What Happened?
Shares of luxury furniture retailer Arhaus (NASDAQ: ARHS) fell 4.6% in the afternoon session after peer and fellow furniture retailer RH (formerly Restoration Hardware) reported disappointing quarterly results and lowered its outlook, creating negative sentiment across the sector.
RH announced second-quarter results that fell short of Wall Street's expectations for both profit and revenue. The luxury home furnishings company also trimmed its full-year revenue growth forecast to a range of 9% to 11%, down from a prior projection of 10% to 13%. RH attributed the lowered outlook to $30 million in tariff costs and said it was delaying a new product line.
Adding to investor concerns for the industry, RH's CEO pointed to broader challenges, including "the polarizing impact of tariff uncertainty and the worst housing market in almost 50 years," sparking worries about margin compression and sales for other companies in the home furnishings space like Arhaus.
The shares closed the day at $10.77, down 4.2% from previous close.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Arhaus? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Arhaus’s shares are extremely volatile and have had 44 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 3% on the news that a significant downward revision of U.S. job creation data raised concerns about the health of the economy. The Labor Department reported that employers added 911,000 fewer jobs from April 2024 through March 2025 than initially estimated. This revision brings the average monthly job gains during that period down significantly, suggesting a cooler labor market. The downgrades were widespread across various service sectors. The largest revisions were seen in leisure and hospitality, which added 176,000 fewer jobs than first reported, followed by professional and business services and retail. Such data is closely watched by investors and economists as it can influence the Federal Reserve's decisions on interest rates.
JPMorgan Chase CEO Jamie Dimon added that the U.S. economy is "weakening," though he stopped short of predicting a recession. "Whether it's on the way to recession or just weakening, I don't know," he said. Dimon's remarks are closely watched, given his influence as head of one of the nation's largest banks.
Arhaus is up 14.3% since the beginning of the year, but at $10.77 per share, it is still trading 19.2% below its 52-week high of $13.33 from September 2024. Investors who bought $1,000 worth of Arhaus’s shares at the IPO in November 2021 would now be looking at an investment worth $841.41.
Do you want to know what moves the business you care about? Add them to your StockStory watchlist and every time a stock significantly moves, we provide you with a timely explanation straight to your inbox. It’s free and will only take you a second.
