ThredUp Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue totaled $88.2 million, a 7% increase year-over-year.
• Gross profit was $69.0 million, a 6% increase year-over-year, with a gross margin of 78.2% compared to 79.4% in the prior year period.
• Net loss was $5.5 million (6.2% of revenue) for the quarter, compared to a loss of $4.2 million (5.2% of revenue) in the prior year period.
• Adjusted EBITDA was $3.5 million (4.0% of revenue), down from $3.8 million (4.6% of revenue) in the prior year period.
• Cash, cash equivalents, restricted cash, and marketable securities ended the quarter at $57.6 million, an increase of $0.2 million from the previous quarter.
• For the nine months ended September 30, 2026, net cash provided by operating activities was $11.2 million, compared to $12.1 million in the prior year period.
• Non-GAAP free cash flow for the nine months ended September 30, 2026, was $2.4 million, compared to $3.4 million in the prior year period.
• Total assets were $169.5 million as of September 30, 2026, compared to $167.2 million as of December 31, 2025.
• Total liabilities were $109.1 million as of September 30, 2026, compared to $108.1 million as of December 31, 2025.
• Long-term debt, net of current portion, was $17.7 million as of September 30, 2026, compared to $14.3 million as of December 31, 2025.

Guidance and Future Outlook:

• For Q4 2026, revenue is expected to be between $77.0 million and $79.0 million, representing a 2% year-over-year decline at the midpoint and an 8% two-year average growth rate.
• Q4 2026 gross margin is projected to be between 76.5% and 77.5%.
• Q4 2026 Adjusted EBITDA margin is projected to be between (4.0)% and (2.0)%.
• For the full fiscal year 2026, revenue is expected to be between $337.7 million and $339.7 million, representing a 9% year-over-year growth at the midpoint and a 14% two-year average growth rate.
• Full year 2026 gross margin is projected to be between 78.5% and 78.7%.
• Full year 2026 Adjusted EBITDA margin is projected to be between 2.4% and 2.8%.
• Depreciation and amortization is expected to be $3.3 million for Q4 2026 and $14.0 million for the full year 2026.
• Stock-based compensation expense is expected to be $6.0 million for Q4 2026 and $22.3 million for the full year 2026.
• The company is not providing a quantitative reconciliation of forward-looking Adjusted EBITDA margin to net loss margin or free cash flow estimates due to the inability to reasonably predict certain items without unreasonable effort.

Business Segments and Product Lines:

• Active Buyers reached a record 1.82 million, a 16% increase year-over-year.
• Orders totaled 1.89 million, a 17% increase year-over-year.
• The company continues to focus on its managed marketplace model and Resale-as-a-Service (RaaS) offerings.
• ThredUp has processed over 250 million unique secondhand items from 60,000 brands across 100 categories.

Market and Competitive Landscape:

• Management noted navigating a highly competitive environment.
• The company is focused on innovating across the product experience to compound competitive advantages.
• The company is making investments in technology and infrastructure, including AI technologies.
• The company is launching a rebrand to make resale more engaging and accessible to a wider audience.

Risks and Challenges:

• Risks include the ability to attract new users and convert them into buyers and Active Buyers.
• Challenges include achieving and maintaining profitability and the sufficiency of cash resources to meet liquidity needs.
• The company faces risks from an intensely competitive market and the ability to effectively manage growth.
• Risks include the ability to deploy new and evolving technologies such as artificial intelligence and machine learning.
• Economic and industry trends, including tariffs, inflationary pressures, interest rate volatility, changing consumer habits, and climate change, pose risks.
• Legal and regulatory developments present potential risks.
• The company may face risks related to integrating and realizing benefits from past or future strategic acquisitions or investments.

Management Commentary and Tone:

• CEO James Reinhart stated the company is proud to report a record quarter for active buyers, orders, and items sold, delivering clear value for buyers in Q3.
• Management emphasized a continued focus on innovating across the product experience to compound competitive advantages as a managed marketplace.

Other Key Points:

• The company is not providing a quantitative reconciliation of forward-looking guidance for Adjusted EBITDA margin to net loss margin because certain items are out of control or cannot be reasonably predicted.
• The company is not providing a quantitative reconciliation for free cash flow estimates on a forward-looking basis.
• ThredUp is listed on Nasdaq (TDUP) and the London Stock Exchange (TDUP).
• A live and archived webcast of the earnings call is available at ir.thredup.com/news-events/events-and-presentations.
• The company defines an Active Buyer as a buyer who has made at least one purchase in the last twelve months.
• Orders are defined as the total number of orders placed by buyers across marketplaces, including through RaaS clients, net of cancellations.