ThredUp(US:TDUP)2022-05-10 00:03Financial Data and Key Metrics Changes - Revenue for Q1 2022 reached $73 million, a 31% increase year-over-year, while gross profits grew 26% to a record $50 million [10] - Gross margins were reported at 69.1%, reflecting a 300 basis point improvement over Q4 2021 [10] - Adjusted EBITDA loss was $13 million, with a margin of 17.8% of revenue, compared to a loss of $9.1 million or 16.4% of revenue in Q1 2021 [41][42] Business Line Data and Key Metrics Changes - Consignment revenue increased by 6% year-over-year, while product revenue surged by 130% [38] - Active buyers rose by 33% to 1.7 million, and orders increased by 45% to 1.6 million [39] Market Data and Key Metrics Changes - The U.S. gross margins expanded to 74.1%, a 280 basis point increase from the same quarter last year [39] - The European business contributed to a consolidated gross margin of 69.1%, which was a 220 basis point decline year-over-year due to lower-margin operations [40] Company Strategy and Development Direction - The company is focused on long-term growth, investing in infrastructure and technology to support future revenue growth and widen its competitive moat [15][47] - ThredUp is expanding its Resale-As-A-Service (RaaS) platform, expecting to onboard approximately 40 brands by year-end [20] - The company is also building a new processing facility in Bulgaria to enhance its European operations and capture market share [29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of rising consumer prices and inflation on consumer spending, noting a general softening across the market [11][12] - Despite near-term uncertainties, management remains confident in the long-term retail opportunity and the company's path to profitability [16][47] Other Important Information - The company is investing in four new facilities in 2022, which will significantly increase processing capacity [26][27] - The company is also focusing on improving its pricing and payout systems to expand margins and enhance customer acquisition [30] Q&A Session Summary Question: Revenue outlook and customer cohort pressures - Management noted no significant warning signs from customers but acknowledged a general softening in consumer behavior [56] Question: Freight component of guidance - Freight impact increased from an expected $6 million to $9 million year-over-year [57] Question: RaaS business potential - RaaS is currently small but has the potential to grow significantly with many enterprise clients expected [61] Question: Impact of macroeconomic conditions on consumer spending - Management indicated that while inflation is affecting consumer spending, resale may perform well as consumers trade down [62] Question: Marketing growth expectations - Marketing spend was moderated in Q1 due to processing constraints but is expected to increase in the back half of the year [75] Question: Inventory levels and concerns - Elevated inventory levels are primarily related to European operations, with no concerns about carryover in the U.S. [76] Question: Gross margin guidance increase - Gross margin guidance was raised due to improved shipment consolidation and automation [96]