ThredUp shares plummeted 11.66% amid sector-specific secondhand e-commerce challenges and consumer behavior shifts

ThredUp shares plummeted 11.66% in pre-market trading on December 24, 2025, marking one of the most significant intraday declines in the company’s history. The sharp drop came amid heightened market sensitivity to evolving consumer behavior and sector-specific challenges in the secondhand e-commerce space. Analysts noted the move reflected broader investor caution following mixed signals on post-holiday spending patterns and regulatory scrutiny of online resale platforms.

The selloff followed a string of strategic missteps highlighted in recent earnings reports, including slower-than-expected growth in active buyers and margin pressures from aggressive discounting. While the company has historically benefited from sustainability-driven consumer trends, recent data suggested a plateau in user acquisition, raising concerns about long-term scalability. Institutional investors appeared to recalibrate positions ahead of year-end portfolio adjustments, amplifying short-term volatility.

Market participants are now closely monitoring ThredUp’s ability to execute its cost-cutting initiatives and stabilize key metrics like average order value. With the stock trading at a discount to its 52-week high, the decline underscores the sector’s vulnerability to macroeconomic shifts and shifting retail dynamics. Further clarity on the company’s fourth-quarter performance and capital allocation strategy is expected to shape near-term momentum.

Analysts remain divided on whether the current pullback represents an overreaction or a necessary correction. Some suggest the company's long-term value proposition—driven by the rising demand for sustainable fashion—could attract bargain hunters, while others caution that structural challenges in monetizing user growth may persist. The broader market’s response to similar secondhand platforms will likely offer additional context for ThredUp's valuation trajectory.

Looking ahead, the company's next earnings report will be critical in gauging the effectiveness of recent operational changes and investor sentiment. Until then, the stock is expected to remain range-bound, with key support levels likely to be tested in the coming weeks.