			(2,527	)			(2,137	)			(1,009	)			(820	)
Income tax expense			20,823				18,945				3,880				5,154
Depreciation and amortization			39,384				34,716				14,270				11,757
EBITDA			107,368				103,690				24,960				28,309
Equity based compensation			8,483				6,344				2,425				2,954
Other expenses (income)(1)			—				81				—				(27	)
Adjusted EBITDA		$	115,851			$	110,115			$	27,385			$	31,236
Net revenue		$	1,067,289			$	1,014,377			$	368,116			$	344,570
Net and comprehensive income as a % of net revenue			4.7	%			5.1	%			2.1	%			3.5	%
Adjusted EBITDA as a % of net revenue			10.9	%			10.9	%			7.4	%			9.1	%

^{(1) Other expenses (income) represent costs and investments not indicative of ongoing business performance, such as loss (gain) on disposal of assets.}

Arhaus, Inc. and Subsidiaries Reconciliation of Free Cash Flow (Unaudited, amounts in thousands)
	Nine months ended
	September 30,
		2026				2025
Net cash provided by operating activities	$	172,960			$	127,538
Net cash used in investing activities		(58,139	)			(59,697	)
Free cash flow	$	114,821			$	67,841

Free Cash Flow is defined as net cash provided by operating activities less net cash used in investing activities.

Arhaus, Inc. and Subsidiaries Supplemental Comparable Metrics Schedules  (Unaudited)
Supplemental Comparable Metrics Schedules Comparable Written Sales(2) by Quarter and Year-to-Date The table below represents Comparable Written Sales(2) on a quarterly and year-to-date basis for fiscal year 2026. Comparable Written Sales(2) reflects written sales trends during the period and is measured using a 13-month comparable Showroom definition.
2026		Comparable Written Sales (By Quarter)			Comparable Written Sales (Year-to-Date)
First Quarter		(5.7) %			(5.7) %
Second Quarter		12.5	%		2.8	%
Third Quarter		13.9	%		6.7	%

Comparable Delivered Sales⁽¹⁾ by Quarter and Year-to-Date

The table below represents Comparable Delivered Sales⁽¹⁾ on a quarterly and year-to-date basis for fiscal year 2026. Comparable Delivered Sales⁽¹⁾ reflects revenue recognized during the period and is measured using a 15-month comparable Showroom definition.

2026		Comparable Delivered Sales (By Quarter)			Comparable Delivered Sales (Year-to-Date)
First Quarter		(1.7) %			(1.7) %
Second Quarter		4.0	%		1.4	%
Third Quarter		2.6	%		1.8	%

Due to differences in order timing, backlog, and revenue recognition, Comparable Written Sales⁽²⁾ and Comparable Delivered Sales⁽¹⁾ use different comparable Showroom eligibility thresholds.

Arhaus, Inc. and Subsidiaries Supplemental Showroom Schedules  (Unaudited)
Supplemental Showroom Schedules Showroom Portfolio Composition The table below represents the composition of the Showroom Portfolio by format and operating footprint as of each period presented:
	September 30, 2026		December 31, 2025
Traditional Showrooms	91		90
Design Studios	9		9
Lofts	9		8
Total Showrooms	109		107
Total gross square footage (in thousands)	1,922		1,836
Showrooms with interior designers	98		97
Total interior designers	152		142
States where we operate	31		31

Geographic Showroom Footprint

The table below represents the number of Showrooms in each U.S. state in which the Company operates as of September 30, 2026.

Locations		Showrooms		Locations		Showrooms
Alabama		1		Missouri		1
Arizona		2		Montana		1
California		17		New Hampshire		1
Colorado		6		New Jersey		5
Connecticut		3		New York		4
Florida		9		North Carolina		4
Georgia		3		Ohio		9
Illinois		4		Oklahoma		1
Indiana		1		Pennsylvania		4
Kansas		1		South Carolina		1
Kentucky		3		Tennessee		1
Louisiana		1		Texas		8
Maryland		4		Utah		1
Massachusetts		3		Virginia		5
Michigan		3		Wisconsin		1
Minnesota		1

Showroom Maturity Mix

The table below represents the composition of the Showroom portfolio by maturity as of the period presented.

September 30, 2026
Maturity Bucket		Definition		% of Portfolio			# of Showrooms
		Opened within Last 12 Months		8	%		9
12-24 Months		Opened 12 to 24 Months		9	%		10
24-36 Months		Opened 24 to 36 Months		19	%		20
> 36 Months		Mature Showrooms		64	%		70
Total				100	%		109

Maturity is measured from Showroom opening date or relocation reopening date; includes Traditional Showrooms, Design Studios, and Lofts; excludes temporary closures.

Illustrative Unit Economics (Targets)

The table below represents targeted Showroom unit economics at maturity, based on internal underwriting assumptions and historical performance.

Metric		Traditional Showroom		Design Studio
		(~17K sq ft)		(~6K sq ft)
Net Revenue Maturity		> $10M		Lower than Traditional
Contribution Margin (pre-D&A)		~32%		~35%
Cash Payback
Company-funded capital expenditures		~$4 - 6M		Lower
Revenue Maturity		Year 3		Year 3

Company-funded capital expenditures represents the total net cash used in investing activities less landlord contributions. Targets reflect performance at full maturity. Assumptions are informed by historical performance, internal underwriting, and recent Showroom cohorts.

Total Showroom Projects⁽³⁾

The table below represents the total Showroom project pipeline for fiscal year 2026, consistent with the Company’s guidance.

Guidance Full-Year 2026
Project Type		Definition		# of Projects
New Openings		New Showroom openings		4 to 6
Relocations		Relocation of existing Showrooms		4 to 5
Renovations/Expansions		Refreshes of remodels and Expansions of existing Showrooms		2 to 3
Total Showroom Projects				10 to 14

Total Showroom Projects⁽³⁾ are expected to be within the Company’s full-year 2026 guidance range. For competitive reasons, the Company does not disclose the specific locations of planned Total Showroom Projects⁽³⁾. The Company provides additional detail on Showroom activity following completion as part of its regular quarterly disclosures.

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