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01/09 22:04
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary reflects strong financial performance, with significant growth in GMV and revenue projections, and positive EBITDA outlook. The company is making strategic investments in AI, automation, and marketing, which are expected to drive efficiency and growth. The Q&A section highlights management's confidence in their strategies and market position, despite some uncertainties. The announcement of new initiatives and partnerships, along with positive cash flow projections, further supports a positive sentiment. Overall, these factors suggest a likely stock price increase of 2% to 8% over the next two weeks.
GMV (Gross Merchandise Value) $520 million, up 20% year-over-year. Growth was driven roughly evenly by unit volume and higher average selling prices.
Revenue $174 million, up 17% year-over-year. Consignment revenue increased 15% year-over-year, and direct revenue increased 47% compared to Q3 of 2024.
Adjusted EBITDA $9.3 million or 5.4% of total revenue, up 380 basis points year-over-year. This improvement reflects gains from operating efficiencies, AI, and automation.
Free Cash Flow $14 million, a $12 million improvement year-over-year, demonstrating favorable cash dynamics as the business grows.
Average Order Value $584, up 12% year-over-year, driven by higher average selling prices.
Take Rate 37.9%, declined 70 basis points year-over-year due to a mix into higher-value items and categories.
Gross Profit $129 million, up 16% year-over-year. Gross margin was 74.3%, down 60 basis points compared to the prior year due to a higher mix of direct revenue.
Operating Expenses $136 million, leveraged 620 basis points year-over-year as a percent of revenue. Excluding stock-based compensation, operating expenses leveraged by 470 basis points.
Active Buyer Base More than 1 million active buyers, up 7% year-over-year, marking a new all-time high.
Operating Cash Flow $19 million, a $10 million improvement year-over-year.
Fine Jewelry: Fastest-growing category with a 46% increase in first-time watch buyers, led by heritage brands.
Wedding Dresses: Search volume increased by 247%, indicating a growing trend for major life milestones.
Handbags: Searches for fair condition handbags increased by 32%, showing a shift towards the 'lived-in' look.
Luxury Resale Market: Solidified position as a market leader with a total addressable market of over $200 billion in untapped supply in U.S. closets.
Retail Stores: Currently operating 18 locations with plans to add 1-3 stores per year, providing a 10-year growth runway.
AI-Enabled Product Intake (Athena): Touched 27% of all items, aiming for 30-40% by year-end, with a goal to reduce processing time from 14 days to 7 days.
Sales Team Productivity: Supply value per luxury manager increased by 12% year-over-year, supported by AI tools and a new compensation plan.
Flywheelers Strategy: Focus on customers participating in both buying and selling, who are 2-3x more valuable and transact more frequently.
AI-Fueled Marketing: Developing a smart prospecting engine to enhance targeting of new consignors and combining organic and paid social media for brand relevance.
Market Conditions: The company faces potential risks from economic uncertainties that could impact consumer spending on luxury resale items. While the market for resale is growing, economic downturns or reduced consumer confidence could adversely affect demand.
Competitive Pressures: The luxury resale market is becoming increasingly competitive, with other players entering the space. This could lead to pricing pressures and challenges in maintaining market share.
Regulatory Hurdles: The company operates in a space that may face evolving regulations, particularly around resale and secondhand goods. Compliance with these regulations could increase operational costs.
Supply Chain Disruptions: Although not explicitly mentioned, the reliance on consignors and the supply of luxury goods could be disrupted by external factors such as economic conditions or logistical challenges.
Strategic Execution Risks: The company’s growth strategy relies heavily on AI and automation, which may face implementation challenges. Additionally, the expansion of brick-and-mortar locations and experiential events requires significant investment and operational efficiency to succeed.
Economic Uncertainties: The company’s performance is tied to consumer spending, which could be impacted by broader economic conditions, including inflation or recessionary pressures.
Full Year GMV Outlook: The company expects full year GMV in the range of $2.10 billion to $2.11 billion, reflecting a 15% growth at the midpoint of the guidance range.
Full Year Revenue Outlook: Revenue is projected to be in the range of $687 million to $690 million, representing a 15% growth at the midpoint of the guidance range.
Full Year Adjusted EBITDA Outlook: Adjusted EBITDA is expected to be between $37.7 million and $38.7 million, with an adjusted EBITDA margin of 5.5%, reflecting a 400 basis point improvement compared to 2024.
Fourth Quarter GMV Outlook: GMV is expected to range between $585 million and $595 million, representing 17% growth compared to the prior year period at the midpoint of the guidance range.
Fourth Quarter Revenue Outlook: Revenue is expected to range between $188 million and $191 million, reflecting 16% growth compared to the prior year period at the midpoint of the guidance range.
Fourth Quarter Adjusted EBITDA Outlook: Adjusted EBITDA is projected to be between $17.5 million and $18.5 million, approximately 9.5% of total revenue, with over 275 basis points of margin expansion year-over-year at the midpoint of the range.
Operational Efficiency Goals: The company aims to achieve full listing automation and reduce processing time from 14 days to 7 days, with Athena, the AI-enabled product intake process, expected to touch 30%-40% of all items by year-end.
Retail Expansion Plans: Plans to add 1 to 3 new stores per year, providing a 10-year runway for growth from new stores.
Marketing and AI Initiatives: Focus on developing an AI-fueled smart prospecting engine to enhance targeting of new consignors and building a 360-degree presence combining organic and paid social media to boost brand relevance and digital performance.
The selected topic was not discussed during the call.
The earnings call summary reflects strong financial performance, with significant growth in GMV and revenue projections, and positive EBITDA outlook. The company is making strategic investments in AI, automation, and marketing, which are expected to drive efficiency and growth. The Q&A section highlights management's confidence in their strategies and market position, despite some uncertainties. The announcement of new initiatives and partnerships, along with positive cash flow projections, further supports a positive sentiment. Overall, these factors suggest a likely stock price increase of 2% to 8% over the next two weeks.
The earnings call shows strong financial performance with improved operating expenses and cash flow. The Q&A indicates confidence in growth momentum, scalability, and margin stability, supported by strategic initiatives like AI and drop ship expansion. Despite some uncertainties in revenue guidance, the overall sentiment is positive, driven by double-digit new seller growth and effective reinvestments. The company's strategic focus and optimistic outlook for margin expansion suggest a positive stock price movement in the short term.
The earnings call highlights strong financial performance with revenue, gross profit, and adjusted EBITDA growth, alongside optimistic guidance for the next quarter and year. Although macroeconomic risks and competitive pressures are acknowledged, the company has demonstrated resilience and strategic initiatives like the Real Partners program. The absence of a share repurchase program is a minor negative, but overall, the positive financials and guidance outweigh potential risks, suggesting a positive stock price movement.
The earnings call summary reveals strong financial performance with increased revenue, improved adjusted EBITDA, and positive cash flow. Additionally, the company has provided optimistic guidance for Q4 2024 and the full year, indicating potential profitability. The Q&A section supports this sentiment, highlighting healthy supply trends, strong demand, and effective operational strategies. Despite some vague responses, the overall outlook is positive, especially with the company's focus on growth and efficiency. The absence of a market cap suggests a neutral-to-positive reaction, leading to a positive stock price movement prediction of 2% to 8%.
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