Arhaus (ARHS) Q2 2026 Earnings Report

The call conveyed strong operational momentum and record revenue driven by broad‑based product demand, accelerating written sales, robust showroom expansion, improving inventory availability, a full tariff refund cash outcome, and continued execution on technology and channel initiatives. However, meaningful near‑term headwinds remain: tariffs (structural and ongoing), elevated fuel and shipping costs, and intentional SG&A/technology investments that depress near‑term margins. Management maintained prudent full‑year revenue guidance while updating profitability to reflect the one‑time tariff recovery and deliberate reinvestment of a portion of that benefit. On balance, the positive operational achievements, cash position, tariff refund realization, and beating guidance outweigh the cost pressures and near‑term profitability noise.

Arhaus maintained full‑year net revenue guidance of $1.43–1.47 billion (up 3.7%–6.6%), comparable delivered sales flat to +3%, net income $71–80 million and adjusted EBITDA $160–171 million, while incorporating a discrete IEEPA tariff recovery (requested $37.8M; $32.7M receivable recognized; full cash refund received after recognizing $23.8M benefit in COGS in Q2, including $15.5M related to pre‑April inventory, plus a $14M reduction to inventory costs); management will reinvest $7–10M of the recovery into marketing and technology, expects roughly $10M to flow through to adjusted EBITDA, and anticipates additional ~$5–7M tariff flow‑through in Q3 and a similar amount in Q4. Q2 results were net revenue $385M (+7.4%), comparable written sales +12.5% (YTD +2.8%), comparable delivered sales +4% (YTD +1.4%), gross profit $172M (44.7% margin; 40.7% ex‑tariff), adjusted EBITDA $70M ($55M ex‑tariff), net income $40M, SG&A $118M (30.6% of sales), cash $226M, inventory $354M and client deposits ~$264M. Q3 guidance: net revenue $355–375M (+3%–8.8%), comp delivered -1% to +5%, net income $8–13M and adjusted EBITDA $26–34M; company also flags a 2026 tariff headwind of ~$30–40M, ~$10M each of elevated fuel and shipping costs for the year, a June delivery‑fee benefit of ~$5–6M annualized, and expected TMS/operational and technology savings to help margins over time.