Arhaus (ARHS) investor relations material

Executive summary

• Q3 net revenue reached a record $368.1M, up 6.8% YoY; Comparable Written Sales rose 13.9% and Comparable Delivered Sales increased 2.6%.

• Net income fell 36% to $7.8M and Adjusted EBITDA declined 12.3% to $27.4M YoY, as higher SG&A weighed on results.

• FY26 net revenue and Comparable Delivered Sales outlook increased; Net Income and Adjusted EBITDA guidance remained unchanged.

• Strong demand from affluent clients, larger projects, new products and showroom expansion supported results despite subdued housing activity.

Financial highlights

• Q3 gross profit was $144.4M, up 8.2% YoY; gross margin expanded 50 bps to 39.2%.

• Q3 operating income was $10.1M versus $16.4M, net income was $7.8M versus $12.2M, and diluted EPS was $0.05 versus $0.09.

• Q3 SG&A rose 14.8% to $134.3M, including higher G&A and selling expenses; marketing, technology, variable compensation timing and legal costs contributed to pressure.

• 9M revenue was $1.067B versus $1.014B; net income was $49.7M versus $52.2M. Comparable Written Sales rose 6.7% and Comparable Delivered Sales increased 1.8% YTD.

• Q3 included a $12.5M IEEPA tariff-recovery benefit; $36.3M of recovery benefit was recognized in 9M.

Outlook and guidance

• FY26 net revenue guidance rose to $1.465B–$1.485B, up 6.2%–7.7%; Comparable Delivered Sales guidance increased to 2.5%–4.0%.

• FY26 Net Income guidance is $71M–$80M and Adjusted EBITDA is $160M–$171M; company-funded capex is estimated at $70M–$90M.

• Q4 net revenue guidance is $398M–$418M, up 9.1%–14.6%; Comparable Delivered Sales guidance is 6%–12%, Net Income is $21M–$30M and Adjusted EBITDA is $44M–$55M.

• FY26 guidance includes 10–14 showroom projects and mid-single-digit net unit growth; 4–6 new showroom openings are planned.

• Revenue uplift is expected to add $4M–$5M in profitability, reinvested in ~$3M of spring catalog circulation and ~$2M for digital and e-commerce initiatives.