Arhaus Inc. (NASDAQ: ARHS) saw its shares tumble over 6% in pre-market trading on Thursday, despite reporting third-quarter earnings that beat analyst expectations. The premium home furnishings retailer's cautious outlook for the fourth quarter appears to have overshadowed its strong Q3 performance.

For the third quarter, Arhaus reported earnings per share of $0.09, surpassing the analyst consensus estimate of $0.08. Revenue came in at $344.57 million, also beating the expected $338.23 million. The company saw a 7.97% increase in sales compared to the same period last year.

However, investors seem more focused on Arhaus' guidance for the fourth quarter and full year. While the company raised the low end of its full-year outlook, it maintained the high end, suggesting caution about the upcoming holiday season. Arhaus now expects full-year net revenue of $1.35 billion to $1.38 billion, representing growth of 6.2% to 8.6%.

Most concerning to investors is the company's fourth-quarter comparable growth guidance of -7% to 1%, indicating potential weakness in the crucial holiday shopping period. This projection, coupled with management's comments about "continued macroeconomic uncertainty," appears to be driving the stock's pre-market decline.

The market's negative reaction underscores the challenges facing retailers as they navigate an uncertain economic environment. Despite Arhaus' strong performance in the third quarter, investors seem to be pricing in the risk of a softer fourth quarter and potentially challenging 2026.