Financial Data and Key Metrics Changes - For Q4 2024, revenue totaled $67.3 million, an increase of 9.5% year over year, driven by marketing investments and AI upgrades [33] - Gross margin was 80.4%, a 290 basis point increase from the same quarter last year, attributed to a higher percentage of sales from consignment [34] - Adjusted EBITDA was $5 million, representing 7.4% of revenue, doubling the adjusted EBITDA dollars from the previous year [35] Business Line Data and Key Metrics Changes - Active buyers reached 1.3 million, a decline of 6% year over year, while order growth reaccelerated to 1.2 million, an increase of 2% year over year [33] - Fresh listings, defined as items under 14 days old, increased by 9% year over year, indicating a growing supply of high-quality apparel [13] Market Data and Key Metrics Changes - 51% of consumers indicated that inflation impacts their spending on apparel, while 62% expressed concern that tariffs would increase apparel prices [25][26] - The company noted that secondhand goods could become more attractive to consumers seeking affordable options due to rising prices in new apparel [25] Company Strategy and Development Direction - The company aims to accelerate growth while maintaining adjusted EBITDA margins, focusing on increasing active buyers through marketing and fresh listings [38] - Investments in generative AI are expected to enhance the secondhand shopping experience, with advancements in AI search functionality driving higher conversion rates [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum from Q4 continuing into Q1 2025, despite some uncertainty in consumer behavior [52] - The company plans to reach positive free cash flow on an annual basis in 2025, indicating a strong financial position [42] Other Important Information - The company completed the divestiture of Remix in November 2024, allowing a focus on its US business [6] - The company plans to reduce stock-based compensation by over 40% in 2025 to mitigate share dilution [43] Q&A Session Summary Question: Revenue, gross margin, and EBITDA pacing through the year - Management indicated that revenue growth is expected to accelerate from Q1 to Q2 and Q2 to Q3, with gross margin rates remaining consistent throughout the year [50][51] Question: Marketing spend and stock-based compensation outlook - Marketing is expected to be about 19% of revenue on a quarterly basis, with a conscious decision to use more cash and less stock to reduce dilution [61][60] Question: Image search technology and its impact on conversion - Image search has driven higher conversion rates as customers find relevant items more easily, leading to increased utilization of the product [68][70] Question: Impact of tariffs on advertising costs and pricing algorithms - Management noted that lower advertising costs could allow for increased spending on marketing, while dynamic pricing algorithms are in place to adjust to market conditions [76][80]