0001484778-25-000116
SEC filingThredUp's Q3 2025 revenue rose 33.6% YoY to $82.2M, driven by 37.2% order growth, with gross margin stable at 79.4%.
In Q3 2025, ThredUp delivered revenue of $82.2 million, a 33.6% increase year-over-year, driven by a 37.2% surge in Orders to 1.608 million. This was partially offset by a 4.2% decline in average order value, attributed to higher mix from new buyers who place smaller orders. Gross profit rose 33.8% to $65.2 million, with gross margin expanding 10 basis points to 79.4%, reflecting stable cost of revenue relative to sales. Loss from continuing operations narrowed significantly to $4.2 million (5.2% of revenue) from $10.4 million (16.8%) in the prior year, a 59% improvement. Non-GAAP Adjusted EBITDA turned positive at $3.8 million (4.6% margin), compared to $0.3 million (0.5%) a year ago. For the nine-month period, revenue grew 19.9% to $231.1 million, with orders up 24.6% and a slight 0.9% decline in AOV. Gross margin remained essentially flat at 79.3%, while loss from continuing operations improved 54.2% to $14.6 million.
ThredUp operates as a single segment – its managed marketplace for secondhand apparel, shoes, and accessories, inclusive of its Resale-as-a-Service (RaaS) offering. Revenue growth continues to be fueled by strong order volume, with active buyers increasing 25.6% to 1.568 million. The company successfully leveraged its platform to acquire new buyers while maintaining gross margin stability. Marketing spend rose 25.4% in Q3 to $16.2 million but declined as a percentage of revenue (19.7% vs 21.0%), illustrating improved operating leverage. Cost controls were evident across operations, product, and technology, which grew only 15.8% despite higher supply volume, and sales, general, and administrative expenses increased modestly by 14.3%. The overall mix shift toward a consignment model (product revenue no longer material) has streamlined operations.
Management expects operating losses to continue in 2025 as investments in growth persist, but cash flow from operations turned positive ($12.1 million for nine months 2025 vs $4.2 million a year ago). As of September 30, 2025, the company held $56.1 million in cash, equivalents, and short-term marketable securities, with $22.5 million available under its term loan for equipment purchases. Capital expenditures are expected to remain modest for the remainder of 2025, with no plans to expand the distribution network near term. The company's primary uses of cash include seller payouts, operating costs, and debt service, while liquidity sources are cash flows, cash on hand, and borrowings. No formal revenue or earnings guidance was provided, but the positive EBITDA trajectory and strong order growth signal improving unit economics.
As of September 30, 2025, ThredUp held cash and cash equivalents of $46.2 million and marketable securities of $4.9 million. Total cash, including restricted cash, was $51.3 million. The company had total debt of $19.1 million (net of unamortized discount) under its Term Loan, with a current portion of $3.9 million. Liquidity remains adequate with $22.5 million of undrawn capacity designated for equipment purchases. Deferred revenue stood at $1.6 million, down from $3.3 million at year-end 2024, primarily due to the discontinuation of the loyalty program. No inventory is reported separately; it was reclassified to other current assets as the company transitioned to a consignment model.
ThredUp’s primary contractual cash commitments are its operating lease liabilities and long-term debt. Operating lease liabilities totaled $35.2 million ($5.1 million current, $30.1 million non-current). Future principal payments on the Term Loan are $1.0 million in the remainder of 2025, $4.0 million in 2026, and $14.3 million in 2027. The company has no material purchase commitments or contingent liabilities, as disclosed in Note 9. Gift card and site credit liabilities were $9.2 million, and seller payable was $17.9 million, reflecting ongoing obligations to sellers and customers.
ThredUp did not repurchase any shares or pay dividends during the nine months ended September 30, 2025. The company repaid $3.0 million of its Term Loan, consistent with prior period repayments. Capital expenditures from the cash flow statement (not in Notes) are not analyzed here, but Note 6 indicates that $22.5 million remains available for equipment purchases under the Term Loan. Stock-based compensation expense totaled $14.5 million, contributing to cash flow from financing activities.
ThredUp operates as a single reportable segment. The CODM uses consolidated loss from continuing operations as the key measure of profit or loss. No geographic or finer segment economics are disclosed in the Notes. Discontinued operations (European subsidiary Remix) were divested in November 2024, with no continuing involvement.
ThredUp's operating cash flow (CFO) turned positive and significantly improved to $12.1M for the nine months ended September 30, 2025, compared to $4.2M in the prior year, despite a loss from continuing operations of $(14.6M). The divergence between CFO and net income is driven by non-cash charges (stock-based compensation $14.5M, depreciation $9.5M) and favorable working capital changes, particularly a $2.8M increase in seller payable and $4.4M in accounts payable. CapEx of $8.7M (72% of CFO) indicates moderate reinvestment, but free cash flow is not explicitly stated. Investing activities were net negative due to $13.0M in securities purchases partially offset by $20.8M in sales/maturities. Financing activities reflected $3.0M debt repayment and $19.2M in share withholding taxes, partially offset by $21.8M in stock-based award proceeds. No dividends or buybacks were reported. The cash flow statement excludes discontinued operations which had no impact in 2025. Overall, cash generation is improving but capital demands remain significant.