This is the first I’ve heard of it, but here’s one of his infamous quotes:
"There is a trait in the Jewish character that does provoke animosity, maybe it’s a kind of lack of generosity towards non-Jews.
I mean, there’s always a reason why anti-anything crops up anywhere; even a stinker like Hitler didn’t just pick on them for no reason.”
His other quotes tend to be condemnation about specifically Israeli zionism and barbaric murder, but i don’t have context as to whether he’s referring to palestine or not. Some people might have more sympathy for these statements these days, but a lot of his other quotes have to do with Jews controlling money and media, less defensible prejudice.
Leaving aside his poetry and his collaborative works, here are some other examples of racism in Lovecraft stories.
“The Rats in the Walls” features a cat named “N----- Man”
“The Horror at Red Hook” refers to a villain as “an Arab with a hatefully negroid mouth”
The Case of Charles Dexter Ward: “the wife [had] a very repulsive cast of countenance, probably due to a mixture of negro blood.”
Herbert West: Reanimator contains a particularly problematic bit of description:
The negro had been knocked out, and a moment’s examination shewed us that he would permanently remain so. He was a loathsome, gorilla-like thing, with abnormally long arms which I could not help calling fore legs, and a face that conjured up thoughts of unspeakable Congo secrets and tom-tom poundings under an eerie moon. The body must have looked even worse in life—but the world holds many ugly things.
Edit: this is entirely copy pasta