Arhaus Reports Third Quarter Results

November 5, 2026  by Karen Parrish in Business Strategy, Industry   

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 increased 2.6%

- Comparable Written Sales 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.

Conference Call

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.