UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 September 30, 2020 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: 001-38953 The RealReal, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 45-1234222 ( State or othe ...

The RealReal, Inc. (NASDAQ:REAL) Q3 2020 Earnings Conference Call November 9, 2020 5:00 PM ET Company Participants Paul Bieber - Head, Investor Relations Julie Wainwright - Founder & Chief Executive Officer Matt Gustke - Chief Financial Officer Conference Call Participants Justin Post - Bank of America Oliver Chen - Cowen Michael Binetti - Credit Suisse Eric Sheridan - UBS Ike Boruchow - Wells Fargo Edward Yruma - KeyBanc Capital Markets Aaron Kessler - Raymond James Rick Patel - Needham & Company Alec Leg ...

The RealReal, Inc. (NASDAQ:REAL) Q2 2020 Earnings Conference Call August 6, 2020 5:00 PM ET Company Participants Paul Bieber – Head of Investor Relations Julie Wainwright – Founder and Chief Executive Officer Matt Gutske – Chief Financial Officer Conference Call Participants Michael Binetti – Crédit Suisse Oliver Chen – Cowen Alexandra Steiger – UBS Ed Yruma – KeyBanc Capital Markets Aaron Kessler – Raymond James Ike Boruchow – Wells Fargo Rick Patel – Needham & Company Simeon Siegel – BMO Capital Markets A ...

[PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Unaudited financial statements for The RealReal, Inc. reflect COVID-19's impact, showing decreased revenue, increased net loss, and a strengthened cash position from convertible notes and ASC 842 adoption [Condensed Balance Sheets](index=5&type=section&id=Condensed%20Balance%20Sheets) The balance sheet as of June 30, 2020, shows increased cash and total assets due to convertible notes, a rise in liabilities from new notes and ASC 842, and a decrease in stockholders' equity Condensed Balance Sheet Highlights (in thousands) | Metric | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $304,348 | $154,446 | | Total current assets | $452,249 | $408,439 | | Total assets | $634,060 | $466,930 | | **Liabilities & Equity** | | | | Total current liabilities | $102,553 | $118,546 | | Convertible senior notes, net | $146,958 | $— | | Total liabilities | $366,159 | $128,002 | | Total stockholders' equity | $267,901 | $338,928 | [Condensed Statements of Operations](index=6&type=section&id=Condensed%20Statements%20of%20Operations) For Q2 and six months ended June 30, 2020, the company reported decreased revenue and widening net losses due to COVID-19, driven by lower gross profit and higher operating expenses Statement of Operations Summary (in thousands) | Metric | Q2 2020 | Q2 2019 | Six Months 2020 | Six Months 2019 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $57,389 | $72,209 | $135,629 | $142,791 | | Gross profit | $35,769 | $46,050 | $84,966 | $88,432 | | Loss from operations | $(42,972) | $(25,340) | $(82,538) | $(48,555) | | Net loss | $(42,892) | $(26,875) | $(81,184) | $(50,097) | | Net loss per share | $(0.49) | $(2.83) | $(0.94) | $(5.87) | [Condensed Statements of Cash Flows](index=10&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2020, cash used in operations increased, while investing activities provided cash, and financing activities, primarily from convertible notes, significantly boosted the overall cash position Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | $(86,581) | $(46,174) | | Net cash provided by (used in) investing activities | $88,882 | $(182) | | Net cash provided by financing activities | $147,601 | $65,743 | | **Net increase in cash** | **$149,902** | **$19,387** | [Notes to Unaudited Condensed Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) These notes detail the material impact of COVID-19 on revenues, the early adoption of ASC 842, the issuance of **$172.5 million** in convertible senior notes, and ongoing legal proceedings including the Chanel lawsuit and shareholder class actions - The COVID-19 pandemic materially impacted business, causing net revenues to decrease by **21%** for the three months and **5%** for the six months ended June 30, 2020, compared to the same periods in 2019[36](index=36&type=chunk) - In June 2020, the Company issued **$172.5 million** of 3.00% Convertible Senior Notes due 2025, receiving net proceeds of approximately **$165.8 million** after costs[99](index=99&type=chunk)[100](index=100&type=chunk) - The company is involved in a lawsuit with **Chanel, Inc.** over trademark and advertising claims, and is also defending against shareholder class action complaints filed after its IPO[140](index=140&type=chunk)[141](index=141&type=chunk) - The company early adopted the new lease accounting standard **ASC 842** on January 1, 2020, recognizing **$110.3 million** in right-of-use assets and corresponding lease liabilities[82](index=82&type=chunk)[83](index=83&type=chunk)[84](index=84&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses COVID-19's significant negative impact on H1 2020 financial performance, including a **20%** Q2 GMV decrease, noting a recovery trend and strengthened liquidity from a **$172.5 million** convertible note issuance [Overview and COVID-19 Impact](index=30&type=section&id=Overview%20and%20COVID-19%20Impact) The online luxury marketplace experienced significant COVID-19 disruption, with a **20%** Q2 2020 GMV decrease, but saw recovery by June, leading to the issuance of **$172.5 million** in convertible senior notes to bolster finances - GMV was negatively impacted by COVID-19, declining **40%-45%** year-over-year in March through mid-April 2020, but trends improved to a decline of approximately **8%** year-over-year in June 2020[155](index=155&type=chunk) Key Financial and Operating Metrics | Metric | Q2 2020 | Q2 2019 | | :--- | :--- | :--- | | GMV (in thousands) | $182,771 | $228,487 | | Number of Orders (in thousands) | 438 | 505 | | Active Buyers (in thousands) | 612 | 492 | | AOV | $417 | $453 | - As a preemptive measure to strengthen its balance sheet during the pandemic, the company issued **$172.5 million** in aggregate principal amount of 3% convertible senior notes due 2025 in June 2020[157](index=157&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Q2 2020 results show a **22%** decrease in consignment and service revenue due to COVID-19, with marketing expenses increasing as a percentage of revenue, and rising operations, technology, and SG&A costs leading to a significant operating loss - Consignment and service revenue decreased by **22%** in Q2 2020 compared to Q2 2019, primarily due to a decrease in GMV caused by COVID-19 related operational limitations and store closures[189](index=189&type=chunk) - Marketing expense decreased by **18%** in Q2 2020 as investments were reduced in response to COVID-19, but it increased as a percentage of revenue from **16.2%** to **16.8%** due to the significant revenue decline[194](index=194&type=chunk)[195](index=195&type=chunk) - Operations and technology expense increased by **6%** in Q2 2020, and Selling, general and administrative expense increased by **28%**, both driven by higher headcount, stock compensation, and fixed costs against a lower revenue base[196](index=196&type=chunk)[198](index=198&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2020, the company held **$410.3 million** in cash and investments, with liquidity significantly enhanced by **$143.3 million** from convertible notes, which management believes is sufficient for the next 12 months despite ongoing operating losses - As of June 30, 2020, the company had unrestricted cash, cash equivalents, and short-term investments of **$410.3 million**[204](index=204&type=chunk) - In June 2020, the company received net proceeds of **$143.3 million** from the issuance of convertible senior notes and the related capped call transactions[204](index=204&type=chunk) Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2020 | 2019 | | :--- | :--- | :--- | | Operating Activities | $(86,581) | $(46,174) | | Investing Activities | $88,882 | $(182) | | Financing Activities | $147,601 | $65,743 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate fluctuations on its **$410.3 million** in cash and investments, which management deems immaterial, as fixed-rate convertible notes mitigate direct financial statement risk from interest rate changes - The company is exposed to interest rate risk on its **$410.3 million** of cash, cash equivalents, and short-term investments, but does not consider the risk to be material[234](index=234&type=chunk) - The convertible senior notes bear a fixed interest rate, mitigating direct financial statement risk from interest rate changes[235](index=235&type=chunk) [Item 4. Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) As of June 30, 2020, management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - Management concluded that as of June 30, 2020, the company's disclosure controls and procedures were effective at a reasonable assurance level[237](index=237&type=chunk) - No material changes to the company's internal control over financial reporting were identified during the quarter[238](index=238&type=chunk) [PART II. OTHER INFORMATION](index=44&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in significant legal proceedings, including an ongoing trademark lawsuit with **Chanel, Inc.** and multiple shareholder class action lawsuits related to its IPO, with uncertain outcomes - The company is in litigation with **Chanel, Inc.**, which filed a lawsuit in November 2018 alleging trademark and advertising-related claims, with the outcome uncertain[243](index=243&type=chunk) - Multiple purported shareholder class action complaints have been filed against the company, its officers, directors, and IPO underwriters, alleging federal securities law violations related to the IPO registration statement, which the company is vigorously defending[244](index=244&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) Key risks include the ongoing adverse impacts of the COVID-19 pandemic, dependency on consignor supply, authentication accuracy, intense competition, potential for costly litigation, and challenges in scaling operations and technology - The COVID-19 pandemic has adversely affected and is expected to continue to adversely impact business operations, results of operations, financial condition, and liquidity[255](index=255&type=chunk) - The business's success is highly dependent on its ability to attract and retain consignors to generate a sufficient supply of pre-owned luxury goods[249](index=249&type=chunk) - Failure to accurately authenticate items and identify counterfeit goods could severely damage the company's reputation and expose it to liability[264](index=264&type=chunk) - The company faces significant competition from a wide range of players, including branded luxury stores, department stores, traditional consignment shops, and other online marketplaces[278](index=278&type=chunk) - The company is party to lawsuits, including with **Chanel** and shareholder class actions, which are expensive, time-consuming, and could have a significant negative impact if resolved unfavorably[268](index=268&type=chunk)[270](index=270&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=67&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period, and the use of IPO proceeds remains unchanged from previous disclosures - There were no unregistered sales of equity securities in the period[337](index=337&type=chunk) - The use of proceeds from the company's IPO, declared effective on June 27, 2019, remains unchanged from previous disclosures[338](index=338&type=chunk) [Item 3. Defaults Upon Senior Securities](index=67&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable as the company has not defaulted upon any senior securities - Not applicable[339](index=339&type=chunk) [Item 4. Mine Safety Disclosures](index=67&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's business - Not applicable[340](index=340&type=chunk) [Item 5. Other Information](index=67&type=section&id=Item%205.%20Other%20Information) This item is not applicable as there is no other information to report - Not applicable[341](index=341&type=chunk) [Item 6. Exhibits](index=69&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including the indenture for the **3.00%** Convertible Senior Notes due 2025, related capped call confirmations, and required CEO and CFO certifications - Exhibit **4.1** is the Indenture for the **3.00%** Convertible Senior Notes due 2025[343](index=343&type=chunk) - Exhibits **10.1** and **10.2** are the confirmations for the Capped Call Transactions related to the convertible notes[343](index=343&type=chunk) - Exhibits **31.1**, **31.2**, **32.1**, and **32.2** are the required CEO and CFO certifications[343](index=343&type=chunk)

The RealReal, Inc. (NASDAQ:REAL) Q1 2020 Earnings Conference Call May 6, 2020 5:00 PM ET Company Participants Paul Bieber - Head of Investor Relations Julie Wainwright - Founder, Chairperson and Chief Executive Officer Matt Gustke - Chief Financial Officer Conference Call Participants Justin Post - Bank of America Merrill Lynch Oliver Chen - Cowen and Company Michael Binetti - Credit Suisse Abigail Zvejnieks - KeyBanc Capital Markets Inc. Aaron Kessler - Raymond James & Associates, Inc. Irwin Boruchow - Wel ...

Financial Performance - The company's GMV for the three months ended March 31, 2020, was $257.6 million, representing a 15% growth compared to $224.1 million in the same period of 2019[129]. - Total revenue for the same period was $78.2 million, an 11% increase from $70.6 million year-over-year[129]. - Gross profit for the three months ended March 31, 2020, was $49.2 million, reflecting a 16% growth from $42.4 million in the prior year[129]. - Total revenue for the three months ended March 31, 2020, was $78.2 million, an increase of $7.7 million, or 11%, compared to $70.6 million for the same period in 2019[159]. - Consignment and service revenue increased by $9.7 million, or 17%, driven by a 32% increase in active buyers and a GMV growth exceeding 30% in January and February 2020[160]. - Direct revenue decreased by $2.1 million, or 14%, due to COVID-19 impacts and a lower mix of sales of owned items[162]. - Adjusted EBITDA for the three months ended March 31, 2020, was a loss of $30.9 million, compared to a loss of $18.5 million for the same period in 2019[152]. Active Buyer Growth - The active buyer base grew to over 16.5 million members as of March 31, 2020, with 602 active buyers in the latest quarter compared to 456 in the same quarter of 2019[128][144]. - The percentage of GMV from repeat consignors remained stable at 82% for both Q1 2020 and Q1 2019[138]. Expenses and Cost Management - Marketing expenses increased by $1.2 million, or 10%, to $12.9 million, maintaining 17% of total revenue[165]. - Operations and technology expenses rose by $9.1 million, or 29%, to $40.7 million, increasing as a percentage of revenue from 45% to 52%[167][168]. - Selling, general and administrative expenses increased by $12.8 million, or 57%, to $35.1 million, with a percentage of revenue rising from 32% to 45%[169][170]. - The company has implemented cost-saving measures including reducing marketing investments and instituting a hiring freeze to preserve liquidity[175]. Cash Flow and Liquidity - As of March 31, 2020, the company had unrestricted cash and short-term investments of $303.3 million and an accumulated deficit of $392.8 million[174]. - Net cash used in operating activities for Q1 2020 was $55.0 million, compared to $22.6 million in Q1 2019, reflecting a net loss of $38.3 million[180][181]. - Cash provided by investing activities in Q1 2020 was $32.8 million, significantly higher than $7.4 million in Q1 2019, driven by $114.0 million from short-term investments[182][183]. - Cash provided by financing activities in Q1 2020 was $2.4 million, a decrease from $69.7 million in Q1 2019, primarily due to reduced stock issuance[184][185]. - The company anticipates that existing cash and cash equivalents will be sufficient to meet working capital and capital expenditure needs for at least the next 12 months[175]. Future Outlook and Challenges - The company expects the COVID-19 pandemic to have a materially adverse impact on its business operations and results for at least the remainder of 2020[132]. - The company plans to continue investing in technology and physical infrastructure to support future growth despite the challenges posed by COVID-19[141]. - The company expects operations and technology expenses to increase over the long term to support growth, including investments in automation and technology improvements[156]. - Operating losses and negative cash flows from operations are expected to continue due to COVID-19 challenges and expansion investments[175]. - The company may seek additional equity or debt financing to support future capital requirements, depending on revenue growth and investment timing[176]. Debt and Financing - The company has no outstanding term loans as of March 31, 2020, following the full repayment of its term loans[188][189]. - Interest income increased by $0.9 million, or 218%, due to higher cash and investment balances associated with IPO proceeds[171]. Market Conditions - The company does not believe inflation has had a material effect on its business, but acknowledges potential risks if costs rise significantly[200].

TheRealReal Investor Presentation May 2020 Safe Harbor 1 This presentation contains forward-looking statements relating to, among other things, the future performance of The RealReal that are based on the company's current expectations, forecasts and assumptions and involve risks and uncertainties. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expect," "plan," anticipate," "believe," "estimate," "predict," "intend," "potential," "continu ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 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 001-38953 The RealReal, Inc. (Exact name of Registrant as specified in its Charter) | Delaware | 45-1234222 | | --- | --- | | (State or o ...

The RealReal INVESTOR PRESENTATION February 2020 Safe Harbor This presentation and the accompanying oral presentation contain forward-looking statements. These statements may relate to, but are not limited to, expectations of future results of operations or financial performance of The RealReal, certain of our key financial and operating metrics, capital expenditures, plans for growth and future operations, and technological capabilities, as well as assumptions relating to the foregoing. Forward-looking sta ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 September 30, 2019 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: 001-38953 The RealReal, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 45-1234222 ( State or othe ...