The RealReal(US:REAL)2020-05-07 20:55Financial 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].