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Equity Based Compensation | 6 Months Ended
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Jun. 30, 2026
Share-Based Payment Arrangement [Abstract] |
Equity Based Compensation | Equity Based Compensation Activity of the Company’s Restricted Stock and their 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, 2025 | 64,187 |  |  | $ | 18.61 |
Granted | — |  |  | — |
Forfeited | — |  |  | — |
Vested | (64,187) |  |  | 18.61 |
Unvested at June 30, 2026 | — |  |  | $ | — |
| Six months ended |  | Three months ended
| June 30, |  | June 30,
| 2026 |  | 2025 |  | 2026 |  | 2025
Equity based compensation expense - Restricted Stock | $ | 445 |  |  | $ | 225 |  |  | $ | 146 |  |  | $ | 103 |
The Arhaus, Inc. 2021 Equity Incentive Plan (the “2021 Plan”) was adopted in November 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 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 will vest over two to five years (depending on the terms of the award) on each anniversary of the grant date, 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 cancelled 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. Dividend equivalents are settled in the form of cash or Class A common stock based on the award agreement. The RSUs issued to certain members of the Board of Directors will generally vest on the one-year anniversary of the grant date. The fair value of RSUs is determined based on the market value of the Company’s Class A common stock on the grant date. The number of PSUs earned will be based on the Company’s financial performance as measured against pre-established target performance goals over the applicable performance period. For PSUs granted in fiscal year 2024, the performance goals are cumulative demand revenue and cumulative adjusted EBITDA. In April 2025, the Company granted PSUs with the aforementioned performance goals and a new performance goal for relative Total Shareholder Return (“TSR”). The fair value of PSUs is determined based on the market value of the Company’s Class A common stock on the grant date. The fair value of the portion of PSUs related to relative TSR is derived from a Monte Carlo valuation model that estimates fair value as of the grant date. The Monte Carlo valuation model uses multiple simulations to evaluate our probability of achieving various stock price levels to determine the Company’s expected TSR ranking relative to a custom peer group. For PSUs granted in fiscal year 2026, the performance goals are cumulative comparable written sales, cumulative adjusted EBITDA and relative TSR. PSUs will vest as of the end of the applicable 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 applicable performance goals, with each goal weighted equally. The Company accounts for forfeitures as they occur. Activity of the Company’s PSU and RSU awards and their 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, 2025 | 605,039 |  |  | $ | 9.78 |  |  | 2,320,867 |  |  | $ | 8.73 |
Granted | 791,262 |  |  | 7.31 |  |  | 1,321,504 |  |  | 6.93 |
Forfeited | (19,709) |  |  | 8.52 |  |  | (43,306) |  |  | 7.95 |
Vested | — |  |  | — |  |  | (788,334) |  |  | 9.02 |
Unvested at June 30, 2026 | 1,376,592 |  |  | $ | 8.37 |  |  | 2,810,731 |  |  | $ | 7.82 |
| Six months ended |  | Three months ended
| June 30, |  | June 30,
| 2026 |  | 2025 |  | 2026 |  | 2025
Equity based compensation expense - PSUs(1) | $ | 1,417 |  |  | $ | 246 |  |  | $ | 954 |  |  | $ | 173 |
Equity based compensation expense - RSUs(2) | $ | 4,196 |  |  | $ | 2,919 |  |  | $ | 2,313 |  |  | $ | 1,519 |
(1) Total unrecognized equ ity based compensation for the PSUs to be recognized in future periods is $8.9 million at June 30, 2026, and will be recognized over a weighted average period of 2.20 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 $19.2 million at June 30, 2026, and will be recognized over a weighted average period of 2.55 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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