OAKLAND, Calif. – ThredUp Inc. (NASDAQ:TDUP), a prominent online resale platform for apparel, shoes, and accessories, reported its financial outcomes for the first quarter ended March 31, 2024.
Despite a 5% increase in revenue to $79.6 million YoY, the company missed the analyst consensus of $80.38 million. The adjusted EPS for the quarter was -$0.15, slightly below the analyst estimate of -$0.14. Following the earnings release, ThredUp's stock fell by 6.5%, indicating investor concerns over the earnings and guidance miss.
ThredUp's gross profit saw an 8% rise YoY, reaching $55.3 million with a gross margin of 69.5%, up from 67.3% in the first quarter of the previous year. The net loss improved to $16.6 million from $19.8 million YoY, and the adjusted EBITDA loss was significantly reduced to $0.7 million from $6.6 million. Active buyers increased by 4% and orders by 9% YoY, signaling continued customer engagement on the platform.
CEO James Reinhart stated, "We delivered another quarter of strong financial performance, demonstrating healthy gross profit growth and bottom-line leverage."
He emphasized the company's strategic shift towards becoming an AI-powered resale entity, focusing on product enhancements, operational efficiency, and marketing investments while aiming to reduce operating expenses and achieve positive free cash flow.
For the second quarter of 2024, ThredUp anticipates revenue between $81 million and $83 million, with the midpoint falling short of the consensus estimate of $86 million. The company's full-year guidance for 2024 was set at a range of $328.0 million to $338.0 million, significantly below the analyst consensus of $379.7 million.
This updated outlook includes expectations for a positive adjusted EBITDA margin of 2.0% to 4.0% and positive annual free cash flow.
The market's reaction to the earnings and guidance miss was evident in the stock's performance, as ThredUp shares experienced a notable decline. This response underscores the importance of meeting or exceeding analyst expectations and the impact of forward-looking guidance on investor sentiment.
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