Core Insights - ThredUP reported better-than-expected first-quarter earnings, indicating a growing consumer preference for secondhand clothing, with CEO James Reinhart suggesting that proposed tariffs on Chinese imports could further enhance this trend [1][3]. Financial Performance - ThredUP's revenue for Q1 reached $71.3 million, a 10.5% increase year-over-year and approximately 4% above Wall Street estimates [2] - The gross margin remained strong at 79%, with an adjusted EBITDA profit of $3.8 million, a significant improvement from the previous year's losses [2] - The net loss narrowed to $5.2 million, or $0.04 per share, and the company raised its full-year sales outlook to about $286 million, up from $275 million [2] Market Dynamics - The tightening of the "de minimis" exemption and potential broader apparel tariffs could increase the cost of new clothing, making ThredUP's secondhand offerings more attractive to consumers [3] - Higher import duties may also create a more competitive marketing environment, as major advertisers like Shein and Temu have reduced spending, leading to lower customer-acquisition costs for ThredUP [4] User Engagement - ThredUP experienced a 6% increase in active buyers, reaching 1.37 million, with new-buyer additions surging by 95%, marking the best quarter in the company's history [5] - The implementation of AI search tools, including "Shop Similar" and visual-search features, has improved conversion rates and enhanced the shopping experience [5] Market Reaction - Following the positive earnings report, ThredUP's shares rose nearly 16% in after-hours trading, reflecting investor optimism [6]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 totaled $71.3 million, representing a year-over-year increase of 10.5% [25] - Adjusted EBITDA was $3.8 million, or 5.3% of revenue, doubling the adjusted EBITDA dollars compared to the previous year [26] - Gross margin was 79.1%, a decrease of 100 basis points year-over-year due to higher incentives for new buyers [26] - Active buyers increased by 5.7% year-over-year, totaling 1.4 million for the trailing twelve months [25] Business Line Data and Key Metrics Changes - New buyer acquisition surged by 95% year-over-year, marking the strongest quarter for new buyer acquisition in the company's history [25] - Orders increased by 16.1% year-over-year, reaching 1.4 million [26] - Premium items processed contributed 60% higher margins compared to regular items [18] Market Data and Key Metrics Changes - The company noted that the closure of the de minimis loophole and potential tariff impacts could enhance the value proposition for used clothing [11][12] - The advertising market has become less competitive, allowing for potentially lower customer acquisition costs [12] Company Strategy and Development Direction - The company aims to maintain gross margin and bottom line efficiency while reinvesting in acquiring new buyers and sellers [9] - ThredUP is focusing on enhancing its AI-driven product experience and expanding its resale as a service (RAS) strategy [19][21] - The company is open-sourcing its technology to help brands build scalable circularity business models [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's momentum, citing strong new buyer acquisition and operational improvements [37] - The company remains cautious about the consumer environment but is optimistic about revenue growth for the remainder of the year [28] - Management highlighted that the business was accelerating before recent trade disruptions, indicating a fundamentally improving growth profile [12] Other Important Information - The company generated $2.6 million in cash during the quarter, ending with $55.4 million in cash and securities [27] - Free cash flow reached a record level of $3.9 million for the quarter [27] Q&A Session Summary Question: What is driving the buyer and revenue outperformance? - Management noted that the momentum seen in Q4 continued into Q1, driven by new buyer acquisition and supply-side improvements [36] Question: Are there expectations for Q3 to accelerate from Q2 in revenue? - Management confirmed expectations for revenue acceleration from Q2 to Q3, with Q3 projected to be the high point for EBITDA margin [40] Question: What demographics are being targeted for new customers? - Management indicated that new customers are primarily middle to upper-income individuals, consistent with trends observed post-pandemic [46] Question: How is the marketing spend expected to maintain momentum? - Management plans to continue spending on marketing as long as paybacks remain attractive, with recent trends indicating strong customer acquisition [47] Question: What trends are observed on the seller side of the business? - Management reported good momentum in the seller side, particularly in the consignment premium offering, which has better contribution margins [77] Question: Is there any pricing pressure observed? - Management clarified that the decline in average revenue per order is due to the mix of new buyers rather than pricing pressure [78]

Financial Data and Key Metrics Changes - For Q1 2025, revenue totaled $71.3 million, an increase of 10.5% year over year [23] - Adjusted EBITDA was $3.8 million, or 5.3% of revenue, doubling adjusted EBITDA dollars versus last year [25] - Gross margin was 79.1%, a 100 basis point decrease compared to the same quarter last year [25] - Active buyers grew to 1.4 million, up 5.7% year over year, with orders up 16.1% [24] Business Line Data and Key Metrics Changes - New buyer acquisition increased by 95% year over year, marking the strongest quarter for new buyer acquisition in the company's history [24] - Premium items sold contributed margins that are 60% higher than regular items sold, indicating a shift towards higher-value goods [17] Market Data and Key Metrics Changes - The company noted that the closure of the de minimis loophole and potential tariff impacts could enhance the value proposition for used clothing [9][10] - The advertising market is becoming less competitive, which may lead to lower customer acquisition costs [10] Company Strategy and Development Direction - The company aims to maintain gross margin and bottom line efficiency while reinvesting in acquiring new buyers and sellers [6] - The strategy includes expanding the seller experience and optimizing the marketplace to drive growth [16] - The company is focusing on AI-driven product experiences to enhance customer engagement and conversion rates [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's ability to sustain growth despite macroeconomic uncertainties [36] - The company is cautious but optimistic about the consumer environment, expecting continued positive trends [27] - Management highlighted that the business was accelerating before recent trade disruptions, indicating resilience [10] Other Important Information - The company generated $2.6 million in cash during Q1, with free cash flow reaching a record level of $3.9 million [26] - The company plans to raise its revenue guidance for the full year of 2025, reflecting positive trends observed in Q1 [27] Q&A Session Summary Question: What is driving the buyer and revenue outperformance? - Management noted that the momentum seen in Q4 continued into Q1, driven by new buyer acquisition and supply-side improvements [36] Question: Are there expectations for Q3 to accelerate from Q2 in revenue? - Management confirmed that they expect revenue to accelerate from Q2 to Q3, with Q3 projected to be the high point for EBITDA margin [39] Question: What demographics are being targeted for new customers? - The company is attracting slightly more middle to upper-income customers, consistent with trends observed post-pandemic [46] Question: How does the company plan to maintain marketing momentum? - Management indicated that they will continue to invest in marketing as long as paybacks remain attractive, benefiting from reduced competition in advertising [47] Question: What trends are seen on the seller side of the business? - The company is experiencing good momentum in the seller side, particularly in the consignment premium offering, which has better contribution margins [78] Question: Is there any pricing pressure observed? - Management clarified that the decline in average revenue per order is due to the mix of new buyers versus existing buyers, not due to pricing pressure [79]

Part I. Financial Information [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company's Q1 2025 unaudited financial statements show revenue growth to **$71.3 million**, a reduced net loss of **$5.2 million**, and stable assets, following the late 2024 divestiture of its European business [Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Highlights (in thousands) | Balance Sheet Highlights (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $41,057 | $31,851 | | Total current assets | $60,460 | $56,922 | | Total assets | $172,500 | $171,225 | | Total current liabilities | $65,605 | $61,524 | | Total liabilities | $116,417 | $114,924 | | Total stockholders' equity | $56,083 | $56,301 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Statement of Operations (in thousands) | Statement of Operations (in thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $71,291 | $64,533 | | Gross profit | $56,371 | $51,713 | | Operating loss | $(5,434) | $(12,395) | | Loss from continuing operations | $(5,215) | $(12,190) | | Loss from discontinued operations, net of tax | — | $(4,364) | | Net loss | $(5,215) | $(16,554) | | Total loss per share, basic and diluted | $(0.04) | $(0.15) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Cash Flow Summary (in thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by continuing operating activities | $5,743 | $3,288 | | Net cash provided by (used in) continuing investing activities | $5,075 | $(5,291) | | Net cash used in continuing financing activities | $(1,589) | $(1,480) | | Net change in cash, cash equivalents, and restricted cash | $9,229 | $(5,987) | [Notes to Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the Remix divestiture as a discontinued operation, reclassification of revenue reporting, termination of the customer loyalty program, and compliance with debt covenants - In Q4 2024, the company divested its European business, **Remix**, now reported as a discontinued operation, with all continuing operations discussions excluding Remix results[36](index=36&type=chunk)[82](index=82&type=chunk)[88](index=88&type=chunk) - Beginning in Q1 2025, the company combined consignment and product revenue into a single 'revenue' line item due to the shift to a primarily consignment model[35](index=35&type=chunk)[97](index=97&type=chunk) - The customer loyalty program was discontinued as of **March 31, 2025**, with revenue from this program at **$1.5 million** in Q1 2025, down from **$3.7 million** in Q1 2024[46](index=46&type=chunk) - As of **March 31, 2025**, the company had **$21.3 million** outstanding under its Term Loan and was in compliance with all debt covenants[65](index=65&type=chunk)[67](index=67&type=chunk) [Management's Discussion and Analysis (MD&A)](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A highlights Q1 revenue growth to **$71.3 million**, positive Non-GAAP Adjusted EBITDA of **$3.8 million**, improved operating leverage, and sufficient liquidity for the next 12 months [Key Financial and Operating Metrics](index=23&type=section&id=Key%20Financial%20and%20Operating%20Metrics) Key Metrics (Q1 2025 vs Q1 2024) | Key Metrics (Q1 2025 vs Q1 2024) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Active Buyers (in thousands) | 1,370 | 1,296 | +5.7% | | Orders (in thousands) | 1,371 | 1,181 | +16.1% | | Revenue (in thousands) | $71,291 | $64,533 | +10.5% | | Gross Margin | 79.1% | 80.1% | -100 bps | | Loss from continuing operations (in thousands) | $(5,215) | $(12,190) | -57.2% | | Non-GAAP Adjusted EBITDA (in thousands) | $3,808 | $1,888 | +101.7% | [Results of Operations](index=24&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) Revenue increased **10.5%** to **$71.3 million** driven by buyer and order growth, while gross margin declined and operating expenses decreased due to cost efficiencies - Revenue growth was primarily driven by a **5.7% increase in Active Buyers** and a **16.1% increase in Orders**, reflecting strength in the core marketplace business[98](index=98&type=chunk) - Gross margin decreased to **79.1%** from **80.1%** year-over-year, mainly due to higher outbound shipping, labor, and packaging costs[99](index=99&type=chunk) - Operations, product, and technology expenses decreased by **$2.0 million**, primarily due to a **$1.1 million** decrease in severance costs from the March 2024 workforce reorganization[100](index=100&type=chunk) - Sales, general, and administrative expenses decreased by **$2.6 million**, mainly from a **$3.6 million** reduction in personnel-related costs, including a **$1.2 million** decrease in severance costs from the 2024 reorganization[102](index=102&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) The company generated **$5.7 million** in positive operating cash flow, holding **$55.4 million** in liquidity, deemed sufficient for at least the next 12 months - The company generated positive cash flows from continuing operations of **$5.7 million** for Q1 2025, an increase from **$3.3 million** in the prior year period[105](index=105&type=chunk)[109](index=109&type=chunk) - As of **March 31, 2025**, the company had cash, cash equivalents, and short-term marketable securities totaling **$55.4 million**[105](index=105&type=chunk) - Management believes existing cash and available credit will be sufficient for at least the next **12 months** and does not anticipate expanding its distribution network in the near term[106](index=106&type=chunk) [Market Risk Disclosures](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Primary market risks include immaterial interest rate exposure and significant inflation risk impacting operating costs and potentially customer spending - The company's Term Loan bears a variable interest rate, but a **1%** change in rates would not materially impact annual interest expense[117](index=117&type=chunk) - Inflation remains a key risk, contributing to rising costs for labor, freight, and other operational expenses, potentially affecting customer purchasing power and revenue growth[118](index=118&type=chunk) [Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of **March 31, 2025**, with no material changes to internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of **March 31, 2025**[120](index=120&type=chunk) - There were no material changes in internal control over financial reporting during the quarter[121](index=121&type=chunk) Part II. Other Information [Legal Proceedings, Risk Factors, and Other Disclosures](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in material legal proceedings, and no material changes occurred to risk factors, unregistered equity sales, or senior security defaults - The company is not currently a party to any material pending legal proceedings[124](index=124&type=chunk) - There have been no material changes to the company's risk factors as disclosed in its Fiscal 2024 10-K[125](index=125&type=chunk)

Financial Performance - Q1 2025 revenue reached $71 million, showing a year-over-year growth of 10%[8] - Q1 2025 gross profit was $56 million, resulting in a gross profit margin of 79%[8] - Q1 2025 Adjusted EBITDA was $4 million, representing an Adjusted EBITDA margin of 5%[8] Operational Metrics - ThredUp had 14 million active buyers in Q1 2025, a year-over-year increase of 6%[8] - Q1 2025 orders totaled 14 million, reflecting a year-over-year growth of 16%[8] - The company saved 666 million pounds of carbon emissions, 13 billion kWh of energy, and 7 billion gallons of water[8] Strategic Initiatives - ThredUp's operating platform leverages multi-year infrastructure investments for single-SKU logistics at scale[10] - The company's AI-powered search tools, including image search and chat search, enhance the customer experience[27, 28] - The U S secondhand apparel market is expected to grow at a 9% CAGR from 2024 to 2029[37]

[Executive Summary & Outlook](index=1&type=section&id=Executive%20Summary%20%26%20Outlook) [Q1 2025 Performance Highlights](index=1&type=section&id=Q1%202025%20Performance%20Highlights) ThredUp demonstrated strong performance in Q1 2025, achieving significant year-over-year growth in revenue, gross profit, and orders, alongside improved profitability metrics Q1 2025 Key Financial and Operational Metrics (Year-over-Year) | Metric | Q1 2025 | Q1 2024 | Year-over-Year Change | | :------------------------------------------------ | :------------- | :------------- | :------- | | Revenue | $71.3 Million USD | $64.5 Million USD | +10.5% | | Gross Profit | $56.4 Million USD | $51.7 Million USD | +9.0% | | Gross Margin | 79.1% | 80.1% | -1.0 pp | | Loss from Continuing Operations | $(5.2) Million USD | $(12.2) Million USD | -57.4% | | Adjusted EBITDA from Continuing Operations | $3.8 Million USD | $1.9 Million USD | +100.0% | | Adjusted EBITDA Margin from Continuing Operations | 5.3% | 2.9% | +2.4 pp | | Active Buyers | 1,370 Thousand | 1,296 Thousand | +5.7% | | Orders | 1,371 Thousand | 1,181 Thousand | +16.1% | | Cash, Cash Equivalents, Restricted Cash, and Short-Term Marketable Securities (End of Quarter) | $55.4 Million USD | N/A | N/A | [Financial Outlook](index=1&type=section&id=Financial%20Outlook) ThredUp provided financial guidance for Q2 2025 and the full fiscal year 2025, anticipating continued revenue growth and further improvement in Adjusted EBITDA margin [Second Quarter 2025 Outlook](index=1&type=section&id=Second%20Quarter%202025%20Outlook) For Q2 2025, ThredUp projects revenue between $72.5 million and $74.5 million, a gross margin of 77.0% to 79.0%, and an Adjusted EBITDA margin of approximately 3.3% Q2 2025 Financial Guidance | Metric | Range/Amount | | :----------------------- | :---------- | | Revenue | $72.5 - $74.5 Million USD | | Gross Margin | 77.0% - 79.0% | | Adjusted EBITDA Margin | Approx. 3.3% | | Depreciation and Amortization | Approx. $3.2 Million USD | | Stock-Based Compensation Expense | Approx. $3.7 Million USD | | Weighted-Average Shares Outstanding | Approx. 119 Million shares | [Fiscal Year 2025 Outlook](index=1&type=section&id=Fiscal%20Year%202025%20Outlook) For the full fiscal year 2025, the company anticipates revenue between $281.0 million and $291.0 million, a gross margin of 77.0% to 79.0%, and an Adjusted EBITDA margin of approximately 4.0% Fiscal Year 2025 Financial Guidance | Metric | Range/Amount | | :----------------------- | :---------- | | Revenue | $281.0 - $291.0 Million USD | | Gross Margin | 77.0% - 79.0% | | Adjusted EBITDA Margin | Approx. 4.0% | | Depreciation and Amortization | Approx. $12.6 Million USD | | Stock-Based Compensation Expense | Approx. $16.0 Million USD | | Weighted-Average Shares Outstanding | Approx. 122 Million shares | [Financial Performance](index=2&type=section&id=Financial%20Performance) [Condensed Consolidated Statements of Operations](index=2&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) ThredUp's condensed consolidated statements of operations present multi-quarter trends in revenue, costs, gross profit, operating expenses, and net loss, showing a recent decline in operating losses and sustained high gross margins Q1 2025 Operating Results (Year-over-Year) | Metric | Q1 2025 (Thousand USD) | Q1 2024 (Thousand USD) | Year-over-Year Change | | :----------------------- | :--------------------- | :--------------------- | :----------- | | Revenue | $71,291 | $64,533 | +10.5% | | Cost of Revenue | $14,920 | $12,820 | +16.4% | | Gross Profit | $56,371 | $51,713 | +9.0% | | Gross Margin | 79.1% | 80.1% | -1.0 pp | | Total Operating Expenses | $61,805 | $64,108 | -3.6% | | Operating Loss | $(5,434) | $(12,395) | -56.2% | | Loss from Continuing Operations | $(5,215) | $(12,190) | -57.2% | - Operating expenses as a percentage of revenue decreased from **99.3% in Q1 2024** to **86.7% in Q1 2025**, indicating improved operational efficiency[6](index=6&type=chunk) - Operating loss as a percentage of revenue improved from **(19.2)% in Q1 2024** to **(7.6)% in Q1 2025**[6](index=6&type=chunk) [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, ThredUp reported total assets of $172.5 million and total liabilities of $116.4 million, with a decrease in total current assets and an increase in accounts payable compared to June 30, 2024 Key Balance Sheet Data as of March 31, 2025 | Metric | Amount (Thousand USD) | | :-------------------------------- | :------------ | | Total Current Assets | $60,460 | | Total Assets | $172,500 | | Total Current Liabilities | $65,605 | | Total Liabilities | $116,417 | | Total Stockholders' Equity | $56,083 | - Compared to June 30, 2024, cash and cash equivalents slightly decreased from **$43,135 thousand** to **$41,057 thousand**, but showed a recovery from December 31, 2024[10](index=10&type=chunk) - Marketable securities decreased from **$10,525 thousand** to **$5,719 thousand**[10](index=10&type=chunk) - Accounts payable increased from **$6,120 thousand** to **$13,000 thousand**[10](index=10&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the three months ended March 31, 2025, ThredUp generated **$5.7 million** in net cash from continuing operating activities, a significant improvement from prior quarters, with a net increase of **$9.2 million** in cash, cash equivalents, and restricted cash Q1 2025 Cash Flows (Continuing Operations) | Metric | Q1 2025 (Thousand USD) | Q1 2024 (Thousand USD) | | :------------------------------------------------ | :--------------------- | :--------------------- | | Net Cash Provided by (Used in) Continuing Operating Activities | $5,743 | $(3,035) | | Net Cash Provided by (Used in) Continuing Investing Activities | $5,075 | $1,164 | | Net Cash Provided by (Used in) Continuing Financing Activities | $(1,589) | $(1,182) | | Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash from Continuing Operations | $9,229 | $(3,053) | | Cash, Cash Equivalents, and Restricted Cash (End of Period) | $49,717 | $50,125 | - Net cash flow from continuing operating activities significantly improved, shifting from a **negative value in Q1 2024** to a **positive value in Q1 2025**[11](index=11&type=chunk) - Net cash flow from investing activities was positive, primarily driven by the **sale and maturity of marketable securities**[11](index=11&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) [Adjusted EBITDA (Loss) Reconciliation](index=3&type=section&id=Adjusted%20EBITDA%20%28Loss%29%20Reconciliation) ThredUp's Adjusted EBITDA from continuing operations significantly improved to **$3.8 million in Q1 2025**, doubling from **$1.9 million in Q1 2024**, with an Adjusted EBITDA margin reaching **5.3%**, after excluding non-cash and non-recurring items like stock-based compensation, depreciation, and restructuring charges Adjusted EBITDA (Loss) from Continuing Operations (Year-over-Year) | Metric | Q1 2025 (Thousand USD) | Q1 2024 (Thousand USD) | Year-over-Year Change | | :----------------------- | :--------------------- | :--------------------- | :----------- | | Loss from Continuing Operations | $(5,215) | $(12,190) | -57.2% | | Stock-Based Compensation Expense | $5,520 | $6,911 | -20.1% | | Depreciation and Amortization | $3,169 | $3,748 | -15.4% | | Adjusted EBITDA (Loss) | $3,808 | $1,888 | +101.7% | | Adjusted EBITDA (Loss) Margin | 5.3% | 2.9% | +2.4 pp | - The company has achieved **positive Adjusted EBITDA** for the fourth consecutive quarter[7](index=7&type=chunk) [Non-GAAP Operating Expenses Reconciliation](index=4&type=section&id=Non-GAAP%20Operating%20Expenses%20Reconciliation) In Q1 2025, ThredUp's non-GAAP operating expenses were **$56.3 million**, representing **79.0% of revenue**, a significant improvement from **84.4% in Q1 2024**, primarily due to the exclusion of stock-based compensation and restructuring charges Non-GAAP Operating Expenses (Year-over-Year) | Metric | Q1 2025 (Thousand USD) | Q1 2024 (Thousand USD) | Year-over-Year Change | | :----------------------- | :--------------------- | :--------------------- | :----------- | | Total Operating Expenses (GAAP) | $61,805 | $64,108 | -3.6% | | Less: Stock-Based Compensation Expense | $(5,520) | $(6,911) | -20.1% | | Less: Severance and Other Restructuring Charges | $(3) | $(2,731) | -99.9% | | Total Non-GAAP Operating Expenses | $56,288 | $54,466 | +3.3% | | Non-GAAP Operating Expenses as a Percentage of Revenue | 79.0% | 84.4% | -5.4 pp | - Stock-based compensation expense decreased year-over-year across all categories: **operations, product and technology; marketing; and selling, general and administrative**[8](index=8&type=chunk) - Severance and other restructuring charges in Q1 2025 were **negligible** compared to Q1 2024[9](index=9&type=chunk) [Non-GAAP Free Cash Flow Reconciliation](index=8&type=section&id=Non-GAAP%20Free%20Cash%20Flow%20Reconciliation) ThredUp's non-GAAP free cash flow from continuing operations reached **$3.9 million in Q1 2025**, a significant improvement from negative free cash flow in Q1 2024, indicating enhanced cash generation capability after capital expenditures Non-GAAP Free Cash Flow from Continuing Operations (Year-over-Year) | Metric | Q1 2025 (Thousand USD) | Q1 2024 (Thousand USD) | | :------------------------------------------------ | :--------------------- | :--------------------- | | Net Cash Provided by (Used in) Continuing Operating Activities | $5,743 | $(3,035) | | Less: Purchases of Property and Equipment | $(1,815) | $(848) | | Non-GAAP Free Cash Flow from Continuing Operations | $3,928 | $(3,883) | - The company has transitioned from **negative to positive free cash flow**, demonstrating stronger cash management capabilities[12](index=12&type=chunk) [Operational Metrics](index=3&type=section&id=Operational%20Metrics) [Active Buyers and Orders](index=3&type=section&id=Active%20Buyers%20and%20Orders) ThredUp achieved growth in key operational metrics in Q1 2025, with active buyers increasing **5.7% year-over-year to 1,370 thousand** and orders growing **16.1% to 1,371 thousand** Active Buyers and Orders (Year-over-Year) | Metric | Q1 2025 (Thousands) | Q1 2024 (Thousands) | Year-over-Year Change | | :----------- | :------------------ | :------------------ | :------- | | Active Buyers | 1,370 | 1,296 | +5.7% | | Orders | 1,371 | 1,181 | +16.1% | - Both metrics have shown **consistent growth** over the past several quarters, indicating expanding customer engagement and transaction volume[7](index=7&type=chunk) [Additional Information](index=9&type=section&id=Additional%20Information) [About ThredUp](index=9&type=section&id=About%20ThredUp) ThredUp is a leading online resale platform for apparel, footwear, and accessories, driving resale through technology and a 'secondhand first' mission, offering sellers an easy way to clear closets and buyers up to 90% off branded items, supported by its proprietary operating platform and Resale-as-a-Service (RaaS) model - ThredUp's mission is to inspire the world to **think secondhand first**, transforming the resale industry through technology[14](index=14&type=chunk) - The company is one of the **largest online resale platforms** for apparel, footwear, and accessories globally, having processed over **200 million unique secondhand items** across **60,000 brands and 100 categories**[14](index=14&type=chunk) - Its proprietary operating platform underpins its managed marketplace and offers a **Resale-as-a-Service (RaaS) model** to help other brands and retailers provide customizable resale experiences[14](index=14&type=chunk) [Forward-Looking Statements](index=9&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding future financial and operational performance, business developments, market trends, and strategic initiatives, which are subject to significant risks and uncertainties, and investors should note that actual results may differ materially from these projections - Forward-looking statements pertain to future events or the company's future financial or operating performance, including **Q2 and full-year 2025 financial guidance**, business developments, market trends, **AI technology investments**, RaaS model expansion, and active buyer acquisition[15](index=15&type=chunk) - These statements are subject to **significant risks and uncertainties**, and actual results may differ from expectations[15](index=15&type=chunk)[16](index=16&type=chunk) - The company undertakes no obligation to update any forward-looking statements unless required by law, with further risk information available in its **periodic reports filed with the SEC**[16](index=16&type=chunk)[17](index=17&type=chunk) [Non-GAAP Financial Measures and Other Operating and Business Metrics Definitions](index=10&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Other%20Operating%20and%20Business%20Metrics%20Definitions) This section defines non-GAAP financial measures used in the report, including Adjusted EBITDA (Loss) from continuing operations, Adjusted EBITDA (Loss) margin from continuing operations, non-GAAP operating expenses, and non-GAAP free cash flow from continuing operations, along with key operating metrics like active buyers and orders, which are used for performance evaluation and comparability but are not GAAP substitutes - Non-GAAP financial measures include **Adjusted EBITDA (Loss) from continuing operations**, **Adjusted EBITDA (Loss) margin from continuing operations**, **non-GAAP operating expenses**, and **non-GAAP free cash flow from continuing operations**[18](index=18&type=chunk) - These non-GAAP metrics are utilized for assessing **operating performance, operating leverage, internal planning, and forecasting**, and for comparability with other companies, but are not substitutes for GAAP results[18](index=18&type=chunk) - Active buyers are defined as ThredUp buyers who have made at least one purchase in the preceding twelve months, while orders represent the total number of orders placed by buyers across all marketplaces (including RaaS clients) in a given period, net of cancellations[23](index=23&type=chunk)

Core Insights - ThredUp Inc. reported strong financial results for Q1 2025, with a record quarter for new buyer acquisition and an optimistic outlook for the full year [2][3][5] Financial Highlights - Revenue for Q1 2025 was $71.3 million, a 10% increase year-over-year [6] - Gross profit reached $56.4 million, up 9% year-over-year, with a gross margin of 79.1% [6] - The company reported a loss from continuing operations of $5.2 million, improving from a loss of $12.2 million in Q1 2024 [6] - Adjusted EBITDA from continuing operations was $3.8 million, or 5.3% of revenue, compared to $1.9 million, or 2.9% of revenue, in the same quarter last year [6][21] Business Developments - ThredUp launched an AI-powered social commerce feature called Shop Social, currently in beta on the iOS app [6] - The company announced a next-generation branded resale platform, removing branded resale fees to enhance brand partnerships [6] - ThredUp's 2025 Resale Report indicated that the U.S. secondhand market grew five times faster than the broader retail clothing market in 2024, projected to reach $74 billion by 2029 [6] Future Outlook - For Q2 2025, ThredUp anticipates record revenue of $71.3 million, a gross margin of 79.1%, and an increase in active buyers to 1.37 million, reflecting a 6% year-over-year growth [5][11] - The full-year 2025 outlook has been revised upwards, with expected revenue between $281 million and $291 million, representing a 10% year-over-year increase [11]

Olivier Le Moal The following segment was excerpted from The Optimist Fund Q1 2025 Quarterly Letter. Top Contributors ThredUp (TDUP) As highlighted in our Q4 letter, ThredUp preannounced strong results in January, pointing to a meaningful acceleration in both revenue growth ...

Company Overview - ThredUp's stock experienced a rise ahead of its upcoming earnings report, reflecting positive momentum with an increase in active buyers and solid customer retention [1][2] - The company has issued mid-to-high single-digit revenue growth guidance for both Q1 and the full year, driven by new buyer acquisition and investments in AI [2] Financial Performance - ThredUp projected Q1 revenue between $67.5 million and $69.5 million, and annual revenue between $270 million and $280 million [5] - The company is expected to maintain flat year-over-year adjusted EBITDA margins despite revenue growth [2] Market Position - ThredUp's proprietary platform and logistics infrastructure provide a competitive edge in the fragmented secondhand clothing market [2] - The secondhand clothing sector is performing well, particularly during economic downturns, attracting younger consumers [4] Industry Trends - The secondhand market is benefiting from consumers seeking bargains and selling items for extra cash, while also being less affected by tariffs [3] - Analysts caution that inventory challenges may arise if consumers choose to hold onto existing items due to economic uncertainty [4]

Group 1: Market Overview - As of April 23, 2025, two stocks in the consumer discretionary sector are signaling potential warnings for momentum-focused investors [1] - The Relative Strength Index (RSI) is highlighted as a key momentum indicator, with values above 70 indicating overbought conditions [2] Group 2: Company Analysis - ThredUp Inc (TDUP) - ThredUp is set to release its Q1 financial results on May 5, with the stock having increased approximately 37% over the past month and reaching a 52-week high of $3.89 [6] - The current RSI value for ThredUp is 83.2, indicating overbought conditions, and the stock closed at $3.85 after a 15.3% gain [6] - ThredUp has a momentum score of 99.37 and a value score of 52.30 according to Edge Stock Ratings [6] Group 3: Company Analysis - Ammo Inc (POWW) - Ammo Inc completed the sale of ammunition manufacturing assets to Olin Winchester on April 18, which is seen as a pivotal moment for the company [6] - This strategic move is expected to unlock significant value and facilitate growth as a pure-play e-commerce platform [6] - Ammo's stock rose around 35% over the past five days, reaching a 52-week high of $2.86, with an RSI value of 81.4 [6] - The stock closed at $1.80 after a 15.4% increase [6]