ThredUp Q2 2025 Earnings Call: Revenue Growth Accelerates, AI-Driven Success, and Q4 Guidance Lowered

ThredUp Inc. reported Q2 2025 earnings with strong revenue growth at 16.4% YoY, driven by customer growth and orders. Gross margin improved to 79.5%, and adjusted EBITDA reached 3.9%. New buyer acquisition increased by 74% YoY, and AI-driven product improvements led to a 30% increase in visitor-to-sign-up rates and a 60% increase in sign-up-to-purchase rates. However, the closure of the de minimis loophole and potential tariff impacts create uncertainty in pricing and production volumes.

ThredUp Inc. (TDUP) announced its second-quarter 2025 financial results, showcasing robust growth and improved financial performance. The online resale platform reported a 16.4% year-over-year (YoY) increase in revenue to $77.7 million, driven by strong customer and order growth [1].

The company's gross margin improved to 79.5%, up from 78.8% in the same period last year, reflecting enhanced operational efficiency and pricing strategies. Gross profit increased by 17% YoY to $61.7 million. ThredUp also reported a significant increase in active buyers, with 1.47 million users, representing a 17% YoY growth, and new buyer acquisition grew by 74% YoY, the highest quarterly increase in the company's history [1].

Adjusted EBITDA from continuing operations reached $3.0 million, or 3.9% of revenue, indicating a notable improvement over the previous year's 2.2% [1]. Despite these positive results, ThredUp reported a loss from continuing operations of $5.2 million, or a negative 6.7% of revenue, compared to a loss of $9.4 million, or a negative 14.1% of revenue, in the same period last year [1].

ThredUp's AI-led product journey continues to yield positive results, with a 30% increase in visitor-to-sign-up rates and a 60% increase in sign-up-to-purchase rates, contributing to the company's strong financial performance [1]. However, the closure of the de minimis loophole and potential tariff impacts pose uncertainties in pricing and production volumes, which could impact future financial results [1].

Looking ahead, ThredUp expects revenue of $76.0 million to $78.0 million for the third quarter 2025, with a midpoint of $77.0 million, representing a 25% YoY increase. The company also anticipates a gross margin of 77.0% to 79.0% and an adjusted EBITDA margin of approximately 4.5% for the third quarter [1].

References:
[1] https://ir.thredup.com/news-releases/news-release-details/thredup-announces-second-quarter-2025-results