ThredUp Inc.

Previous wording

On November 30, 2024, we divested 91% of our European business and Bulgarian subsidiary, Remix, which qualified for reporting as a discontinued operation. As a result, Remix’s results during 2024 are presented as a single line item, loss from discontinued operations, net of tax in the condensed consolidated statements of operations and excluded from continuing operations for the three and six months ended June 30, 2024. In the condensed consolidated statements of cash flows, cash flows attributable to Remix have been segregated and presented separately as net cash flow used in discontinued operating activities and net cash flow used in discontinued investing activities for the six months ended June 30, 2024. Accordingly, any discussion of historical information in the following sections reflects Remix’s results as a discontinued operation, and amounts, including key operating metrics, and disclosures below pertain to our continuing operations for all periods presented, unless otherwise noted.

Current wording

On November 30, 2024, we divested 91% of our European business and Bulgarian subsidiary, Remix, which qualified for reporting as a discontinued operation. As a result, Remix’s results during 2024 are presented as a single line item, loss from discontinued operations, net of tax in the condensed consolidated statements of operations and excluded from continuing operations for the three and nine months ended September 30, 2024. In the condensed consolidated statements of cash flows, cash flows attributable to Remix have been segregated and presented separately as net cash flow used in discontinued operating activities and net cash flow used in discontinued investing activities for the nine months ended September 30, 2024. Accordingly, any discussion of historical information in the following sections reflects Remix’s results as a discontinued operation, and amounts, including key operating metrics, and disclosures below pertain to our continuing operations for all periods presented, unless otherwise noted.

Previous wording

Gross Profit and Margin: Gross profit totaled $61.7 million, representing an increase of 17.5% year over year. Gross margin was 79.5%, an increase of 70 basis points from 78.8% in the comparable quarter last year.

Current wording

Gross Profit and Margin: Gross profit totaled $65.2 million for the third quarter of 2025, compared to $48.8 million for the third quarter of 2024, representing an increase of 33.8% year over year. Gross margin was 79.4%, an increase of 10 basis points from 79.3% in the comparable quarter last year.

Previous wording

Loss from continuing operations: Loss from continuing operations was $5.2 million, or a negative 6.7% of revenue, for the second quarter of 2025, compared to a loss of $9.4 million, or a negative 14.1% of revenue, for the second quarter of 2024.

Current wording

Loss from continuing operations: Loss from continuing operations was $4.2 million, or a negative 5.2% of revenue, for the third quarter of 2025, compared to $10.4 million, or a negative 16.8% of revenue, for the third quarter of 2024, representing a decrease of 59.0% year over year .

Previous wording

Non-GAAP Adjusted EBITDA from continuing operations(1): Non-GAAP Adjusted EBITDA from continuing operations was $3.0 million, or 3.9% of revenue, for the second quarter of 2025, compared to $1.5 million, or 2.2% of revenue, for the second quarter of 2024.

Current wording

Non-GAAP Adjusted EBITDA from continuing operations(1): Non-GAAP Adjusted EBITDA from continuing operations was $3.8 million, or 4.6% of revenue, for the third quarter of 2025, compared to $0.3 million, or 0.5% of revenue, for the third quarter of 2024, representing an increase of 1101.3% year over year.

Previous wording

Active Buyers and Orders: Active Buyers and Orders each totaled 1.5 million in the second quarter of 2025, representing increases of 16.5% and 20.8%, respectively, compared to the second quarter of 2024.

Current wording

Active Buyers and Orders: Active Buyers totaled 1.568 million and Orders totaled 1.608 million, in the third quarter of 2025, compared to 1.248 million and 1.172 million, respectively, in the third quarter of 2024, representing increases of 25.6% and 37.2%, respectively, year over year.

Previous wording

Non-GAAP Adjusted EBITDA from continuing operations means loss from continuing operations adjusted to exclude, where applicable in a given period, stock-based compensation expense, depreciation and amortization, interest expense, provision for income taxes, gain on sale of non-marketable equity investment, and severance and other reorganization costs. Non-GAAP Adjusted EBITDA from continuing operations margin represents Non-GAAP Adjusted EBITDA from continuing operations divided by Revenue. We use these non-GAAP measures to evaluate and assess our operating performance and the operating leverage in our business, and for internal planning and forecasting purposes. We believe these non-GAAP measures, when taken collectively with our GAAP results, may be helpful to investors because they provide consistency and comparability with past financial performance and assist in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results.

Current wording

Non-GAAP Adjusted EBITDA from continuing operations means loss from continuing operations adjusted to exclude, where applicable in a given period, stock-based compensation expense, depreciation and amortization, interest expense, provision (benefit) for income taxes, severance and other reorganization costs, and gain on sale of non-marketable equity investment. Non-GAAP Adjusted EBITDA from continuing operations margin represents Non-GAAP Adjusted EBITDA from continuing operations divided by Revenue. We use these non-GAAP measures to evaluate and assess our operating performance and the operating leverage in our business, and for internal planning and forecasting purposes. We believe these non-GAAP measures, when taken collectively with our GAAP results, may be helpful to investors because they provide consistency and comparability with past financial performance and assist in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results.

Previous wording

Comparison of the Three and Six Months Ended June 30, 2025 and 2024

Current wording

Comparison of the Three and Nine Months Ended September 30, 2025 and 2024

Previous wording

Revenue increased $10.9 million, or 16.4%, for the three months ended June 30, 2025 as compared to the same period in 2024. The growth in revenue was mainly driven by a 20.8% increase in Orders, partially offset by a 2.4% decrease in the average order value, reflecting continued strength in our core marketplace business and our ongoing focus on the higher-margin, capital-efficient consignment model.

Current wording

Revenue increased $20.6 million, or 33.6%, for the three months ended September 30, 2025 as compared to the same period in 2024. The growth in revenue was mainly driven by a 37.2% increase in Orders, supported by higher engagement from new buyers acquired during the third quarter and repeat purchases from customers acquired earlier in the year, partially offset by a 4.2% decrease in the average order value, primarily due to a higher mix of orders from new buyers, who tend to place smaller orders. These trends reflect the continued strength in our core marketplace business and our ongoing focus on driving platform growth.

Previous wording

Revenue increased $17.7 million, or 13.5%, for the six months ended June 30, 2025 as compared to the same period in 2024. The growth in revenue was mainly driven by an 18.5% increase in Orders, partially offset by a more modest 0.7% increase in the average order value, reflecting continued strength in our core marketplace business and our ongoing focus on the higher-margin, capital-efficient consignment model.

Current wording

Revenue increased $38.3 million, or 19.9%, for the nine months ended September 30, 2025 as compared to the same period in 2024. The growth in revenue was mainly driven by an 24.6% increase in Orders, supported by higher engagement from new buyers acquired during the third quarter and repeat purchases from customers acquired earlier in the year, partially offset by a 0.9% decrease in the average order value, primarily due to a higher mix of orders from new buyers, who tend to place smaller orders. These trends reflect the continued strength in our core marketplace business and our ongoing focus on driving platform growth.

Previous wording

Operations, product, and technology expenses increased $2.6 million, or 7.3%, for the three months ended June 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $3.1 million increase in personnel-related costs, primarily driven by higher headcount at our distribution centers to support greater supply availability for customers, and a $0.4 million increase in facilities, technology and other costs. This increase was partially offset by a $0.9 million decrease in inbound shipping costs, primarily driven by lower rates. The decrease in operations, product, and technology expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue.

Current wording

Operations, product, and technology expenses increased $5.2 million, or 15.8%, for the three months ended September 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $3.0 million increase in personnel-related costs, primarily driven by distribution center-related labor costs to support greater supply availability for customers, a $1.2 million increase in inbound shipping costs, primarily driven by higher supply volume, and a $1.0 million increase in facilities, technology and other distribution center-related costs. The decrease in operations, product, and technology expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue.

Previous wording

Operations, product, and technology expenses increased $0.6 million, or 0.8%, for the six months ended June 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $3.6 million increase in personnel-related costs, primarily driven by higher headcount at our distribution centers to support greater supply availability for customers. This increase was partially offset by a $1.2 million decrease in inbound shipping costs, primarily driven by lower rates; a $1.0 million decrease in severance costs following the completion of our workforce reorganization in March 2024; and a $0.8 million decrease in facilities, technology and other costs. The decrease in operations, product, and technology expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue.

Current wording

Operations, product, and technology expenses increased $5.8 million, or 5.5%, for the nine months ended September 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $5.6 million increase in personnel-related costs, primarily driven by distribution center-related labor costs to support greater supply availability for customers, and a $0.2 million increase in facilities, technology and other distribution center-related costs. The decrease in operations, product, and technology expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue.

Previous wording

Marketing expenses increased $2.9 million, or 22.2%, for the three months ended June 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $2.1 million increase in advertising costs, a $0.5 million increase in professional services, and a $0.2 million increase in personnel-related costs driven by higher headcount. The increase in marketing expenses as a percentage of revenue reflected a higher rate of marketing spend relative to the growth in revenue, as we continue to invest in marketing initiatives to support future growth.

Current wording

Marketing expenses increased $3.3 million, or 25.4%, for the three months ended September 30, 2025 as compared to the same period in 2024. The increase was primarily due to a $3.4 million increase in advertising costs related to our marketing initiatives aimed at driving customer engagement and platform growth. The decrease in marketing expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue.

Previous wording

Sales, general, and administrative expenses decreased $3.3 million, or 10.9%, for the six months ended June 30, 2025 as compared to the same period in 2024. The decrease was primarily due to a $5.0 million decrease in personnel-related costs, including a $3.2 million decrease in stock-based compensation expense, and a $1.2 million decrease in severance costs following the completion of our workforce reorganization in March 2024. This decrease was partially offset by a $1.4 million increase in facilities, technology and other costs and a $0.4 million increase in professional services. The decrease in sales, general, and administrative expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue and lower overall costs.

Current wording

Sales, general, and administrative expenses decreased $1.4 million, or 3.3%, for the nine months ended September 30, 2025 as compared to the same period in 2024. The decrease was primarily due to a $4.3 million decrease in personnel-related costs, mainly attributable to lower stock-based compensation expense and severance costs incurred in the prior year related to our March 2024 workforce reorganization. This decrease was partially offset by a $1.3 million increase in payment processing fees and a $1.2 million increase in customer appeasement costs, both largely driven by higher order volume during the period. The decrease in sales, general, and administrative expenses as a percentage of revenue was primarily due to increased operating leverage resulting from higher revenue and lower overall costs.

Previous wording

Interest expense decreased $0.3 million for the six months ended June 30, 2025 as compared to the same period in 2024, primarily due to a lower interest rate environment and reduced outstanding debt balances.

Current wording

Interest expense decreased $0.5 million for the nine months ended September 30, 2025 as compared to the same period in 2024, primarily due to a lower interest rate environment and reduced outstanding debt balances.

Previous wording

Other income, net decreased $0.3 million for the three months ended June 30, 2025 as compared to the same period in 2024, primarily due to lower interest income resulting from both a decline in interest rates and a reduced average cash balance.

Current wording

Other income, net decreased $0.2 million for the three months ended September 30, 2025 as compared to the same period in 2024, primarily due to lower interest income resulting from both a decline in interest rates and a reduced average balance of cash and cash equivalents and marketable securities.

Previous wording

Other income, net decreased $0.4 million for the six months ended June 30, 2025 as compared to the same period in 2024, primarily due to lower interest income resulting from both a decline in interest rates and a reduced average cash balance.

Current wording

Other income, net decreased $0.5 million for the nine months ended September 30, 2025 as compared to the same period in 2024, primarily due to lower interest income resulting from both a decline in interest rates and a reduced average balance of cash and cash equivalents and marketable securities.

Previous wording

While we have a history of negative cash flows from operations, we generated positive cash flows from continuing operations of $6.1 million for the six months ended June 30, 2025. We have primarily financed our operations through private and public sales of equity securities and debt. As of June 30, 2025, we had cash, cash equivalents, restricted cash and short-term marketable securities of $56.2 million. Additionally, we have a term loan facility (“Term Loan”) under which $22.5 million remained available to be drawn as of June 30, 2025 for the purchase of certain equipment, and we were in full compliance with our debt covenants under the Term Loan as of that date. See Note 6, Long-Term Debt, to the condensed consolidated financial statements included in Part I, Item 1, Financial Statements, of this Quarterly Report on Form 10-Q for a further discussion on our Term Loan.

Current wording

We generated positive cash flows from continuing operations of $12.1 million for the nine months ended September 30, 2025. We have primarily financed our operations through private and public sales of equity securities and a term loan facility (“Term Loan”). As of September 30, 2025, we had cash, cash equivalents, restricted cash and short-term marketable securities of $56.1 million. Additionally, we have a Term Loan under which $22.5 million remained available to be drawn as of September 30, 2025 for the purchase of certain equipment, and we were in full compliance with our debt covenants under the Term Loan as of that date. See Note 6, Long-Term Debt, to the condensed consolidated financial statements included in Part I, Item 1, Financial Statements, of this Quarterly Report on Form 10-Q for a further discussion on our Term Loan.

Previous wording

We expect operating losses to continue in 2025 as we continue to invest in growing our business and our infrastructure. Our primary sources of liquidity are cash flows generated from operations, cash on hand and borrowings available under the Term Loan. Our primary use of cash includes seller payouts, operating costs such as distribution network spend, product and technology, marketing, personnel-related expenses, and other expenditures necessary to support our operations and our growth. Additionally, our primary capital expenditures are related to the set-up, expansion and/or automation of our distribution network. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term marketable securities will be sufficient for at least the next 12 months and beyond to meet our short and long-term capital requirements, and we do not anticipate expanding our distribution network to include additional locations in the near term. Our cash flow forecast is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially.

Current wording

We expect operating losses to continue in 2025 as we continue to invest in growing our business and our infrastructure. Our primary sources of liquidity are cash flows generated from operations, cash on hand and borrowings available under the Term Loan. Our primary uses of cash include seller payouts, operating costs such as distribution network spend, product and technology, marketing, personnel-related expenses, and other expenditures necessary to support our operations and our growth, as well as repayments on our Term Loan. Additionally, our primary capital expenditures are related to the set-up, expansion and/or automation of our distribution network. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term marketable securities will be sufficient for at least the next 12 months and beyond to meet our short and long-term capital requirements, and we do not anticipate expanding our distribution network to include additional locations in the near term. Our cash flow forecast is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially.

Previous wording

Net cash provided by continuing operating activities was $6.1 million during the six months ended June 30, 2025, compared to $0.3 million during the six months ended June 30, 2024. The $5.8 million increase in continuing operating cash inflows was primarily due to a $11.2 million decrease in our loss from continuing operations, partially offset by a $4.2 million decrease in non-cash charges and a $1.1 million net use of cash from changes in operating assets and liabilities. The decrease in non-cash charges was primarily related to a $3.6 million reduction in stock-based compensation expense as a result of the March 2024 workforce reorganization, and a $1.0 million decrease in depreciation expense due to the accelerated depreciation recorded in the fourth quarter of 2024 for warehouse equipment we no longer plan to use. The $1.1 million net decrease in operating assets and liabilities was primarily attributable to cash outflows of $2.3 million from overall lower accounts payable and accrued and other liabilities, primarily reflecting the timing of vendor and bonus payments; $1.6 million from higher accounts receivable, reflecting the timing of cash receipts from payment processors; and $1.4 million from higher other current assets, primarily related to lower sales of owned inventory. These were partially offset by cash inflows of $3.6 million from higher seller payable, primarily reflecting the timing of seller credit cash-outs or redemptions and conversions to gift cards.

Current wording

Net cash provided by continuing operating activities was $12.1 million during the nine months ended September 30, 2025, compared to $4.2 million for the same period in 2024. The $7.9 million increase in continuing operating cash inflows was primarily due to a $17.3 million decrease in our loss from continuing operations, partially offset by a $6.2 million decrease in non-cash charges and a $3.3 million net use of cash from changes in operating assets and liabilities. The decrease in non-cash charges was primarily related to a $5.3 million reduction in stock-based compensation expense as a result of the March 2024 workforce reorganization, and a $1.4 million decrease in depreciation expense due to the accelerated depreciation recorded in the fourth quarter of 2024 for warehouse equipment we no longer plan to use. The $3.3 million net decrease in operating assets and liabilities was primarily attributable to cash outflows of $3.9 million from accounts payable, accrued and other liabilities, primarily reflecting the timing of vendor payments and executive bonus program for 2025; $3.6 million from other assets, primarily related to lower sales of owned inventory and the timing of payments and receipts related to prepaid expenses and other receivables; and $1.1 million from accounts receivable, reflecting the timing of cash receipts and higher sales volume near the end of the quarter. These were partially offset by cash inflows of $4.8 million from seller payable, primarily reflecting an increase in seller credit issuance.

Previous wording

Net cash provided by continuing investing activities for the six months ended June 30, 2025 was $1.0 million as compared to net cash used in continuing investing activities of $4.1 million for the same period in 2024. The $5.1 million increase in cash inflows was primarily due to a $6.1 million decrease in purchases of marketable securities and a $2.2 million increase in sale and maturities of marketable securities, partially offset by a $3.1 million increase in purchases of property and equipment.

Current wording

Net cash used in continuing investing activities for the nine months ended September 30, 2025 was $0.9 million as compared to $7.2 million for the same period in 2024. The $6.3 million increase in cash inflows was primarily due to a $11.7 million decrease in purchases of marketable securities, partially offset by a $4.6 million increase in purchases of property and equipment and a $0.8 million decrease in sale and maturities of marketable securities.

Previous wording

Net cash provided by continuing financing activities for the six months ended June 30, 2025 was $2.1 million as compared to net cash used in continuing financing activities of $2.7 million for the same period in 2024. The $4.7 million increase in cash inflows was primarily due to a $13.1 million increase in proceeds from issuance of stock-based awards, driven by a higher stock price, partially offset by a $8.3 million increase in payroll taxes paid on stock-based award activity.

Current wording

Net cash used in continuing financing activities for the nine months ended September 30, 2025 was $0.4 million as compared to $3.9 million for the same period in 2024. The $3.5 million increase in cash inflows was primarily due to a $19.7 million increase in proceeds from issuance of stock-based awards, driven by a higher stock price, partially offset by a $16.2 million increase in payroll taxes paid on stock-based award activity.