ThredUp's Q1 2025 Earnings Call: Unpacking Key Contradictions in Marketing Strategy, Profitability, and Macroeconomic Impact

Marketing strategy and efficiency, impact of tariffs and macroeconomic environment, customer acquisition strategy, profitability expectations for the U.S. business, and European business impact on U.S. EBITDA are the key contradictions discussed in ThredUp's latest 2025Q1 earnings call.



Record Financial Performance:
- ThredUp reported revenue of $71.3 million for Q1 2025, a 10.5% year-over-year increase.
- The growth was driven by significant investments in marketing and inbound processing, leading to the strongest quarter for new buyer acquisition in the company's history.

New Buyer Acquisition:
- Active buyer growth turned positive, with a 5.7% year-over-year increase, while new buyers acquired in Q1 2025 were up 95% from Q1 2024.
- The positive trend was attributed to a more efficient product experience, leading to higher conversion rates.

Macro Environment and Tariffs:
- ThredUp's financial results exceeded expectations, with tariffs and the de minimis closure not having a direct impact in Q1.
- The potential benefits include the closure of the de minimis loophole, which aligns with ThredUp's competitive positioning, and potential tariff-induced disruptions in new apparel prices.

AI and Product Experience:
- ThredUp has augmented customer experience with AI-driven enhancements, including visual search and personalized pathways for product discovery.
- These initiatives have reshaped browse behaviors and improved customer engagement, contributing to increased conversion rates.