Arhaus (NASDAQ:ARHS) Issues Quarterly Earnings Results, Misses Estimates By $0.03 EPS

Arhaus (NASDAQ:ARHS) released its quarterly earnings results on Thursday. The company reported $0.05 earnings per share for the quarter, missing analysts’ consensus estimates of $0.08 by ($0.03), FiscalAI reports. Arhaus had a net margin of 4.91% and a return on equity of 17.23%. The firm had revenue of $368.12 million for the quarter, compared to analysts’ expectations of $370.56 million. The company’s revenue for the quarter was up 6.8% on a year-over-year basis. During the same quarter in the previous year, the business earned $0.09 EPS.

Here are the key takeaways from Arhaus’ conference call:

• Arhaus reported record third-quarter revenue of $368 million, up 6.8%, and comparable written sales rose 13.9%. The company raised its full-year revenue and delivered-sales outlook, while maintaining its profit guidance.
• Demand was broad-based, with new-customer acquisition up more than 20% in September and growth in larger orders, custom products, and design-assisted sales. Management said September’s new customers had average order values more than 30% above existing customers, though it noted the cohort is still being evaluated.
• Profitability declined: net income fell 36% to $7.8 million, while adjusted EBITDA decreased 12.3% to $27 million and its margin contracted 170 basis points. Higher marketing and technology spending, legal costs, variable compensation timing, fuel and transportation costs, and new-showroom expenses weighed on results.
• Arhaus is investing in catalogs, digital commerce, and technology, and targets raising e-commerce to 25% of revenue over five years. Management expects transportation efficiencies and other initiatives to support margin improvement, but cited ongoing fuel and freight pressures and said fourth-quarter results depend partly on delivery capacity.

Arhaus Trading Up 6.2%

NASDAQ:ARHS traded up $0.81 during trading hours on Friday, hitting $13.74. The company had a trading volume of 2,080,164 shares, compared to its average volume of 1,418,774. The stock has a 50-day moving average price of $9.80 and a 200 day moving average price of $8.39. Arhaus has a 52 week low of $5.57 and a 52 week high of $13.87. The company has a debt-to-equity ratio of 0.13, a current ratio of 1.33 and a quick ratio of 0.60. The company has a market capitalization of $1.95 billion, a PE ratio of 27.44, a price-to-earnings-growth ratio of 3.73 and a beta of 2.24.

Insider Buying and Selling

In related news, major shareholder 2018 Reed Dynasty Trust sold 77,695 shares of Arhaus stock in a transaction dated Wednesday, November 4th. The shares were sold at an average price of $13.03, for a total transaction of $1,012,365.85. Following the completion of the transaction, the insider directly owned 64,927 shares of the company’s stock, valued at $845,998.81. This trade represents a 54.48% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Alton F. Doody III sold 3,500 shares of the company’s stock in a transaction dated Tuesday, September 8th. The stock was sold at an average price of $8.47, for a total transaction of $29,645.00. Following the completion of the transaction, the director owned 87,113 shares in the company, valued at approximately $737,847.11. The trade was a 3.86% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 278,896 shares of company stock worth $3,508,782 in the last three months. 1.18% of the stock is owned by corporate insiders.

Analysts Set New Price Targets

A number of analysts recently weighed in on ARHS shares. Jefferies Financial Group upgraded Arhaus from a “hold” rating to a “buy” rating and boosted their target price for the stock from $9.50 to $10.00 in a research report on Monday, September 21st. Craig Hallum raised shares of Arhaus from a “hold” rating to a “buy” rating and set a $12.00 price target on the stock in a research note on Thursday, August 6th. Zacks Research upgraded shares of Arhaus from a “hold” rating to a “strong-buy” rating in a report on Tuesday, October 6th. Wall Street Zen raised shares of Arhaus from a “sell” rating to a “hold” rating in a research note on Monday, July 20th. Finally, Weiss Ratings upgraded shares of Arhaus from a “hold (c-)” rating to a “hold (c)” rating in a research report on Monday, August 17th. One investment analyst has rated the stock with a Strong Buy rating, six have given a Buy rating and three have assigned a Hold rating to the company’s stock. According to data from MarketBeat, the stock has an average rating of “Moderate Buy” and an average price target of $10.78.

Key Arhaus News

Here are the key news stories impacting Arhaus this week:

• Positive Sentiment: Comparable written sales climbed 13.9% year over year, while delivered sales rose 2.6%, pointing to improving demand. Arhaus Reports Third Quarter 2026 Financial Results
• Positive Sentiment: Arhaus forecast FY2026 net revenue of $1.465 billion to $1.485 billion and aims for e-commerce to reach 25% of sales within five years. The target offers a potential longer-term growth channel, though it is not a near-term earnings result. Arhaus revenue forecast and e-commerce target
• Neutral Sentiment: Q3 revenue increased 6.8% to $368 million, showing year-over-year growth, but was slightly below analysts’ estimate of about $371 million. Arhaus Q3 results
• Negative Sentiment: EPS of $0.05 missed the $0.08 consensus and fell from $0.09 a year earlier. Net income declined 36% to $8 million, while adjusted EBITDA fell 12.3% to $27 million; higher SG&A costs contributed to pressure on profitability. Arhaus Reports Third Quarter 2026 Financial Results
• Negative Sentiment: CEO John Reed and the 2018 Reed Dynasty Trust reported substantial share sales. The transactions were made under pre-arranged Rule 10b5-1 plans, which may lessen their significance, but insider selling can still weigh on sentiment. CEO SEC filing Trust SEC filing

Arhaus Company Profile

Arhaus, Inc is a lifestyle-focused retailer of luxury and artisan-inspired furniture and home furnishings. The company offers products for living rooms, bedrooms, dining areas, offices and outdoor spaces, along with lighting, rugs, textiles, wall art, mirrors, décor and other home accessories.

Arhaus combines retail showrooms with e-commerce and interior design services, providing products intended to support a coordinated approach to home furnishing. Its collections are developed through collaborations with designers and craftspeople and may incorporate materials such as reclaimed wood, natural stone, upholstery fabrics and other distinctive finishes.

Founded in 1986, Arhaus serves customers primarily in the United States through its stores, online platform and interior design professionals.