ThredUp Announces Third Quarter 2024 Results
Third quarter Total revenue of $73.0 million, a decrease of 11% year-over-year.
U.S. Total revenue of $61.5 million, a decrease of 10% year-over-year.
Third quarter Gross margin of 71.2% and a decrease in Gross profit of 8% year-over-year.
U.S. Gross margin of 79.3% and a decrease in U.S. Gross profit of 9% year-over-year.
Active Buyers of 1.632 million and Orders of 1.553 million in Q3 2024, representing decreases of 7% and 14%, respectively, year-over-year.
U.S. Active Buyers of 1.248 million and Orders of 1.172 million in Q3 2024, representing a decrease of 7% and a decrease of 10%, respectively, year-over-year.
ThredUp has signed a non-binding term sheet for a management buyout of its European business.
Raising Q4 and FY 2024 guidance for the U.S. business.
OAKLAND, Calif., Nov. 04, 2024 (GLOBE NEWSWIRE) -- ThredUp Inc. (NASDAQ:TDUP, LTSE: TDUP)), one of the largest online resale platforms for apparel, shoes, and accessories, announced today its financial results for the third quarter ended September 30, 2024 and updated full year 2024 financial outlook.
"Though we know there is still work ahead, we have made clear progress in course-correcting in the U.S. since last quarter," said ThredUp CEO and co-founder James Reinhart. "With momentum in our marketplace, we are pleased to be raising our U.S. Q4 and 2024 revenue outlook and are excited for the opportunities in front of us."
Third Quarter 2024 Financial Highlights1
Revenue: Total revenue of $73.0 million, a decrease of 11% year-over-year.
U.S. Total revenue of $61.5 million, a decrease of 10% year-over-year.
Gross Profit and Gross Margin: Gross profit totaled $52.0 million, a decrease of 8% year-over-year. Gross margin was 71.2% as compared to 69.0% for the third quarter 2023.
U.S. Gross profit of $48.8 million, a decrease of 9% year-over-year. U.S. Gross margin was 79.3% as compared to 78.5% for the third quarter 2023.
Net Loss: Net loss was $24.8 million, or a negative 33.9% of Total revenue, for the third quarter 2024, compared to a net loss of $18.1 million, or a negative 22.0% of Total revenue, for the third quarter 2023. Net loss for the third quarter of 2024 included an impairment of long-lived assets related to our European operations of $9.8 million.
U.S. Net loss was $9.9 million, or a negative 16.0% of revenue, for the third quarter 2024, compared to a U.S. Net loss of $12.5 million, or a negative 18.3% of U.S. Total revenue, for the third quarter 2023.
Adjusted EBITDA Loss and Adjusted EBITDA Loss Margin: Adjusted EBITDA loss was $2.5 million, or a negative 3.4% of Total revenue, for the third quarter 2024, compared to an Adjusted EBITDA loss of $3.6 million, or a negative 4.4% of Total revenue, for the third quarter 2023.
U.S. Adjusted EBITDA was $0.7 million, or a 1.1% of U.S. Total revenue, for the third quarter 2024, compared to U.S. Adjusted EBITDA of $0.1 million, or a 0.2% of U.S. Total revenue, for the third quarter 2023.
Active Buyers and Orders: Active Buyers of 1.632 million and Orders of 1.553 million, representing decreases of 7% and 14%, respectively, over the third quarter 2023.
U.S. Active Buyers of 1.248 million and Orders of 1.172 million, representing decreases of 7% and 10%, respectively, over the third quarter 2023.
__________________________1 U.S. Total revenue, U.S. Gross profit, U.S. Gross margin, Adjusted EBITDA loss, Adjusted EBITDA loss margin, U.S. Adjusted EBITDA and U.S. Adjusted EBITDA margin are non-GAAP measures. See "Reconciliation of GAAP to Non-GAAP Financial Measures" in this earnings release and "Reconciliation of U.S. Financial Information to Condensed Consolidated Statement of Operations" in the Supplemental Financial Information for a detailed reconciliation of these non-GAAP measures to the most directly comparable GAAP measures and "Non-GAAP Financial Measures" for a discussion of why we believe these non-GAAP measures are useful.
Recent Business Highlights
Europe Divestiture: On October 31, 2024, ThredUp signed a non-binding term sheet for a management buyout of Remix by Florin Filote (Remix's current General Manager) and the Remix management team. Both parties are working toward the closing of this transaction by the end of 2024.
AI Update: ThredUp launched its suite of AI tools in August. Since its launch last quarter, more than 60% of searches lead to item exploration, and the diversity of search terms have more than doubled. Additionally, TIME Magazine recognized the tech in its 2024 Best Inventions list.
Shaping Legislation: ThredUp launched the Sales and Use Tax petition in partnership with the circular coalition group American Circular Textiles (ACT) and its members. Through its public policy efforts, ThredUp also helped shape a California-statewide bill (SB707) aiming to minimize landfill disposal and environmental impacts, which was signed and approved in September 2024.
Financial Outlook
For the fourth quarter 2024, ThredUp expects:
Total revenue in the range of $67.2 million to $69.2 million.
U.S. Total revenue in the range of $58.0 million to $60.0 million.
Gross margin in the range of 72.3% to 73.3%.
U.S. Gross margin in the range of 78.5% to 79.5%.
Adjusted EBITDA loss margin in the range of (4.7)% to (2.7)%.
U.S. Adjusted EBITDA margin in the range of 0.0% to 2.0%.
For the full fiscal year 2024, ThredUp expects:
Total revenue in the range $300 million to $302 million.
U.S. Total revenue in the range of $250.8 million to $252.8 million.
Gross margin in the range of 70.8% to 71.0%.
U.S. Gross margin in the range of 79.2% to 79.4%.
Adjusted EBITDA loss margin in the range of (2.6)% to (2.2)%.
U.S. Adjusted EBITDA margin in the range of 1.6% to 2.1%.
ThredUp is not providing a quantitative reconciliation of forward-looking guidance of the Non-GAAP measures above, including Adjusted EBITDA margin, U.S. Total Revenue, U.S. Gross Margin and U.S. Adjusted EBITDA margin to their most directly comparable financial measures under GAAP because certain items are out of ThredUp's control or cannot be reasonably predicted. Historically, these items have included, but are not limited to, stock-based compensation expense, impairment of long-lived assets, depreciation and amortization, severance and other reorganization costs, interest expense, and provision (benefit) for income taxes. Accordingly, a reconciliation for Adjusted EBITDA loss in order to calculate forward-looking Adjusted EBITDA loss margin is not available without unreasonable effort. However, for the fourth quarter of 2024 and full year 2024, Depreciation and amortization is expected to be $4.6 million and $19.1 million, respectively, and U.S. Depreciation and amortization is expected to be $3.4 million and $14.3 million, respectively. In addition, for the fourth quarter of 2024 and full year 2024, Stock-based compensation expense is expected to be $6.6 million and $27.3 million, respectively, and U.S. Stock-based compensation expense is expected to be $6.0 million and $25.8 million, respectively. These items are uncertain, depend on various factors, and could result in projected net loss being materially less than is indicated by the currently estimated Adjusted EBITDA loss margin. In addition, due to the inherent uncertainty of the proposed divestiture of the Remix business, it is not possible without unreasonable efforts to provide a reconciliation for forward-looking U.S. Revenue, U.S. Gross Margin and U.S. Adjusted EBITDA margin.
Conference Call and Webcast Information
The live and archived webcast and all related earnings materials will be available at ThredUp's investor relations website: ir.thredup.com/news-events/events-and-presentations.
ThredUp Inc.Condensed Consolidated Balance Sheets(unaudited)
September 30,2024
December 31,2023
(in thousands)
ASSETS
Current assets:
Cash and cash equivalents
$
43,715
$
56,084
Marketable securities
11,581
8,100
Accounts receivable, net
5,717
7,813
Inventory
7,375
15,687
Other current assets
4,977
6,204
Total current assets
73,365
93,888
Operating lease right-of-use assets
44,804
42,118
Property and equipment, net
76,432
87,672
Goodwill
12,121
11,957
Intangible assets
1,995
8,156
Other assets
6,227
6,176
Total assets
$
214,944
$
249,967
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
13,125
$
9,457
Accrued and other current liabilities
34,170
35,934
Seller payable
19,802
21,495
Operating lease liabilities, current
5,455
5,949
Current portion of long-term debt
3,851
3,838
Total current liabilities
76,403
76,673
Operating lease liabilities, non-current
47,147
44,621
Long-term debt, net of current portion
19,116
22,006
Other non-current liabilities
3,006
2,750
Total liabilities
145,672
146,050
Commitments and contingencies
Stockholders' equity:
Class A and B common stock, $0.0001 par value; 1,120,000 shares authorized as of September 30, 2024 and December 31, 2023; 113,758 and 108,784 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively
11
11
Additional paid-in capital
605,687
585,156
Accumulated other comprehensive loss
(2,272
)
(2,375
)
Accumulated deficit
(534,154
)
(478,875
)
Total stockholders' equity
69,272
103,917
Total liabilities and stockholders' equity
$
214,944
$
249,967
ThredUp Inc.Condensed Consolidated Statements of Operations(unaudited)
Three Months Ended
Nine Months Ended
September 30,2024
September 30,2023
September 30,2024
September 30,2023
(in thousands, except per share amounts)
Revenue:
Consignment
$
59,850
$
57,838
$
184,930
$
157,732
Product
13,171
24,211
47,434
82,897
Total revenue
73,021
82,049
232,364
240,629
Cost of revenue:
Consignment
11,354