TDUP - ThredUp sees margin pressure in Q3 cuts full-year forecasts

ThredUp ( NASDAQ: TDUP ) stock slid sharply in Monday’s extended session after reporting a mixed Q3 earnings result and tempering sales, margin, and EBITDA guidance.

For the third quarter, the Oakland-based e-commerce company notched $67.9M in revenue, rising above the $65.2M analyst expectation. However, a $0.24 per share loss came in wider than the $0.21 consensus estimate. Gross margin fell to 65.5% from 72.8% in the prior year quarter and 68.9% in Q2. Active buyers on the platform remained steady sequentially at 1.7M.

“We are proud to deliver strong Q3 results in what continues to be a highly dynamic environment," said thredUP CEO and co-founder James Reinhart. “Even as the retail landscape becomes increasingly competitive and our customer is faced with economic uncertainty, we remain confident in our ability to flex our marketplace model and make progress towards profitability.”

Nonetheless, Reinhart trimmed forecasts for the fourth quarter. Management now anticipates $62M to $64M in revenue, down from the $70M to $72 in prior forecasts and below the $71.1M consensus. As such, full-year sales forecasts were also reeled in from $283M to $287M guided in August to $279M to $281M.

Adjusted EBITDA loss margin in the range of 17% to 16.5% is now anticipated as well for the full year, shifted from a guide of 16% to 15% offered in August. Gross margin for 2022 is now projected to range from 66.5% to 67%, down from 67% to 69% in prior projections.

Despite the downbeat guidance, shares of ThredUp ( TDUP ) ticked 0.62% higher in after hours trading, adding to an over 7% rise on Monday and a double-digit leap on Friday. Despite the pop in recent days, the stock has still marked an over 90% decline year to date.

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