NASDAQ$ARHS

Arhaus Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Reported strong third-quarter results, driven by exceptional demand and strategic showroom expansions.

Arhaus reported a 1.9% increase in net revenue to $326 million for Q3 2023, with net income at $20 million. The company is raising the midpoint of its full-year outlook for net revenue, net income, and adjusted EBITDA, driven by strong demand across all regions, products, and channels.

  • Net revenue increased by 1.9% to $326 million.
  • Net and Comprehensive Income reached $20 million.
  • Demand comparable growth was up 11.7%.
  • The company ended the quarter with 86 showrooms across 29 states.

Headline financials

Total Revenue

$326M

Previous: $320M+1.9%
EPS (adj)

$0.14

Previous: $0.27-48.1%
Comparable Delivered Sales

-2.1%

Previous: 54.3%-103.9%
Adjusted EBITDA

$34M

No prior period
Capital Expenditures

-$42.3M

Previous: -$37M-14.5%
Free Cash Flow

-$22.6M

Previous: -$14K-161078.6%
Net Income

$19.7M

Previous: $36.9M-46.6%
Operating Income

$23.9M

Previous: $47.1M-49.3%
Gross Profit

$131M

Previous: $136M-4.0%
Cash & Equivalents

$237M

Previous: $146M+62.6%
Total Assets

$1.12B

Previous: $907M+23.0%
R&D Expense

$0.00

No prior period
Stock-Based Comp

$1.85M

Previous: $1.22M+51.0%

Revenue & EPS history

Arhaus · Revenue · Quarterly

$326M

Q3 2023+1.9%vs Q3 2022
Beat estimate in 11 of 15 quarters(73%)
ActualEstimate

Forward guidance

Arhaus anticipates net revenue between $1.265 billion and $1.285 billion, and net income between $112.5 million and $117.5 million for the full year 2023.

Tailwinds

  • Net revenue of $1,265 million to $1,285 million
  • Comparable Growth of (1)% to 1%
  • Net income of $112.5 million to $117.5 million
  • Adjusted EBITDA of $192.5 million to $197.5 million
  • Company-funded capital expenditures of $60 to $70

Headwinds

  • Implied 4Q 2023 Comparable growth(1) (15)% to (9)%
  • Implied 4Q 2023 Net income(4) $18.5 to $23.5
  • Implied 4Q 2023 Adjusted EBITDA(5) $40.3 to $45.3
  • Gross margin decrease primarily driven by the sale of price-actioned products that were receipted with higher container costs
  • Adjusted EBITDA as a percent of net revenue declined 740 basis points to 10.3%

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

+7.6%

Avg return

Earnings day

+7.3%

Avg return

5 days after

+5.0%

Avg return

30 days after

61%

14 / 23 earnings

Positive

+30.4%

Q3 2020

Best reaction

-26.3%

Q4 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-6.9%-22.3%-16.6%
Q4 2025+10.6%-4.5%-22.4%
Q3 2025-3.5%-2.4%+8.0%
Q1 2025-5.3%+4.3%+4.8%
Q4 2024-8.1%-24.7%-28.0%
Q3 2024+6.1%+7.5%+15.4%
Q2 2024-8.5%-15.4%-20.4%
Q1 2024+23.4%+28.3%+48.9%
Q4 2023+16.2%+18.1%+22.5%
Q3 2023+5.1%+10.5%+19.8%
Q2 2023+6.0%+3.3%-17.4%
Q1 2023+10.2%+15.3%-2.4%
Q4 2022-26.3%-31.0%-40.9%
Q3 2022-4.4%-1.8%+4.8%
Q2 2022+25.2%+44.7%+41.6%
Q2 2021+25.2%+44.7%+41.6%
Q1 2021-9.2%-10.9%-18.9%
Q1 2022-9.2%-10.9%-18.9%
Q4 2021+18.2%+24.7%-0.4%
Q4 2019+18.2%+24.7%-0.4%
Q3 2021+30.4%+21.8%+31.3%
Q4 2020+30.4%+21.8%+31.3%
Q3 2020+30.4%+21.8%+31.3%
Q2 2020
Q1 2020

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