10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

OR

☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-41009

Arhaus, Inc.

(Exact name of registrant as specified in its charter)

Delaware	87-1729256
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

51 E. Hines Hill Road, Boston Heights, Ohio

(Address of Principal Executive Offices)

44236

(Zip Code)

(440) 439-7700

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.001 par value per share	ARHS	The Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of April 30, 2024 the registrant had 53,241,316 shares of Class A common stock and 87,115,600 shares of Class B common stock outstanding.

Table of Contents

		Page
Part I - Financial Information		2
Item 1.	Financial Statements of Arhaus, Inc. and Subsidiaries	2
	Condensed Consolidated Balance Sheets (unaudited)	2
	Condensed Consolidated Statements of Comprehensive Income (unaudited)	3
	Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)	4
	Condensed Consolidated Statements of Cash Flows (unaudited)	5
	Notes to Condensed Consolidated Financial Statements (unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	32
Part II. Other Information		35
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
Item 3.	Defaults Upon Senior Securities	35
Item 4.	Mine Safety Disclosures	35
Item 5.	Other Information	35
Item 6.	Exhibits	37
Signatures		38

1

Part I - Financial Information

Item 1. Financial Statements of Arhaus, Inc. and Subsidiaries

Arhaus, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited, amounts in thousands, except share and per share data)

	March 31, 2024		December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	233,230	$	223,098
Restricted cash	3,210		3,207
Accounts receivable, net	1,805		2,394
Merchandise inventory, net	268,410		254,292
Prepaid and other current assets	33,122		26,304
Total current assets	539,777		509,295
Operating right-of-use assets	322,905		302,157
Financing right-of-use assets	38,209		38,835
Property, furniture and equipment, net	243,167		220,248
Deferred tax assets	18,953		19,127
Goodwill	10,961		10,961
Other noncurrent assets	2,407		4,525
Total assets	$	1,176,379	$	1,105,148
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	62,135	$	63,699
Dividends payable	70,628		—
Accrued taxes	13,296		9,638
Accrued wages	11,156		15,185
Accrued other expenses	43,195		46,062
Client deposits	202,922		173,808
Current portion of operating lease liabilities	42,694		33,051
Current portion of financing lease liabilities	919		904
Total current liabilities	446,945		342,347
Operating lease liabilities, long-term	383,684		362,598
Financing lease liabilities, long-term	53,658		53,870
Deferred rent and lease incentives	1,871		1,952
Other long-term liabilities	4,574		4,143
Total liabilities	$	890,732	$	764,910
Commitments and contingencies (Note 9)
Stockholders’ equity
Class A shares, par value $0.001 per share (600,000,000 shares authorized, 53,361,983 shares issued and 53,241,316 outstanding as of March 31, 2024; 53,254,088 shares issued and 53,169,711 outstanding as of December 31, 2023)	53		52
Class B shares, par value $0.001 per share (100,000,000 shares authorized, 87,115,600 shares issued and outstanding as of March 31, 2024; 87,115,600 shares issued and outstanding as of December 31, 2023)	87		87
Retained earnings	89,206		145,292
Additional paid-in capital	196,301		194,807
Total Arhaus, Inc. stockholders’ equity	285,647		340,238
Total liabilities and stockholders’ equity	$	1,176,379	$	1,105,148

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2

Arhaus, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Unaudited, amounts in thousands, except share and per share data)

	Three months ended
	March 31,
	2024		2023
Net revenue	$	295,162	$	304,568
Cost of goods sold	180,108		176,330
Gross margin	115,054		128,238
Selling, general and administrative expenses	96,693		82,782
Income from operations	$	18,361	$	45,456
Interest expense (income), net	(1,432)		(173)
Other income	(122)		(572)
Income before taxes	19,915		46,201
Income tax expense	4,816		12,102
Net and comprehensive income	$	15,099	$	34,099
Net and comprehensive income per share, basic
Weighted-average number of common shares outstanding, basic	139,816,792		139,072,756
Net and comprehensive income per share, basic	$	0.11	$	0.25
Net and comprehensive income per share, diluted
Weighted-average number of common shares outstanding, diluted	140,556,031		139,939,543
Net and comprehensive income per share, diluted	$	0.11	$	0.24

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3

Arhaus, Inc. and Subsidiaries

Condensed Consolidated Statements of Changes in Stockholders’ Equity

(Unaudited, amounts in thousands)

	Three Months Ended
	Common Stock						Treasury Stock				Total Stockholders’ Equity
	Class A			Class B			Class A
	Shares	Amount		Shares	Amount		Shares		Amount		Retained Earnings		Additional Paid-in Capital		Total Stockholders’ Equity
Balances as of December 31, 2023	52,669	$	52	87,116	$	87	84		$	—	$	145,292	$	194,807	$	340,238
Net income	—	—		—	—		—		—		15,099		—		15,099
Shareholder capital contribution	—	—		—	—		—		—		—		11		11
Equity based compensation	129	1		—	—		—		—		—		2,023		2,024
Shares withheld to cover employees’ withholding taxes for equity based compensation	(37)	—		—	—		37		—		—		(540)		(540)
Dividends declared	—	—		—	—		—		—		(71,185)		—		(71,185)
March 31, 2024	52,761	$	53	87,116	$	87	121		$	—	$	89,206	$	196,301	$	285,647
	Three Months Ended
	Common Stock						Treasury Stock				Total Stockholders’ Equity
	Class A			Class B			Class A
	Shares	Amount		Shares	Amount		Shares		Amount		Retained Earnings		Additional Paid-in Capital		Total Stockholders’ Equity
Balances as of December 31, 2022	51,437	$	51	87,116	$	87	—		$	—	$	20,053	$	189,504	$	209,695
Net income	—	—		—	—		—		—		34,099		—		34,099
Shareholder capital contribution	—	—		—	—		—		—		—		17		17
Equity based compensation	804	1		—	—		—		—		—		1,629		1,630
Shares withheld to cover employees’ withholding taxes for equity based compensation	(25)	—		—	—		25		—		—		(347)		(347)
March 31, 2023	52,216	$	52	87,116	$	87	$	25	$	—	$	54,152	$	190,803	$	245,094

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4

Arhaus, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited, amounts in thousands)

	Three months ended
	March 31,
	2024		2023
Cash flows from operating activities
Net income	$	15,099	$	34,099
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	8,603		6,740
Amortization of operating lease right-of-use asset	8,738		7,559
Amortization of deferred financing fees, interest on finance lease in excess of principal paid and interest on operating leases	6,233		4,640
Equity based compensation	2,024		1,630
Deferred tax assets	174		4,599
Amortization of cloud computing arrangements	310		—
Amortization and write-off of lease incentives	(80)		(80)
Insurance proceeds	—		47
Changes in operating assets and liabilities
Accounts receivable	589		(173)
Merchandise inventory	(14,118)		(5,750)
Prepaid and other assets	(5,758)		(1,286)
Other noncurrent liabilities	18		93
Accounts payable	(4,819)		(12,625)
Accrued expenses	(5,092)		(13,346)
Operating lease liabilities	(4,207)		(10,628)
Client deposits	29,114		(4,654)
Net cash provided by operating activities	36,828		10,865
Cash flows from investing activities
Purchases of property, furniture and equipment	(25,932)		(11,693)
Insurance proceeds	—		333
Net cash used in investing activities	(25,932)		(11,360)
Cash flows from financing activities
Principal payments under finance leases	(221)		(65)
Repurchase of shares for payment of withholding taxes for equity based compensation	(540)		(347)
Net cash used in financing activities	(761)		(412)
Net increase (decrease) in cash, cash equivalents and restricted cash	10,135		(907)
Cash, cash equivalents and restricted cash
Beginning of period	226,305		152,527
End of period	$	236,440	$	151,620
Supplemental disclosure of cash flow information
Interest paid in cash	$	840	$	1,305
Interest received in cash	2,871		1,507
Income taxes paid in cash	991		1,246
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	15,250		8,025
Noncash financing activities:
Capital contributions	11		17

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1

1. Nature of Business and Basis of Presentation

Nature of Business

Arhaus, Inc. (the “Company,” “we” or “Arhaus”) is a Delaware corporation and is a premium retailer in the home furnishings market, specializing in livable luxury supported by heirloom quality merchandise. We offer merchandise in a number of categories, including furniture, outdoor, lighting, textiles and décor. Our curated assortments are presented across our sales channels in sophisticated, family friendly and unique lifestyle settings. We position our retail locations as Showrooms for our brand, while our website acts as a virtual extension of our Showrooms. The Company operated 92 Showrooms as of March 31, 2024.

Basis of Presentation

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying condensed consolidated financial statements include our accounts and those of our wholly owned subsidiaries. Accordingly, all intercompany balances and transactions have been eliminated through the consolidation process.

The accompanying condensed consolidated balance sheets at March 31, 2024 and December 31, 2023, the condensed consolidated statements of comprehensive income, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023 and the related interim condensed consolidated disclosures are unaudited and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

In management’s opinion, the accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company’s financial position at March 31, 2024, the results of operations, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023. The condensed consolidated balance sheet as of December 31, 2023 included herein was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP.

The results for the three months ended March 31, 2024 and March 31, 2023 are not necessarily indicative of the operating results to be expected for the full fiscal year or any future period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.

Use of Estimates

The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The accounting estimates and other matters included within our condensed consolidated financial statements and notes to the condensed consolidated financial statements we have assessed include, but were not limited to, revenue recognition, including a reserve for merchandise returns, inventory reserves, impairment of long-lived assets and fair value of financial instruments which include, but are not limited to, accounts receivable, payables and lease obligations.

Client Deposits

Client deposits represent payments made by clients on orders. At the time of order, the Company collects deposits for all orders equivalent to at least 50 percent of the clients’ purchase price. Orders are recognized as revenue when the merchandise is delivered to the client and at the time of delivery the client deposit is no longer recorded as a liability. The Company expects substantially all client deposits as of March 31, 2024 will be recognized as net revenue within the next 12 months as the performance obligations are satisfied.

6

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Gift Cards

The Company sells gift cards to clients in our Showrooms and through our website. Such gift cards do not have expiration dates. We defer revenue when payments are received in advance of performance for unsatisfied obligations related to our gift cards. The liability related to unredeemed gift cards at March 31, 2024 and December 31, 2023 of $0.4 million and $0.5 million, respectively, is recorded in the accrued other expenses line item of the condensed consolidated balance sheets. The Company recognizes income associated with breakage proportional to actual gift card redemptions. For the three months ended March 31, 2024 and March 31, 2023, breakage income was minimal.

Fair Values of Financial Instruments

The Company’s primary financial instruments are cash and cash equivalent investments, accounts receivable, payables, lease obligations and equity based compensation instruments. Due to the short-term maturities of cash and cash equivalent investments, accounts receivable and payables, the Company believes the fair values of these instruments approximate their respective carrying values at March 31, 2024 and December 31, 2023. See Note 5 — Leases for discussion of our lease obligations and Note 6 — Equity Based Compensation for discussion of our equity based compensation instruments.

The Company has established a hierarchy to measure our financial instruments at fair value, which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect the Company’s own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. The hierarchy defines three levels of inputs that may be used to measure fair value:

Level 1Unadjusted quoted prices in active markets for identical, unrestricted assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3Unobservable inputs that reflect the entity’s own assumptions about the assumptions market participants would use in the pricing of the asset or liability and are consequently not based on market activity but rather through particular valuation techniques.

From time to time, the Company invests in Level 1 cash and cash equivalent investments such as money market funds and interest-bearing checking accounts. For the three months ended March 31, 2024, the Company earned $2.8 million in interest income. For the three months ended March 31, 2023, interest income was $1.5 million. Interest income is included within interest expense (income), net on our condensed consolidated statements of comprehensive income.

Revision to Previously Issued Consolidated Financial Statements and Interim Unaudited Condensed Consolidated Financial Statements

As previously disclosed, in preparation of the December 31, 2023 consolidated financial statements, the Company identified an error within the unaudited condensed consolidated balance sheets related to certain leasehold and landlord improvements prior to showroom completion being incorrectly included in prepaid and other current assets rather than property, furniture and equipment, net. The error resulted in inaccurate cash flows ascribed to operating and investing activities in the unaudited condensed consolidated statement of cash flows and the Company concluded to revise the consolidated financial statements and interim unaudited condensed consolidated financial statements as presented below in Adjustment No.1.

In preparation of the March 31, 2024 unaudited condensed consolidated financial statements, the Company identified an additional error within the unaudited condensed consolidated balance sheets related to certain cash receipts from landlord reimbursements prior to showroom completion being incorrectly included in property, furniture and equipment, net. The error resulted in inaccurate cash flows ascribed to operating and investing activities in the unaudited condensed consolidated statement of cash flows as presented below in Adjustment No. 2.

7

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company has evaluated the errors both quantitatively and qualitatively and concluded they were not material, individually or in the aggregate, to the prior period consolidated financial statements and interim unaudited condensed consolidated financial statements. The Company concluded to further revise: the unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of cash flows as of and for the three months ended March 31, 2023 and 2022, and as of and for the six months ended June 30, 2023 and 2022; the unaudited condensed consolidated balance sheet as of September 30, 2022; the consolidated balance sheets as of December 31, 2023 and 2022; and the consolidated statements of cash flows for the years ended December 31, 2023, 2022 and 2021.

In connection with the revisions, the Company determined it is appropriate to correct for certain other immaterial errors. The Company will effect the revisions of the consolidated financial statements for 2023 and 2022 within our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The Company will effect the revision of the unaudited interim condensed consolidated financial statements for the second quarter of 2023 within our Quarterly Report on Form 10-Q for the fiscal period ended June 30, 2024.

The Company has also revised impacted amounts within the accompanying notes to the unaudited condensed consolidated financial statements, as applicable.

The following tables summarize the impact of these corrections for the periods presented (amounts in thousands):

	December 31, 2023
Consolidated Balance Sheet	As Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	45,260	$	(18,956)	$	26,304
Total current assets	$	528,251	$	(18,956)	$	509,295
Property, furniture and equipment, net	$	210,238	$	10,010	$	220,248
Total assets	$	1,114,094	$	(8,946)	$	1,105,148
Accrued other expenses	$	42,502	$	3,560	$	46,062
Current portion of operating lease liabilities	45,557		(12,506)		33,051
Total current liabilities	$	351,293	$	(8,946)	$	342,347
Total liabilities	$	773,856	$	(8,946)	$	764,910
Total liabilities and stockholders' equity	$	1,114,094	$	(8,946)	$	1,105,148

8

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Year ended
	December 31, 2023
Consolidated Statement of Cash Flows	As Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(20,721)	$	9,612	$	(11,109)
Changes in operating lease liabilities	(25,794)		(13,226)		(39,020)
Net cash provided by operating activities	$	172,299	$	(3,614)	$	168,685
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(97,055)	$	3,614	$	(93,441)
Net cash used in investing activities	$	(96,722)	$	3,614	$	(93,108)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	6,726	$	3,560	$	10,286

	June 30, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	43,084	$	(13,274)	$	29,810	$	(11,380)	$	18,430
Total current assets	$	521,047	$	(13,274)	$	507,773	$	(11,380)	$	496,393
Operating right-of-use assets	$	309,211	$	(7,350)	$	301,861	$	—	$	301,861
Property, furniture and equipment, net	149,515		13,274		162,789		15,160		177,949
Total assets	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709
Accrued other expenses	$	33,857	$	—	$	33,857	$	2,410	$	36,267
Current portion of operating lease liabilities	41,483		—		41,483		1,370		42,853
Total current liabilities	$	344,627	$	—	$	344,627	$	3,780	$	348,407
Operating lease liabilities, long-term	$	352,898	$	(7,350)	$	345,548	$	—	$	345,548
Total liabilities	$	757,715	$	(7,350)	$	750,365	$	3,780	$	754,145
Total liabilities and stockholders' equity	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709

9

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Six months ended
	June 30, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(6,808)	$	5,391	$	(1,417)	$	2,036	$	619
Changes in accounts payable	(4,849)		(5,676)		(10,525)		—		(10,525)
Changes in operating lease liabilities	(17,903)		—		(17,903)		650		(17,253)
Net cash provided by operating activities	$	61,795	$	(285)	$	61,510	$	2,686	$	64,196
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(32,815)	$	285	$	(32,530)	$	(2,686)	$	(35,216)
Net cash used in investing activities	$	(32,482)	$	285	$	(32,197)	$	(2,686)	$	(34,883)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,945	$	(4,945)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	456	$	5,676	$	6,132	$	2,410	$	8,542

	March 31, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	44,122	$	(10,221)	$	33,901	$	(12,469)	$	21,432
Total current assets	$	489,771	$	(10,221)	$	479,550	$	(12,469)	$	467,081
Property, furniture and equipment, net	$	136,156	$	7,908	$	144,064	$	16,636	$	160,700
Other noncurrent assets	277		2,313		2,590		—		2,590
Total assets	$	965,886	$	—	$	965,886	$	4,167	$	970,053
Accrued other expenses	$	33,174	$	—	$	33,174	$	1,804	$	34,978
Current portion of operating lease liabilities	40,233		—		40,233		2,363		42,596
Total current liabilities	$	346,816	$	—	$	346,816	$	4,167	$	350,983
Total liabilities	$	720,792	$	—	$	720,792	$	4,167	$	724,959
Total liabilities and stockholders' equity	$	965,886	$	—	$	965,886	$	4,167	$	970,053

10

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Three months ended
	March 31, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(7,513)	$	3,102	$	(4,411)	$	3,125	$	(1,286)
Changes in accounts payable	(7,943)		(4,682)		(12,625)		—		(12,625)
Changes in operating lease liabilities	(12,271)		—		(12,271)		1,643		(10,628)
Net cash provided by operating activities	$	7,677	$	(1,580)	$	6,097	$	4,768	$	10,865
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(8,505)	$	1,580	$	(6,925)	$	(4,768)	$	(11,693)
Net cash used in investing activities	$	(8,172)	$	1,580	$	(6,592)	$	(4,768)	$	(11,360)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	741	$	(741)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,539	$	4,682	$	6,221	$	1,804	$	8,025

	December 31, 2022
Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	37,371	$	(7,503)	$	29,868	$	(9,344)	$	20,524
Total current assets	$	478,051	$	(7,503)	$	470,548	$	(9,344)	$	461,204
Operating right-of-use assets	$	252,055	$	5,292	$	257,347	$	—	$	257,347
Property, furniture and equipment, net	135,066		5,547		140,613		11,655		152,268
Other noncurrent assets	296		1,956		2,252		—		2,252
Total assets	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395
Accrued other expenses	$	35,169	$	—	$	35,169	$	1,591	$	36,760
Current portion of operating lease liabilities	39,744		(494)		39,250		720		39,970
Total current liabilities	$	373,783	$	(494)	$	373,289	$	2,311	$	375,600
Operating lease liabilities, long-term	$	289,871	$	5,786	$	295,657	$	—	$	295,657
Total liabilities	$	722,097	$	5,292	$	727,389	$	2,311	$	729,700
Total liabilities and stockholders' equity	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395

11

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Year ended
	December 31, 2022
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(9,329)	$	2,442	$	(6,887)	$	(267)	$	(7,154)
Changes in accounts payable	14,014		(3,718)		10,296		—		10,296
Changes in operating lease liabilities	(33,682)		—		(33,682)		4,551		(29,131)
Net cash provided by operating activities	$	74,454	$	(1,276)	$	73,178	$	4,284	$	77,462
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Net cash used in investing activities	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,312	$	(4,312)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	3,160	$	3,718	$	6,878	$	1,591	$	8,469

    

	September 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	35,867	$	(5,772)	$	30,095	$	(11,298)	$	18,797
Total current assets	$	482,298	$	(5,772)	$	476,526	$	(11,298)	$	465,228
Operating right-of-use assets	$	224,921	$	7,092	$	232,013	$	—	$	232,013
Property, furniture and equipment, net	128,783		4,249		133,032		7,246		140,278
Other noncurrent assets	235		1,523		1,758		—		1,758
Total assets	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248
Accrued other expenses	$	33,756	$	—	$	33,756	$	1,044	$	34,800
Current portion of operating lease liabilities	39,248		680		39,928		(5,096)		34,832
Total current liabilities	$	423,986	$	680	$	424,666	$	(4,052)	$	420,614
Operating lease liabilities, long-term	$	263,753	$	6,412	$	270,165	$	—	$	270,165
Total liabilities	$	746,413	$	7,092	$	753,505	$	(4,052)	$	749,453
Total liabilities and stockholders' equity	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248

12

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	June 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	29,509	$	(5,264)	$	24,245	$	(10,390)	$	13,855
Total current assets	$	455,100	$	(5,264)	$	449,836	$	(10,390)	$	439,446
Property, furniture and equipment, net	$	116,620	$	4,105	$	120,725	$	5,891	$	126,616
Other noncurrent assets	249		1,159		1,408		—		1,408
Total assets	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533
Accrued other expenses	$	26,718	$	—	$	26,718	$	777	$	27,495
Current portion of operating lease liabilities	37,624		—		37,624		(5,276)		32,348
Total current liabilities	$	426,659	$	—	$	426,659	$	(4,499)	$	422,160
Total liabilities	$	753,138	$	—	$	753,138	$	(4,499)	$	748,639
Total liabilities and stockholders' equity	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533

	Six months ended
	June 30, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(5,095)	$	4,520	$	(575)	$	779	$	204
Changes in accounts payable	15,197		(321)		14,876		—		14,876
Changes in operating lease liabilities	(15,401)		—		(15,401)		(1,445)		(16,846)
Net cash provided by operating activities	$	41,110	$	4,199	$	45,309	$	(666)	$	44,643
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Net cash used in investing activities	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,494	$	(4,494)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,673	$	321	$	1,994	$	777	$	2,771

13

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	March 31, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	31,013	$	(5,060)	$	25,953	$	(9,015)	$	16,938
Total current assets	$	435,116	$	(5,060)	$	430,056	$	(9,015)	$	421,041
Operating right-of-use assets	$	196,896	$	3,071	$	199,967	$	—	$	199,967
Property, furniture and equipment, net	107,581		4,083		111,664		8,823		120,487
Other noncurrent assets	264		977		1,241		—		1,241
Total assets	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068
Accrued other expenses	$	20,946	$	—	$	20,946	$	717	$	21,663
Current portion of operating lease liabilities	37,957		(138)		37,819		(909)		36,910
Total current liabilities	$	444,885	$	(138)	$	444,747	$	(192)	$	444,555
Operating lease liabilities, long-term	$	227,191	$	3,209	$	230,400	$	—	$	230,400
Total liabilities	$	727,645	$	3,071	$	730,716	$	(192)	$	730,524
Total liabilities and stockholders' equity	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068

	Three months ended
	March 31, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,016)	$	1,628	$	(1,388)	$	(596)	$	(1,984)
Changes in accounts payable	8,680		(2,247)		6,433		—		6,433
Changes in operating lease liabilities	(11,485)		—		(11,485)		2,922		(8,563)
Net cash provided by operating activities	$	35,219	$	(619)	$	34,600	$	2,326	$	36,926
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Net cash used in investing activities	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	108	$	2,247	$	2,355	$	717	$	3,072

14

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Year ended
	December 31, 2021
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,621)	$	(8,673)	$	(12,294)	$	3,590	$	(8,704)
Changes in accounts payable	17,595		(3,088)		14,507		—		14,507
Changes in deferred rent and lease incentives	4,518		5,352		9,870		(2,074)		7,796
Net cash provided by operating activities	$	146,243	$	(6,409)	$	139,834	$	1,516	$	141,350
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Net cash used in investing activities	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	5,352	$	(5,352)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	5,968	$	3,088	$	9,056	$	363	$	9,419

As previously disclosed, these errors also resulted in the restatement of the unaudited condensed consolidated balance sheet and statement of cash flows as of and for the nine months ended September 30, 2023 and the revision of the unaudited condensed consolidated statement of cash flows for the nine months ended September 30, 2022.

2. Recently Issued Accounting Standards

New Accounting Standards Adopted in Fiscal 2024

The Company adopted Accounting Standards Updates (“ASU”) 2023-01 — Leases (Topic 842): Common Control Arrangements in the three months ended March 31, 2024. We believe the adoption of ASU 2023-01 did not have a material impact on our accounting policies or our condensed consolidated financial statements and related disclosures.

Accounting Standards Not Yet Adopted

The following table summarizes accounting pronouncements which we have not yet adopted but will be adopted in the upcoming fiscal year. ASU 2023-07 is effective for annual periods beginning after December 15, 2023. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures.

ASU	Description	Adoption Date
ASU 2023-07	Segment Reporting (Topic 280): Improvements	Fiscal Year 2024
ASU 2023-09	Income Taxes (Topic 740): Improvements to Income Tax Disclosures	Fiscal Year 2025

15

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

3. Merchandise Warranties

The Company warrants certain merchandise to be free of defects in both construction materials and workmanship from the date the performance obligation was fulfilled to the client for three to ten years depending on the merchandise category. The Company accounts for merchandise warranties by accruing an estimated liability when we recognize revenue on the sale of warrantied merchandise. We estimate future warranty claims based on claim experience which includes materials and labor costs to perform the repairs or replace products. We use judgment in making our estimates. We record differences between our estimated and actual costs when the differences are known.

A reconciliation of the changes in our limited merchandise warranty liability is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Balance as of beginning of period	$	7,084	$	6,375
Accruals during the period	3,080		3,381
Settlements during the period	(3,136)		(3,291)
Balance as of end of the period(1)	$	7,028	$	6,465

(1) $4.0 million and $3.7 million were recorded in accrued other expenses at March 31, 2024 and March 31, 2023, respectively. The remainder is recorded in other long-term liabilities on our condensed consolidated balance sheets.

We recorded accruals during the periods presented in the table above, primarily to reflect charges that relate to limited merchandise warranties issued during the respective periods.

4. Debt

On November 8, 2021, the Company entered into a revolving credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provides for, among other things, (1) a revolving credit facility in an aggregate amount not to exceed at any time outstanding the amount of such lender’s commitment, (2) a letter of credit commitment in an amount equal to the lesser of (a) $10.0 million, and (b) the amount of the revolving credit facility as of such date, and (3) a swingline loan in an amount equal to the lesser of (a) $5.0 million, and (b) the amount of the revolving credit facility as of such date. The aggregate amount of all commitments of all lenders under the 2021 Credit Facility was initially $50.0 million. The 2021 Credit Facility contains restrictive covenants and has certain financial covenants, including a minimum rent-adjusted total leverage ratio and a minimum fixed charge ratio. The 2021 Credit Facility bears variable interest rates at the prevailing Bloomberg Short-Term Bank Yield index rate plus the applicable margin (1.50% at March 31, 2024 and 1.50% at March 31, 2023), whereas the applicable margin is adjusted quarterly based on the Company’s consolidated rent-adjusted total leverage ratio.

On December 9, 2022, the Company amended the 2021 Credit Facility to increase the revolving credit commitment thereunder by $25.0 million. After giving effect to such increase, the aggregate amount of all commitments under the 2021 Credit Facility is $75.0 million. The 2021 Credit Facility expires on November 8, 2026.

At March 31, 2024 and December 31, 2023, we had no borrowings on the 2021 Credit Facility. Deferred financing costs related to the 2021 Credit Facility of $0.4 million and $0.4 million as of March 31, 2024 and December 31, 2023, respectively, are recorded in other noncurrent assets on the condensed consolidated balance sheets and will be amortized over the term of the 2021 Credit Facility on a straight-line basis. Accumulated amortization related to deferred financing costs for the 2021 Credit Facility was $0.2 million as of March 31, 2024 and $0.1 million as of December 31, 2023.

The Company was in compliance with all applicable debt covenants at March 31, 2024 and December 31, 2023, and expects to remain in compliance over the next 12 months.

5. Leases

The Company leases real estate and equipment under operating and finance leases, some of which are from related parties as discussed in Note 10 — Related Party Transactions. The most significant obligations under these lease agreements

16

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

require the payments of periodic rentals, real estate taxes, insurance and maintenance costs. Depending on particular Showroom leases, the Company can also owe a percentage rent payment if particular Showrooms meet certain sales figures.

The following table summarizes the amounts recognized in our condensed consolidated balance sheets related to leases (amounts in thousands):

	Condensed Consolidated Balance Sheet Classification	March 31, 2024		December 31, 2023
Assets
Operating lease assets	Operating right-of-use assets	$	322,905	$	302,157
Finance lease assets	Financing right-of-use assets	38,209		38,835
Total leased assets		$	361,114	$	340,992
Liabilities
Current operating leases	Current portion of operating lease liabilities	$	42,694	$	33,051
Non-current operating leases	Operating lease liabilities, long-term	383,684		362,598
Total operating lease liabilities		426,378		395,649
Current finance leases	Current portion of financing lease liabilities	919		904
Non-current finance leases	Financing lease liabilities, long-term	53,658		53,870
Total finance lease liabilities		54,577		54,774
Total lease liabilities		$	480,955	$	450,423

17

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The components of lease cost recognized within our condensed consolidated statements of comprehensive income are as follows (amounts in thousands):

		Three months ended
		March 31,
	Condensed Consolidated Statements of Comprehensive Income Classification	2024		2023
Lease costs:
Operating lease costs	Cost of goods sold	$	12,185	$	9,714
Operating lease costs	Selling, general and administrative expenses	2,501		2,401
Finance lease costs
Amortization of right-of-use assets	Selling, general and administrative expenses	626		540
Interest expense on lease liabilities	Interest expense (income), net	1,301		1,268
Variable lease costs(1)	Cost of goods sold	9,488		10,031
Short term lease costs	Selling, general and administrative expenses	18		120
Total lease costs		$	26,119	$	24,074

(1) For the three months ended March 31, 2024, there were no month-to-month lease costs. For the three months ended March 31, 2023, total lease costs includes $0.3 million of month-to-month lease costs.

We often have options to renew lease terms for Showrooms and other assets. The exercise of lease renewal options is generally at our sole discretion. In addition, certain lease agreements may be terminated prior to their original expiration date at our discretion. We evaluate each renewal and termination option at the lease commencement date to determine if we are reasonably certain to exercise the option on the basis of economic factors. The weighted average remaining lease terms are as follows:

	Three months ended
	March 31,
Weighted Average Remaining Lease Term (In Years)	2024	2023
Operating leases	9.24	9.32
Finance leases	20.66	22.26

When readily available, we use the discount rate implicit within the lease as determined at the time of lease commencement. However, the discount rate implicit within many of our leases is generally not determinable at the time of lease commencement and therefore the Company determines the discount rate based on its incremental borrowing rate (“IBR”). For leases in which the discount rate was not explicit, the Company utilized a market-based approach to estimate the IBR, which required significant judgment. The Company estimated the base IBR based on an analysis of (i) yields on the Company’s 2021 Credit Facility, as well as comparable companies and (ii) unsecured yields and discount rates. The Company applied adjustments to the base IBRs to account for full collateralization and lease term. The weighted average discount rates used to measure our lease liabilities are as follows:

	Three months ended
	March 31,
Weighted Average Discount Rate	2024		2023
Operating leases	6.04	%	5.80	%
Finance leases	9.64	%	9.72	%

18

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Future lease liabilities at March 31, 2024 are as follows (amounts in thousands):

Year Ending December 31,	Operating Lease Liabilities (1)		Finance Lease Liabilities		Total Lease Liabilities
Remainder of 2024	$	48,161	$	4,343	$	52,504
2025	69,044		5,800		74,844
2026	63,772		6,259		70,031
2027	59,709		6,060		65,769
2028	54,283		5,610		59,893
2029	51,279		5,224		56,503
Thereafter	222,283		104,719		327,002
Total lease payments	568,531		138,015		706,546
Less: Amounts representing interest	(142,153)		(83,438)		(225,591)
Total	$	426,378	$	54,577	$	480,955

(1) Includes leases with related parties. See Note 10 — Related Party Transactions for amounts leased from related parties.

At March 31, 2024, the Company has entered into leases for Showrooms and equipment which have not yet commenced with expected lease terms ranging from 3 to 13 years. The aggregate minimum rental payments over the term of the leases of approximately $151.4 million are not included in the above table.

Supplemental cash flow information related to leases is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	15,996	$	13,411
Operating cash flows for finance leases	1,230		1,204
Financing cash flows for finance leases	221		129
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	28,751	$	28,582
Finance leases	—		—

6. Equity Based Compensation

Activity of the Company’s Restricted Stock and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	Restricted Stock - Class A
	Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	500,304	$	15.47
Granted	—	—
Forfeited	—	—
Vested	(21,477)	0.20
Unvested at March 31, 2024	478,827	$	16.16

19

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - Restricted Stock(1)	$	660	$	698

(1) Total unrecognized equity based compensation to be recognized in future periods is $5.5 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

The Arhaus, Inc. 2021 Equity Incentive Plan (the “2021 Plan”) was adopted on November 8, 2021. The 2021 Plan authorizes the Company the ability to grant stock options (either incentive or non-qualified), stock appreciation rights (“SARs”), restricted stock, restricted stock units (“RSUs”), performance shares, performance share units (“PSUs”) and other stock-based awards with respect to our Class A common stock to our employees, officers, consultants, advisors and directors. The maximum number of Class A common stock that may be granted under the 2021 Plan is 11,205,100 shares.

Per the 2021 Equity Plan, each RSU and PSU represents a contingent right to receive one share of the Company’s Class A common stock upon vesting. The RSUs granted to award recipients vest in one-third increments on each of the first, second and third anniversary of the date of grant, provided that the award recipient continues to serve the Company through the applicable vesting date (“Continuous Service”). If the award recipient’s Continuous Service terminates for any reason other than death, disability or in connection with a change in control (as such terms are defined in the 2021 Plan), unless the Compensation Committee of the Board of Directors determines otherwise, all RSUs that are unvested at the time of such termination shall be forfeited and canceled immediately without consideration. RSU and PSU awards contain forfeitable rights to dividend equivalents. Dividend equivalents for outstanding awards are accrued when dividends are declared on the Company’s common stock but are not paid until the awards vest, and dividend equivalents accrued for awards that ultimately do not vest are forfeited. The RSUs issued to certain members of the Board of Directors will vest on the one-year anniversary of the grant date.

The number of PSUs earned will be based on the Company’s financial performance as measured against pre-established target goals for cumulative demand revenue and cumulative adjusted EBITDA (the “Performance Goals”) over the applicable performance period. PSUs will vest as of the end of the performance period subject to the award recipient’s Continuous Service, but will not settle and payout until the number of PSUs earned is determined by the Compensation Committee. The award recipient may earn between 0% and 200% of the PSU target award based on the Company’s achievement of the Performance Goals. The Company accounts for forfeitures as they occur.

Activity of the Company’s PSU and RSU awards and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	PSU Awards			RSU Awards
	Amount	Weighted Average Grant Date Fair Value		Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	700,229	$	7.20	1,248,165	$	7.79
Granted	—	—		—	—
Forfeited	(10,000)	9.93		(7,894)	9.54
Vested	—	—		(107,895)	9.49
Unvested at March 31, 2024	690,229	$	7.16	1,132,376	$	7.62

20

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - PSUs(1)	$	352	$	433
Equity based compensation expense - RSUs(2)	$	1,012	$	499

(1) Total unrecognized equity based compensation for the PSUs to be recognized in future periods is $2.6 million at March 31, 2024, and will be recognized over a weighted average period of 1.31 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

(2) Total unrecognized equity based compensation for the RSUs to be recognized in future periods is $6.7 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

7. Segment Reporting

Our chief operating decision maker is our Chief Executive Officer (“CEO”), who reviews financial information presented on a consolidated basis for purposes of making decisions, assessing financial performance and allocating resources. We operate our business as one operating segment and therefore we have one reportable segment that offers an assortment of merchandise across a number of categories, including furniture, outdoor, lighting, textiles, and décor. The assortment of merchandise can be purchased through our Retail and eCommerce merchandise sales channels.

The majority of our net revenue is generated through sales to clients in the United States. Sales to clients outside of the United States are not significant. Further, no single client represents more than ten percent or more of our net revenue.

Net revenue by merchandise sales channel is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Retail	$	243,255	$	250,102
eCommerce	51,907		54,466
Total net revenue	$	295,162	$	304,568

8. Net and Comprehensive Income per Share

Basic and diluted net and comprehensive income per share for the three months ended March 31, 2024 and March 31, 2023, was calculated by dividing net and comprehensive income by the number of basic and diluted weighted-average common shares outstanding. The Company has elected to not adjust net and comprehensive income for forfeitable dividend equivalents, when declared, related to unvested equity awards. The Company will recognize dividends paid on common shares when the dividend equivalents are no longer forfeitable, such as if the contingency is met or the share-based payment awards vest into common shares.

21

Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Basic and diluted net and comprehensive income per share are as follows (amounts in thousands, except per share data):

	Three months ended
	March 31,
	2024		2023
Numerator
Net and comprehensive income	$	15,099	$	34,099
Denominator—Weighted Average Shares Outstanding
Weighted-average number of common shares outstanding, basic	139,816,792		139,072,756
Effect of dilutive restricted stock (1) (2)	739,239		866,787
Weighted-average number of common shares outstanding, diluted	140,556,031		139,939,543
Net and Comprehensive Income Per Share
Net and comprehensive income per share, basic	$	0.11	$	0.25
Net and comprehensive income per share, diluted	$	0.11	$	0.24

(1) During the three months ended March 31, 2024, 412,487 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive. During the three months ended March 31, 2023, 547,370 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive.

(2) Excluded from the calculation of the effect of dilutive restricted stock as of three months ended March 31, 2024 and March 31, 2023, were 540,335 and 768,013 PSUs, respectively, because they did not meet the required performance criteria.

9. Commitments and Contingencies

The Company is involved in litigation and claims that are incidental to its business. Although the outcome of these matters cannot be determined at the present time, management of the Company believes that the ultimate resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

From time to time, the Company has received inquiries from a number of state and local taxing agencies with respect to the remittance of sales, use, telecommunications, excise, and income taxes. Several jurisdictions are currently conducting tax audits of the Company's records. The Company collects, or has accrued for, taxes that it believes are required to be remitted. The amounts that have been remitted have historically been within the accruals established by the Company. The Company adjusts its accrual when facts relating to specific exposures warrant such adjustment. As of March 31, 2024 and December 31, 2023, we recorded liabilities of $0.2 million and $0.2 million, respectively, in accrued other expenses on the condensed consolidated balance sheets for non-income tax matters that were probable and reasonably estimable.

In August 2023, the Company committed to make a $10.0 million donation to The Nature Conservancy. As of March 31, 2024, we have a remaining commitment of $5.0 million in accrued other expense on our condensed consolidated balance sheets.

On February 29, 2024, the Board of Directors of the Company declared a special cash dividend on the Company’s Class A and Class B common stock of $0.50 per share, payable April 4, 2024, to shareholders of record at the close of business on March 21, 2024 (the “Record Date”). As of March 31, 2024, we recorded $70.6 million in current liabilities and $0.6 million in other long-term liabilities on our condensed consolidated balance sheet.

The Company paid out the aforementioned special cash dividend in April 2024 on its Class A and Class B common stock in the amount of $69.9 million. The remaining dividends payable balance recorded in current liabilities on our condensed consolidated balance sheet relates to dividend equivalents on outstanding equity awards under the Company’s equity incentive plans that were unvested as of the Record Date and are expected to vest within the next 12 months.

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Arhaus, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

10. Related Party Transactions

Leasing transactions

In November 2000, the Company entered into a lease agreement with Pagoda Partners, LLC, a company of which John Reed, our CEO, indirectly owns 50%, for our warehouse in Walton Hills, Ohio. The base lease term was 17 years with a 5-year renewal option. In August 2020, the Company amended the lease agreement to extend the lease term to April 2024. The monthly rental payments are $0.1 million. In July 2023, the Company amended the lease agreement to extend the lease term to April 2034 with one additional 5-year renewal option. The monthly rental payments range from $0.1 million to $0.2 million. Rent expense was $0.4 million and $0.3 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

In July 2010, the Company entered into a lease agreement with Brooklyn Arhaus, a company of which our CEO and Mr. Beargie, a Director of the Company, own 85% and 15%, respectively, for our Outlet in Brooklyn, Ohio. The base lease term is 15 years with no lease renewal options. The monthly rental payments are $20 thousand. Rent expense was $0.1 million and $0.1 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

In March 2021, the Company entered into a lease agreement with Premier Conover, LLC, a company of which our CEO indirectly owns 40%, for a distribution center and manufacturing building, for which construction was completed in the fourth quarter of 2021. The base lease term is for 12 years, with a 10-year renewal option and two additional 5-year renewal options at the higher of the minimum base rent or the fair market rent at the time of renewal execution. The monthly rental payments range from $0.2 million to $0.3 million during the 12-year base lease term and from $0.4 million to $0.5 million during the 10-year renewal period. Rent expense was $1.0 million and $1.0 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

Other transactions

The accounts payable due to related parties for state and federal income tax refunds were $0.2 million and $2.3 million at March 31, 2024 and December 31, 2023, respectively, and are included within accounts payable on the condensed consolidated balance sheets.

11. Income Taxes

Income tax expenses were $4.8 million and $12.1 million in the three months ended March 31, 2024 and March 31, 2023, respectively. The effective tax rate was 24.2% and 26.2% for the three months ended March 31, 2024 and March 31, 2023, respectively.

As of March 31, 2024, no unrecognized tax benefits have been recognized. The Company files income tax returns in the U.S. and various state and local jurisdictions. The tax years after 2019 remain open to examination by the state taxing jurisdictions in which the Company is subject to tax. As of March 31, 2024, the Company was not under examination by the Internal Revenue Service or any state tax jurisdiction.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes included elsewhere in this Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2023. This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or are proven incorrect, could cause our business and results of operations to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements can generally be identified by the use of forward-looking terminology, including, but not limited to, “may,” “could,” “seek,” “guidance,” “predict,” “potential,” “likely,” “believe,” “will,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “forecast,” 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. Such factors include, but are not limited to, the following:

•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;

•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;

•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 business 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.

The risks, uncertainties and assumptions referred to above that could cause our results to differ materially from the results expressed or implied by such forward-looking statements include, but are not limited to, those discussed under Item 1A. Risk Factors, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2023. All forward-looking statements included in this document are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements. These statements are based on information available to us as of the date of this Form 10-Q. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

The following discussion contains references to the three months ended March 31, 2024 and March 31, 2023, which represents the condensed consolidated financial results of Arhaus, Inc. and subsidiaries for the three months ended March 31, 2024 and March 31, 2023, respectively.

Revision of Previously Issued Condensed Consolidated Financial Statements

This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” has been revised to give effect to the revision of our condensed consolidated balance sheets and condensed consolidated statements of cash flows, as more fully described in Note 1 - Nature of Business and Basis of Presentation to the Notes to Condensed Consolidated Financial Statements.

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Overview

Arhaus is a rapidly growing lifestyle brand and premium retailer in the U.S. home furnishings market, specializing in livable luxury supported by globally-sourced, heirloom-quality merchandise. We offer a differentiated direct-to-consumer approach to furniture and décor. Our curated assortments are presented across our sales channels in sophisticated, family friendly and unique lifestyle settings. We offer merchandise assortments across a number of categories, including furniture, outdoor, lighting, textiles, and décor. Our products, designed to be used and enjoyed throughout the home, are sourced directly from factories and vendors with no wholesale or dealer markup, allowing us to offer an exclusive assortment at an attractive value. Our direct sourcing network consists of more than 400 vendors, some of whom we have had relationships with since our founding. Our product development teams work alongside our direct sourcing partners to bring to market proprietary merchandise that is a great value to clients, while delivering attractive margins.

We believe in providing a dynamic and welcoming experience in our Showrooms and online with the conviction that retail is theater. Our national omni-channel business positions our retail locations as Showrooms for our brand, while our website acts as a virtual extension of our Showrooms. Our theater-like Showrooms are highly inspirational and function as an invaluable brand awareness vehicle. Our seasoned sales associates and in-home designers provide expert advice and assistance to our client base that drives significant client engagement. Our omni-channel model allows clients to begin or end their shopping journey online, while also experiencing our theater-like Showrooms throughout the shopping journey.

As of March 31, 2024, we operated 92 Showrooms, 80 with in-home interior designers. At December 31, 2023, we operated 92 Showrooms, 78 with in-home interior designers.

	March 31, 2024	December 31, 2023
Traditional Showrooms	80	80
Design Studios	8	8
Outlets	4	4
Total Showroom locations	92	92
Total square footage (in thousands)	1,448	1,438

For the three months ended March 31, 2024, we generated $295.2 million of net revenue, $115.1 million of gross margin and $15.1 million of net and comprehensive income.

How We Assess the Performance of Our Business

In addition to U.S. GAAP results, this Form 10-Q contains references to the non-GAAP financial measures below. We use these 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.

The non-GAAP financial measures presented herein are specific to us and may not be comparable to similar measures disclosed by other companies because of differing methods used by other companies in calculating them. These measures are also not intended to be measures of free cash flow for management’s discretionary use, as they do not reflect tax payments, debt service requirements and certain other cash costs that may recur in the future, including, among other things, cash requirements for working capital needs. Management compensates for these limitations by relying on our U.S. GAAP results in addition to using these non-GAAP financial measures. The non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. We consider the following financial and operating measures that affect our results of operations:

Net Revenue and Demand. Net revenue is recognized when a client obtains control of the merchandise. We also track demand in our business which is a key performance indicator linked to the level of client orders placed. Demand is an operating metric that we use to measure the dollar value of orders (based on purchase price) at the time the order is placed, net of the dollar value of cancellations and returns (based on unpaid purchase price and amount credited to client). These orders are recognized as net revenue when a client obtains control of the merchandise. Because demand is measured net of cancellations, all demand will eventually become net revenue, with appropriate reserves, when delivered to the client.

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Comparable Growth. Comparable growth is 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 comparable Showrooms and eCommerce, including through our catalogs and other mailings. This metric is a key performance indicator used by management to evaluate Showroom performance for locations that have been opened for at least 15 consecutive months, which enables management to view the performance of those Showrooms without the dollar value of orders delivered for new Showrooms being included. Comparable Showrooms are defined as permanent Showrooms open for at least 15 consecutive months, including relocations in the same market. Showrooms record demand immediately upon opening, while orders delivered take additional time because product must be delivered to the client. The dollar value of orders delivered for Outlet comparable locations is included.

Demand Comparable Growth. Demand comparable growth is the year-over-year percentage change of demand from our comparable Showrooms and eCommerce, including through our catalogs and other mailings. This metric is a key performance indicator used by management to evaluate Showroom demand performance for locations that have been opened for at least 13 consecutive months, which enables management to view the performance of those Showrooms without new Showroom demand included. For demand purposes, comparable Showrooms are defined as permanent Showrooms open for at least 13 consecutive months, including relocations in the same market. Outlet comparable location demand is included.

Demand comparable growth provides insight into business levels in a particular period by comparing the dollar value of orders (based on purchase price) placed in that period to the prior comparable period. Although these orders do not result in net revenue until the order is delivered at a later point in time, management utilizes this metric to evaluate core performance.

Comparable growth is an additional measure that management utilizes to compare the dollar value of orders delivered (based on purchase price) in a period compared to the prior comparable period. Since delivery generally coincides with recognition of net revenue, with appropriate reserves, comparable growth trends will more closely track trends in reported net revenue than demand comparable growth trends. While increases or decreases in demand comparable growth will translate into increases or decreases in comparable growth over time, the trends do not necessarily correlate in any particular period. This is partially due to the general lag in time between when an order is placed and when an order is delivered. When the time gap from order to delivery increases, due to supply chain challenges for example, it may take longer for comparable growth to reflect demand comparable growth. Notwithstanding these limitations, management considers it useful to assess both measures together to get a more complete picture of overall performance trends, and believes these measures can be useful to investors for the same purpose, when viewed together with our reported results and other metrics.

Gross Margin. Gross margin is equal to our net revenue less cost of goods sold. Cost of goods sold includes the direct cost of purchased merchandise, inventory reserves, inbound freight, all freight costs to get merchandise to our Showrooms, credit card fees, design, buying and allocation costs, our supply chain, such as product development and sourcing, occupancy costs related to Showroom operations, such as rent and common area maintenance for our leases, depreciation and amortization of leasehold improvements, equipment and other assets in our Showrooms. In addition, cost of goods sold includes all logistics costs associated with shipping product to our clients, partially offset by delivery fees collected from clients (recorded in net revenue on the condensed consolidated statements of comprehensive income).

Selling, General and Administrative Expenses. Selling, general and administrative (“SG&A”) expenses include all operating costs not included in cost of goods sold. These expenses include payroll and payroll related expenses, Showroom expenses other than occupancy and expenses related to many of our operations at our distribution centers and corporate headquarters, including marketing, information technology, legal, human resources, utilities and depreciation and amortization expense. Payroll includes both fixed compensation and variable compensation. Variable compensation includes Showroom commissions and Showroom bonus compensation related to demand, likely before the client obtains control of the merchandise. Variable compensation is not significant in our eCommerce channel. All new Showroom opening expenses, other than occupancy, are included in SG&A expenses and are expensed as incurred. We expect certain of these expenses to continue to increase as we open new Showrooms, develop new product categories and otherwise pursue our current business initiatives. SG&A expenses as a percentage of net revenue are usually higher in lower-volume quarters and lower in higher-volume quarters because a significant portion of the costs are fixed.

EBITDA. We define EBITDA as consolidated net income before depreciation and amortization, interest expense (income), net and income tax expense.

Adjusted EBITDA. We believe that adjusted EBITDA is a useful measure of operating performance as the adjustments eliminate items that we believe are not reflective of underlying operating performance in a particular period. Adjusted

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EBITDA facilitates a comparison of our operating performance on a consistent basis from period-to-period and provides for a more complete understanding of factors and trends affecting our business.

Because adjusted EBITDA omits certain non-cash items and items that we believe are not reflective of underlying operating performance in a particular period, we feel that it is less susceptible to variances in actual performance resulting from depreciation, amortization and other non-cash charges and can be more reflective of our operating performance in a particular period. We also use adjusted EBITDA as a method for planning and forecasting overall expected performance and for evaluating, on a quarterly and annual basis, actual results against such expectations.

The following is a reconciliation of our net and comprehensive income to EBITDA and adjusted EBITDA for the periods presented (in thousands):

	Three months ended
	March 31,
	2024		2023
Net and comprehensive income	$	15,099	$	34,099
Interest expense (income), net	(1,432)		(173)
Income tax expense	4,816		12,102
Depreciation and amortization	8,603		6,740
EBITDA	27,086		52,768
Equity based compensation	2,024		1,630
Other expenses (1)	—		437
Adjusted EBITDA	$	29,110	$	54,835

(1)Other expenses represent costs and investments not indicative of ongoing business performance, such as public offering costs, severance, signing bonuses and recruiting costs. For the three months ended March 31, 2023, these expenses consisted largely of $0.3 million of severance, signing bonuses and recruiting costs and $0.1 million of public offering costs.

Factors Affecting the Comparability of our Results of Operations

Our results over the past two years have been affected by the following events, which must be understood in order to assess the comparability of our period-to-period financial performance and condition.

Showroom Openings and Closings

New Showrooms contribute incremental expense, new Showroom opening expense and net revenue to the Company. Our recent showroom growth from January 1, 2023 to March, 31, 2024 is summarized in the following table:

	March 31, 2024	December 31, 2023
Showrooms open at beginning of period	92	81
Showrooms opened (1)	2	14
Showrooms closed for relocations	(2)	(3)
Showrooms closed permanently	—	—
Showrooms open at end of period	92	92

(1) Showrooms opened during the respective periods includes both new and relocated Showrooms.

Results of Operations

The following tables summarize key components of our results of operations for the periods indicated. The following discussion should be read in conjunction with our condensed consolidated financial statements and related notes.

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Condensed Consolidated Statements of Comprehensive Income Data (in thousands):

	Three months ended
	March 31,
	2024		2023
Net revenue	$	295,162	$	304,568
Cost of goods sold	180,108		176,330
Gross margin	115,054		128,238
Selling, general and administrative expenses	96,693		82,782
Income from operations	18,361		45,456
Interest expense (income), net	(1,432)		(173)
Other income	(122)		(572)
Income before taxes	19,915		46,201
Income tax expense	4,816		12,102
Net and comprehensive income	$	15,099	$	34,099

Other Operational Data (dollars in thousands):

	Three months ended
	March 31,
	2024			2023
Net revenue	$	295,162		$	304,568
Comparable growth	(9.5)		%	21.0		%
Demand comparable growth	1.3		%	5.6		%
Gross margin as a % of net revenue	39.0		%	42.1		%
Selling, general and administrative expenses as a % of net revenue	32.8		%	27.2		%
Income from operations as a % of net revenue	6.2		%	14.9		%
Net and comprehensive income	$	15,099		$	34,099
Net and comprehensive income as a % of net revenue	5.1		%	11.2		%
Adjusted EBITDA(1)	$	29,110		$	54,835
Adjusted EBITDA as a % of net revenue	9.9		%	18.0		%
Total Showrooms at end of period	92			82

(1) See “How We Assess the Performance of Our Business,” for a definition of adjusted EBITDA and a reconciliation of adjusted EBITDA to net and comprehensive income.

Comparison of the three months ended March 31, 2024 and March 31, 2023

Net Revenue

Net revenue decreased $9.4 million, or 3.1%, to $295.2 million in the three months ended March 31, 2024 compared to $304.6 million in the three months ended March 31, 2023. The decrease was driven primarily by the non-recurrence of prior year abnormal backlog deliveries and a weather-related impact on deliveries in January, partially offset by favorable demand versus prior year.

Gross Margin

Gross margin decreased $13.2 million, or 10.3%, to $115.1 million in the three months ended March 31, 2024 compared to $128.2 million in the three months ended March 31, 2023. Lower gross margin was primarily driven by the decrease in net revenue and increased Showroom costs of $4.0 million.

As a percentage of net revenue, gross margin decreased 310 basis points to 39.0% of net revenue in the three months ended March 31, 2024 compared to 42.1% of net revenue in the three months ended March 31, 2023. The gross margin decrease as a percentage of net revenue was primarily the result of higher Showroom costs, which increased 160 basis points, deleverage on fixed expenses of 50 basis points and higher transportation costs, which increased 40 basis points.

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Selling, General and Administrative Expenses

SG&A expenses increased $13.9 million, or 16.8%, to $96.7 million in the three months ended March 31, 2024 compared to $82.8 million in the three months ended March 31, 2023. The increase in SG&A expenses was primarily driven by a $6.6 million increase in selling expenses related to new Showrooms and demand strength, a $5.6 million increase in corporate expenses due to strategic investments, including supply chain and technology improvements, and increased warehouse expense of $1.4 million as our Dallas location continues to increase productivity.

As a percentage of net revenue, SG&A expenses increased 560 basis points to 32.8% of net revenue in the three months ended March 31, 2024 compared to 27.2% of net revenue in the three months ended March 31, 2023.

Interest Expense (Income), net

Interest expense (income), net increased $1.3 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023, primarily due to an increase in interest income earned on interest-bearing checking accounts.

Income Taxes

Income tax expense was $4.8 million in the three months ended March 31, 2024 compared to $12.1 million in the three months ended March 31, 2023. The decrease was primarily due to lower income before taxes. Our effective tax rate was 24.2% and 26.2% for the three months ended March 31, 2024 and 2023, respectively.

Net and Comprehensive Income

Net and comprehensive income decreased $19.0 million to $15.1 million in the three months ended March 31, 2024 compared to $34.1 million in the three months ended March 31, 2023. The decrease was driven by the factors described above.

Liquidity and Capital Resources

Liquidity Outlook

Our primary cash needs have historically been for merchandise inventories, payroll, marketing catalogs, Showroom rent, capital expenditures associated with opening new Showrooms and updating existing Showrooms, as well as the development of our infrastructure and information technology. We seek out and evaluate opportunities for effectively managing and deploying capital in ways that improve working capital and support and enhance our business initiatives and strategies. As of March 31, 2024, we had cash and cash equivalents of $233.2 million.

For the three months ended March 31, 2024, our principal sources of liquidity were cash flows from operations. We believe our operating cash flows will be sufficient to meet working capital requirements and fulfill other capital needs for at least the next 12 months, although we may enter into borrowing arrangements in the future.

While we do not require debt to fund our operations, our goal continues to be to position the Company to take advantage of the many opportunities that we may identify in connection with our business and operations. We have pursued in the past, and may pursue in the future, additional strategies to generate capital to pursue opportunities and investments, including new debt financing arrangements. In addition to funding the normal operations of our business, we have used our liquidity to fund investments and strategies such as growth initiatives, including supply chain and technology improvements. In addition, our needs and uses of capital may change in the future due to changes in our business or new opportunities that we choose to pursue. As of March 31, 2024, we have no material off-balance sheet arrangements.

On February 29, 2024, the Board of Directors of the Company declared a special cash dividend on the Company’s Class A and Class B common stock of $0.50 per share, payable April 4, 2024, to shareholders of record at the close of business on March 21, 2024.

Credit Facility

In November 2021, the Company entered into a revolving credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provides for, among other things, (1) a revolving credit facility in an aggregate amount not to exceed at any time outstanding the amount of such lender’s commitment, (2) a letter of credit commitment in an amount equal to the lesser of (a) $10.0 million, and (b) the amount of the revolving credit facility as of such date, and (3) a swingline loan in an amount

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equal to the lesser of (a) $5.0 million, and (b) the amount of the revolving credit facility as of such date. The aggregate amount of all commitments of all lenders under the 2021 Credit Facility was initially $50.0 million. The 2021 Credit Facility contains restrictive covenants and has certain financial covenants, including a minimum rent-adjusted total leverage ratio and a minimum fixed charge ratio. The 2021 Credit Facility bears variable interest rates at the prevailing Bloomberg Short-Term Bank Yield index rate plus the applicable margin (1.50% at March 31, 2024 and 1.50% at March 31, 2023), whereas the applicable margin is adjusted quarterly based on the Company’s consolidated rent-adjusted total leverage ratio.

On December 9, 2022, the Company amended the 2021 Credit Facility to increase the revolving credit commitment thereunder by $25.0 million. After giving effect to such increase, the aggregate amount of all commitments under the 2021 Credit Facility is $75.0 million. The 2021 Credit Facility expires on November 8, 2026. At March 31, 2024, we had no borrowings on the 2021 Credit Facility. Refer to Note 4 — Debt to our condensed consolidated financial statements for further information on our 2021 Credit Facility.

Cash Flow Analysis

The following table provides a summary of our cash provided by operating, investing and financing activities (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Net cash provided by operating activities	$	36,828	$	10,865
Net cash used in investing activities	(25,932)		(11,360)
Net cash used in financing activities	(761)		(412)
Net increase (decrease) in cash, cash equivalents and restricted cash	$	10,135	$	(907)

Net cash provided by operating activities

Comparison of the three months ended March 31, 2024 and March 31, 2023

Operating activities consist primarily of net income adjusted for non-cash items including depreciation and amortization, operating lease amortization, deferred income taxes, equity based compensation and the effect of changes in working capital and other activities.

For the three months ended March 31, 2024, net cash provided by operating activities was $36.8 million and consisted of net income of $15.1 million and an increase of non-cash items of $26.0 million, which were partially offset by a change in working capital and other activities of $4.3 million. The use of cash from working capital was primarily driven by an increase in merchandise inventory of $14.1 million, an increase in prepaid and other assets of $5.8 million, a decrease in accrued expenses of $5.1 million, a decrease in accounts payable of $4.8 million, and a decrease in operating lease liabilities of $4.2 million primarily due to payments made under the related lease agreements which was partially offset by an increase in client deposits of $29.1 million in the three months ended March 31, 2024.

For the three months ended March 31, 2023, net cash provided by operating activities was $10.9 million and consisted of net income of $34.1 million and increases of non-cash items of $25.1 million, which was partially offset by a change in working capital and other activities of $48.4 million. The use of cash from working capital was primarily driven by a decrease in accrued expenses of $13.3 million, a decrease in accounts payable of $12.6 million, a decrease in operating lease liabilities of $10.6 million primarily due to payments made under the related lease agreements, an increase in merchandise inventory of $5.8 million, a decrease in client deposits of $4.7 million primarily due to improved delivery of our backlog orders and lower demand comparable growth and an increase in prepaid and other assets of $1.3 million in the three months ended March 31, 2023.

Net cash used in investing activities

Investing activities consist primarily of capital expenditures related to investments in retail Showrooms, information technology and systems infrastructure, as well as supply chain investments.

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Comparison of the three months ended March 31, 2024 and March 31, 2023

For the three months ended March 31, 2024, net cash used in investing activities was $25.9 million primarily due to investments in Showrooms, information technology and systems infrastructure and strategic investments in our supply chain.

For the three months ended March 31, 2023, net cash used in investing activities was $11.4 million primarily due to investments in Showrooms, supply chain expansion and information technology and systems infrastructure.

Capital Expenditures

Historically, we have invested significant capital expenditures in opening new Showrooms. These capital expenditures have increased in the past and may continue to increase in future periods as we open additional Showrooms. Our capital expenditures include expenditures related to investing activities and outflows of capital related to construction activities to design and build leasehold improvement assets. Certain lease arrangements require the landlord to fund a portion of the construction related costs through tenant improvement allowance payments directly to us. New Showrooms may require different levels of company-funded capital investment in the future.

Historical capital expenditures are summarized as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Net cash used in investing activities	$	25,932	$	11,360
Less: Landlord contributions	13,004		2,983
Total capital expenditures, net of landlord contributions	$	12,928	$	8,377

Total capital expenditures, net of landlord contributions increased by $4.6 million in the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

We anticipate our total company funded capital expenditures to be between $80 million and $100 million in fiscal year 2024, primarily related to the opening of new Showrooms.

Net cash used in financing activities

Comparison of the three months ended March 31, 2024 and March 31, 2023

For the three months ended March 31, 2024, net cash used in financing activities was $0.8 million primarily due to the repurchase of shares for payment of withholding taxes for equity based compensation.

For the three months ended March 31, 2023, net cash used in financing activities was $0.4 million primarily due to the repurchase of shares for payment of withholding taxes for equity based compensation.

Critical Accounting Policies and Estimates

Accounting policies and estimates are considered critical when they require management to make subjective and complex judgments, estimates and assumptions about matters that have a material impact on the presentation of our financial statements and accompanying notes. For a description of our critical accounting policies and estimates, see Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2023.

Recent Accounting Pronouncements

See Note 2 — Recently Issued Accounting Standards to our condensed consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risks, which include significant deterioration of the U.S. and foreign markets, changes in U.S. interest rates, foreign currency exchange rate fluctuations and the effects of economic uncertainty, which may affect the

31

prices we pay our vendors in the foreign countries in which we do business. We do not engage in financial transactions for trading or speculative purposes.

Foreign Currency Exchange Risk

We believe foreign currency exchange rate fluctuations do not contain significant market risk to us due to the nature of our relationships with our vendors outside of the United States. We purchase the majority of our inventory from vendors outside of the United States in transactions that are primarily denominated in U.S. dollars and, as such, any foreign currency impact related to these international purchase transactions was not significant to us for the three months ended March 31, 2024 and March 31, 2023, respectively. However, since we pay for the majority of our international purchases in U.S. dollars, a decline in the U.S. dollar relative to other foreign currencies would subject us to risks associated with increased purchasing costs from our vendors. We cannot predict with certainty the effect these increased costs may have on our financial statements or results of operations. We currently do not use derivative instruments to manage this risk.

Interest Rate Risk

We are primarily exposed to interest rate risk with respect to borrowing under our 2021 Credit Facility and as of March 31, 2024, we have not drawn upon the 2021 Credit Facility. Based on the interest rate in the 2021 Credit Facility and to the extent borrowings were outstanding, we do not believe a 100 basis point change in interest rates would have a material impact on our financial condition or results of operations for the periods presented. We currently do not use derivative instruments to manage this risk.

Impact of Inflation

Inflation generally affects us by increasing our cost of labor, material, transportation, and our general costs. We have historically been able to recover these cost increases through price increases. However, we cannot reasonably estimate our ability to successfully recover any impact of inflation through price increases in the future. We currently do not use derivative instruments to manage this risk.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our CEO and Chief Financial Officer (“CFO”), management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (“Exchange Act”)) as of March 31, 2024. Based on their evaluation as of March 31, 2024, the CEO and CFO have concluded that our disclosure controls and procedures were not effective at the reasonable assurance level because of the material weaknesses in our internal control over financial reporting described below.

Material Weaknesses in Internal Control Over Financial Reporting

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. We identified four material weaknesses in our internal control over financial reporting.

•We did not design and maintain an effective control environment commensurate with our financial reporting requirements. Specifically, we lacked a sufficient complement of professionals with an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and disclose accounting matters timely and accurately. Additionally, the lack of a sufficient number of professionals resulted in an inability to consistently establish appropriate authorities and responsibilities in pursuit of our financial reporting objectives, as demonstrated by, amongst other things, insufficient segregation of duties in our finance and accounting functions. This material weakness contributed to the following additional material weaknesses.

•We did not design and maintain accounting policies, procedures and controls, or maintain documentary evidence of existing control activities over significant accounts and disclosures to achieve complete, accurate and timely financial accounting, reporting and disclosures, including adequate controls over the period-end financial reporting process, the preparation and review of account reconciliations and journal entries, including segregation of duties and assessing the reliability of reports and spreadsheets used in controls.

32

•We did not design and maintain effective controls to address the identification of and accounting for certain non-routine or complex transactions, including the proper application of U.S. GAAP of such transactions. Specifically, we did not design and maintain controls to timely or appropriately account for our incentive unit plan.

These material weaknesses resulted in a restatement of our previously issued annual consolidated financial statements as of and for the years ended December 31, 2020 and 2019 principally related to selling, general and administrative expenses and other long-term liabilities, and misclassifications in the balance sheets and statements of comprehensive income. These material weaknesses also resulted in immaterial adjustments recorded prior to the issuance of the consolidated financial statements as of and for the year ended December 31, 2021 principally related to property, furniture and equipment, net; selling, general and administrative expenses; and misclassifications in the balance sheet and statement of cash flows.

In preparation of the December 31, 2023 consolidated financial statements and in preparation of the March 31, 2024 condensed consolidated financial statements, these material weaknesses resulted in restatements as of and for the interim period ended September 30, 2023 and revisions as of and for the annual periods ended December 31, 2023, 2022 and 2021, and as of and for the interim periods ended March 31, 2022, June 30, 2022, September 30, 2022, March 31, 2023 and June 30, 2023, principally related to prepaid and other current assets, property, furniture and equipment, net and operating lease liabilities, which resulted in misclassifications in the balance sheets and statements of cash flows and the timely recording of liabilities, operating right-of-use assets and operating lease liabilities. There were also immaterial misstatements. Additionally, each of the material weaknesses could result in misstatements to substantially all of our accounts or disclosures, that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

•Lastly, we did not design and maintain effective controls over information technology (“IT”) general controls for information systems that are relevant to the preparation of our financial statements. Specifically, we did not design and maintain: (i) program change management controls for financial systems to ensure that information technology program and data changes affecting financial applications and underlying accounting records are identified, tested, authorized and implemented appropriately; (ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate Company personnel; (iii) computer operations controls to ensure that critical batch jobs are monitored and data backups are authorized and monitored; and (iv) testing and approval controls for program development to ensure that new software development is aligned with business and IT requirements.

These IT deficiencies did not result in material adjustments to our consolidated financial statements, however, the deficiencies, when aggregated, could impact maintaining effective segregation of duties, as well as the effectiveness of IT-dependent controls (such as automated controls that address the risk of material misstatement to one or more assertions, along with the IT controls and underlying data that support the effectiveness of system-generated data and reports) that could result in misstatements potentially impacting all financial statement accounts and disclosures that would not be prevented or detected. Accordingly, management has determined these IT deficiencies in the aggregate constitute a material weakness.

Remediation Activities

With the oversight of senior management and our Audit Committee, we have designed and begun to implement a remediation plan which includes:

•Updating our policies and procedures to establish and maintain effective segregation of duties for our accounting staff in relation to journal entries, reconciliations and other applicable processes.

•Designing and implementing internal financial reporting procedures and controls to improve the completeness, accuracy and timely preparation of financial reporting and disclosures inclusive of establishing an ongoing program to provide sufficient training to our finance and accounting staff.

•Enhancing the design and operation of user access control activities and procedures to ensure that access to IT applications and data is adequately restricted to appropriate personnel.

•Hiring additional competent and qualified technical accounting and financial reporting personnel with appropriate knowledge and experience of U.S. GAAP and SEC financial reporting requirements, including non-routine and complex transactions, to design, execute and/or provide appropriate oversight of activities related to internal control over financial reporting, or ICFR.

•Implementing additional program change management policies and procedures, control activities, and tools to ensure changes affecting key financial systems related to IT applications and underlying accounting records are identified, authorized, tested, and implemented appropriately.

33

•Designing and implementing a formal systems development lifecycle methodology and related program development controls to ensure significant IT change events are appropriately tested and approved.

•Enhancing the design and operation of control activities and procedures within the computer operations domain to ensure key batch jobs are monitored, processing failures are adequately resolved, and recovery capability is tested.

•Identifying and evaluating key IT dependencies including key reports, automated application controls, interfaces, and end user computer facilities.

•Enhancing the control activity design related to the review of our consolidated balance sheet and statement of cash flows to ensure the classification of operating and investing activities is appropriately presented in the statement of cash flows.

While the material weaknesses are not considered remediated until the related internal controls are designed, implemented, tested and deemed to be operating effectively, we have made progress under our remediation plan, including:

•Commenced the design and implementation of formal processes, policies, and procedures supporting our financial close process, including formalizing procedures over the review of financial statements.

•Commenced the design and implementation of policies and procedures to establish and maintain segregation of duties for our accounting staff in relation to journal entries and account reconciliations.

•Continue to hire additional competent and qualified technical accounting and financial reporting personnel with appropriate knowledge and experience of U.S. GAAP and SEC financial reporting requirements.

Although we have developed and begun to implement our plan to remediate the material weaknesses and believe, based on our evaluation to date, that the material weaknesses will be remediated in a timely fashion, we cannot project a specific timeline on when the plan will be fully implemented. The material weaknesses will not be remediated until the necessary internal controls have been designed, implemented, tested and determined to be operating effectively. In addition, we may need to take additional measures to address the material weaknesses or modify the planned remediation steps, and we cannot be certain that the measures we have taken, and expect to take, to improve our internal controls will be sufficient to address the issues identified, to ensure that our internal controls are effective or to ensure that the identified material weaknesses will not result in a material misstatement of our consolidated financial statements. Moreover, we cannot provide assurance that we will not identify additional material weaknesses in our ICFR in the future. Until we remediate the material weaknesses, our ability to record, process and report financial information accurately, and to prepare our consolidated financial statements within the time periods specified by the rules and forms of the SEC, could be adversely affected.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting as such term is defined in Exchange Act Rule 13a-15(f) during the quarter ended March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Part II - Other Information

Item 1. Legal Proceedings

From time to time, we have and we may become involved in legal proceedings arising in the ordinary course of business, including claims related to our employment practices, claims of intellectual property infringement and claims related to personal injuries and product liability for the products that we sell and in the Showrooms we operate. Any claims could result in litigation against us and could result in regulatory proceedings being brought against us by various federal and state agencies that regulate our business. Defending such litigation is costly and can impose significant burdens on management and employees. Further, we could receive unfavorable preliminary or interim rulings in the course of litigation, and there can be no assurance that favorable final outcomes will be obtained.

We are currently not a party to any legal proceedings, the outcome of which, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition or results of operations.

Item 1A. Risk Factors

There have been no material changes from the risk factors disclosed in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table contains information with respect to repurchases of shares made by the Company during the three months ended March 31, 2024. The table reflects shares delivered to the Company by employees to satisfy tax withholding obligations due upon the vesting of restricted stock units. These shares were not repurchased in connection with any publicly announced share repurchase programs.

Period	Total number of shares purchased	Weighted average price paid per share		Total number of shares purchased as part of publicly announced plans	Approximate dollar value of shares that may yet be purchased under publicly announced plans
January 2024	—	$	—	—	$	—
February 2024	—	—		—	—
March 2024	36,290	14.88		—	—
Total	36,290	$	14.88	—	$	—

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

During the three months ended March 31, 2024, none of our directors or executive officers adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K, except as follows:

On March 11, 2024, Dawn Sparks, Chief Logistics Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 120,000 shares of the Company’s Class A common stock beginning June 10, 2024. The arrangement’s expiration date is December 10, 2024.

On March 12, 2024, Dawn Phillipson, Chief Financial Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 150,000 shares of the Company’s Class A common stock beginning June 10, 2024. The arrangement’s expiration date is March 6, 2025.

35

On March 14, 2024, Venkat Nachiappan, Chief Information Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 20,093 shares of the Company’s Class A common stock beginning June 14, 2024. The arrangement’s expiration date is December 31, 2024.    

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Item 6. Exhibits

Exhibit No.	Description	Filings Referenced for Incorporation by Reference
3.1	Amended and Restated Certificate of Incorporation of Arhaus, Inc.	November 10, 2021 Form 8-K, Exhibit 3.1
3.2	Amended and Restated Bylaws of Arhaus, Inc.	November 10, 2021 Form 8-K, Exhibit 3.2
10.1#	Employment Letter (John Moran)	Filed herewith
31.1	Certificate of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
31.2	Certificate of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
32.1*	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Furnished herewith
32.2*	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Furnished herewith
101.INS	XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)	Filed herewith
101.SCH	Inline XBRL Taxonomy Extension Schema Document	Filed herewith
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document	Filed herewith
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document	Filed herewith
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document	Filed herewith
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document	Filed herewith
104	Cover Page with Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101)	Filed herewith

# Indicates management contract

*    The certifications furnished in Exhibit 32.1 and 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates them by reference.

37

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on this 10th day of May, 2024.

ARHAUS, INC.
By:	/s/ Dawn Phillipson
Name:	Dawn Phillipson
Title:	Chief Financial Officer
	(Principal Financial and Accounting Officer)

38

EX-10.1

Exhibit 10.1

Commuting Benefits Paid Time Off Executive Severance ARHAUS \1111rl11,1111 In the event you leave Arhaus for any reason within 12 months of your start date, you must repay the Company the entire Transition Allowance within 30 days from your last day of employment. By your signature below, you authorize Arhaus to withhold this repayment from your final paycheck(s). You will be eligible for reimbursement of monthly commuting expense consistent with our Corporate Travel & Expense Policy. These reimbursements are to cover the costs of flights and/or mileage from your home to an Arhaus location. Your signature acknowledges receipt of the Arhaus Corporate Travel & Expense Policy. You and your eligible dependents will be offered the opportunity to participate in the Company's benefit programs. To view specific plan information, please visit: https:ljarhausbenefits.com/. Benefits are effective the first of the month after 30 days of employment. Detailed instructions for enrollment in our programs will be provided via email. You will be eligible for paid time off days and Company holidays to the extent and under the terms of the Company's policies. Prorated for 2024: after 30 days in role, you will be eligible for 16 days paid time off, in line with the paid time off policy. In 2025, you will be eligible for 20 days of paid time off. Should Arhaus choose to terminate your employment with the Company for any reason other than Cause (as defined below), or should you voluntarily resign from your employment with the Company for Good Reason (as defined below) you will be entitled, at the time of such termination or resignation, to the payment of a lump sum equal to the sum of: (a) 50% of the greater of (X) $490,000 or (Y) your highest base salary rate prior to such termination or resignation; plus (b) a COBRA stipend covering the six-month period immediately following such termination or resignation. Your lump sum payment will be subject to you signing a standard Arhaus employee severance agreement. Notwithstanding the provisions of the foregoing paragraph, if you voluntarily resign from your employment with the Company for any 51 E Hines Hill Road I Boston Heights, Ohio 44236 440.439. 7700 I arhaus.com Exhibit 10.1

Exhibit 10.1

Exhibit 10.1

EX-31.1

Exhibit 31.1

CERTIFICATION OF PERIODIC REPORT UNDER SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, John Reed, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Arhaus, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	May 10, 2024
/s/ John Reed
John Reed
Chief Executive Officer
(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PERIODIC REPORT UNDER SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Dawn Phillipson, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Arhaus, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	May 10, 2024
/s/ Dawn Phillipson
Dawn Phillipson
Chief Financial Officer
(Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Arhaus, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Reed, Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the dates and periods covered by the Report.

/s/ John Reed

John Reed

Chief Executive Officer

(Principal Executive Officer)

Date: May 10, 2024

A signed original of this written statement required by Section 906 has been provided to, and will be retained by, Arhaus, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Arhaus, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dawn Phillipson, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the dates and periods covered by the Report.

/s/ Dawn Phillipson

Dawn Phillipson

Chief Financial Officer

(Principal Financial and Accounting Officer)

Date: May 10, 2024

A signed original of this written statement required by Section 906 has been provided to, and will be retained by, Arhaus, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover - shares	3 Months Ended
	Mar. 31, 2024	Apr. 30, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-41009
Entity Registrant Name	Arhaus, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	87-1729256
Entity Address, Address Line One	51 E. Hines Hill Road
Entity Address, City or Town	Boston Heights
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	44236
City Area Code	440
Local Phone Number	439-7700
Title of 12(b) Security	Class A common stock, $0.001 par value per share
Trading Symbol	ARHS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001875444
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Class A
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		53,241,316
Class B
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		87,115,600

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 233,230	$ 223,098
Restricted cash	3,210	3,207
Accounts receivable, net	1,805	2,394
Merchandise inventory, net	268,410	254,292
Prepaid and other current assets	33,122	26,304
Total current assets	539,777	509,295
Operating right-of-use assets	322,905	302,157
Financing right-of-use assets	38,209	38,835
Property, furniture and equipment, net	243,167	220,248
Deferred tax assets	18,953	19,127
Goodwill	10,961	10,961
Other noncurrent assets	2,407	4,525
Total assets	1,176,379	1,105,148
Current liabilities
Accounts payable	62,135	63,699
Dividends payable	70,628	0
Accrued taxes	13,296	9,638
Accrued wages	11,156	15,185
Accrued other expenses	43,195	46,062
Client deposits	202,922	173,808
Current portion of operating lease liabilities	42,694	33,051
Current portion of financing lease liabilities	919	904
Total current liabilities	446,945	342,347
Operating lease liabilities, long-term	383,684	362,598
Financing lease liabilities, long-term	53,658	53,870
Deferred rent and lease incentives	1,871	1,952
Other long-term liabilities	4,574	4,143
Total liabilities	890,732	764,910
Commitments and contingencies (Note 9)
Stockholders’ equity
Retained earnings	89,206	145,292
Additional paid-in capital	196,301	194,807
Total Arhaus, Inc. stockholders’ equity	285,647	340,238
Total liabilities and stockholders’ equity	1,176,379	1,105,148
Class A
Stockholders’ equity
Stock issued	53	52
Class B
Stockholders’ equity
Stock issued	$ 87	$ 87

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Class A
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock , shares authorized (in shares)	600,000,000	600,000,000
Common stock, shares issued (in shares)	53,361,983	53,254,088
Common stock, shares outstanding (in shares)	53,241,316	53,169,711
Class B
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock , shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	87,115,600	87,115,600
Common stock, shares outstanding (in shares)	87,115,600	87,115,600

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
Net revenue	$ 295,162	$ 304,568
Cost of goods sold	180,108	176,330
Gross margin	115,054	128,238
Selling, general and administrative expenses	96,693	82,782
Income from operations	18,361	45,456
Interest expense (income), net	(1,432)	(173)
Other income	(122)	(572)
Income before taxes	19,915	46,201
Income tax expense	4,816	12,102
Net and comprehensive income	$ 15,099	$ 34,099
Net and comprehensive income per share, basic
Weighted-average number of common shares outstanding, basic (in shares)	139,816,792	139,072,756
Net and comprehensive income per share, basic (in dollars per share)	$ 0.11	$ 0.25
Net and comprehensive income per share, diluted
Weighted-average number of common shares outstanding, diluted (in shares)	140,556,031	139,939,543
Net and comprehensive income per share, diluted (in dollars per share)	$ 0.11	$ 0.24

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Class A	Class B	Common Stock Class A	Common Stock Class B	Treasury Stock Class A	Retained Earnings	Additional Paid-in Capital
Beginning Balance (in shares) at Dec. 31, 2022				51,437,000	87,116,000
Beginning Balance at Dec. 31, 2022	$ 209,695			$ 51	$ 87	$ 0	$ 20,053	$ 189,504
Beginning Balance (in shares) at Dec. 31, 2022						0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	34,099						34,099
Shareholder capital contribution	17							17
Equity based compensation (in shares)				804,000
Equity based compensation	1,630			$ 1				1,629
Shares withheld to cover employees' withholding taxes for equity based compensation (in shares)				(25,000)		(25,000)
Shares withheld to cover employees’ withholding taxes for equity based compensation	(347)							(347)
Ending Balance (in shares) at Mar. 31, 2023				52,216,000	87,116,000
Ending Balance at Mar. 31, 2023	245,094			$ 52	$ 87	$ 0	54,152	190,803
Ending Balance (in shares) at Mar. 31, 2023						25,000
Beginning Balance (in shares) at Dec. 31, 2023		53,169,711	87,115,600	52,669,000	87,116,000
Beginning Balance at Dec. 31, 2023	340,238			$ 52	$ 87	$ 0	145,292	194,807
Beginning Balance (in shares) at Dec. 31, 2023						84,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	15,099						15,099
Shareholder capital contribution	11							11
Equity based compensation (in shares)				129,000
Equity based compensation	2,024			$ 1				2,023
Shares withheld to cover employees' withholding taxes for equity based compensation (in shares)				(37,000)		(37,000)
Shares withheld to cover employees’ withholding taxes for equity based compensation	(540)							(540)
Dividends declared	(71,185)						(71,185)
Ending Balance (in shares) at Mar. 31, 2024		53,241,316	87,115,600	52,761,000	87,116,000
Ending Balance at Mar. 31, 2024	$ 285,647			$ 53	$ 87	$ 0	$ 89,206	$ 196,301
Ending Balance (in shares) at Mar. 31, 2024						121,000

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended		6 Months Ended	12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Jun. 30, 2023	Dec. 31, 2023	Dec. 31, 2022
Cash flows from operating activities
Net income	$ 15,099	$ 34,099
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	8,603	6,740
Amortization of operating lease right-of-use asset	8,738	7,559
Amortization of deferred financing fees, interest on finance lease in excess of principal paid and interest on operating leases	6,233	4,640
Equity based compensation	2,024	4,599
Deferred tax assets	174	0
Amortization of cloud computing arrangements	310	1,630
Amortization and write-off of lease incentives	(80)	(80)
Insurance proceeds	0	47
Changes in operating assets and liabilities
Accounts receivable	589	(173)
Merchandise inventory	(14,118)	(5,750)
Prepaid and other assets	(5,758)	(1,286)	$ 619	$ (11,109)	$ (7,154)
Other noncurrent liabilities	18	93
Accounts payable	(4,819)	(12,625)	(10,525)		10,296
Accrued expenses	(5,092)	(13,346)
Operating lease liabilities	(4,207)	(10,628)	(17,253)	(39,020)	(29,131)
Client deposits	29,114	(4,654)
Net cash provided by operating activities	36,828	10,865	64,196	168,685	77,462
Cash flows from investing activities
Purchases of property, furniture and equipment	(25,932)	(11,693)	(35,216)	(93,441)	(55,666)
Insurance proceeds	0	333
Net cash used in investing activities	(25,932)	(11,360)	(34,883)	(93,108)	(55,666)
Cash flows from financing activities
Principal payments under finance leases	(221)	(65)
Repurchase of shares for payment of withholding taxes for equity based compensation	(540)	(347)
Net cash used in financing activities	(761)	(412)
Net increase (decrease) in cash, cash equivalents and restricted cash	10,135	(907)
Cash, cash equivalents and restricted cash
Beginning of period	226,305	152,527	152,527	152,527
End of period	236,440	151,620		226,305	152,527
Supplemental disclosure of cash flow information
Interest paid in cash	840	1,305
Interest received in cash	2,871	1,507
Income taxes paid in cash	991	1,246
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	15,250	8,025	$ 8,542	$ 10,286	$ 8,469
Noncash financing activities:
Capital contributions	$ 11	$ 17

XML

Nature of Business and Basis of Presentation

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Nature of Business and Basis of Presentation

Nature of Business and Basis of Presentation

Nature of Business

Arhaus, Inc. (the “Company,” “we” or “Arhaus”) is a Delaware corporation and is a premium retailer in the home furnishings market, specializing in livable luxury supported by heirloom quality merchandise. We offer merchandise in a number of categories, including furniture, outdoor, lighting, textiles and décor. Our curated assortments are presented across our sales channels in sophisticated, family friendly and unique lifestyle settings. We position our retail locations as Showrooms for our brand, while our website acts as a virtual extension of our Showrooms. The Company operated 92 Showrooms as of March 31, 2024.

Basis of Presentation

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying condensed consolidated financial statements include our accounts and those of our wholly owned subsidiaries. Accordingly, all intercompany balances and transactions have been eliminated through the consolidation process.

The accompanying condensed consolidated balance sheets at March 31, 2024 and December 31, 2023, the condensed consolidated statements of comprehensive income, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023 and the related interim condensed consolidated disclosures are unaudited and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

In management’s opinion, the accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company’s financial position at March 31, 2024, the results of operations, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023. The condensed consolidated balance sheet as of December 31, 2023 included herein was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP.

The results for the three months ended March 31, 2024 and March 31, 2023 are not necessarily indicative of the operating results to be expected for the full fiscal year or any future period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.

Use of Estimates

The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The accounting estimates and other matters included within our condensed consolidated financial statements and notes to the condensed consolidated financial statements we have assessed include, but were not limited to, revenue recognition, including a reserve for merchandise returns, inventory reserves, impairment of long-lived assets and fair value of financial instruments which include, but are not limited to, accounts receivable, payables and lease obligations.

Client Deposits

Client deposits represent payments made by clients on orders. At the time of order, the Company collects deposits for all orders equivalent to at least 50 percent of the clients’ purchase price. Orders are recognized as revenue when the merchandise is delivered to the client and at the time of delivery the client deposit is no longer recorded as a liability. The Company expects substantially all client deposits as of March 31, 2024 will be recognized as net revenue within the next 12 months as the performance obligations are satisfied.

Gift Cards

The Company sells gift cards to clients in our Showrooms and through our website. Such gift cards do not have expiration dates. We defer revenue when payments are received in advance of performance for unsatisfied obligations related to our gift cards. The liability related to unredeemed gift cards at March 31, 2024 and December 31, 2023 of $0.4 million and $0.5 million, respectively, is recorded in the accrued other expenses line item of the condensed consolidated balance sheets. The Company recognizes income associated with breakage proportional to actual gift card redemptions. For the three months ended March 31, 2024 and March 31, 2023, breakage income was minimal.

Fair Values of Financial Instruments

The Company’s primary financial instruments are cash and cash equivalent investments, accounts receivable, payables, lease obligations and equity based compensation instruments. Due to the short-term maturities of cash and cash equivalent investments, accounts receivable and payables, the Company believes the fair values of these instruments approximate their respective carrying values at March 31, 2024 and December 31, 2023. See Note 5 — Leases for discussion of our lease obligations and Note 6 — Equity Based Compensation for discussion of our equity based compensation instruments.

The Company has established a hierarchy to measure our financial instruments at fair value, which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect the Company’s own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. The hierarchy defines three levels of inputs that may be used to measure fair value:

Level 1Unadjusted quoted prices in active markets for identical, unrestricted assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3Unobservable inputs that reflect the entity’s own assumptions about the assumptions market participants would use in the pricing of the asset or liability and are consequently not based on market activity but rather through particular valuation techniques.

From time to time, the Company invests in Level 1 cash and cash equivalent investments such as money market funds and interest-bearing checking accounts. For the three months ended March 31, 2024, the Company earned $2.8 million in interest income. For the three months ended March 31, 2023, interest income was $1.5 million. Interest income is included within interest expense (income), net on our condensed consolidated statements of comprehensive income.

Revision to Previously Issued Consolidated Financial Statements and Interim Unaudited Condensed Consolidated Financial Statements

As previously disclosed, in preparation of the December 31, 2023 consolidated financial statements, the Company identified an error within the unaudited condensed consolidated balance sheets related to certain leasehold and landlord improvements prior to showroom completion being incorrectly included in prepaid and other current assets rather than property, furniture and equipment, net. The error resulted in inaccurate cash flows ascribed to operating and investing activities in the unaudited condensed consolidated statement of cash flows and the Company concluded to revise the consolidated financial statements and interim unaudited condensed consolidated financial statements as presented below in Adjustment No.1.

In preparation of the March 31, 2024 unaudited condensed consolidated financial statements, the Company identified an additional error within the unaudited condensed consolidated balance sheets related to certain cash receipts from landlord reimbursements prior to showroom completion being incorrectly included in property, furniture and equipment, net. The error resulted in inaccurate cash flows ascribed to operating and investing activities in the unaudited condensed consolidated statement of cash flows as presented below in Adjustment No. 2.

The Company has evaluated the errors both quantitatively and qualitatively and concluded they were not material, individually or in the aggregate, to the prior period consolidated financial statements and interim unaudited condensed consolidated financial statements. The Company concluded to further revise: the unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of cash flows as of and for the three months ended March 31, 2023 and 2022, and as of and for the six months ended June 30, 2023 and 2022; the unaudited condensed consolidated balance sheet as of September 30, 2022; the consolidated balance sheets as of December 31, 2023 and 2022; and the consolidated statements of cash flows for the years ended December 31, 2023, 2022 and 2021.

In connection with the revisions, the Company determined it is appropriate to correct for certain other immaterial errors. The Company will effect the revisions of the consolidated financial statements for 2023 and 2022 within our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The Company will effect the revision of the unaudited interim condensed consolidated financial statements for the second quarter of 2023 within our Quarterly Report on Form 10-Q for the fiscal period ended June 30, 2024.

The Company has also revised impacted amounts within the accompanying notes to the unaudited condensed consolidated financial statements, as applicable.

The following tables summarize the impact of these corrections for the periods presented (amounts in thousands):

	December 31, 2023
Consolidated Balance Sheet	As Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	45,260	$	(18,956)	$	26,304
Total current assets	$	528,251	$	(18,956)	$	509,295
Property, furniture and equipment, net	$	210,238	$	10,010	$	220,248
Total assets	$	1,114,094	$	(8,946)	$	1,105,148
Accrued other expenses	$	42,502	$	3,560	$	46,062
Current portion of operating lease liabilities	45,557		(12,506)		33,051
Total current liabilities	$	351,293	$	(8,946)	$	342,347
Total liabilities	$	773,856	$	(8,946)	$	764,910
Total liabilities and stockholders' equity	$	1,114,094	$	(8,946)	$	1,105,148

	Year ended
	December 31, 2023
Consolidated Statement of Cash Flows	As Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(20,721)	$	9,612	$	(11,109)
Changes in operating lease liabilities	(25,794)		(13,226)		(39,020)
Net cash provided by operating activities	$	172,299	$	(3,614)	$	168,685
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(97,055)	$	3,614	$	(93,441)
Net cash used in investing activities	$	(96,722)	$	3,614	$	(93,108)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	6,726	$	3,560	$	10,286

	June 30, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	43,084	$	(13,274)	$	29,810	$	(11,380)	$	18,430
Total current assets	$	521,047	$	(13,274)	$	507,773	$	(11,380)	$	496,393
Operating right-of-use assets	$	309,211	$	(7,350)	$	301,861	$	—	$	301,861
Property, furniture and equipment, net	149,515		13,274		162,789		15,160		177,949
Total assets	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709
Accrued other expenses	$	33,857	$	—	$	33,857	$	2,410	$	36,267
Current portion of operating lease liabilities	41,483		—		41,483		1,370		42,853
Total current liabilities	$	344,627	$	—	$	344,627	$	3,780	$	348,407
Operating lease liabilities, long-term	$	352,898	$	(7,350)	$	345,548	$	—	$	345,548
Total liabilities	$	757,715	$	(7,350)	$	750,365	$	3,780	$	754,145
Total liabilities and stockholders' equity	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709

	Six months ended
	June 30, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(6,808)	$	5,391	$	(1,417)	$	2,036	$	619
Changes in accounts payable	(4,849)		(5,676)		(10,525)		—		(10,525)
Changes in operating lease liabilities	(17,903)		—		(17,903)		650		(17,253)
Net cash provided by operating activities	$	61,795	$	(285)	$	61,510	$	2,686	$	64,196
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(32,815)	$	285	$	(32,530)	$	(2,686)	$	(35,216)
Net cash used in investing activities	$	(32,482)	$	285	$	(32,197)	$	(2,686)	$	(34,883)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,945	$	(4,945)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	456	$	5,676	$	6,132	$	2,410	$	8,542

	March 31, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	44,122	$	(10,221)	$	33,901	$	(12,469)	$	21,432
Total current assets	$	489,771	$	(10,221)	$	479,550	$	(12,469)	$	467,081
Property, furniture and equipment, net	$	136,156	$	7,908	$	144,064	$	16,636	$	160,700
Other noncurrent assets	277		2,313		2,590		—		2,590
Total assets	$	965,886	$	—	$	965,886	$	4,167	$	970,053
Accrued other expenses	$	33,174	$	—	$	33,174	$	1,804	$	34,978
Current portion of operating lease liabilities	40,233		—		40,233		2,363		42,596
Total current liabilities	$	346,816	$	—	$	346,816	$	4,167	$	350,983
Total liabilities	$	720,792	$	—	$	720,792	$	4,167	$	724,959
Total liabilities and stockholders' equity	$	965,886	$	—	$	965,886	$	4,167	$	970,053

	Three months ended
	March 31, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(7,513)	$	3,102	$	(4,411)	$	3,125	$	(1,286)
Changes in accounts payable	(7,943)		(4,682)		(12,625)		—		(12,625)
Changes in operating lease liabilities	(12,271)		—		(12,271)		1,643		(10,628)
Net cash provided by operating activities	$	7,677	$	(1,580)	$	6,097	$	4,768	$	10,865
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(8,505)	$	1,580	$	(6,925)	$	(4,768)	$	(11,693)
Net cash used in investing activities	$	(8,172)	$	1,580	$	(6,592)	$	(4,768)	$	(11,360)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	741	$	(741)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,539	$	4,682	$	6,221	$	1,804	$	8,025

	December 31, 2022
Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	37,371	$	(7,503)	$	29,868	$	(9,344)	$	20,524
Total current assets	$	478,051	$	(7,503)	$	470,548	$	(9,344)	$	461,204
Operating right-of-use assets	$	252,055	$	5,292	$	257,347	$	—	$	257,347
Property, furniture and equipment, net	135,066		5,547		140,613		11,655		152,268
Other noncurrent assets	296		1,956		2,252		—		2,252
Total assets	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395
Accrued other expenses	$	35,169	$	—	$	35,169	$	1,591	$	36,760
Current portion of operating lease liabilities	39,744		(494)		39,250		720		39,970
Total current liabilities	$	373,783	$	(494)	$	373,289	$	2,311	$	375,600
Operating lease liabilities, long-term	$	289,871	$	5,786	$	295,657	$	—	$	295,657
Total liabilities	$	722,097	$	5,292	$	727,389	$	2,311	$	729,700
Total liabilities and stockholders' equity	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395

	Year ended
	December 31, 2022
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(9,329)	$	2,442	$	(6,887)	$	(267)	$	(7,154)
Changes in accounts payable	14,014		(3,718)		10,296		—		10,296
Changes in operating lease liabilities	(33,682)		—		(33,682)		4,551		(29,131)
Net cash provided by operating activities	$	74,454	$	(1,276)	$	73,178	$	4,284	$	77,462
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Net cash used in investing activities	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,312	$	(4,312)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	3,160	$	3,718	$	6,878	$	1,591	$	8,469

    

	September 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	35,867	$	(5,772)	$	30,095	$	(11,298)	$	18,797
Total current assets	$	482,298	$	(5,772)	$	476,526	$	(11,298)	$	465,228
Operating right-of-use assets	$	224,921	$	7,092	$	232,013	$	—	$	232,013
Property, furniture and equipment, net	128,783		4,249		133,032		7,246		140,278
Other noncurrent assets	235		1,523		1,758		—		1,758
Total assets	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248
Accrued other expenses	$	33,756	$	—	$	33,756	$	1,044	$	34,800
Current portion of operating lease liabilities	39,248		680		39,928		(5,096)		34,832
Total current liabilities	$	423,986	$	680	$	424,666	$	(4,052)	$	420,614
Operating lease liabilities, long-term	$	263,753	$	6,412	$	270,165	$	—	$	270,165
Total liabilities	$	746,413	$	7,092	$	753,505	$	(4,052)	$	749,453
Total liabilities and stockholders' equity	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248

	June 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	29,509	$	(5,264)	$	24,245	$	(10,390)	$	13,855
Total current assets	$	455,100	$	(5,264)	$	449,836	$	(10,390)	$	439,446
Property, furniture and equipment, net	$	116,620	$	4,105	$	120,725	$	5,891	$	126,616
Other noncurrent assets	249		1,159		1,408		—		1,408
Total assets	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533
Accrued other expenses	$	26,718	$	—	$	26,718	$	777	$	27,495
Current portion of operating lease liabilities	37,624		—		37,624		(5,276)		32,348
Total current liabilities	$	426,659	$	—	$	426,659	$	(4,499)	$	422,160
Total liabilities	$	753,138	$	—	$	753,138	$	(4,499)	$	748,639
Total liabilities and stockholders' equity	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533

	Six months ended
	June 30, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(5,095)	$	4,520	$	(575)	$	779	$	204
Changes in accounts payable	15,197		(321)		14,876		—		14,876
Changes in operating lease liabilities	(15,401)		—		(15,401)		(1,445)		(16,846)
Net cash provided by operating activities	$	41,110	$	4,199	$	45,309	$	(666)	$	44,643
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Net cash used in investing activities	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,494	$	(4,494)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,673	$	321	$	1,994	$	777	$	2,771

	March 31, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	31,013	$	(5,060)	$	25,953	$	(9,015)	$	16,938
Total current assets	$	435,116	$	(5,060)	$	430,056	$	(9,015)	$	421,041
Operating right-of-use assets	$	196,896	$	3,071	$	199,967	$	—	$	199,967
Property, furniture and equipment, net	107,581		4,083		111,664		8,823		120,487
Other noncurrent assets	264		977		1,241		—		1,241
Total assets	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068
Accrued other expenses	$	20,946	$	—	$	20,946	$	717	$	21,663
Current portion of operating lease liabilities	37,957		(138)		37,819		(909)		36,910
Total current liabilities	$	444,885	$	(138)	$	444,747	$	(192)	$	444,555
Operating lease liabilities, long-term	$	227,191	$	3,209	$	230,400	$	—	$	230,400
Total liabilities	$	727,645	$	3,071	$	730,716	$	(192)	$	730,524
Total liabilities and stockholders' equity	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068

	Three months ended
	March 31, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,016)	$	1,628	$	(1,388)	$	(596)	$	(1,984)
Changes in accounts payable	8,680		(2,247)		6,433		—		6,433
Changes in operating lease liabilities	(11,485)		—		(11,485)		2,922		(8,563)
Net cash provided by operating activities	$	35,219	$	(619)	$	34,600	$	2,326	$	36,926
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Net cash used in investing activities	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	108	$	2,247	$	2,355	$	717	$	3,072

	Year ended
	December 31, 2021
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,621)	$	(8,673)	$	(12,294)	$	3,590	$	(8,704)
Changes in accounts payable	17,595		(3,088)		14,507		—		14,507
Changes in deferred rent and lease incentives	4,518		5,352		9,870		(2,074)		7,796
Net cash provided by operating activities	$	146,243	$	(6,409)	$	139,834	$	1,516	$	141,350
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Net cash used in investing activities	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	5,352	$	(5,352)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	5,968	$	3,088	$	9,056	$	363	$	9,419

As previously disclosed, these errors also resulted in the restatement of the unaudited condensed consolidated balance sheet and statement of cash flows as of and for the nine months ended September 30, 2023 and the revision of the unaudited condensed consolidated statement of cash flows for the nine months ended September 30, 2022.

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Recently Issued Accounting Standards

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Recently Issued Accounting Standards

Recently Issued Accounting Standards

New Accounting Standards Adopted in Fiscal 2024

The Company adopted Accounting Standards Updates (“ASU”) 2023-01 — Leases (Topic 842): Common Control Arrangements in the three months ended March 31, 2024. We believe the adoption of ASU 2023-01 did not have a material impact on our accounting policies or our condensed consolidated financial statements and related disclosures.

Accounting Standards Not Yet Adopted

The following table summarizes accounting pronouncements which we have not yet adopted but will be adopted in the upcoming fiscal year. ASU 2023-07 is effective for annual periods beginning after December 15, 2023. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures.

ASU	Description	Adoption Date
ASU 2023-07	Segment Reporting (Topic 280): Improvements	Fiscal Year 2024
ASU 2023-09	Income Taxes (Topic 740): Improvements to Income Tax Disclosures	Fiscal Year 2025

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Merchandise Warranties

3 Months Ended

Mar. 31, 2024

Product Warranties Disclosures [Abstract]

Merchandise Warranties

Merchandise Warranties

The Company warrants certain merchandise to be free of defects in both construction materials and workmanship from the date the performance obligation was fulfilled to the client for three to ten years depending on the merchandise category. The Company accounts for merchandise warranties by accruing an estimated liability when we recognize revenue on the sale of warrantied merchandise. We estimate future warranty claims based on claim experience which includes materials and labor costs to perform the repairs or replace products. We use judgment in making our estimates. We record differences between our estimated and actual costs when the differences are known.

A reconciliation of the changes in our limited merchandise warranty liability is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Balance as of beginning of period	$	7,084	$	6,375
Accruals during the period	3,080		3,381
Settlements during the period	(3,136)		(3,291)
Balance as of end of the period(1)	$	7,028	$	6,465

(1) $4.0 million and $3.7 million were recorded in accrued other expenses at March 31, 2024 and March 31, 2023, respectively. The remainder is recorded in other long-term liabilities on our condensed consolidated balance sheets.

We recorded accruals during the periods presented in the table above, primarily to reflect charges that relate to limited merchandise warranties issued during the respective periods.

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Debt

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Debt

Debt

On November 8, 2021, the Company entered into a revolving credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provides for, among other things, (1) a revolving credit facility in an aggregate amount not to exceed at any time outstanding the amount of such lender’s commitment, (2) a letter of credit commitment in an amount equal to the lesser of (a) $10.0 million, and (b) the amount of the revolving credit facility as of such date, and (3) a swingline loan in an amount equal to the lesser of (a) $5.0 million, and (b) the amount of the revolving credit facility as of such date. The aggregate amount of all commitments of all lenders under the 2021 Credit Facility was initially $50.0 million. The 2021 Credit Facility contains restrictive covenants and has certain financial covenants, including a minimum rent-adjusted total leverage ratio and a minimum fixed charge ratio. The 2021 Credit Facility bears variable interest rates at the prevailing Bloomberg Short-Term Bank Yield index rate plus the applicable margin (1.50% at March 31, 2024 and 1.50% at March 31, 2023), whereas the applicable margin is adjusted quarterly based on the Company’s consolidated rent-adjusted total leverage ratio.

On December 9, 2022, the Company amended the 2021 Credit Facility to increase the revolving credit commitment thereunder by $25.0 million. After giving effect to such increase, the aggregate amount of all commitments under the 2021 Credit Facility is $75.0 million. The 2021 Credit Facility expires on November 8, 2026.

At March 31, 2024 and December 31, 2023, we had no borrowings on the 2021 Credit Facility. Deferred financing costs related to the 2021 Credit Facility of $0.4 million and $0.4 million as of March 31, 2024 and December 31, 2023, respectively, are recorded in other noncurrent assets on the condensed consolidated balance sheets and will be amortized over the term of the 2021 Credit Facility on a straight-line basis. Accumulated amortization related to deferred financing costs for the 2021 Credit Facility was $0.2 million as of March 31, 2024 and $0.1 million as of December 31, 2023.

The Company was in compliance with all applicable debt covenants at March 31, 2024 and December 31, 2023, and expects to remain in compliance over the next 12 months.

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Leases

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Leases

Leases

The Company leases real estate and equipment under operating and finance leases, some of which are from related parties as discussed in Note 10 — Related Party Transactions. The most significant obligations under these lease agreements

require the payments of periodic rentals, real estate taxes, insurance and maintenance costs. Depending on particular Showroom leases, the Company can also owe a percentage rent payment if particular Showrooms meet certain sales figures.

The following table summarizes the amounts recognized in our condensed consolidated balance sheets related to leases (amounts in thousands):

	Condensed Consolidated Balance Sheet Classification	March 31, 2024		December 31, 2023
Assets
Operating lease assets	Operating right-of-use assets	$	322,905	$	302,157
Finance lease assets	Financing right-of-use assets	38,209		38,835
Total leased assets		$	361,114	$	340,992
Liabilities
Current operating leases	Current portion of operating lease liabilities	$	42,694	$	33,051
Non-current operating leases	Operating lease liabilities, long-term	383,684		362,598
Total operating lease liabilities		426,378		395,649
Current finance leases	Current portion of financing lease liabilities	919		904
Non-current finance leases	Financing lease liabilities, long-term	53,658		53,870
Total finance lease liabilities		54,577		54,774
Total lease liabilities		$	480,955	$	450,423

The components of lease cost recognized within our condensed consolidated statements of comprehensive income are as follows (amounts in thousands):

		Three months ended
		March 31,
	Condensed Consolidated Statements of Comprehensive Income Classification	2024		2023
Lease costs:
Operating lease costs	Cost of goods sold	$	12,185	$	9,714
Operating lease costs	Selling, general and administrative expenses	2,501		2,401
Finance lease costs
Amortization of right-of-use assets	Selling, general and administrative expenses	626		540
Interest expense on lease liabilities	Interest expense (income), net	1,301		1,268
Variable lease costs(1)	Cost of goods sold	9,488		10,031
Short term lease costs	Selling, general and administrative expenses	18		120
Total lease costs		$	26,119	$	24,074

(1) For the three months ended March 31, 2024, there were no month-to-month lease costs. For the three months ended March 31, 2023, total lease costs includes $0.3 million of month-to-month lease costs.

We often have options to renew lease terms for Showrooms and other assets. The exercise of lease renewal options is generally at our sole discretion. In addition, certain lease agreements may be terminated prior to their original expiration date at our discretion. We evaluate each renewal and termination option at the lease commencement date to determine if we are reasonably certain to exercise the option on the basis of economic factors. The weighted average remaining lease terms are as follows:

	Three months ended
	March 31,
Weighted Average Remaining Lease Term (In Years)	2024	2023
Operating leases	9.24	9.32
Finance leases	20.66	22.26

When readily available, we use the discount rate implicit within the lease as determined at the time of lease commencement. However, the discount rate implicit within many of our leases is generally not determinable at the time of lease commencement and therefore the Company determines the discount rate based on its incremental borrowing rate (“IBR”). For leases in which the discount rate was not explicit, the Company utilized a market-based approach to estimate the IBR, which required significant judgment. The Company estimated the base IBR based on an analysis of (i) yields on the Company’s 2021 Credit Facility, as well as comparable companies and (ii) unsecured yields and discount rates. The Company applied adjustments to the base IBRs to account for full collateralization and lease term. The weighted average discount rates used to measure our lease liabilities are as follows:

	Three months ended
	March 31,
Weighted Average Discount Rate	2024		2023
Operating leases	6.04	%	5.80	%
Finance leases	9.64	%	9.72	%

Future lease liabilities at March 31, 2024 are as follows (amounts in thousands):

Year Ending December 31,	Operating Lease Liabilities (1)		Finance Lease Liabilities		Total Lease Liabilities
Remainder of 2024	$	48,161	$	4,343	$	52,504
2025	69,044		5,800		74,844
2026	63,772		6,259		70,031
2027	59,709		6,060		65,769
2028	54,283		5,610		59,893
2029	51,279		5,224		56,503
Thereafter	222,283		104,719		327,002
Total lease payments	568,531		138,015		706,546
Less: Amounts representing interest	(142,153)		(83,438)		(225,591)
Total	$	426,378	$	54,577	$	480,955

(1) Includes leases with related parties. See Note 10 — Related Party Transactions for amounts leased from related parties.

At March 31, 2024, the Company has entered into leases for Showrooms and equipment which have not yet commenced with expected lease terms ranging from 3 to 13 years. The aggregate minimum rental payments over the term of the leases of approximately $151.4 million are not included in the above table.

Supplemental cash flow information related to leases is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	15,996	$	13,411
Operating cash flows for finance leases	1,230		1,204
Financing cash flows for finance leases	221		129
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	28,751	$	28,582
Finance leases	—		—

Leases

Leases

The Company leases real estate and equipment under operating and finance leases, some of which are from related parties as discussed in Note 10 — Related Party Transactions. The most significant obligations under these lease agreements

require the payments of periodic rentals, real estate taxes, insurance and maintenance costs. Depending on particular Showroom leases, the Company can also owe a percentage rent payment if particular Showrooms meet certain sales figures.

The following table summarizes the amounts recognized in our condensed consolidated balance sheets related to leases (amounts in thousands):

	Condensed Consolidated Balance Sheet Classification	March 31, 2024		December 31, 2023
Assets
Operating lease assets	Operating right-of-use assets	$	322,905	$	302,157
Finance lease assets	Financing right-of-use assets	38,209		38,835
Total leased assets		$	361,114	$	340,992
Liabilities
Current operating leases	Current portion of operating lease liabilities	$	42,694	$	33,051
Non-current operating leases	Operating lease liabilities, long-term	383,684		362,598
Total operating lease liabilities		426,378		395,649
Current finance leases	Current portion of financing lease liabilities	919		904
Non-current finance leases	Financing lease liabilities, long-term	53,658		53,870
Total finance lease liabilities		54,577		54,774
Total lease liabilities		$	480,955	$	450,423

The components of lease cost recognized within our condensed consolidated statements of comprehensive income are as follows (amounts in thousands):

		Three months ended
		March 31,
	Condensed Consolidated Statements of Comprehensive Income Classification	2024		2023
Lease costs:
Operating lease costs	Cost of goods sold	$	12,185	$	9,714
Operating lease costs	Selling, general and administrative expenses	2,501		2,401
Finance lease costs
Amortization of right-of-use assets	Selling, general and administrative expenses	626		540
Interest expense on lease liabilities	Interest expense (income), net	1,301		1,268
Variable lease costs(1)	Cost of goods sold	9,488		10,031
Short term lease costs	Selling, general and administrative expenses	18		120
Total lease costs		$	26,119	$	24,074

(1) For the three months ended March 31, 2024, there were no month-to-month lease costs. For the three months ended March 31, 2023, total lease costs includes $0.3 million of month-to-month lease costs.

We often have options to renew lease terms for Showrooms and other assets. The exercise of lease renewal options is generally at our sole discretion. In addition, certain lease agreements may be terminated prior to their original expiration date at our discretion. We evaluate each renewal and termination option at the lease commencement date to determine if we are reasonably certain to exercise the option on the basis of economic factors. The weighted average remaining lease terms are as follows:

	Three months ended
	March 31,
Weighted Average Remaining Lease Term (In Years)	2024	2023
Operating leases	9.24	9.32
Finance leases	20.66	22.26

When readily available, we use the discount rate implicit within the lease as determined at the time of lease commencement. However, the discount rate implicit within many of our leases is generally not determinable at the time of lease commencement and therefore the Company determines the discount rate based on its incremental borrowing rate (“IBR”). For leases in which the discount rate was not explicit, the Company utilized a market-based approach to estimate the IBR, which required significant judgment. The Company estimated the base IBR based on an analysis of (i) yields on the Company’s 2021 Credit Facility, as well as comparable companies and (ii) unsecured yields and discount rates. The Company applied adjustments to the base IBRs to account for full collateralization and lease term. The weighted average discount rates used to measure our lease liabilities are as follows:

	Three months ended
	March 31,
Weighted Average Discount Rate	2024		2023
Operating leases	6.04	%	5.80	%
Finance leases	9.64	%	9.72	%

Future lease liabilities at March 31, 2024 are as follows (amounts in thousands):

Year Ending December 31,	Operating Lease Liabilities (1)		Finance Lease Liabilities		Total Lease Liabilities
Remainder of 2024	$	48,161	$	4,343	$	52,504
2025	69,044		5,800		74,844
2026	63,772		6,259		70,031
2027	59,709		6,060		65,769
2028	54,283		5,610		59,893
2029	51,279		5,224		56,503
Thereafter	222,283		104,719		327,002
Total lease payments	568,531		138,015		706,546
Less: Amounts representing interest	(142,153)		(83,438)		(225,591)
Total	$	426,378	$	54,577	$	480,955

(1) Includes leases with related parties. See Note 10 — Related Party Transactions for amounts leased from related parties.

At March 31, 2024, the Company has entered into leases for Showrooms and equipment which have not yet commenced with expected lease terms ranging from 3 to 13 years. The aggregate minimum rental payments over the term of the leases of approximately $151.4 million are not included in the above table.

Supplemental cash flow information related to leases is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	15,996	$	13,411
Operating cash flows for finance leases	1,230		1,204
Financing cash flows for finance leases	221		129
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	28,751	$	28,582
Finance leases	—		—

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Equity Based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Equity Based Compensation

Equity Based Compensation

Activity of the Company’s Restricted Stock and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	Restricted Stock - Class A
	Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	500,304	$	15.47
Granted	—	—
Forfeited	—	—
Vested	(21,477)	0.20
Unvested at March 31, 2024	478,827	$	16.16

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - Restricted Stock(1)	$	660	$	698

(1) Total unrecognized equity based compensation to be recognized in future periods is $5.5 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

The Arhaus, Inc. 2021 Equity Incentive Plan (the “2021 Plan”) was adopted on November 8, 2021. The 2021 Plan authorizes the Company the ability to grant stock options (either incentive or non-qualified), stock appreciation rights (“SARs”), restricted stock, restricted stock units (“RSUs”), performance shares, performance share units (“PSUs”) and other stock-based awards with respect to our Class A common stock to our employees, officers, consultants, advisors and directors. The maximum number of Class A common stock that may be granted under the 2021 Plan is 11,205,100 shares.

Per the 2021 Equity Plan, each RSU and PSU represents a contingent right to receive one share of the Company’s Class A common stock upon vesting. The RSUs granted to award recipients vest in one-third increments on each of the first, second and third anniversary of the date of grant, provided that the award recipient continues to serve the Company through the applicable vesting date (“Continuous Service”). If the award recipient’s Continuous Service terminates for any reason other than death, disability or in connection with a change in control (as such terms are defined in the 2021 Plan), unless the Compensation Committee of the Board of Directors determines otherwise, all RSUs that are unvested at the time of such termination shall be forfeited and canceled immediately without consideration. RSU and PSU awards contain forfeitable rights to dividend equivalents. Dividend equivalents for outstanding awards are accrued when dividends are declared on the Company’s common stock but are not paid until the awards vest, and dividend equivalents accrued for awards that ultimately do not vest are forfeited. The RSUs issued to certain members of the Board of Directors will vest on the one-year anniversary of the grant date.

The number of PSUs earned will be based on the Company’s financial performance as measured against pre-established target goals for cumulative demand revenue and cumulative adjusted EBITDA (the “Performance Goals”) over the applicable performance period. PSUs will vest as of the end of the performance period subject to the award recipient’s Continuous Service, but will not settle and payout until the number of PSUs earned is determined by the Compensation Committee. The award recipient may earn between 0% and 200% of the PSU target award based on the Company’s achievement of the Performance Goals. The Company accounts for forfeitures as they occur.

Activity of the Company’s PSU and RSU awards and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	PSU Awards			RSU Awards
	Amount	Weighted Average Grant Date Fair Value		Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	700,229	$	7.20	1,248,165	$	7.79
Granted	—	—		—	—
Forfeited	(10,000)	9.93		(7,894)	9.54
Vested	—	—		(107,895)	9.49
Unvested at March 31, 2024	690,229	$	7.16	1,132,376	$	7.62

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - PSUs(1)	$	352	$	433
Equity based compensation expense - RSUs(2)	$	1,012	$	499

(1) Total unrecognized equity based compensation for the PSUs to be recognized in future periods is $2.6 million at March 31, 2024, and will be recognized over a weighted average period of 1.31 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

(2) Total unrecognized equity based compensation for the RSUs to be recognized in future periods is $6.7 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

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Segment Reporting

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

Our chief operating decision maker is our Chief Executive Officer (“CEO”), who reviews financial information presented on a consolidated basis for purposes of making decisions, assessing financial performance and allocating resources. We operate our business as one operating segment and therefore we have one reportable segment that offers an assortment of merchandise across a number of categories, including furniture, outdoor, lighting, textiles, and décor. The assortment of merchandise can be purchased through our Retail and eCommerce merchandise sales channels.

The majority of our net revenue is generated through sales to clients in the United States. Sales to clients outside of the United States are not significant. Further, no single client represents more than ten percent or more of our net revenue.

Net revenue by merchandise sales channel is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Retail	$	243,255	$	250,102
eCommerce	51,907		54,466
Total net revenue	$	295,162	$	304,568

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Net and Comprehensive Income per Share

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Net and Comprehensive Income per Share

Net and Comprehensive Income per Share

Basic and diluted net and comprehensive income per share for the three months ended March 31, 2024 and March 31, 2023, was calculated by dividing net and comprehensive income by the number of basic and diluted weighted-average common shares outstanding. The Company has elected to not adjust net and comprehensive income for forfeitable dividend equivalents, when declared, related to unvested equity awards. The Company will recognize dividends paid on common shares when the dividend equivalents are no longer forfeitable, such as if the contingency is met or the share-based payment awards vest into common shares.

Basic and diluted net and comprehensive income per share are as follows (amounts in thousands, except per share data):

	Three months ended
	March 31,
	2024		2023
Numerator
Net and comprehensive income	$	15,099	$	34,099
Denominator—Weighted Average Shares Outstanding
Weighted-average number of common shares outstanding, basic	139,816,792		139,072,756
Effect of dilutive restricted stock (1) (2)	739,239		866,787
Weighted-average number of common shares outstanding, diluted	140,556,031		139,939,543
Net and Comprehensive Income Per Share
Net and comprehensive income per share, basic	$	0.11	$	0.25
Net and comprehensive income per share, diluted	$	0.11	$	0.24

(1) During the three months ended March 31, 2024, 412,487 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive. During the three months ended March 31, 2023, 547,370 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive.

(2) Excluded from the calculation of the effect of dilutive restricted stock as of three months ended March 31, 2024 and March 31, 2023, were 540,335 and 768,013 PSUs, respectively, because they did not meet the required performance criteria.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Company is involved in litigation and claims that are incidental to its business. Although the outcome of these matters cannot be determined at the present time, management of the Company believes that the ultimate resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

From time to time, the Company has received inquiries from a number of state and local taxing agencies with respect to the remittance of sales, use, telecommunications, excise, and income taxes. Several jurisdictions are currently conducting tax audits of the Company's records. The Company collects, or has accrued for, taxes that it believes are required to be remitted. The amounts that have been remitted have historically been within the accruals established by the Company. The Company adjusts its accrual when facts relating to specific exposures warrant such adjustment. As of March 31, 2024 and December 31, 2023, we recorded liabilities of $0.2 million and $0.2 million, respectively, in accrued other expenses on the condensed consolidated balance sheets for non-income tax matters that were probable and reasonably estimable.

In August 2023, the Company committed to make a $10.0 million donation to The Nature Conservancy. As of March 31, 2024, we have a remaining commitment of $5.0 million in accrued other expense on our condensed consolidated balance sheets.

On February 29, 2024, the Board of Directors of the Company declared a special cash dividend on the Company’s Class A and Class B common stock of $0.50 per share, payable April 4, 2024, to shareholders of record at the close of business on March 21, 2024 (the “Record Date”). As of March 31, 2024, we recorded $70.6 million in current liabilities and $0.6 million in other long-term liabilities on our condensed consolidated balance sheet.

The Company paid out the aforementioned special cash dividend in April 2024 on its Class A and Class B common stock in the amount of $69.9 million. The remaining dividends payable balance recorded in current liabilities on our condensed consolidated balance sheet relates to dividend equivalents on outstanding equity awards under the Company’s equity incentive plans that were unvested as of the Record Date and are expected to vest within the next 12 months.

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Related Party Transactions

3 Months Ended

Mar. 31, 2024

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Leasing transactions

In November 2000, the Company entered into a lease agreement with Pagoda Partners, LLC, a company of which John Reed, our CEO, indirectly owns 50%, for our warehouse in Walton Hills, Ohio. The base lease term was 17 years with a 5-year renewal option. In August 2020, the Company amended the lease agreement to extend the lease term to April 2024. The monthly rental payments are $0.1 million. In July 2023, the Company amended the lease agreement to extend the lease term to April 2034 with one additional 5-year renewal option. The monthly rental payments range from $0.1 million to $0.2 million. Rent expense was $0.4 million and $0.3 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

In July 2010, the Company entered into a lease agreement with Brooklyn Arhaus, a company of which our CEO and Mr. Beargie, a Director of the Company, own 85% and 15%, respectively, for our Outlet in Brooklyn, Ohio. The base lease term is 15 years with no lease renewal options. The monthly rental payments are $20 thousand. Rent expense was $0.1 million and $0.1 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

In March 2021, the Company entered into a lease agreement with Premier Conover, LLC, a company of which our CEO indirectly owns 40%, for a distribution center and manufacturing building, for which construction was completed in the fourth quarter of 2021. The base lease term is for 12 years, with a 10-year renewal option and two additional 5-year renewal options at the higher of the minimum base rent or the fair market rent at the time of renewal execution. The monthly rental payments range from $0.2 million to $0.3 million during the 12-year base lease term and from $0.4 million to $0.5 million during the 10-year renewal period. Rent expense was $1.0 million and $1.0 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

Other transactions

The accounts payable due to related parties for state and federal income tax refunds were $0.2 million and $2.3 million at March 31, 2024 and December 31, 2023, respectively, and are included within accounts payable on the condensed consolidated balance sheets.

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Income Taxes

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Income tax expenses were $4.8 million and $12.1 million in the three months ended March 31, 2024 and March 31, 2023, respectively. The effective tax rate was 24.2% and 26.2% for the three months ended March 31, 2024 and March 31, 2023, respectively.

As of March 31, 2024, no unrecognized tax benefits have been recognized. The Company files income tax returns in the U.S. and various state and local jurisdictions. The tax years after 2019 remain open to examination by the state taxing jurisdictions in which the Company is subject to tax. As of March 31, 2024, the Company was not under examination by the Internal Revenue Service or any state tax jurisdiction.

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Insider Trading Arrangements

3 Months Ended

Mar. 31, 2024

shares

Trading Arrangements, by Individual

Non-Rule 10b5-1 Arrangement Adopted

false

Rule 10b5-1 Arrangement Terminated

false

Non-Rule 10b5-1 Arrangement Terminated

false

Dawn Sparks [Member]

Trading Arrangements, by Individual

Material Terms of Trading Arrangement

On March 11, 2024, Dawn Sparks, Chief Logistics Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 120,000 shares of the Company’s Class A common stock beginning June 10, 2024. The arrangement’s expiration date is December 10, 2024.

Name

Dawn Sparks

Title

Chief Logistics Officer

Rule 10b5-1 Arrangement Adopted

true

Adoption Date

March 11, 2024

Arrangement Duration

274 days

Aggregate Available

120,000

Dawn Phillipson [Member]

Trading Arrangements, by Individual

Material Terms of Trading Arrangement

On March 12, 2024, Dawn Phillipson, Chief Financial Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 150,000 shares of the Company’s Class A common stock beginning June 10, 2024. The arrangement’s expiration date is March 6, 2025.

Name

Dawn Phillipson

Title

Chief Financial Officer

Rule 10b5-1 Arrangement Adopted

true

Adoption Date

March 12, 2024

Arrangement Duration

359 days

Aggregate Available

150,000

Venkat Nachiappan [Member]

Trading Arrangements, by Individual

Material Terms of Trading Arrangement

On March 14, 2024, Venkat Nachiappan, Chief Information Officer, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 20,093 shares of the Company’s Class A common stock beginning June 14, 2024. The arrangement’s expiration date is December 31, 2024.

Name

Venkat Nachiappan

Title

Chief Information Officer

Rule 10b5-1 Arrangement Adopted

true

Adoption Date

March 14, 2024

Arrangement Duration

292 days

Aggregate Available

20,093

XML

Nature of Business and Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying condensed consolidated financial statements include our accounts and those of our wholly owned subsidiaries. Accordingly, all intercompany balances and transactions have been eliminated through the consolidation process.

The accompanying condensed consolidated balance sheets at March 31, 2024 and December 31, 2023, the condensed consolidated statements of comprehensive income, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023 and the related interim condensed consolidated disclosures are unaudited and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

In management’s opinion, the accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company’s financial position at March 31, 2024, the results of operations, changes in stockholders’equity and cash flows for the three months ended March 31, 2024 and March 31, 2023. The condensed consolidated balance sheet as of December 31, 2023 included herein was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP.

The results for the three months ended March 31, 2024 and March 31, 2023 are not necessarily indicative of the operating results to be expected for the full fiscal year or any future period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.

Use of Estimates

Use of Estimates

The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The accounting estimates and other matters included within our condensed consolidated financial statements and notes to the condensed consolidated financial statements we have assessed include, but were not limited to, revenue recognition, including a reserve for merchandise returns, inventory reserves, impairment of long-lived assets and fair value of financial instruments which include, but are not limited to, accounts receivable, payables and lease obligations.

Client Deposits and Gift Cards

Client Deposits

Client deposits represent payments made by clients on orders. At the time of order, the Company collects deposits for all orders equivalent to at least 50 percent of the clients’ purchase price. Orders are recognized as revenue when the merchandise is delivered to the client and at the time of delivery the client deposit is no longer recorded as a liability. The Company expects substantially all client deposits as of March 31, 2024 will be recognized as net revenue within the next 12 months as the performance obligations are satisfied.

Gift Cards

The Company sells gift cards to clients in our Showrooms and through our website. Such gift cards do not have expiration dates. We defer revenue when payments are received in advance of performance for unsatisfied obligations related to our gift cards. The liability related to unredeemed gift cards at March 31, 2024 and December 31, 2023 of $0.4 million and $0.5 million, respectively, is recorded in the accrued other expenses line item of the condensed consolidated balance sheets. The Company recognizes income associated with breakage proportional to actual gift card redemptions. For the three months ended March 31, 2024 and March 31, 2023, breakage income was minimal.

Fair Values of Financial Instruments

Fair Values of Financial Instruments

The Company’s primary financial instruments are cash and cash equivalent investments, accounts receivable, payables, lease obligations and equity based compensation instruments. Due to the short-term maturities of cash and cash equivalent investments, accounts receivable and payables, the Company believes the fair values of these instruments approximate their respective carrying values at March 31, 2024 and December 31, 2023. See Note 5 — Leases for discussion of our lease obligations and Note 6 — Equity Based Compensation for discussion of our equity based compensation instruments.

The Company has established a hierarchy to measure our financial instruments at fair value, which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect the Company’s own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. The hierarchy defines three levels of inputs that may be used to measure fair value:

Level 1Unadjusted quoted prices in active markets for identical, unrestricted assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3Unobservable inputs that reflect the entity’s own assumptions about the assumptions market participants would use in the pricing of the asset or liability and are consequently not based on market activity but rather through particular valuation techniques.

New Accounting Standards Adopted in Fiscal 2024 and Accounting Standards Not Yet Adopted

New Accounting Standards Adopted in Fiscal 2024

The Company adopted Accounting Standards Updates (“ASU”) 2023-01 — Leases (Topic 842): Common Control Arrangements in the three months ended March 31, 2024. We believe the adoption of ASU 2023-01 did not have a material impact on our accounting policies or our condensed consolidated financial statements and related disclosures.

Accounting Standards Not Yet Adopted

The following table summarizes accounting pronouncements which we have not yet adopted but will be adopted in the upcoming fiscal year. ASU 2023-07 is effective for annual periods beginning after December 15, 2023. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. We believe the adoption will not have a material impact on our accounting policies, financial position or results of operations but could require additional disclosures.

ASU	Description	Adoption Date
ASU 2023-07	Segment Reporting (Topic 280): Improvements	Fiscal Year 2024
ASU 2023-09	Income Taxes (Topic 740): Improvements to Income Tax Disclosures	Fiscal Year 2025

XML

Nature of Business and Basis of Presentation (Tables)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Schedule of Error Correction

The following tables summarize the impact of these corrections for the periods presented (amounts in thousands):

	December 31, 2023
Consolidated Balance Sheet	As Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	45,260	$	(18,956)	$	26,304
Total current assets	$	528,251	$	(18,956)	$	509,295
Property, furniture and equipment, net	$	210,238	$	10,010	$	220,248
Total assets	$	1,114,094	$	(8,946)	$	1,105,148
Accrued other expenses	$	42,502	$	3,560	$	46,062
Current portion of operating lease liabilities	45,557		(12,506)		33,051
Total current liabilities	$	351,293	$	(8,946)	$	342,347
Total liabilities	$	773,856	$	(8,946)	$	764,910
Total liabilities and stockholders' equity	$	1,114,094	$	(8,946)	$	1,105,148

	Year ended
	December 31, 2023
Consolidated Statement of Cash Flows	As Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(20,721)	$	9,612	$	(11,109)
Changes in operating lease liabilities	(25,794)		(13,226)		(39,020)
Net cash provided by operating activities	$	172,299	$	(3,614)	$	168,685
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(97,055)	$	3,614	$	(93,441)
Net cash used in investing activities	$	(96,722)	$	3,614	$	(93,108)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	6,726	$	3,560	$	10,286

	June 30, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	43,084	$	(13,274)	$	29,810	$	(11,380)	$	18,430
Total current assets	$	521,047	$	(13,274)	$	507,773	$	(11,380)	$	496,393
Operating right-of-use assets	$	309,211	$	(7,350)	$	301,861	$	—	$	301,861
Property, furniture and equipment, net	149,515		13,274		162,789		15,160		177,949
Total assets	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709
Accrued other expenses	$	33,857	$	—	$	33,857	$	2,410	$	36,267
Current portion of operating lease liabilities	41,483		—		41,483		1,370		42,853
Total current liabilities	$	344,627	$	—	$	344,627	$	3,780	$	348,407
Operating lease liabilities, long-term	$	352,898	$	(7,350)	$	345,548	$	—	$	345,548
Total liabilities	$	757,715	$	(7,350)	$	750,365	$	3,780	$	754,145
Total liabilities and stockholders' equity	$	1,045,279	$	(7,350)	$	1,037,929	$	3,780	$	1,041,709

	Six months ended
	June 30, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(6,808)	$	5,391	$	(1,417)	$	2,036	$	619
Changes in accounts payable	(4,849)		(5,676)		(10,525)		—		(10,525)
Changes in operating lease liabilities	(17,903)		—		(17,903)		650		(17,253)
Net cash provided by operating activities	$	61,795	$	(285)	$	61,510	$	2,686	$	64,196
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(32,815)	$	285	$	(32,530)	$	(2,686)	$	(35,216)
Net cash used in investing activities	$	(32,482)	$	285	$	(32,197)	$	(2,686)	$	(34,883)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,945	$	(4,945)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	456	$	5,676	$	6,132	$	2,410	$	8,542

	March 31, 2023
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	44,122	$	(10,221)	$	33,901	$	(12,469)	$	21,432
Total current assets	$	489,771	$	(10,221)	$	479,550	$	(12,469)	$	467,081
Property, furniture and equipment, net	$	136,156	$	7,908	$	144,064	$	16,636	$	160,700
Other noncurrent assets	277		2,313		2,590		—		2,590
Total assets	$	965,886	$	—	$	965,886	$	4,167	$	970,053
Accrued other expenses	$	33,174	$	—	$	33,174	$	1,804	$	34,978
Current portion of operating lease liabilities	40,233		—		40,233		2,363		42,596
Total current liabilities	$	346,816	$	—	$	346,816	$	4,167	$	350,983
Total liabilities	$	720,792	$	—	$	720,792	$	4,167	$	724,959
Total liabilities and stockholders' equity	$	965,886	$	—	$	965,886	$	4,167	$	970,053

	Three months ended
	March 31, 2023
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(7,513)	$	3,102	$	(4,411)	$	3,125	$	(1,286)
Changes in accounts payable	(7,943)		(4,682)		(12,625)		—		(12,625)
Changes in operating lease liabilities	(12,271)		—		(12,271)		1,643		(10,628)
Net cash provided by operating activities	$	7,677	$	(1,580)	$	6,097	$	4,768	$	10,865
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(8,505)	$	1,580	$	(6,925)	$	(4,768)	$	(11,693)
Net cash used in investing activities	$	(8,172)	$	1,580	$	(6,592)	$	(4,768)	$	(11,360)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	741	$	(741)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,539	$	4,682	$	6,221	$	1,804	$	8,025

	December 31, 2022
Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Prepaid and other current assets	$	37,371	$	(7,503)	$	29,868	$	(9,344)	$	20,524
Total current assets	$	478,051	$	(7,503)	$	470,548	$	(9,344)	$	461,204
Operating right-of-use assets	$	252,055	$	5,292	$	257,347	$	—	$	257,347
Property, furniture and equipment, net	135,066		5,547		140,613		11,655		152,268
Other noncurrent assets	296		1,956		2,252		—		2,252
Total assets	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395
Accrued other expenses	$	35,169	$	—	$	35,169	$	1,591	$	36,760
Current portion of operating lease liabilities	39,744		(494)		39,250		720		39,970
Total current liabilities	$	373,783	$	(494)	$	373,289	$	2,311	$	375,600
Operating lease liabilities, long-term	$	289,871	$	5,786	$	295,657	$	—	$	295,657
Total liabilities	$	722,097	$	5,292	$	727,389	$	2,311	$	729,700
Total liabilities and stockholders' equity	$	931,792	$	5,292	$	937,084	$	2,311	$	939,395

	Year ended
	December 31, 2022
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(9,329)	$	2,442	$	(6,887)	$	(267)	$	(7,154)
Changes in accounts payable	14,014		(3,718)		10,296		—		10,296
Changes in operating lease liabilities	(33,682)		—		(33,682)		4,551		(29,131)
Net cash provided by operating activities	$	74,454	$	(1,276)	$	73,178	$	4,284	$	77,462
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Net cash used in investing activities	$	(52,658)	$	1,276	$	(51,382)	$	(4,284)	$	(55,666)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,312	$	(4,312)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	3,160	$	3,718	$	6,878	$	1,591	$	8,469

    

	September 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	35,867	$	(5,772)	$	30,095	$	(11,298)	$	18,797
Total current assets	$	482,298	$	(5,772)	$	476,526	$	(11,298)	$	465,228
Operating right-of-use assets	$	224,921	$	7,092	$	232,013	$	—	$	232,013
Property, furniture and equipment, net	128,783		4,249		133,032		7,246		140,278
Other noncurrent assets	235		1,523		1,758		—		1,758
Total assets	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248
Accrued other expenses	$	33,756	$	—	$	33,756	$	1,044	$	34,800
Current portion of operating lease liabilities	39,248		680		39,928		(5,096)		34,832
Total current liabilities	$	423,986	$	680	$	424,666	$	(4,052)	$	420,614
Operating lease liabilities, long-term	$	263,753	$	6,412	$	270,165	$	—	$	270,165
Total liabilities	$	746,413	$	7,092	$	753,505	$	(4,052)	$	749,453
Total liabilities and stockholders' equity	$	907,208	$	7,092	$	914,300	$	(4,052)	$	910,248

	June 30, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	29,509	$	(5,264)	$	24,245	$	(10,390)	$	13,855
Total current assets	$	455,100	$	(5,264)	$	449,836	$	(10,390)	$	439,446
Property, furniture and equipment, net	$	116,620	$	4,105	$	120,725	$	5,891	$	126,616
Other noncurrent assets	249		1,159		1,408		—		1,408
Total assets	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533
Accrued other expenses	$	26,718	$	—	$	26,718	$	777	$	27,495
Current portion of operating lease liabilities	37,624		—		37,624		(5,276)		32,348
Total current liabilities	$	426,659	$	—	$	426,659	$	(4,499)	$	422,160
Total liabilities	$	753,138	$	—	$	753,138	$	(4,499)	$	748,639
Total liabilities and stockholders' equity	$	877,032	$	—	$	877,032	$	(4,499)	$	872,533

	Six months ended
	June 30, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(5,095)	$	4,520	$	(575)	$	779	$	204
Changes in accounts payable	15,197		(321)		14,876		—		14,876
Changes in operating lease liabilities	(15,401)		—		(15,401)		(1,445)		(16,846)
Net cash provided by operating activities	$	41,110	$	4,199	$	45,309	$	(666)	$	44,643
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Net cash used in investing activities	$	(20,355)	$	(4,199)	$	(24,554)	$	666	$	(23,888)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	4,494	$	(4,494)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	1,673	$	321	$	1,994	$	777	$	2,771

	March 31, 2022
Condensed Consolidated Balance Sheet	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Prepaid and other current assets	$	31,013	$	(5,060)	$	25,953	$	(9,015)	$	16,938
Total current assets	$	435,116	$	(5,060)	$	430,056	$	(9,015)	$	421,041
Operating right-of-use assets	$	196,896	$	3,071	$	199,967	$	—	$	199,967
Property, furniture and equipment, net	107,581		4,083		111,664		8,823		120,487
Other noncurrent assets	264		977		1,241		—		1,241
Total assets	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068
Accrued other expenses	$	20,946	$	—	$	20,946	$	717	$	21,663
Current portion of operating lease liabilities	37,957		(138)		37,819		(909)		36,910
Total current liabilities	$	444,885	$	(138)	$	444,747	$	(192)	$	444,555
Operating lease liabilities, long-term	$	227,191	$	3,209	$	230,400	$	—	$	230,400
Total liabilities	$	727,645	$	3,071	$	730,716	$	(192)	$	730,524
Total liabilities and stockholders' equity	$	814,189	$	3,071	$	817,260	$	(192)	$	817,068

	Three months ended
	March 31, 2022
Condensed Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Disclosed		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,016)	$	1,628	$	(1,388)	$	(596)	$	(1,984)
Changes in accounts payable	8,680		(2,247)		6,433		—		6,433
Changes in operating lease liabilities	(11,485)		—		(11,485)		2,922		(8,563)
Net cash provided by operating activities	$	35,219	$	(619)	$	34,600	$	2,326	$	36,926
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Net cash used in investing activities	$	(10,151)	$	619	$	(9,532)	$	(2,326)	$	(11,858)
Supplemental disclosure of cash flow information
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	108	$	2,247	$	2,355	$	717	$	3,072

	Year ended
	December 31, 2021
Consolidated Statement of Cash Flows	As Originally Reported		Adjustment No. 1		As Previously Reported		Adjustment No. 2		As Revised
Cash flows from operating activities
Changes in prepaid and other assets	$	(3,621)	$	(8,673)	$	(12,294)	$	3,590	$	(8,704)
Changes in accounts payable	17,595		(3,088)		14,507		—		14,507
Changes in deferred rent and lease incentives	4,518		5,352		9,870		(2,074)		7,796
Net cash provided by operating activities	$	146,243	$	(6,409)	$	139,834	$	1,516	$	141,350
Cash flows from investing activities
Purchases of property, furniture and equipment	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Net cash used in investing activities	$	(47,870)	$	6,409	$	(41,461)	$	(1,516)	$	(42,977)
Supplemental disclosure of cash flow information
Noncash operating activities
Lease incentives	$	5,352	$	(5,352)	$	—	$	—	$	—
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$	5,968	$	3,088	$	9,056	$	363	$	9,419

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Merchandise Warranties (Tables)

3 Months Ended

Mar. 31, 2024

Product Warranties Disclosures [Abstract]

Schedule of Merchandise Warranty Liability

A reconciliation of the changes in our limited merchandise warranty liability is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Balance as of beginning of period	$	7,084	$	6,375
Accruals during the period	3,080		3,381
Settlements during the period	(3,136)		(3,291)
Balance as of end of the period(1)	$	7,028	$	6,465

(1) $4.0 million and $3.7 million were recorded in accrued other expenses at March 31, 2024 and March 31, 2023, respectively. The remainder is recorded in other long-term liabilities on our condensed consolidated balance sheets.

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Leases (Tables)

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Schedule of Liability for Operating and Finance Leases

The following table summarizes the amounts recognized in our condensed consolidated balance sheets related to leases (amounts in thousands):

	Condensed Consolidated Balance Sheet Classification	March 31, 2024		December 31, 2023
Assets
Operating lease assets	Operating right-of-use assets	$	322,905	$	302,157
Finance lease assets	Financing right-of-use assets	38,209		38,835
Total leased assets		$	361,114	$	340,992
Liabilities
Current operating leases	Current portion of operating lease liabilities	$	42,694	$	33,051
Non-current operating leases	Operating lease liabilities, long-term	383,684		362,598
Total operating lease liabilities		426,378		395,649
Current finance leases	Current portion of financing lease liabilities	919		904
Non-current finance leases	Financing lease liabilities, long-term	53,658		53,870
Total finance lease liabilities		54,577		54,774
Total lease liabilities		$	480,955	$	450,423

Schedule of Components of Lease Expense

The components of lease cost recognized within our condensed consolidated statements of comprehensive income are as follows (amounts in thousands):

		Three months ended
		March 31,
	Condensed Consolidated Statements of Comprehensive Income Classification	2024		2023
Lease costs:
Operating lease costs	Cost of goods sold	$	12,185	$	9,714
Operating lease costs	Selling, general and administrative expenses	2,501		2,401
Finance lease costs
Amortization of right-of-use assets	Selling, general and administrative expenses	626		540
Interest expense on lease liabilities	Interest expense (income), net	1,301		1,268
Variable lease costs(1)	Cost of goods sold	9,488		10,031
Short term lease costs	Selling, general and administrative expenses	18		120
Total lease costs		$	26,119	$	24,074

(1) For the three months ended March 31, 2024, there were no month-to-month lease costs. For the three months ended March 31, 2023, total lease costs includes $0.3 million of month-to-month lease costs.

The weighted average remaining lease terms are as follows:

	Three months ended
	March 31,
Weighted Average Remaining Lease Term (In Years)	2024	2023
Operating leases	9.24	9.32
Finance leases	20.66	22.26

The weighted average discount rates used to measure our lease liabilities are as follows:

	Three months ended
	March 31,
Weighted Average Discount Rate	2024		2023
Operating leases	6.04	%	5.80	%
Finance leases	9.64	%	9.72	%

Schedule of Lessee, Operating Lease, Liability, Maturity

Future lease liabilities at March 31, 2024 are as follows (amounts in thousands):

Year Ending December 31,	Operating Lease Liabilities (1)		Finance Lease Liabilities		Total Lease Liabilities
Remainder of 2024	$	48,161	$	4,343	$	52,504
2025	69,044		5,800		74,844
2026	63,772		6,259		70,031
2027	59,709		6,060		65,769
2028	54,283		5,610		59,893
2029	51,279		5,224		56,503
Thereafter	222,283		104,719		327,002
Total lease payments	568,531		138,015		706,546
Less: Amounts representing interest	(142,153)		(83,438)		(225,591)
Total	$	426,378	$	54,577	$	480,955

(1) Includes leases with related parties. See Note 10 — Related Party Transactions for amounts leased from related parties.

Schedule of Finance Lease, Liability, Fiscal Year Maturity

Future lease liabilities at March 31, 2024 are as follows (amounts in thousands):

Year Ending December 31,	Operating Lease Liabilities (1)		Finance Lease Liabilities		Total Lease Liabilities
Remainder of 2024	$	48,161	$	4,343	$	52,504
2025	69,044		5,800		74,844
2026	63,772		6,259		70,031
2027	59,709		6,060		65,769
2028	54,283		5,610		59,893
2029	51,279		5,224		56,503
Thereafter	222,283		104,719		327,002
Total lease payments	568,531		138,015		706,546
Less: Amounts representing interest	(142,153)		(83,438)		(225,591)
Total	$	426,378	$	54,577	$	480,955

(1) Includes leases with related parties. See Note 10 — Related Party Transactions for amounts leased from related parties.

Schedule of Supplemental Cash Flow from Leases

Supplemental cash flow information related to leases is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	15,996	$	13,411
Operating cash flows for finance leases	1,230		1,204
Financing cash flows for finance leases	221		129
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	28,751	$	28,582
Finance leases	—		—

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Equity Based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Unvested Stock Activity

Activity of the Company’s Restricted Stock and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	Restricted Stock - Class A
	Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	500,304	$	15.47
Granted	—	—
Forfeited	—	—
Vested	(21,477)	0.20
Unvested at March 31, 2024	478,827	$	16.16

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - Restricted Stock(1)	$	660	$	698

(1) Total unrecognized equity based compensation to be recognized in future periods is $5.5 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

Activity of the Company’s PSU and RSU awards and related equity based compensation expense are summarized in the following tables (amounts in thousands, except share and per share data):

	PSU Awards			RSU Awards
	Amount	Weighted Average Grant Date Fair Value		Amount	Weighted Average Grant Date Fair Value
Unvested at December 31, 2023	700,229	$	7.20	1,248,165	$	7.79
Granted	—	—		—	—
Forfeited	(10,000)	9.93		(7,894)	9.54
Vested	—	—		(107,895)	9.49
Unvested at March 31, 2024	690,229	$	7.16	1,132,376	$	7.62

	Three months ended
	March 31,
	2024		2023
Equity based compensation expense - PSUs(1)	$	352	$	433
Equity based compensation expense - RSUs(2)	$	1,012	$	499

(1) Total unrecognized equity based compensation for the PSUs to be recognized in future periods is $2.6 million at March 31, 2024, and will be recognized over a weighted average period of 1.31 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

(2) Total unrecognized equity based compensation for the RSUs to be recognized in future periods is $6.7 million at March 31, 2024, and will be recognized over a weighted average period of 2.16 years. Equity based compensation expense is recorded within selling, general and administrative expenses on our condensed consolidated statements of comprehensive income.

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Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Schedule of Net Revenue by Segment

Net revenue by merchandise sales channel is as follows (amounts in thousands):

	Three months ended
	March 31,
	2024		2023
Retail	$	243,255	$	250,102
eCommerce	51,907		54,466
Total net revenue	$	295,162	$	304,568

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Net and Comprehensive Income per Share (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Earnings Per Share

Basic and diluted net and comprehensive income per share are as follows (amounts in thousands, except per share data):

	Three months ended
	March 31,
	2024		2023
Numerator
Net and comprehensive income	$	15,099	$	34,099
Denominator—Weighted Average Shares Outstanding
Weighted-average number of common shares outstanding, basic	139,816,792		139,072,756
Effect of dilutive restricted stock (1) (2)	739,239		866,787
Weighted-average number of common shares outstanding, diluted	140,556,031		139,939,543
Net and Comprehensive Income Per Share
Net and comprehensive income per share, basic	$	0.11	$	0.25
Net and comprehensive income per share, diluted	$	0.11	$	0.24

(1) During the three months ended March 31, 2024, 412,487 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive. During the three months ended March 31, 2023, 547,370 shares of unvested restricted stock and RSUs were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive.

(2) Excluded from the calculation of the effect of dilutive restricted stock as of three months ended March 31, 2024 and March 31, 2023, were 540,335 and 768,013 PSUs, respectively, because they did not meet the required performance criteria.

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Nature of Business and Basis of Presentation - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($) store	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of stores | store	92
Client deposits, percentage collected at least (as a percent)	50.00%
Client deposits	$ 202,922		$ 173,808
Breakage income	0	$ 0
Interest income	2,800	$ 1,500
Other Accrued Expenses
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Client deposits	$ 400		$ 500

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Nature of Business and Basis of Presentation - Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prepaid and other current assets	$ 33,122	$ 26,304	$ 18,430	$ 21,432	$ 20,524	$ 18,797	$ 13,855	$ 16,938
Total current assets	539,777	509,295	496,393	467,081	461,204	465,228	439,446	421,041
Operating right-of-use assets	322,905	302,157	301,861		257,347	232,013		199,967
Property, furniture and equipment, net	243,167	220,248	177,949	160,700	152,268	140,278	126,616	120,487
Other noncurrent assets	2,407	4,525		2,590	2,252	1,758	1,408	1,241
Total assets	1,176,379	1,105,148	1,041,709	970,053	939,395	910,248	872,533	817,068
Accrued other expenses	43,195	46,062	36,267	34,978	36,760	34,800	27,495	36,910
Current portion of operating lease liabilities	42,694	33,051	42,853	42,596	39,970	34,832	32,348	21,663
Total current liabilities	446,945	342,347	348,407	350,983	375,600	420,614	422,160	444,555
Operating lease liabilities, long-term	383,684	362,598	345,548		295,657	270,165		230,400
Total liabilities	890,732	764,910	754,145	724,959	729,700	749,453	748,639	730,524
Total liabilities and stockholders' equity	$ 1,176,379	1,105,148	1,041,709	970,053	939,395	910,248	872,533	817,068
As Previously Disclosed
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prepaid and other current assets		45,260	29,810	33,901	29,868	30,095	24,245	25,953
Total current assets		528,251	507,773	479,550	470,548	476,526	449,836	430,056
Operating right-of-use assets			301,861		257,347	232,013		199,967
Property, furniture and equipment, net		210,238	162,789	144,064	140,613	133,032	120,725	111,664
Other noncurrent assets				2,590	2,252	1,758	1,408	1,241
Total assets		1,114,094	1,037,929	965,886	937,084	914,300	877,032	817,260
Accrued other expenses		42,502	33,857	33,174	35,169	33,756	26,718	37,819
Current portion of operating lease liabilities		45,557	41,483	40,233	39,250	39,928	37,624	20,946
Total current liabilities		351,293	344,627	346,816	373,289	424,666	426,659	444,747
Operating lease liabilities, long-term			345,548		295,657	270,165		230,400
Total liabilities		773,856	750,365	720,792	727,389	753,505	753,138	730,716
Total liabilities and stockholders' equity		1,114,094	1,037,929	965,886	937,084	914,300	877,032	817,260
Adjustment No. 1
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prepaid and other current assets			(13,274)	(10,221)	(7,503)	(5,772)	(5,264)	(5,060)
Total current assets			(13,274)	(10,221)	(7,503)	(5,772)	(5,264)	(5,060)
Operating right-of-use assets			(7,350)		5,292	7,092		3,071
Property, furniture and equipment, net			13,274	7,908	5,547	4,249	4,105	4,083
Other noncurrent assets				2,313	1,956	1,523	1,159	977
Total assets			(7,350)	0	5,292	7,092	0	3,071
Accrued other expenses			0	0	0	0	0	(138)
Current portion of operating lease liabilities			0	0	(494)	680	0	0
Total current liabilities			0	0	(494)	680	0	(138)
Operating lease liabilities, long-term			(7,350)		5,786	6,412		3,209
Total liabilities			(7,350)	0	5,292	7,092	0	3,071
Total liabilities and stockholders' equity			(7,350)	0	5,292	7,092	0	3,071
Adjustment No. 2
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prepaid and other current assets		(18,956)	(11,380)	(12,469)	(9,344)	(11,298)	(10,390)	(9,015)
Total current assets		(18,956)	(11,380)	(12,469)	(9,344)	(11,298)	(10,390)	(9,015)
Operating right-of-use assets			0		0	0		0
Property, furniture and equipment, net		10,010	15,160	16,636	11,655	7,246	5,891	8,823
Other noncurrent assets				0	0	0	0	0
Total assets		(8,946)	3,780	4,167	2,311	(4,052)	(4,499)	(192)
Accrued other expenses		3,560	2,410	1,804	1,591	1,044	777	(909)
Current portion of operating lease liabilities		(12,506)	1,370	2,363	720	(5,096)	(5,276)	717
Total current liabilities		(8,946)	3,780	4,167	2,311	(4,052)	(4,499)	(192)
Operating lease liabilities, long-term			0		0	0		0
Total liabilities		(8,946)	3,780	4,167	2,311	(4,052)	(4,499)	(192)
Total liabilities and stockholders' equity		$ (8,946)	3,780	4,167	2,311	(4,052)	(4,499)	(192)
As Originally Reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prepaid and other current assets			43,084	44,122	37,371	35,867	29,509	31,013
Total current assets			521,047	489,771	478,051	482,298	455,100	435,116
Operating right-of-use assets			309,211		252,055	224,921		196,896
Property, furniture and equipment, net			149,515	136,156	135,066	128,783	116,620	107,581
Other noncurrent assets				277	296	235	249	264
Total assets			1,045,279	965,886	931,792	907,208	877,032	814,189
Accrued other expenses			33,857	33,174	35,169	33,756	26,718	37,957
Current portion of operating lease liabilities			41,483	40,233	39,744	39,248	37,624	20,946
Total current liabilities			344,627	346,816	373,783	423,986	426,659	444,885
Operating lease liabilities, long-term			352,898		289,871	263,753		227,191
Total liabilities			757,715	720,792	722,097	746,413	753,138	727,645
Total liabilities and stockholders' equity			$ 1,045,279	$ 965,886	$ 931,792	$ 907,208	$ 877,032	$ 814,189

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Nature of Business and Basis of Presentation - Consolidated Statement of Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities
Changes in prepaid and other assets	$ (5,758)	$ (1,286)	$ (1,984)	$ 619	$ 204	$ (11,109)	$ (7,154)	$ (8,704)
Changes in accounts payable	(4,819)	(12,625)	6,433	(10,525)	14,876		10,296	14,507
Changes in operating lease liabilities	(4,207)	(10,628)	(8,563)	(17,253)	(16,846)	(39,020)	(29,131)
Changes in deferred rent and lease incentives								7,796
Net cash provided by operating activities	36,828	10,865	36,926	64,196	44,643	168,685	77,462	141,350
Cash flows from investing activities
Purchases of property, furniture and equipment	(25,932)	(11,693)	(11,858)	(35,216)	(23,888)	(93,441)	(55,666)	(42,977)
Net cash used in investing activities	(25,932)	(11,360)	(11,858)	(34,883)	(23,888)	(93,108)	(55,666)	(42,977)
Noncash operating activities
Lease incentives		0		0	0		0	0
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities	$ 15,250	8,025	3,072	8,542	2,771	10,286	8,469	9,419
As Originally Reported
Cash flows from operating activities
Changes in prepaid and other assets		(7,513)	(3,016)	(6,808)	(5,095)		(9,329)	(3,621)
Changes in accounts payable		(7,943)	8,680	(4,849)	15,197		14,014	17,595
Changes in operating lease liabilities		(12,271)	(11,485)	(17,903)	(15,401)		(33,682)
Changes in deferred rent and lease incentives								4,518
Net cash provided by operating activities		7,677	35,219	61,795	41,110		74,454	146,243
Cash flows from investing activities
Purchases of property, furniture and equipment		(8,505)	(10,151)	(32,815)	(20,355)		(52,658)	(47,870)
Net cash used in investing activities		(8,172)	(10,151)	(32,482)	(20,355)		(52,658)	(47,870)
Noncash operating activities
Lease incentives		741		4,945	4,494		4,312	5,352
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities		1,539	108	456	1,673		3,160	5,968
Adjustment No. 1
Cash flows from operating activities
Changes in prepaid and other assets		3,102	1,628	5,391	4,520		2,442	(8,673)
Changes in accounts payable		(4,682)	(2,247)	(5,676)	(321)		(3,718)	(3,088)
Changes in operating lease liabilities		0	0	0	0		0
Changes in deferred rent and lease incentives								5,352
Net cash provided by operating activities		(1,580)	(619)	(285)	4,199		(1,276)	(6,409)
Cash flows from investing activities
Purchases of property, furniture and equipment		(1,580)	619	285	(4,199)		1,276	6,409
Net cash used in investing activities		1,580	619	285	(4,199)		1,276	6,409
Noncash operating activities
Lease incentives		(741)		(4,945)	(4,494)		(4,312)	(5,352)
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities		4,682	2,247	5,676	321		3,718	3,088
As Previously Disclosed
Cash flows from operating activities
Changes in prepaid and other assets		(4,411)	(1,388)	(1,417)	(575)	(20,721)	(6,887)	(12,294)
Changes in accounts payable		(12,625)	6,433	(10,525)	14,876		10,296	14,507
Changes in operating lease liabilities		(12,271)	(11,485)	(17,903)	(15,401)	(25,794)	(33,682)
Changes in deferred rent and lease incentives								9,870
Net cash provided by operating activities		6,097	34,600	61,510	45,309	172,299	73,178	139,834
Cash flows from investing activities
Purchases of property, furniture and equipment		(6,925)	(9,532)	(32,530)	(24,554)	(97,055)	(51,382)	(41,461)
Net cash used in investing activities		(6,592)	(9,532)	(32,197)	(24,554)	(96,722)	(51,382)	(41,461)
Noncash operating activities
Lease incentives		0		0	0		0	0
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities		6,221	2,355	6,132	1,994	6,726	6,878	9,056
Adjustment No. 2
Cash flows from operating activities
Changes in prepaid and other assets		3,125	(596)	2,036	779	9,612	(267)	3,590
Changes in accounts payable		0	0	0	0		0	0
Changes in operating lease liabilities		1,643	2,922	650	(1,445)	(13,226)	4,551
Changes in deferred rent and lease incentives								(2,074)
Net cash provided by operating activities		4,768	2,326	2,686	(666)	(3,614)	4,284	1,516
Cash flows from investing activities
Purchases of property, furniture and equipment		4,768	(2,326)	(2,686)	666	3,614	(4,284)	(1,516)
Net cash used in investing activities		(4,768)	(2,326)	(2,686)	666	3,614	(4,284)	(1,516)
Noncash operating activities
Lease incentives		0		0	0		0	0
Noncash investing activities:
Purchase of property, furniture and equipment in current liabilities		$ 1,804	$ 717	$ 2,410	$ 777	$ 3,560	$ 1,591	$ 363

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Merchandise Warranties - Narrative (Details)	3 Months Ended
	Mar. 31, 2024
Minimum
Product Warranty Liability [Line Items]
Warranty, performance obligation period	3 years
Maximum
Product Warranty Liability [Line Items]
Warranty, performance obligation period	10 years

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Merchandise Warranties - Change in Liability (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance as of beginning of period	$ 7,084	$ 6,375
Accruals during the period	3,080	3,381
Settlements during the period	(3,136)	(3,291)
Balance as of the end of the period	7,028	6,465
Accrued and other expenses	7,028	6,465
Accrued Other Expenses
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance as of the end of the period	4,000	3,700
Accrued and other expenses	$ 4,000	$ 3,700

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Debt (Details) - 2021 Credit Facility - USD ($)		3 Months Ended
	Dec. 09, 2022	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Nov. 08, 2021
Debt Instrument [Line Items]
Credit facility increase	$ 25,000,000
Revolving Credit Facility
Debt Instrument [Line Items]
Credit facility, face amount	$ 75,000,000				$ 50,000,000
Credit facility, basis spread on variable rate		1.50%	1.50%
Borrowings on credit facility		$ 0		$ 0
Loan costs, net		400,000		400,000
Accumulated amortization, deferred loan costs		$ 200,000		$ 100,000
Revolving Credit Facility | Letter of Credit
Debt Instrument [Line Items]
Credit facility, face amount					10,000,000
Revolving Credit Facility | Swingline Loan
Debt Instrument [Line Items]
Credit facility, face amount					$ 5,000,000

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Leases - Liability for Operating and Finance Leases (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022
Leases [Abstract]
Operating right-of-use assets	$ 322,905	$ 302,157	$ 301,861		$ 257,347	$ 232,013		$ 199,967
Financing right-of-use assets	38,209	38,835
Total leased assets	361,114	340,992
Current portion of operating lease liabilities	42,694	33,051	42,853	$ 42,596	39,970	34,832	$ 32,348	21,663
Operating lease liabilities, long-term	383,684	362,598	$ 345,548		$ 295,657	$ 270,165		$ 230,400
Total operating lease liabilities	426,378	395,649
Current portion of financing lease liabilities	919	904
Financing lease liabilities, long-term	53,658	53,870
Total finance lease liabilities	54,577	54,774
Total lease liabilities	$ 480,955	$ 450,423

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Leases - Components of Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Lease Cost [Line Items]
Other lease costs	$ 0	$ 300
Total lease costs	26,119	24,074
Cost of goods sold
Lease Cost [Line Items]
Operating lease costs	12,185	9,714
Other lease costs	9,488	10,031
Selling, general and administrative expenses
Lease Cost [Line Items]
Operating lease costs	2,501	2,401
Amortization of right-of-use assets	626	540
Other lease costs	18	120
Interest expense (income), net
Lease Cost [Line Items]
Interest expense on lease liabilities	$ 1,301	$ 1,268

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Leases - Schedule of Weighted Average Lease Term (Details)	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating leases	9 years 2 months 26 days	9 years 3 months 25 days
Finance leases	20 years 7 months 28 days	22 years 3 months 3 days

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Leases - Schedule of Weighted Average Discount Rate (Details)	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating leases	6.04%	5.80%
Finance leases	9.64%	9.72%

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Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Operating Lease Liabilities
Remainder of 2024	$ 48,161
2025	69,044
2026	63,772
2027	59,709
2028	54,283
2029	51,279
Thereafter	222,283
Total lease payments	568,531
Less: Amounts representing interest	(142,153)
Total operating lease liabilities	426,378	$ 395,649
Finance Lease Liabilities
Remainder of 2024	4,343
2025	5,800
2026	6,259
2027	6,060
2028	5,610
2029	5,224
Thereafter	104,719
Total lease payments	138,015
Less: Amounts representing interest	(83,438)
Total finance lease liabilities	54,577	$ 54,774
Total Lease Liabilities
Remainder of 2024	52,504
2025	74,844
2026	70,031
2027	65,769
2028	59,893
2029	56,503
Total lease payments	327,002
Thereafter	706,546
Less: Amounts representing interest	(225,591)
Total	$ 480,955

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Leases - Narrative (Details) $ in Millions	Mar. 31, 2024 USD ($)
Lease Cost [Line Items]
Aggregate minimum rental payments, not yet commenced	$ 151.4
Minimum
Lease Cost [Line Items]
Lease term, not yet commenced	3 years
Maximum
Lease Cost [Line Items]
Lease term, not yet commenced	13 years

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Leases - Supplemental Cash Flow (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating cash flows for operating leases	$ 15,996	$ 13,411
Operating cash flows for finance leases	1,230	1,204
Financing cash flows for finance leases	221	129
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	28,751	28,582
Finance leases	$ 0	$ 0

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Equity Based Compensation - Unvested Stock Activity (Details)	3 Months Ended
	Mar. 31, 2024 $ / shares shares
PSU Awards
Amount
Unvested, beginning of period (in shares) | shares	700,229
Granted (in shares) | shares	0
Forfeited (in shares) | shares	(10,000)
Vested (in shares) | shares	0
Unvested, end of period (in shares) | shares	690,229
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) | $ / shares	$ 7.20
Granted (in dollars per share) | $ / shares	0
Forfeited (in dollars per share) | $ / shares	9.93
Vested (in dollars per share) | $ / shares	0
Unvested, end of period (in dollars per share) | $ / shares	$ 7.16
RSU Awards
Amount
Unvested, beginning of period (in shares) | shares	1,248,165
Granted (in shares) | shares	0
Forfeited (in shares) | shares	(7,894)
Vested (in shares) | shares	(107,895)
Unvested, end of period (in shares) | shares	1,132,376
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) | $ / shares	$ 7.79
Granted (in dollars per share) | $ / shares	0
Forfeited (in dollars per share) | $ / shares	9.54
Vested (in dollars per share) | $ / shares	9.49
Unvested, end of period (in dollars per share) | $ / shares	$ 7.62
Class A | Restricted Stock
Amount
Unvested, beginning of period (in shares) | shares	500,304
Granted (in shares) | shares	0
Forfeited (in shares) | shares	0
Vested (in shares) | shares	(21,477)
Unvested, end of period (in shares) | shares	478,827
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) | $ / shares	$ 15.47
Granted (in dollars per share) | $ / shares	0
Forfeited (in dollars per share) | $ / shares	0
Vested (in dollars per share) | $ / shares	0.20
Unvested, end of period (in dollars per share) | $ / shares	$ 16.16

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Equity Based Compensation - Equity Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity based compensation expense	$ 660	$ 698
Incentive Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation cost	$ 5,500
Unrecognized compensation cost, period for recognition	2 years 1 month 28 days
PSU Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity based compensation expense	$ 352	433
Unrecognized compensation cost	$ 2,600
Unrecognized compensation cost, period for recognition	1 year 3 months 21 days
RSU Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity based compensation expense	$ 1,012	$ 499
Unrecognized compensation cost	$ 6,700
Unrecognized compensation cost, period for recognition	2 years 1 month 28 days

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Equity Based Compensation - Narrative (Details) - shares	3 Months Ended
	Mar. 31, 2024	Aug. 02, 2022
2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum shares that may be granted (in shares)	11,205,100
RSU and PSU | 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stocks received per each award unit vested	1
RSU Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual vesting percentage		33.00%
RSU Awards | 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	1 year
PSU Awards | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	0.00%
PSU Awards | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	200.00%

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Segment Reporting - Narrative (Details)	3 Months Ended
	Mar. 31, 2024 segment
Segment Reporting [Abstract]
Number of operating segments	1
Number of reportable segments	1

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Segment Reporting - Net Revenue by Merchandise Sales Channel (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting Information [Line Items]
Net revenue	$ 295,162	$ 304,568
Retail
Segment Reporting Information [Line Items]
Net revenue	243,255	250,102
eCommerce
Segment Reporting Information [Line Items]
Net revenue	$ 51,907	$ 54,466

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Net and Comprehensive Income per Share - Calculation of EPS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator
Net and comprehensive income	$ 15,099	$ 34,099
Denominator—Weighted Average Shares Outstanding
Weighted-average number of common shares outstanding, basic (in shares)	139,816,792	139,072,756
Effect of dilutive restricted stock (in shares)	739,239	866,787
Weighted-average number of common shares outstanding, diluted (in shares)	140,556,031	139,939,543
Net and comprehensive income per share, basic (in dollars per share)	$ 0.11	$ 0.25
Net and comprehensive income per share, diluted (in dollars per share)	$ 0.11	$ 0.24
Antidilutive securities excluded from computation of earnings per hare (in shares)	412,487	547,370
Securities not meeting performance target, excluded from computation of earnings per share (in shares)	540,335	768,013

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Commitments and Contingencies (Details) - USD ($) $ / shares in Units, $ in Millions		1 Months Ended
	Feb. 29, 2024	Apr. 30, 2024	Mar. 31, 2024	Dec. 31, 2023	Aug. 31, 2023
Loss Contingencies [Line Items]
Loss contingency accrual			$ 0.2	$ 0.2
Committed donation					$ 10.0
Accrued donation cost			5.0
Common stock, dividends declared (in dollars per share)	$ 0.50
Current liabilities			70.6
Other long-term liabilities			$ 0.6
Subsequent Event
Loss Contingencies [Line Items]
Special cash dividend		$ 69.9

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Related Party Transactions (Details) $ in Thousands	1 Months Ended				3 Months Ended
	Jul. 31, 2023 USD ($) option	Mar. 31, 2021 USD ($)	Aug. 31, 2020 USD ($)	Jul. 31, 2010 USD ($)	Mar. 31, 2024 USD ($) option	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Nov. 30, 2000
Related Party Transaction [Line Items]
Operating lease, term (in years)		12 years
Renewal options | option					2
Accounts payable					$ 62,135		$ 63,699
Walton Hills, Ohio | Warehouse
Related Party Transaction [Line Items]
Operating lease, renewal term (in years)	5 years
Lease monthly payment			$ 100
Number of options to extend | option	1
Brooklyn, Ohio | Outlet
Related Party Transaction [Line Items]
Lease monthly payment				$ 20
Minimum
Related Party Transaction [Line Items]
Operating lease, renewal term (in years)		5 years
Minimum | Base term, 12 years
Related Party Transaction [Line Items]
Lease monthly payment		$ 200
Minimum | Renewal term, 10 years
Related Party Transaction [Line Items]
Lease monthly payment		$ 400
Minimum | Walton Hills, Ohio | Warehouse
Related Party Transaction [Line Items]
Lease monthly payment	$ 100
Maximum
Related Party Transaction [Line Items]
Operating lease, renewal term (in years)		10 years
Maximum | Base term, 12 years
Related Party Transaction [Line Items]
Lease monthly payment		$ 300
Maximum | Renewal term, 10 years
Related Party Transaction [Line Items]
Lease monthly payment		$ 500
Maximum | Walton Hills, Ohio | Warehouse
Related Party Transaction [Line Items]
Lease monthly payment	$ 200
Related Party
Related Party Transaction [Line Items]
Rent expense					1,000	$ 1,000
Accounts payable					200		$ 2,300
Related Party | Chief Executive Officer | Premier Canover, LLC
Related Party Transaction [Line Items]
Ownership percentage by noncontrolling owners		40.00%
Related Party | Walton Hills, Ohio | Chief Executive Officer | Pagoda Partners, LLC
Related Party Transaction [Line Items]
Ownership percentage by noncontrolling owners								50.00%
Related Party | Walton Hills, Ohio | Warehouse
Related Party Transaction [Line Items]
Operating lease, term (in years)								17 years
Rent expense					400	300
Related Party | Brooklyn, Ohio | Chief Executive Officer | Brooklyn Arhaus
Related Party Transaction [Line Items]
Ownership percentage by parent				85.00%
Related Party | Brooklyn, Ohio | Director | Brooklyn Arhaus
Related Party Transaction [Line Items]
Ownership percentage by noncontrolling owners				15.00%
Related Party | Brooklyn, Ohio | Outlet
Related Party Transaction [Line Items]
Operating lease, term (in years)				15 years
Rent expense					$ 100	$ 100
Related Party | Maximum | Walton Hills, Ohio | Warehouse
Related Party Transaction [Line Items]
Operating lease, renewal term (in years)								5 years

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Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income tax expense	$ 4,816	$ 12,102
Effective income tax rate	24.20%	26.20%