1stdibs.com, Inc.

Previous wording

We define Active Buyers as buyers who have made at least one purchase through our online marketplace during the 12 months ended on the last day of the period presented, net of cancellations. A buyer is identified by a unique email address; thus an Active Buyer could have more than one account if they were to use a separate unique email address to set up each account. We believe this metric reflects scale, engagement and brand awareness, and our ability to convert user activity on our online marketplace into transactions. Our historical performance for Active Buyers may not be indicative of future performance in new Active Buyers.

Current wording

We define Active Buyers as buyers who have made at least one purchase through our online marketplace during the 12 months ended on the last day of the period presented, net of cancellations. A buyer is identified by a unique email address; thus an Active Buyer could have more than one account if they were to use a separate unique email address to set up each account. We believe this metric reflects scale, engagement and brand awareness, and our ability to convert user activity on our online marketplace into transactions. Our historical performance for Active Buyers may not be indicative of future performance in Active Buyers.

Previous wording

We define Adjusted EBITDA as net loss excluding depreciation and amortization, stock-based compensation expense, other income, net, provision for income taxes, and strategic alternative expenses. Adjusted EBITDA is a key performance measure used by our management and board of directors to assess our operating performance and the operating leverage of our business. We believe that Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses that we exclude from Adjusted EBITDA. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results, enhances the overall understanding of our past performance and future prospects, and allows for greater transparency with respect to key financial metrics used by our management in their financial and operational decision-making. See “Non-GAAP Financial Measures” for more information and for a reconciliation of net loss, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Current wording

We define Adjusted EBITDA as net loss excluding depreciation and amortization, stock-based compensation expense, other income, net, provision for income taxes, restructuring expenses and strategic alternative expenses. Adjusted EBITDA is a key performance measure used by our management and board of directors to assess our operating performance and the operating leverage of our business. We believe that Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses that we exclude from Adjusted EBITDA. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results, enhances the overall understanding of our past performance and future prospects, and allows for greater transparency with respect to key financial metrics used by our management in their financial and operational decision-making. See “Non-GAAP Financial Measures” for more information and for a reconciliation of net loss, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Previous wording

Cost of revenue includes payment processor fees and hosting expenses. Cost of revenue also includes expenses associated with payroll, employee benefits, stock-based compensation, other headcount-related expenses associated with personnel supporting revenue-related operations and logistics, consulting costs, and amortization expense related to our capitalized internal-use software.

Current wording

Cost of revenue includes payment processor fees and hosting expenses. Cost of revenue also includes payroll, employee benefits, stock-based compensation, other headcount-related expenses associated with personnel supporting revenue-related operations and logistics, consulting costs, and amortization expense related to our capitalized internal-use software.

Previous wording

Sales and marketing expenses include payroll, employee benefits, stock-based compensation, other headcount-related expenses associated with sales and marketing personnel, advertising expense, consulting costs, and promotional discounts offered to new and existing buyers. Advertising expenses consist primarily of costs incurred promoting and marketing our services, such as costs associated with acquiring new users through performance-based marketing, social media programs, email, and events. Promotional discounts and incentives represent incentives solely to end buyers and, therefore, are not considered payments made to our customers. Buyers are not our customers because access to the 1stDibs online marketplace is free for buyers, and we have no performance obligations with respect to buyers; we consider our sellers to be our customers.

Current wording

Sales and marketing expenses include payroll, employee benefits, stock-based compensation, other headcount-related expenses associated with sales and marketing personnel, advertising expense, consulting costs, and promotional discounts offered to new and existing buyers. Advertising expenses consist primarily of costs incurred promoting and marketing our services, such as costs associated with acquiring new users through performance-based marketing, social media programs, email, and events. Promotional discounts and incentives represent incentives solely to buyers and, therefore, are not considered payments made to our customers. Buyers are not our customers because access to the 1stDibs online marketplace is free for buyers, and we have no performance obligations with respect to buyers; we consider our sellers to be our customers.

Previous wording

Provision for transaction losses primarily consists of transaction loss expense associated with our buyer protection program, including damages to products caused by shipping and transit, items that were not received or not as described by the seller, and reimbursements to buyers at our discretion if they are dissatisfied with their experience. The provision for transaction losses also includes bad debt expense associated with our accounts receivable balance.

Current wording

Provision for transaction losses primarily consists of transaction loss expense associated with our buyer protection program, including damages to products caused in shipping and transit, items that were not received or not as described by the seller, and reimbursements to buyers at our discretion if they are dissatisfied with their experience. The provision for transaction losses also includes bad debt expense associated with our seller accounts receivable balance.

Previous wording

Net revenue was generally consistent with $22.1 million for the three months ended June 30, 2025, as compared to $22.2 million for the three months ended June 30, 2024. The $0.1 million decrease was primarily driven by a decrease in GMV which was due to a decrease in number of orders. Net revenue decreased at a lower rate than GMV due to a lower number of high dollar orders which have lower commission rates. While the impacts are difficult to isolate and quantify, we believe our GMV, number of orders, and net revenue have continued to be impacted negatively, both directly and indirectly, by macroeconomic factors, including significant housing market volatility, significant capital market volatility, and global economic and geopolitical developments. We believe we have, and continue to work to position the business to benefit from an improvement in macroeconomic factors.

Current wording

Net revenue was $22.0 million for the three months ended September 30, 2025, as compared to $21.2 million for the three months ended September 30, 2024. The increase of $0.8 million, or 4%, was primarily driven by an increase in GMV which was mainly due to an increase in average order value for the three months ended September 30, 2025. While the impacts are difficult to isolate and quantify, we believe our GMV, number of orders, and net revenue have continued to be impacted negatively, both directly and indirectly, by macroeconomic factors, including significant housing market volatility, significant capital market volatility, and global economic and geopolitical developments. We believe we have, and continue to work to position the business to benefit from an improvement in macroeconomic factors.

Previous wording

Our marketplace transaction fees represent the majority of our net revenue and accounted for 74% and 75% of our net revenue for the three months ended June 30, 2025 and 2024, respectively. Subscription fees accounted for 22% and 21% of our net revenue for the three months ended June 30, 2025 and 2024, respectively.

Current wording

Our marketplace transaction fees represent the majority of our net revenue and accounted for 74% of our net revenue for each of the three months ended September 30, 2025 and 2024. Subscription fees accounted for 21% and 22% of our net revenue for the three months ended September 30, 2025 and 2024, respectively.

Previous wording

Gross profit was $15.9 million and gross margin was 71.8% for the three months ended June 30, 2025, as compared to gross profit of $15.9 million and gross margin of 71.7% for the three months ended June 30, 2024. Gross profit and gross margin for the three months ended June 30, 2025 was generally consistent to the three months ended June 30, 2024 due to the consistent fluctuations in both net revenue and cost of revenue as outlined above.

Current wording

Gross profit was $16.3 million and gross margin was 74.3% for the three months ended September 30, 2025, as compared to gross profit of $15.0 million and gross margin of 71.0% for the three months ended September 30, 2024. The increase in gross profit and gross margin for the three months ended September 30, 2025 was primarily driven by the decrease in cost of revenue, and to a lesser extent, the increase in net revenue, as outlined above.

Previous wording

Sales and marketing expense was $17.3 million for the six months ended June 30, 2025, as compared to $18.4 million for the six months ended June 30, 2024. The decrease of $1.2 million, or 6%, was primarily driven by a $0.6 million decrease in salaries and benefits resulting from decreases in headcount, primarily related to our reduction in workforce in January 2025 and a $0.4 million decrease in promotional campaigns.

Current wording

Sales and marketing expense was $8.0 million for the three months ended September 30, 2025, as compared to $9.1 million for the three months ended September 30, 2024. The decrease of $1.2 million, or 13%, was mainly due to a $1.2 million decrease in performance-based marketing and promotional campaigns. We also had $0.7 million in savings from our January 2025 reduction in workforce which was offset by the $0.8 million of severance expense due to our September 2025 reorganization.

Previous wording

Technology development expense was $5.9 million for the three months ended June 30, 2025, as compared to $5.5 million for the three months ended June 30, 2024. The increase of $0.4 million, or 8%, was primarily driven by a $0.4 million increase in salaries and benefits resulting from our annual compensation increases in March.

Current wording

Technology development expense was $5.9 million for the three months ended September 30, 2025, as compared to $5.5 million for the three months ended September 30, 2024. The increase of $0.4 million, or 8%, was primarily driven by a $0.5 million increase in salaries and benefits mainly due to our annual compensation increases in March and additional bonus awards during the three months ended September 30, 2025.

Previous wording

Provision for transaction losses was $1.0 million for the three months ended June 30, 2025, as compared to $0.8 million for the three months ended June 30, 2024. The increase of $0.1 million, or 17%, was primarily driven by an increase in the reserves for bad debt.

Current wording

Provision for transaction losses was $0.8 million for the three months ended September 30, 2025, as compared to $0.9 million for the three months ended September 30, 2024. The decrease of $0.2 million, or 16%, was primarily driven by a decrease in the reserves for bad debt.

Previous wording

Other income, net was $1.4 million for the three months ended June 30, 2025, as compared to $2.1 million for the three months ended June 30, 2024. The decrease of $0.6 million, or 31%, was primarily due to lower interest income driven by lower cash, cash equivalents, and short-term investments for the three months ended June 30, 2025 coupled with interest rate drops throughout 2024 which caused lower rates for all of 2025.

Current wording

Other income, net was $1.2 million for the three months ended September 30, 2025, as compared to $1.7 million for the three months ended September 30, 2024. The decrease of $0.5 million, or 28%, was due mainly to lower interest income driven by lower cash, cash equivalents, and short-term investments for the three months ended September 30, 2025 coupled with lower interest rates.

Previous wording

Net revenue was $44.7 million for the six months ended June 30, 2025, as compared to $44.3 million for the six months ended June 30, 2024. The increase of $0.4 million, or 1%, was primarily driven by an increase in GMV of 1% from the six months ended June 30, 2024.

Current wording

Net revenue was $66.7 million for the nine months ended September 30, 2025, as compared to $65.5 million for the nine months ended September 30, 2024. The increase of $1.2 million, or 2%, was primarily driven by an increase in GMV which was mainly due to an increase in average order value.

Previous wording

Our marketplace transaction fees represent the majority of our net revenue and accounted for 75% and 75% of our net revenue for the six months ended June 30, 2025 and 2024, respectively. Subscription fees accounted for 21% and 22% of our net revenue for the six months ended June 30, 2025 and 2024, respectively.

Current wording

Our marketplace transaction fees represent the majority of our net revenue and accounted for 74% of our net revenue for each of the nine months ended September 30, 2025 and 2024. Subscription fees accounted for 21% and 22% of our net revenue for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

Cost of revenue was generally consistent with $12.5 million for the six months ended June 30, 2025, as compared to $12.4 million for the six months ended June 30, 2024, an increase of less than $0.1 million. There were increases of $0.3 million in net shipping expense and $0.2 million in salaries and benefits due to annual compensation increases in March. These increases were partially offset by a $0.4 million decrease in credit card processing fees due to better pricing negotiated with one of our main payment processors.

Current wording

Cost of revenue was $18.1 million for the nine months ended September 30, 2025, as compared to $18.5 million for the nine months ended September 30, 2024, The decrease of $0.4 million, or 2%, was primarily driven by a $0.5 million decrease in credit card processing fees due to better pricing negotiated with one of our main payment processors, partially offset by a $0.3 million increase in salaries and benefits due to annual compensation increases in March.

Previous wording

Gross profit was $32.2 million and gross margin was 72.1% for the six months ended June 30, 2025, as compared to gross profit of $31.9 million and gross margin of 72.1% for the six months ended June 30, 2024. Gross profit and gross margin for the six months ended June 30, 2025 were generally consistent due to the fluctuations in both net revenue and cost of revenue as outlined above.

Current wording

Gross profit was $48.6 million and gross margin was 72.8% for the nine months ended September 30, 2025, as compared to gross profit of $47.0 million and gross margin of 71.7% for the nine months ended September 30, 2024. The increase in gross profit and gross margin for the nine months ended September 30, 2025 was primarily driven by the decrease in cost of revenue and increase in net revenue as outlined above.

Previous wording

Sales and marketing expense was $8.1 million for the three months ended June 30, 2025, as compared to $9.3 million for the three months ended June 30, 2024. The decrease of $1.1 million, or 12%, was primarily driven by a $0.5 million decrease in performance-based marketing and promotional campaigns, as well as a $0.5 million decrease in salaries and benefits and a $0.2 million decrease in stock-based compensation, both resulting from decreases in headcount, primarily related to our reduction in workforce in January 2025.

Current wording

Sales and marketing expense was $25.2 million for the nine months ended September 30, 2025, as compared to $27.6 million for the nine months ended September 30, 2024. The decrease of $2.4 million, or 9%, was mainly due to a $1.5 million decrease in performance-based marketing and promotional campaigns, and a $0.8 million decrease in salaries, benefits, and stock-based compensation resulting from decreases in headcount primarily related to our reduction in workforce in January 2025. The decrease in salaries and benefits were partially offset by the severance expense related to our September 2025 reorganization.

Previous wording

Technology development expense was $11.5 million for the six months ended June 30, 2025, as compared to $10.2 million for the six months ended June 30, 2024. The increase of $1.3 million, or 13%, was primarily driven by a $1.1 million increase in salaries and benefits and a $0.2 million increase in stock-based compensation expense resulting from our annual compensation increases and equity grants in March.

Current wording

Technology development expense was $17.4 million for the nine months ended September 30, 2025, as compared to $15.7 million for the nine months ended September 30, 2024. The increase of $1.7 million, or 11%, was mainly due to a $1.6 million increase in salaries and benefits resulting from our annual compensation increases in March.

Previous wording

General and administrative expense was $6.6 million for the three months ended June 30, 2025, as compared to $6.9 million for the three months ended June 30, 2024. The decrease of $0.3 million, or 4%, was primarily driven by a $0.3 million decrease in salaries and benefits as a result of our restructuring costs in the three months ended June 30, 2024.

Current wording

General and administrative expense was $19.9 million for the nine months ended September 30, 2025, as compared to $20.8 million for the nine months ended September 30, 2024. The decrease of $0.8 million, or 4%, was mainly due to a $0.9 million decrease in salaries and wages as a result of our 2024 reductions in workforce.

Previous wording

Provision for transaction losses was $1.9 million for the six months ended June 30, 2025, as compared to $1.2 million for the six months ended June 30, 2024. The increase of $0.6 million, or 51%, was primarily driven by a provision adjustment in the prior year resulting from a change in estimate based upon historical trend analysis as well as the timing and volume of claims.

Current wording

Provision for transaction losses was $2.7 million for the nine months ended September 30, 2025, as compared to $2.2 million for the nine months ended September 30, 2024. The increase of $0.5 million, or 22%, was mainly due to a provision adjustment in the prior year resulting from a change in estimate based upon historical trend analysis as well as the timing and volume of claims.

Previous wording

Other income, net was $2.9 million for the six months ended June 30, 2025, as compared to $4.1 million for the six months ended June 30, 2024. The decrease of $1.2 million, or 30%, was primarily due to lower interest income driven by lower cash, cash equivalents, and short-term investments for the six months ended June 30, 2025 coupled with interest rate drops throughout 2024 which caused lower rates for all of 2025.

Current wording

Other income, net was $4.1 million for the nine months ended September 30, 2025, as compared to $5.8 million for the nine months ended September 30, 2024. The decrease of $1.7 million, or 30%, was mainly due to lower interest income driven by lower cash, cash equivalents, and short-term investments for the nine months ended September 30, 2025 coupled with lower interest rates.

Previous wording

•The exclusion of other income, net, which includes interest income related to our cash, cash equivalents and short-term investments and realized and unrealized gains and losses on foreign currency exchange; and

Current wording

•The exclusion of other income, net, which includes interest income related to our cash, cash equivalents and short-term investments and realized and unrealized gains and losses on foreign currency exchange;

Previous wording

•The exclusion of strategic alternative expenses in connection with capital return strategies, buy- and sell-side mergers, acquisitions and partnerships which include integration costs, sale of a business or subsidiary, business optimization costs related to revisions of operational objectives and priorities which include restructuring charges, in all cases outside the ordinary course.

Current wording

•The exclusion of strategic alternative expenses in connection with capital return strategies, buy and sell-side mergers, acquisitions, partnerships and divestitures, including integration costs.

Previous wording

We define Adjusted EBITDA as our net loss, excluding: (1) depreciation and amortization; (2) stock-based compensation expense; (3) other income, net; (4) provision for income taxes; and (5) strategic alternative expenses. The following table provides a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA:

Current wording

We define Adjusted EBITDA as our net loss, excluding: (1) depreciation and amortization; (2) stock-based compensation expense; (3) other income, net; (4) provision for income taxes; (5) restructuring expenses; and (6) strategic alternative expenses. The following table provides a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA:

Previous wording

As of June 30, 2025, we had cash, cash equivalents and short-term investments of $94.3 million and an accumulated deficit of $341.5 million. Net cash used in operating activities was $5.2 million in the six months ended June 30, 2025. We expect operating losses and negative cash flows from operations to continue in the foreseeable future as we continue to strategically invest in growth activities. Our principal use of cash is to fund our operations including platform development to support our strategic initiatives.

Current wording

As of September 30, 2025, we had cash, cash equivalents and short-term investments of $93.4 million and an accumulated deficit of $345.0 million. Net cash used in operating activities was $6.7 million in the nine months ended September 30, 2025. We expect operating losses to continue in the foreseeable future as we continue to strategically invest in growth activities. Our cash flows, including net cash used in or provided by operating activities, may vary from quarter to quarter, due to the timing of payments to sellers, vendor contracts and prepayments, annual bonuses, marketing related expenses, and other factors. Our principal use of cash is to fund our operations including platform development to support our strategic initiatives and anticipated share repurchases under our Stock Repurchase Programs.

Previous wording

During the six months ended June 30, 2025, 477,992 shares of our common stock were purchased for a total cost of $1.8 million and approximately $2.0 million remains available for future purchases. The following table summarizes total treasury stock purchased under each of the Company's programs as of the periods presented:

Current wording

During the nine months ended September 30, 2025, 477,992 shares of our common stock were purchased for a total cost of $1.8 million and approximately $2.0 million remains available under our 2024 Stock Repurchase Program.

Previous wording

Net cash used in operating activities was $5.2 million for the six months ended June 30, 2025 and was driven primarily by changes in operating assets and liabilities, including a $2.0 million decrease in operating lease liabilities due to our monthly operating lease payments, a $1.7 million decrease in accounts payable and accrued expenses due to timing of payments and invoices, and a $1.3 million increase in prepaid expenses and other current assets due to timing of prepaid contracts.

Current wording

Net cash used in operating activities was $6.7 million for the nine months ended September 30, 2025 and was due mainly to changes in operating assets and liabilities, including a $3.1 million decrease in operating lease liabilities due to our operating lease payments, a $1.8 million increase in prepaid expenses and other current assets due to timing of prepaid contracts, a $1.5 million decrease in payables due to sellers as a result of timing of when sellers are paid, and a $1.1 million decrease in accounts payable and accrued expenses due to the timing of vendor invoices and related invoices.

Previous wording

Net cash used in operating activities was $5.7 million for the six months ended June 30, 2024, and was driven primarily by a $3.6 million change in accounts payable and accrued expenses due to timing of payments and invoices, including our annual bonuses which were paid in March 2024 and a $1.4 million change in operating lease liabilities due to the continued lease payments on our previous and current NYC headquarters, partially offset by our sublease income.

Current wording

Net cash used in operating activities was $5.7 million for the nine months ended September 30, 2024, and was driven primarily by a $2.2 million decrease in accounts payable and accrued expenses due to the timing of payments and invoices, a $2.2 million decrease in operating lease liabilities due to the continued lease payments on our previous and current NYC headquarters, partially offset by our sublease income, and a $1.8 million decrease in other current liabilities and other liabilities related to payments to settle multiple Sales and other non-income tax contingencies. Theses decreases were partially offset by a $2.7 million increase in payables due to sellers due to timing of the bi-weekly payments we make to our sellers.

Previous wording

Net cash provided by investing activities was $5.9 million for the six months ended June 30, 2025, and was driven primarily by $38.8 million in maturities and sales of short-term investments, partially offset by $32.5 million in purchases of short-term investments.

Current wording

Net cash provided by investing activities was $4.2 million for the nine months ended September 30, 2025, and was mainly due to by $56.8 million in maturities and sales of short-term investments, partially offset by $51.9 million in purchases of short-term investments.

Previous wording

Net cash provided by investing activities was $15.3 million for the six months ended June 30, 2024, and was driven primarily by $67.8 million maturities and sales of short-term investments, partially offset by $51.5 million purchases of short-term investments.

Current wording

Net cash provided by investing activities was $15.3 million for the nine months ended September 30, 2024, and was driven primarily by $85.6 million maturities and sales of short-term investments, partially offset by $68.9 million purchases of short-term investments.

Previous wording

Net cash used in financing activities was $3.1 million for the six months ended June 30, 2025, and was driven primarily by $1.8 million in purchases of our common stock as part of our 2024 Stock Repurchase Program and $1.3 million of payments for taxes related to net share settlements of stock-based compensation awards.

Current wording

Net cash used in financing activities was $3.8 million for the nine months ended September 30, 2025, and was driven primarily by $2.0 million of payments for taxes related to net share settlements of stock-based compensation awards and $1.8 million in repurchases of our common stock as part of our 2024 Stock Repurchase Program.

Previous wording

Net cash used in financing activities was $23.1 million for the six months ended June 30, 2024, and was driven primarily by $21.9 million in purchases of our common stock as part of our Stock Repurchase Program and $2.0 million of payments for taxes related to net share settlements of stock-based compensation awards, partially offset by $0.8 million in proceeds from the exercise of stock options.

Current wording

Net cash used in financing activities was $25.2 million for the nine months ended September 30, 2024, and was driven primarily by $22.8 million in repurchases of our common stock as part of our 2023 and 2024 Stock Repurchase Programs and $3.2 million of payments for taxes related to net share settlements of stock-based compensation awards, partially offset by $0.8 million in proceeds from the exercise of stock options.