How did TDUP's Q3 2024 earnings surprise analysts?

ThredUp Inc (TDUP) reported Q3 2024 earnings that were generally in line with analysts' expectations, with some minor surprises. Here's a detailed analysis:

1. Revenue Performance:
   • TDUP's revenue for Q3 2024 was $79.8 million.
   • This fell slightly short of the analyst estimate of $82.48 million.
   • However, this discrepancy was not significant enough to be considered a major surprise.
2. Earnings Per Share (EPS):
   • The company reported an EPS of -$13 cents for Q3 2024.
   • This was worse than the analyst estimate of -$11 cents.
   • The miss in EPS was a minor negative surprise for analysts.
3. Net Loss:
   • TDUP reported a net loss of $14.0 million for the quarter.
   • This was a reduction from the net loss of $18.8 million in the same quarter the previous year.
   • The improvement in net loss was in line with analysts' expectations.
4. Gross Margin and Profitability:
   • The company achieved a gross margin of 70.4%, which is a significant improvement from 67.4% in the same quarter the previous year.
   • Gross profit increased by 1% year-over-year.
   • These improvements were positive surprises for analysts, indicating better operational efficiency.
5. Strategic Shifts and Challenges:
   • TDUP announced plans to exit the European market and evaluate strategic alternatives for its European business.
   • The company faced challenges in both the U.S. and European markets, which likely impacted revenue and profitability.
   • Analysts had likely anticipated these strategic shifts due to the challenging consumer environment and inflationary pressures.

In conclusion, while TDUP's Q3 2024 earnings report contained some minor negatives (primarily the EPS miss), the overall performance was generally in line with analysts' expectations. The positive surprises included improved gross margins and reduced net losses, indicating better operational efficiency and profitability. The strategic decision to exit the European market was likely anticipated by analysts, given the challenges faced by the company in that region.