0001484778-26-000007
SEC filingRevenue grew 19.5% to $310.8M, gross margin dipped 30bps to 79.4%, and operating loss narrowed by 49.5% amid strong order growth.
ThredUp operates one of the world’s largest online resale platforms for apparel, shoes and accessories. The company’s mission is to inspire the world to think secondhand first. Its custom-built operating platform consists of distributed processing infrastructure, proprietary software and systems, and data science expertise, powering the rapidly emerging resale economy.
The Business section does not define separate reporting segments. All commentary pertains to continuing US operations following the divestiture of 91.0% of Remix (European business) in November 2024.
ThredUp’s core marketplace allows buyers in the U.S. to browse and purchase resale items at up to 90% off estimated retail price. Sellers use a Clean Out Bag service, filling and returning bags using a prepaid label. The company also offers Resale-as-a-Service (RaaS) to brands and retailers, enabling them to offer closet clean out services and resale shops. AI-powered shopping tools include improved search with natural language prompts, AI-powered image search, and Style Chat, an AI chatbot for outfit creation.
Revenue is primarily derived from consignment sales (net of seller payouts, discounts, incentives, and returns) and bag fees charged to sellers. The company sells directly to consumers through its website and mobile app, and partners with brands and retailers via RaaS. No customer concentration is disclosed in the Business section.
ThredUp faces intense competition from secondhand marketplaces (eBay, Goodwill, Mercari, Poshmark, The RealReal, Vinted, Vestiaire Collective), large online and discount retailers (Amazon, Target, Walmart), off-price retailers (Burlington, Ross, TJX), and low-cost fast-fashion retailers (Shein, Temu). The company competes on buyer and seller experience, product quality and assortment, breadth of brand offering, convenience, and price.
ThredUp’s strategy is built on three pillars of its operating platform: (1) Distributed Processing Infrastructure – purpose-built for single-SKU logistics, with distribution centers in Arizona, Georgia, Pennsylvania, and Texas, collectively holding over 7.5 million items and processing over 100,000 unique SKUs per day. (2) Proprietary Software and Systems – custom applications and patented automation for put-away, storage, picking, packing, quality assurance, item-attribution, sizing, and photography. (3) Data Science Expertise – using machine learning, predictive analytics, and AI to optimize pricing, seller payouts, item acceptance, merchandising, sell-through, customer acquisition, and personalization. Additionally, the RaaS offering is intended to accelerate category growth and supplement supply.
As of December 31, 2025, ThredUp had 2,132 employees and professional contractors, including 1,817 distribution center employees. No employees are represented by a labor union or covered by a collective bargaining agreement. The company supplements its workforce with contractors and consultants, including Ukrainian engineering specialists operating as independent contractors. ThredUp is committed to diversity, with a workforce that is majority female and underrepresented minorities. Eligible US-based employees enjoy benefits including an employee stock purchase plan, 401k plan, and an eight-week paid sabbatical after three years of service.
For the year ended December 31, 2025, ThredUp's revenue from continuing operations increased 19.5% to $310.8 million, compared to $260.0 million in 2024. The growth was primarily driven by a 25.3% increase in Orders, supported by higher engagement from new buyers. Average order value declined 0.6%, and higher discounts and changes in seller payout mix partially offset the revenue gain. Gross profit rose 19.1% to $246.8 million, but gross margin contracted 30 basis points to 79.4%, mainly due to higher outbound shipping and packaging costs.
Loss from continuing operations improved significantly, narrowing 49.5% to $20.2 million (6.5% of revenue) from $40.0 million (15.4% of revenue) in the prior year. This improvement reflects better operating leverage and cost discipline. Non-GAAP Adjusted EBITDA from continuing operations grew 55.8% to $13.5 million, with margin expanding from 3.3% to 4.4%.
ThredUp operates as a single reportable segment, with all revenue generated from its online resale marketplace, including RaaS offerings. The business model is primarily consignment-based, with product revenue becoming immaterial. Growth was fueled by a 29.5% increase in Active Buyers to 1.65 million and a 25.3% rise in Orders to 6.1 million. Marketing expenses increased 21.3% in absolute dollars but remained relatively stable as a percentage of revenue at 19.0%, reflecting investment in customer acquisition. Operations, product and technology expenses grew only 7.5% and declined as a percentage of revenue from 54.7% to 49.2%, demonstrating improved operating efficiency and economies of scale. Sales, general and administrative expenses decreased slightly (0.4%) and fell as a percentage of revenue from 21.9% to 18.2%, driven by lower stock-based compensation and severance costs, partially offset by higher payment processing fees and customer appeasement costs.
ThredUp expects to continue incurring operating losses in 2026 as it invests in growth and infrastructure. Management anticipates modest capital expenditures in 2026 and does not plan to expand the distribution network with additional locations in the near term. The company believes its existing cash, cash equivalents, and short-term marketable securities ($53.1 million as of December 31, 2025) plus cash flows from operations will be sufficient for at least the next 12 months. The OBBBA tax reform enacted in July 2025 did not have a material impact on the financial statements.
As of December 31, 2025, ThredUp held $38.6 million in cash and cash equivalents and $9.5 million in marketable securities, totaling $48.1 million in liquid assets. Total debt stood at $18.3 million (term loan), with a current portion of $3.9 million and non-current of $14.3 million. Shareholders' equity was $59.2 million, an increase from $56.3 million in 2024, driven by stock issuances and stock-based compensation offset by net loss. The company had no outstanding borrowings on its $22.5 million undrawn committed facility (reduced to $10.0 million post-balance-sheet amendment).
Non-cancellable purchase commitments totaled $3.45 million as of December 31, 2025, primarily for software and other services, with payments due: $1.5 million in 2026, $1.3 million in 2027, and $0.6 million in 2028. The company also has operating lease obligations of $40.7 million undiscounted, with $7.4 million due in 2026. No material purchase obligations for inventory or capacity were disclosed.
ThredUp did not repurchase any shares or pay dividends during 2025. Capital expenditures totaled $10.5 million, representing 3.4% of revenue, primarily for machinery and equipment and internal-use software. The company repaid $4.0 million on its term loan, reducing outstanding debt to $18.3 million. No new debt was issued. Post-balance-sheet, on January 30, 2026, the company amended its loan agreement to extend maturity to 2030, reduce the undrawn facility to $10.0 million, and switch to SOFR-based pricing.
ThredUp operates as a single reportable segment. The chief operating decision maker reviews consolidated financial information. No further segment disclosure is provided. Revenue is generated entirely from the U.S. resale platform following the divestiture of the European business (Remix) in 2024. The discontinued operations contributed $47.3 million in revenue for 2024 but none in 2025.
ThredUp’s growth depends on attracting and retaining buyers and sellers; failure could reduce revenue. The supply of high-quality secondhand items is critical, and any decline in seller participation or item quality could harm margins. The company’s AI/ML initiatives, while potentially beneficial, carry risks of flawed algorithms, biases, and regulatory scrutiny. Macroeconomic headwinds, including inflation, geopolitical conflicts (Ukraine, Middle East), and reduced consumer spending, pose near-term threats. Competition is intense, with larger players able to offer broader supply and lower prices.
Distribution centers are vulnerable to natural disasters, contamination, and labor shortages. ThredUp relies on third-party shippers (FedEx, UPS) and cloud providers (AWS, Shopify); any disruption could impair operations. Fraud and counterfeit items remain concerns, though the company has authentication processes.
Data breaches or privacy compliance failures (e.g., CCPA) could lead to significant costs and reputational harm. The company’s use of open-source software may create licensing liabilities. Dependence on third-party technology (AWS, payment processors) increases vulnerability to outages.
ThredUp must comply with various laws governing e-commerce, secondhand sales, and consumer protection. Tax law changes, especially the OBBBA, could increase costs. NOL carryforwards may be limited under Section 382. Loss of emerging growth company status in 2026 will increase compliance burdens.
The company has a history of losses ($20.2M in 2025) and expects increasing expenses. Additional capital may be needed, potentially diluting stockholders. The loan agreement with Western Alliance Bank imposes restrictive covenants and liquidity requirements; failure to comply could accelerate debt repayment.
The provided excerpt from ThredUp's 10-K for the year ended December 31, 2025 contains only the beginning of the Consolidated Statements of Cash Flows. The only line item shown is 'Loss from continuing operations' which is a net income metric, not a cash flow figure. No operating cash flow, investing cash flow, financing cash flow, or capital expenditures are disclosed in the text. Therefore, an assessment of cash flow quality, including CFO vs net income, capex intensity, and free cash flow coverage, cannot be made. The balance sheet shows cash and cash equivalents of $38.6M and marketable securities of $9.5M as of December 31, 2025, but these do not provide insight into cash generation from operations. Further pages of the filing would be required for a complete analysis.