Arhaus saw a positive market reaction to its Q2 performance, as management credited growth to resilient demand from high-income customers and robust engagement across its channels. CEO John Reed highlighted that larger client projects, new product introductions, and a refreshed showroom experience drove higher average order values. The company pointed to broad-based strength in categories like upholstery, outdoor, and its vintage-inspired collections, while emphasizing the competitive advantage of domestic manufacturing and customization. CFO Michael Lee noted that strategic marketing investments and a rebound in store traffic were key contributors to the quarter's results.
Is now the time to buy ARHS? Find out in our full research report (it’s free for active Edge members).
Arhaus (ARHS) Q2 CY2026 Highlights:
- Revenue: $384.9 million vs analyst estimates of $366.8 million (7.4% year-on-year growth, 4.9% beat)
- Adjusted EBITDA: $70.47 million vs analyst estimates of $46.67 million (18.3% margin, 51% beat)
- The company reconfirmed its revenue guidance for the full year of $1.45 billion at the midpoint
- EBITDA guidance for the full year is $165.5 million at the midpoint, above analyst estimates of $152.7 million
- Operating Margin: 14.1%, up from 13% in the same quarter last year
- Locations: 109 at quarter end, up from 103 in the same quarter last year
- Same-Store Sales rose 4% year on year (10.5% in the same quarter last year)
- Market Capitalization: $1.37 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Arhaus’s Q2 Earnings Call
- Jonathan Matuszewski (Jefferies) asked about the drivers of Q2 demand, especially the balance between new and existing customers. CEO John Reed noted that average order values increased due to larger project sizes, while CFO Michael Lee added that traffic and high-value orders rebounded strongly versus Q1.
- Jacob Nivasch (Guggenheim Securities) questioned the performance and scaling of the trade program. Reed explained that flexible commission structures and comprehensive offerings attracted thousands of new trade members each month, positioning the program for long-term growth.
- Madeline Cech (Bank of America) sought clarity on comparable sales trends and promotional strategies. Lee highlighted a V-shaped recovery in Q2, with targeted promotions driving traffic and minimal margin impact, and Atwood and Reed emphasized the impact of new product launches and expanded catalog reach for the fall.
- Alexia Morgan (Piper Sandler) probed the sustainability of Q2’s momentum given conservative full-year guidance. Reed and Lee expressed optimism but cited external uncertainties, noting internal optimism within merchandising teams while remaining cautious in official forecasts.
- Peter Benedict (Baird) asked for detail on margin pressures and the impact of delivery fee increases and cost headwinds. Lee outlined that tariffs, fuel, and shipping costs would continue to pressure margins, but operational initiatives and higher delivery fees are expected to provide some relief in the second half.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be monitoring (1) the impact of expanded catalog distribution and new product launches on traffic and conversion, (2) how ongoing technology upgrades to the point-of-sale and supply chain systems improve operational execution, and (3) whether margin pressures from tariffs and shipping costs are offset by pricing and efficiency initiatives. The performance of the trade program and showroom expansion will also be important indicators.
Arhaus currently trades at $9.66, up from $8.23 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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