ThredUp’s second quarter results were well received by the market, as the company outpaced Wall Street’s revenue estimates and saw robust year-over-year sales growth. Management credited these results to a surge in new buyers—up 74%—and a positive flywheel effect between product experience enhancements, premium supply, and efficient marketing. CEO James Reinhart highlighted that improvements in site features and operational execution combined to “really get the marketplace humming on all cylinders,” with the company setting records for both buyer acquisition and order volume. The continued growth in active buyers and efficient customer acquisition were central to ThredUp’s strong quarterly performance.
Is now the time to buy TDUP? Find out in our full research report (it’s free).
ThredUp (TDUP) Q2 CY2025 Highlights:
- Revenue: $77.66 million vs analyst estimates of $73.85 million (16.4% year-on-year growth, 5.2% beat)
- Adjusted EPS: -$0.04 vs analyst estimates of -$0.05 ($0.01 beat)
- Adjusted EBITDA: $3.02 million vs analyst estimates of $2.4 million (3.9% margin, relatively in line)
- The company lifted its revenue guidance for the full year to $300 million at the midpoint from $286 million, a 4.9% increase
- Operating Margin: -6.8%, up from -14.4% in the same quarter last year
- Orders: 1.54 million, up 264,000 year on year
- Market Capitalization: $1.27 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From ThredUp’s Q2 Earnings Call
- Irwin Bernard Boruchow (Wells Fargo) asked about what specifically drove the sharp acceleration in new buyer growth. CEO James Reinhart explained it was a combination of product improvements, operational execution, and premium supply, creating a “flywheel” effect in the marketplace.
- Dylan Douglas Carden (William Blair) inquired about maintaining gross margin despite rapid new customer growth. CFO Sean Sobers attributed this to the expansion of premium supply and improvements in pick, pack, and ship operations that support customer experience.
- Dana Lauren Telsey (Telsey Group) questioned whether new buyers differed demographically or by shopping behavior. Reinhart said new customers largely mirror the existing base, with the addressable market still large and underpenetrated, especially for women’s secondhand apparel.
- Bernard Jerome McTernan (Needham & Company) asked about competitive dynamics and the impact of ad spending by fast fashion rivals. Reinhart acknowledged some fluctuation in competition but expressed confidence that ThredUp’s product and marketing efficiency allow it to acquire customers at predictable rates.
- Oliver Chen (TD Cowen) probed the role of AI in driving business outcomes and its hardest challenges. Reinhart noted that AI has most impacted customer acquisition and funnel conversion, but handling the breadth of ThredUp’s catalog remains a significant technical challenge.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will focus on (1) the pace of new buyer and seller acquisition and their repeat purchase rates, (2) the rollout and adoption of new AI-driven shopping features and social commerce integrations, and (3) the scale and impact of brand partnerships under the evolving Resale as a Service strategy. How ThredUp navigates macroeconomic headwinds and competitive ad environments will also be closely watched.
ThredUp currently trades at $10.28, up from $9.71 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).
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