ThredUp's 2024 Q4 Earnings Call: Contradictions in Revenue Growth, Marketing Strategy, and European Operations

These are the key contradictions discussed in ThredUp's latest 2024Q4 earnings call, specifically including: Revenue Growth Pacing, Marketing Spend, EU Business Strategy, Revenue Pacing and Growth Strategy, and Marketing Spend and Customer Acquisition Strategy:



Revenue and Customer Growth:
- ThredUp reported revenue of $67.3 million for Q4, an increase of 9.5% year-over-year.
- This growth was driven by strong customer acquisition, with new customer volume up 32% year-over-year, and improvements in customer retention metrics.

AI and Customer Experience Enhancements:
- ThredUp's AI search functionality has seen 1.3 million image searches, with sessions using image search having an 85% higher conversion rate.
- The integration of AI has significantly enhanced the secondhand shopping experience, leading to increased engagement and sales.

Sustainability and Market Positioning:
- ThredUp's premium selling service is now live to 100% of sellers, with items from premium kits making up more than 10% of newly listed items.
- The company's focus on sustainability and affordability is gaining traction, with 59% of consumers indicating they would seek more affordable options like secondhand due to increased new apparel costs from tariffs and trade policies.

Financial Performance and Outlook:
- ThredUp achieved adjusted EBITDA profitability for the full year 2024 and an adjusted EBITDA margin of 7.4% in Q4, marking a 330 basis point margin improvement.
- The company forecasts revenue growth of 6% at the midpoint for Q1 and full year 2025, with an expectation of positive free cash flow on an annual basis.