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Arhaus Reports Second Quarter 2025 Financial Results

BOSTON HEIGHTS, Ohio, Aug. 07, 2025 (GLOBE NEWSWIRE) -- Arhaus, Inc. (鈥淎rhaus鈥� or the 鈥淐ompany鈥�) (NASDAQ: ARHS), a growing lifestyle brand and omni-channel retailer of premium artisan-crafted home furnishings, reported second quarter 2025 results for the period ended June听30, 2025.

Second Quarter 2025 Highlights

• Net revenue increased 15.7% to $358 million, compared to the second quarter of 2024
• Gross margin increased 19.1% to $148 million, compared to the second quarter of 2024
• Selling, general and administrative expenses increased 6.8% to $101 million, compared to the second quarter of 2024
• Net and comprehensive income increased 57.7% to $35 million, compared to the second quarter of 2024
• Adjusted EBITDA increased 51.2% to $60 million, compared to the second quarter of 2024
• Comparable growth⁽¹⁾ of 10.5%
• Total Showroom Projects⁽²⁾ of 3 locations, inclusive of 2 relocations and 1 renovation
  

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

鈥淲e achieved the highest quarterly net revenue in Arhaus鈥� history, exceeding $358 million, reflecting an increase of 15.7%. This record reflects the strength of our brand, the loyalty of our clients, and the exceptional execution of teams across the business.

During the quarter, we successfully brought operations of our Dallas Distribution Center in-house which ramped ahead of schedule. This transition enabled us to convert strong first quarter demand into net revenue more efficiently, and at a higher volume, than expected. As a result, Comparable growth⁽¹⁾ was 10.5%.

While second-quarter Demand comparable growth⁽³⁾ was (3.6)%, due to macro headwinds, July rebounded sharply, with Demand comparable growth⁽³⁾ up an impressive 15.7%, highlighting strong client engagement and the enduring appeal of our products. Year-to-date, including July, Demand comparable growth⁽³⁾ was up 2.2%.

Additionally, I鈥檓 proud to announce the launch of our Arhaus Bath Collection. This thoughtful expansion into a deeply personal space in the home reflects our commitment to timeless design, artisan craftsmanship, and functional beauty.

With a resilient high-end client base, debt-free balance sheet, and a clear strategic plan, we are navigating the current environment from a position of strength, focused on what we can control: disciplined execution, intentional growth, and continued investment in the systems, products, and talent that will drive our next phase.

Thank you to our teams, your creativity, care, and commitment make moments like this possible. Your passion is what brings Arhaus to life.鈥�

Business Highlights

Arhaus delivered strong second-quarter results, with net revenue exceeding $358 million, up 15.7% and setting a new record for the highest quarterly net revenue in Company history. In the second quarter, Comparable growth⁽¹⁾ was 10.5%, driven by the successful conversion of strong first-quarter demand, while Demand comparable growth⁽³⁾ was (3.6)%, reflecting macroeconomic volatility and external headwinds.

Looking ahead, Demand comparable growth⁽³⁾ in July was up 15.7%, reflecting strong client engagement and the strength of the Arhaus product assortment. Year-to-date, including July, Demand comparable growth⁽³⁾ was 2.2%.

Showroom Highlights

At the end of the second quarter of 2025, Arhaus operated 103 Showrooms across 30 states and all four geographic regions. During the quarter, the Company completed 3 Total Showroom Projects⁽²⁾, including 2 relocations and 1 renovation. Notable updates include:

• Wexford, Pennsylvania 鈥� A relocated showroom opened in Wexford Plaza, a premium open-air retail destination. The expansive, newly designed space features a dedicated design room and extensive fabric library, serving a key affluent suburb of Pittsburgh and reinforcing Arhaus鈥� luxury positioning.
  
  
• Scottsdale, Arizona 鈥� A fully renovated showroom at Kierland Commons. Originally opened in 2015, this renovated space more closely reflects the Arhaus aesthetic, blending international design elements with American craftsmanship to create an eclectic, elevated experience.
  

Year-to-date through the second quarter, Arhaus has completed 8 showroom projects, including 1 new opening, 6 relocations, and 1 renovation. The Company continues to expect the completion of approximately 12 to 15 Total Showroom Projects⁽²⁾ in 2025, consisting of 4 to 6 new openings and 8 to 9 relocations, renovations, or expansions.

Balance Sheet and Liquidity

As of June听30, 2025, the Company reported the following:

• No long-term debt.
• Cash and cash equivalents totaled $235 million.
• Net merchandise inventory of $311 million, a 4.7% increase from December听31, 2024 to June听30, 2025.
• Client deposits of $233 million, a 5.5% increase from December听31, 2024 to June听30, 2025.
• Net cash provided by operating activities totaled $81 million for the six months ended June 30, 2025.
• Net cash used in investing activities was approximately $42 million for the six months ended June 30, 2025. Company-funded capital expenditures⁽⁴⁾ were approximately $31 million and landlord contributions were approximately $11 million.

Outlook

The table below reaffirms Arhaus鈥� previously provided expectations for selected full-year 2025 financial and operating metrics. This outlook reflects currently implemented tariff actions as of the date of this release. The Company has also modestly reduced its full-year capital expenditures outlook by $10 million to reflect updated timing on select investments. In addition, Arhaus is introducing third-quarter 2025 guidance for select financial metrics, as detailed below.

⁽¹⁾ Comparable growth 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⁾ Total Showroom Projects is defined as the number of showroom projects completed during the period, including new showroom openings, strategic 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.
⁽³⁾ Demand comparable growth is a key performance indicator and is defined as the year-over-year percentage change of demand from our comparable Showrooms and eCommerce, including through our catalogs and other mailings.
⁽⁴⁾ Company-funded capital expenditures is defined as total net cash used in investing activities less landlord contributions.
⁽⁵⁾ U.S. GAAP net income (loss).
⁽⁶⁾ 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鈥� conference call to discuss the second quarter 2025 financial results scheduled for today, August听7, 2025, at 8:30 a.m. Eastern Time. The call will be available over the Internet on our website () or by dialing (877) 407-3982 within the U.S., or 1 (201) 493-6780, outside the U.S. The conference ID number is 13748992.

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 听for approximately twelve months.

About Arhaus

Founded in 1986, Arhaus is a growing lifestyle brand and omni-channel retailer of premium home furnishings. Through a differentiated proprietary model that directly designs and sources products from leading manufacturers and artisans around the world, Arhaus offers an exclusive assortment of heirloom quality products that are sustainably sourced, lovingly made, and built to last. With more than 100 showroom and design studio locations across the United States, a team of interior designers providing complimentary in-home design services, and robust online and eCommerce capabilities, Arhaus is known for innovative design, responsible sourcing, and client-first service. For more information, please visit .

Investor Contact:

Tara Louise Atwood
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 and adjusted EBITDA as a percentage of net revenue, 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 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 鈥淥utlook鈥� are not based on historical fact and are 鈥渇orward-looking statements鈥� 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, 鈥渕ay,鈥� 鈥渃ould,鈥� 鈥渟eek,鈥� 鈥済uidance,鈥� 鈥減redict,鈥� 鈥減otential,鈥� 鈥渓ikely,鈥� 鈥渂elieve,鈥� 鈥渨ill,鈥� 鈥渆xpect,鈥� 鈥渁nticipate,鈥� 鈥渆stimate,鈥� 鈥減lan,鈥� 鈥渋ntend,鈥� 鈥渇orecast,鈥� 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; 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鈥檚 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.

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