Revenue growth is highly volatile, with Q2 2026 surging 95.1% year-over-year to $699.2M, yet gross margin remained resilient at 41.0%, while operating margin swung from 0.7% in Q1 2026 to 8.1% in Q2 2026.
Arhaus, Inc. (ARHS) annual income statement — 7-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 |
|---|
| Sales/Revenue | 1.75B | 1.38B | 1.27B | 1.29B | 1.23B | 796.92M | 507.43M | 494.54M |
| Revenue Growth % | 28.28% | 8.51% | -1.29% | 4.78% | 54.21% | 57.05% | 2.61% | - |
| Cost of Goods Sold | 1.06B | 842.81M | 769.88M | 747.28M | 703.87M | 466.99M | 307.93M | 318.55M |
| COGS % of Revenue | - | 61.11% | 60.57% | 58.03% | 57.27% | 58.6% | 60.68% | 64.41% |
| Gross Profit | 684.54M | 536.41M | 501.23M | 540.42M | 525.06M | 329.93M | 199.5M | 175.99M |
| Gross Margin % | 39.2% | 38.89% | 39.43% | 41.97% | 42.73% | 41.4% | 39.32% | 35.59% |
| Gross Profit Growth % | - | 7.02% | -7.25% | 2.93% | 59.14% | 65.38% | 13.36% | - |
| Operating Expenses | 595.55M | 447.44M | 414.22M | 376.11M | 340.39M | 296.58M | 168.62M | 146.33M |
| OpEx % of Revenue | - | 32.44% | 32.59% | 29.21% | 27.7% | 37.22% | 33.23% | 29.59% |
| Selling, General & Admin | 595.44M | 447.44M | 415.43M | 376.11M | 340.39M | 296.12M | 168.62M | 146.31M |
| SG&A % of Revenue | - | 32.44% | 32.68% | 29.21% | 27.7% | 37.16% | 33.23% | 29.58% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 104K | 0 | -1.2M | 0 | 0 | 466K | 8K | 23K |
| Operating Income | 88.98M | 88.89M | 87M | 164.31M | 184.67M | 33.35M | 30.88M | 29.66M |
| Operating Margin % | 5.09% | 6.44% | 6.84% | 12.76% | 15.03% | 4.18% | 6.09% | 6% |
| Operating Income Growth % | - | 2.16% | -47.05% | -11.03% | 453.74% | 8% | 4.12% | - |
| EBITDA | 161.78M | 178.47M | 163.03M | 227.06M | 238.62M | 57.27M | 47.84M | 45.62M |
| EBITDA Margin % | 9.26% | 12.94% | 12.83% | 17.63% | 19.42% | 7.19% | 9.43% | 9.23% |
| EBITDA Growth % | -12.07% | 9.47% | -28.2% | -4.85% | 316.65% | 19.72% | 4.85% | - |
| D&A (Non-Cash Add-back) | 72.81M | 89.58M | 76.02M | 62.75M | 53.95M | 23.92M | 16.96M | 15.96M |
| EBIT | 94.46M | 91.98M | 85.8M | 174.14M | 185.97M | 33.82M | 30.88M | 29.66M |
| Net Interest Income | 1.35M | 3.03M | 3.16M | 3.35M | -3.39M | -5.43M | -13.06M | -13.45M |
| Interest Income | 3.9M | 8.15M | 8.6M | 8.8M | 0 | 0 | 0 | 0 |
| Interest Expense | 2.56M | 5.12M | 5.44M | 5.45M | 3.39M | 5.43M | 13.06M | 13.45M |
| Other Income/Expense | 5.84M | 3.09M | 3.92M | 4.38M | -2.09M | -6.56M | -13.06M | -13.45M |
| Pretax Income | 94.82M | 91.98M | 90.92M | 168.69M | 182.58M | 26.79M | 17.82M | 16.21M |
| Pretax Margin % | 5.43% | 6.67% | 7.15% | 13.1% | 14.86% | 3.36% | 3.51% | 3.28% |
| Income Tax | 30.04M | 24.72M | 22.37M | 43.45M | 45.94M | -10.14M | 783K | 368K |
| Effective Tax Rate % | 31.68% | 26.88% | 24.61% | 25.76% | 25.16% | -37.87% | 4.39% | 2.27% |
| Net Income | 64.78M | 67.26M | 68.55M | 125.24M | 136.63M | 21.12M | 6.08M | 7.53M |
| Net Margin % | 3.71% | 4.88% | 5.39% | 9.73% | 11.12% | 2.65% | 1.2% | 1.52% |
| Net Income Growth % | -11.82% | -1.89% | -45.26% | -8.34% | 547.03% | 247.2% | -19.2% | - |
| Net Income (Continuing) | 64.78M | 67.26M | 68.55M | 125.24M | 136.63M | 36.93M | 17.04M | 15.84M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | -7.69M | 0 |
| EPS (Diluted) | 0.46 | 0.48 | 0.49 | 0.89 | 0.98 | 0.27 | 0.13 | 0.56 |
| EPS Growth % | -12.37% | -2.04% | -44.94% | -9.18% | 262.96% | 107.69% | -76.79% | - |
| EPS (Basic) | - | 0.48 | 0.49 | 0.90 | 0.99 | 0.27 | 0.13 | 0.56 |
| Diluted Shares Outstanding | 142.28M | 141.41M | 140.69M | 140.1M | 139.61M | 136.95M | 136.95M | 28.43M |
| Basic Shares Outstanding | 141.62M | 140.7M | 140.07M | 139.47M | 138.09M | 136.95M | 136.95M | 28.43M |
| Dividend Payout Ratio | - | 0.54% | 102.49% | - | - | 293.2% | - | - |
Quick answers to the most common questions about buying ARHS stock.
For fiscal year 2025, Arhaus, Inc. (ARHS) reported total revenue of $1.38B. This represents a 178.9% increase compared to $494.5M in 2019.
Arhaus, Inc. (ARHS) is profitable, generating $67.3M in net income for the fiscal year ending 2025 with a net profit margin of 4.9%.
Arhaus, Inc. (ARHS) reported an operating income of $88.9M, resulting in an operating profit margin of 6.4%. This margin reflects the operational efficiency of the business before interest and taxes.
Arhaus, Inc. (ARHS) generated $536.4M in gross profit for the year, representing a gross profit margin of 38.9%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Demand normalization and margin volatility
Metrics are mathematically derived from official filings.
Revenue Momentum Shows Sharp Quarterly Swing
Arhaus's Q2 2026 revenue surged 95.1% year-over-year to $699.2M, but this follows a period of low single-digit growth, suggesting a volatile, order-driven revenue pattern rather than steady expansion.
The 95.1% growth in Q2 2026 is an outlier, likely reflecting the clearing of a large order backlog rather than a sustainable demand acceleration. Prior quarters show growth ranging from -3.1% to 15.7%, indicating a lumpy revenue stream tied to project-based purchases. Investors should monitor customer deposits and order trends to gauge whether this spike represents a durable shift or a one-time catch-up.
Gross Margin Resilience Amid Cost Pressures
Gross margin held at 41.0% in Q2 2026, near the high end of the 36.4%-41.2% range over the past ten quarters, suggesting pricing power despite supply chain complexities.
The consistent gross margin around 38-41% indicates that Arhaus can pass on input cost increases to its affluent customer base, a sign of brand strength. However, the 36.4% margin in Q1 2026 shows vulnerability to seasonal and cost fluctuations. The company's artisan sourcing model may provide differentiation, but freight and raw material costs remain a risk to margin stability.
Operating Leverage Highly Variable by Quarter
Operating margin swung from 0.7% in Q1 2026 to 8.1% in Q2 2026, reflecting a high fixed-cost base where revenue timing dramatically impacts profitability.
The fixed-cost nature of showrooms and SG&A means that even modest revenue changes can cause outsized swings in operating income. Q2 2026's operating margin of 8.1% is below the 13.0% achieved in Q2 2025, indicating that the revenue surge did not translate proportionally to operating profit, possibly due to higher SG&A or pre-opening costs. This suggests limited operating leverage in the current model.
Earnings Quality Tempered by SBC and Tax Timing
Net income in Q2 2026 rose to $39.6M with EPS of $0.28, but stock-based compensation of $3.4M and a net margin of 5.7% suggest reported earnings may overstate cash profitability.
SBC as a percentage of net income is roughly 8.6% in Q2 2026, which is not immaterial. The effective tax rate appears to fluctuate, as net income margins vary from 0.7% to 9.8% across quarters, potentially due to discrete tax items. Investors should adjust for SBC and tax anomalies to assess true earnings power.
SG&A Efficiency Wavers with Expansion
SG&A as a percentage of revenue was 32.9% in Q2 2026, up from 28.2% in Q2 2025, indicating that overhead costs are growing faster than sales during the expansion phase.
The increase in SG&A intensity suggests that Arhaus is investing heavily in showroom openings and marketing, which may pressure near-term margins. While this could support future growth, the lack of corresponding operating margin improvement in Q2 2026 (8.1% vs. 13.0% a year ago) implies that cost discipline is not keeping pace with revenue growth. Monitoring SG&A leverage will be key.
Q2 2026 Marks a Demand Catch-Up Inflection
The 95.1% revenue surge in Q2 2026 stands out as a clear inflection point, likely driven by the fulfillment of backlogged orders, but its sustainability is questionable given the maintained guidance for Q3.
The company's Q3 guidance of $355M-$375M implies a sequential decline from Q2's $699.2M, suggesting that the Q2 spike was not a new run-rate but a temporary surge. This inflection may reflect a normalization of supply chains and order delivery, not a fundamental acceleration in consumer demand. The lasting impact is uncertain; investors should watch if customer deposits remain elevated to support future revenue.
Growth Spike Masks Underlying Demand Softness
The Q2 2026 revenue surge may be a one-time backlog clearance, as Q3 guidance implies a 50% sequential drop, and TTM growth of 8.5% is modest for a premium retailer.
Short-sellers could argue that the 95.1% growth is a distortion, and the maintained guidance for Q3 suggests management expects a sharp deceleration. Additionally, the 8.5% TTM growth is below peers like RH (8.1%) but with lower operating margins (6.4% vs. 11.3%), indicating that Arhaus is not converting growth into profits as efficiently. If demand normalizes, the high fixed-cost base could lead to margin compression and earnings disappointment.