TDUP - Earnings call transcript Q2 2024

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Operator

Good day, everyone, and welcome to today's ThredUp Q2 2024 Earnings Call. [Operator Instructions] Please note, today's call will be recorded. [Operator Instructions]

It is now my pleasure to turn the conference over to Lauren Frasch, Head of Investor Relations.

Lauren Frasch

Good afternoon, and thank you for joining us on today's conference call to discuss ThredUp's Second Quarter 2024 Financial Results. Reinhart, and James Sobers, and are CFO. me ThredUp Co-Founder; CEO Sean With press financial and Investor posted release We our supplemental at Relations ir.thredup.com. information website our on of our This site the and webcast is will on call a available being shortly. replay this on call be website,

business strategic our for intelligence execute and I'd change machine uncertainty. market and ability year expressions the strategies Words our remind the performance, statements. and new guarantees believe, intention economic inflation, performance, to, uncertainties, as limited technologies, and full we investments as such in expect to quarters alternatives XXXX. market unknown statements a risks deploy interest effects ability the demand, guidance the and we for forward-looking strategic and similar artificial financial you buyers. to business consumer and well including exit statements will company's European not fourth identify ability and not company's begin, our Before anticipate, offerings, habits, climate of the the to as including, and course but plans, such for growth are prospects, that its seek to learning The evolving cost intended future European statements and make our increased third forward-looking business AI effectively estimate fiscal to during of of to and as of known forward-looking like and to effectively are changing identify this European and involve and alternative call, future new rates, general These global technologies, track regarding

implied any materially differ projections expressed or future statements. could forward-looking results such of results actual by performance from Our or

and posted our information more information our results today, in release as future our obligation update affect filings, operating are events. this can result we these and based to on a IR You could that and Any statements about earnings these or of statements call we make supplemental press on information website. on factors as SEC undertake forward-looking uncertainties that assumptions no other new of risks, find

the not in we substitute measures. measures a financial non-GAAP in for financial to, measures. considered addition should from or In will present call, as be These GAAP addition, during certain non-GAAP isolation

find and GAAP non-GAAP regarding supplemental can in You additional these including our measures, with disclosures on IR posted press earnings reconciliations website. release information comparable our measures

I'd Now to over turn like to Reinhart. the call James

James Reinhart

call. you I'm to everyone. Co-Founder business ThredUp's for financial joining afternoon, share significant CEO James we how We're pleased year news Thank and ThredUp. into and our and of Good the Lauren. XXXX results QX quarter the back our Thanks, for XXXX. half of share and expect to earnings Reinhart, in second about to evolve that

fourth for year provide quarter margin we a them flow next call free quarter more the further expectations We'll Sobers, will on our out new over widely financials provide our EBITDA and for the developments detail Officer, Chief adjusted I expansion, question-and-answer talk and outlook and over of month. XXXX second today's to an our to growth, then Sean products session. in hand in as launch with third to will Financial it this XXXX. close our We update cash AI

case to I explain want for challenging to on order To which This reasons, will X was start that us. get right it, a for quarter basis of I in impact. the consolidated acknowledging the specific by was

most by struggled. significantly, First, really and business European far our

customer promotions, didn't of we initiatives around new in the simply we expected. and they acquisition perform Second, and way with experimented the forms U.S.

the core continue effects compounding an to consumer Third, more we are our inflation hurt operating challenging in or incrementally customers. of environment

in adjusted even over business struggle, is quarter walk $XX you through In as fourth in in and highlight we a invested profit, our margins that cash gross the moment, in financials the I While want growing for is over to U.S. expanding the past to million all Europe, however, continued Sean will detailed has business a the that positive. business row, quarters. EBITDA X

particularly the and upon determined difficult Despite In a a negative from significant team. consignment Remix in contracted longer-term new challenging, environment posting business XX% we inflation. of in leadership, our the accelerated needs been demand that in review, EU attention midst XX% business adjusted EU consumer while of strategic persistent despite the a bringing has turnaround. QX, business transition The U.S. EBITDA our

commence made such, the alternatives. seeking to we've As decision difficult that business strategic and European our divest

are your attention to like sure make understood. There clearly very I I'd would to performance. areas U.S. turn X now are like to

value First, bit QX, lifetime midway through increased changing a on by our a customer and customers incentives. offer from driving plan spending on subsequent structure for less new marketing new retention we and embarked

increase revenue U.S. growing buyer, to strategy further bold and the With cash positive business some the a exploring by CAC to to changes. growth LTV per flow ratio to we new customer attempted testing

X then materialize into recovery in repeat off. July. acquired prior and Unfortunately, and iterate up have will not and customers to observing impact days found XX,XXX testing our retention XX to fewer be reducing also of this and estimated ourselves strategy spend reverted offer of back and The who worse June we was this nearly metrics, to seen on spend year. customers, We that June we immediate

points XX% contribution time X,XXX basis margin. period, than points. margins XXX we pricing contribution the and me flexing prices roughly margin have to when more made improving to promotions Over gains environment for promotion. margins gross optimize we and soften, unit to that let and consumer Since Second, and the with middle basis of have nearly significant back been up began to turn XXXX

per all-time Orders reached have orders of we clothing. customer engagement, results was unit unit economics have high the $XXX early active some margin been part QX, and economics more long-term of QX Total than incrementality as made environment. mixed. into as more in and for What did muted and overall in trade been QX ever, progress buyer and our increased with The experimenting strong U.S. towards than substantial at downside running X of Our to we've And demand sell-through. been profile. for reached the have active all-time buyer revenue sufficient highs buyer a that just pieces is in what given an of million buyer per see the we we not the item believe sales per those quarter

demand In this, To economics, at into sense flowed addition, we with item we June and QX. unit through summer revenue give were QX you forward pulled of a believe in from sales reduced to around and item lessons in and that pricing and will QX targeting, things a just be QX year-over-year, we early decision-making XX% apparel. month elasticity these year of demand made perform June have happened promotions take not weaker impact learned in important tends guide Rather, up choices back we and in into But X We it's the for they full that remainder us. of the the these worth to accountability strategic did a beyond. not Unfortunately, that emphasizing we the will for, well-considered considerations our were the lingering initiatives way half year. which and expected.

a getting this we're right work years segue macro turn the it product I time. But believe won't years EBITDA expansion it every the the couple over adjusted growth over right that's a initiatives our we're the seen we our U.S. of we're But navigate get to of body environment. as you've past our we in more led and have to a getting launches than as that wrong perfect. challenging of it Many past couple lot demonstrates not of steady nice And We week.

AI After shopping months of with testing, endless campaign we to are our products customers. all marketing expression launches going live new our that

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can for like Disney a Cruise letting shop only For Cod Cape now Grande. you and now back-to-school, are or fall limited New creativity. example, by Customers outfits imagination York Bahama or Ariana their for a City

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this I than a more most already have will in foundational can forward product of for a ThredUp build significant This long at on we've the customer the of the ago. infrastructure top advantage, is launched emphasize, massive a enable want brand. we had and Much inspiration. because company and launch we world-class to decade data discovery the us technology this time here beloved built technology leap to arguably from merchandising, since innovation

on of innovating new marketplaces AI a that other in their before, retailers benefits We our upside how to become in AI said business is I've these we're customer. more behalf in isn't this and As significant we fundamental experiences. of consumers plus disproportionately some accustomed types and believe upgrade This products as the see believe will business. relative we our lives, to ThredUp

how the I half broadly with to specifically. of the turn Sean, see it and want over close ThredUp thoughts few I to we Before a for on up year back shaping

environment it our job to gains. soft of inflation, agree are overall begin landings will lower with the same of stability consumer until of benefits rates and as several wage broader and expect to we feel rates many and improve. the quarters especially the from core ongoing down for peers, coming We economy. remain for not interest our commentary with interest challenging consistent First, take feel ebbing We sentiment commentary consumers landing to customers, takeoffs. think remember, consumers, the the benefits to But for

the financial election and a We indicators also the economy cycle degradation slowing jobs given remain market. and in of cautious upcoming recent U.S.

our for new half approach launch of and around and to to investments built remain on our Second, strategic of to a and generative intention cautious AI, year seek set European product of Remix experience business the March is whole general the operating of processing expenditures. marketing, the is volatility alternatives with after restructure, divest the in our first full-scale

on experience, DCs improving costs. will improvements unit our variable and normalizing to our driving lower our product economics, We our overall focus process in our efforts

or of half poised should our be field not ambition remain as to we all see decisionary improved. the could a do second more The engines just and playing halls We apparel suggests of growth conditions the aggressive. we ThredUp, of the in U.S. for teammate that in every spending in optimism accelerate

a we I may we margins, structurally opportunity. This U.S. refocus but Third, flow of back should as despite of the adjusted having us temporarily we mentioned efforts free all on predictable, faster more on once, grow and resilient, we be will forces in at This might our at and business expect catalyst earlier, more a to ahead. cash all focus believe line. EBITDA mercy ThredUp's as we come to laser-like U.S., outside our the the business remain top exclusively the significant for our with not focusing of lower economic higher the move more as control, fundamentals year defensible be of

I'll to now to turn it through more over financials the detail. in walk Sean

Sean Sobers

of the third for Thanks, I James. non-GAAP I'll follow up and fourth of discuss full with begin and my year will guidance overview XXXX. our remarks. an results and with throughout results quarters

are and Our a earnings reconciliation GAAP measures filing. financials our found in supplemental GAAP release, our financials between our XX-Q and and non-GAAP

Before into business overview I an view remainder numbers, year. of how of start the the want I in we to with get the our

U.S. due to the challenge, due outside in control in our a factors of our within factors part part control in was to and in Europe QX the

are In correcting. our report strategy of balance from our are arms that and have U.S., that impact missteps in and linger the around diagnosed James throughout acquisition QX we problem the cadence these buyer challenges. pleased described promotional year. to We the earlier QX of expect both the we course to the have we But the and

strategy While half the the weaker impact second against of absorb XX% being growth our as EBITDA be as positive. revenue XXXX, up we'd negative well will like shift half be the as the we growth we expect in in second than of to

U.S.-only several a operating and results intend quarters, our report exit for when and market but we to the been QX earnings. profitability European present our we expect Europe to on focus drag has

action to get resources to to free and increase our this focus improve gross consolidated burden flow. be path our immediately our profit without operations adjusted and margins, results. positive will EBITDA for direct prioritize our able that growth, cash gross accelerate U.S. We the of us our will optimizing We to anticipate

we and EU our exiting cost, flow free incur the Though do healthy, below balance securities cash marketable some $XX before our will million falling remains we cash anticipate not reach positive. sheet and cash

Now on to our results.

businesses. European U.S. will I of reviewing quarter, results This and be both the our

gross and in buyers, margins We U.S. supplemental providing are net also active historical revenue our financials.

challenging U.S. As were Europe. faced in the we QX with discussed, a both and

million, second a our revenue XXXX, $XX.X quarter totaled of decrease For year-over-year. of X.X% the

were representing environment X.X in X% transition the revenue of flat This decline, for net has a while buyers well challenging X.X% QX, yet revenue of consignment U.S. macro the execute expectation to a of posted buyers, million, representing X.X Europe QX, decline orders to in were to difficult decline active active inflect year-over-year. respectively. an below more a year million, million, year-over-year. be Europe our while Additionally, XX% the The and was a million million, In X.X $XX.X In quarter. to consumer environment. net to last achieved proved X.X% $XX

course approximately this on was negative strategy in implemented earlier, estimate challenged new net that to an net mid-QX, buyers corrected $X QX. us we until miss U.S. acquiring we impact causing out approximate shared to was buyer James We revenue in As our due to XX,XXX June. changes to million

starting persisting and addition, seen compounding became the and mid-April landscape in incrementally their the QX, we've inflation pressured in consumers in into intensify by In purchasing. more promotional selective U.S.

of XX.X%, however, XXX over same the For quarter gross the last points gross our higher year, XXXX, XX.X%, of margin a second U.S. XXX expectations. The basis point was achieved than basis margin quarter increase year. last lower than consolidated

to we an a to harder promotions effort consolidated addition competitive achieve mean in In market, highly our outlook. into

point lower and more gross result year-over-year, unit The of costs discount. XXX of a margin. aggressive higher dynamics, As pressuring units both by of driven posted we gross XX.X%, these a sold basis at margins EU prices decline

negative second revenue the for of $X.X was same XXXX, of EBITDA million last a GAAP second loss GAAP of net XXXX. was loss net $XX.X the quarter Adjusted million compared $XX in X.X% quarter For the to quarter year. million of loss or

in of having million adjusted Europe QX quarter $X QX, after was underperformed. In generated EBITDA QX. adjusted as EBITDA consecutive business our EBITDA generated our in million million of drag we the U.S., fourth in $X.X adjusted a meaningfully positive $X.X on

the Turning balance cash to our second was EU's million debt quarter million ended cash in $XX.X in restructuring, to CapEx paydown. the million, in and sheet. Of that, $X and $X $XX.X the quarter was began million cash QX. was from We $X.X million QX due the used the to and was $X.X needs, with $X.X using million in securities million severance

U.S. the to consumption do not we expect degree this cash business, As focus we on of continue.

our on expectations certainly the a pivoted diagnosed approximately Regarding U.S., Reflecting all on off that of and in the the CapEx, it the feel half some the starting we XXXX. we $X our we are but million mistakes maintaining been stronger half first year, of are made of have second footing. has a we've problem strategy. challenge, but We

marketplace highly in competitive to environment, but well model. We a are our flex are positioned operating

profit options and be U.S. for finally, EBITDA We And attention strategic exploring our our gross stakeholders to immediately are our will market European will our path we our a to accelerate positive margins, the on focusing growth business. business. adjusted cash EBITDA our increase positive improve us served flow. resources EU believe adjusted by exiting solely and best reiterate, get To free our gross

some I to balance year. Moving like to comments provide At headwinds for outlook. facing distinct our the earlier to color moment, context would James the the we in made to X are the of guidance. additional add

acquiring on in until after out approximately strategy in missed we mid-QX, our believe buyer First, changing we we new changed course June. buyers XX,XXX

misstep their be annually, we headwind out of did remainder of revenue repeat we in miss in several out from this would first the impact but million dynamic multiple buyers, make year the purchases feel only estimate when dollar typically the be also buyers on We those to purchases. we the Our the second so purchase on half. miss not this

impact made estimate quality strategic a we of revenue Not consolidated did revenue QX, lower negative $X to be decision in promotional in our our more order Second, to to the out pulled negatively it unit million We but and higher only QX, June be in also quality impact economics goals. July. achieve forward into this QX. to this

purchasing, discriminating feeling in incrementally competitive in inflation. Finally, environment. our of consumer discretion are a They their compounding core the more resulting customers impact multiyear highly

to We worsen. potentially QX promotions our year but moderate of healthy will expect levels this continue in the we and and economics. and we largely marketplace model, return from in QX, balance the dynamic persist QX to flex could In will our to our preserving pricing unit

margins of expect of XX% in of XXX the decline third negative weighted outlook, all last operations this range approximately to only. representing QX XX.X%, midpoint quarter, to in lapped shares I'd growth in to a turn we'll $XX midpoint; to a and $XX With of adjusted as gross of of million flat in year to U.S. XX.X% the like midpoint; million, last year; at mind, XX% refer of flat we to basic the year revenue, outstanding the positive we the our at revenue our to at to range In X% last the million X% shares. EBITDA average of which

revenue the to In the a XX% X% we $XX the fourth of last in quarter, year. $XX decline at QX in of midpoint as growth representing of we expect million million, range lapped

adjusted quarter average gross QX million XXX outstanding basis the reminder, our points of weighted margin U.S. a XX.X%, EBITDA and XXX $X shares approximately is the representing million midpoint; business; margins decline at in the at range a expansion of shares. smallest to of As X% to XX.X% seasonally the of revenue, midpoint; year-over-year of in X% positive basic

representing that the revenue midpoint. now basic million the outlook. of of XXXX approximately the range in of $XXX gross outstanding EU at midpoint of of to at the improvement XXX adjusted of for a mind the a decline business expansion year at full in accounted points revenue, year full the range shares. our $XX basis of in Positive representing X% million Gross million, previous XX.X%, XXX For of of X% $XXX and approximately margin year-over-year average million X% to shares we margins approximately weighted U.S., XX.X% to midpoint, in the Keep EBITDA expect $X million the

profits U.S. closing, favorable our to When strategy free the cash In divesting to investors resources greater talent, capital U.S. flow business gross renew our attention expand cash to We our margins, EBITDA focusing we're that provide free completed, on best our business. on accelerate adjusted with our higher excited will dynamics. and flow. focus the European profitable our transparency operations to believe and our positive U.S. is path structurally and

for I and ready the Operator, open are now James your line. questions. please

Operator

[Operator our from Instructions] We'll Boruchow take Ike question Wells first with Fargo.

Irwin Boruchow

guess I while. wanted first question know a I it's guess Obviously, I EU of U.S. is the on a split on Europe. drag to focus for and we been

guys it. You have talked about

maybe to could maybe, you what quarter. you specifically evolution second about then just in changed came as the talk thinking Just your And James, did? guys kind the of decision you of the

James Reinhart

time, Sure. on And piece go the several materialize as a longer consignment, that year, about them And liked. require And thought think been it think to it as clear the capital. past feel was it's originally take of and Yes. going if you dug the who was to we that taken and growth. business. really investing of that then with turn we that more even idea -- business it's around then of than think we going who change over had made driver in back in May, the operations he we business. had for the degrees talked in the about, brought flexibility on And I've And focusing longer I the I to aligned I great just to he way then product, expansion but not we in like a gross really that we I it technology, quarters started that Florin, think profit and into see just focused

business tough for they that think the get support the for I wanted, them. we going And place that to that to successfully really be in to U.S. so to order the them is the then U.S. decided

We business to the take so and event, in just we the and And going that TAM that opportunity think Europe it's longer. really think is became real. catalyzing

in And part think resources it scenario. and so globally, at is also And capital put deployed challenges million into the $XX EU. over a in U.S.? think million this the the and U.S. would X I the the we'd of looked be point, we like $XX quarters best-case the we place. have better And What given had that that fully we if last reflected put back, our on

that repeat to want same didn't we so mistake. And

Irwin Boruchow

didn't roughly this the kind in Got how -- you Like that could U.S. much on dollars at year? about But talked that you I if it. [indiscernible]. of was And self-inflicted EBITDA, for U.S. issues, sorry, to the EBITDA follow.

Sean Sobers

looking Hold for it. on, I'm Ike,

Irwin Boruchow

business I'm basically as hopefully guess about margin, trying look guess year? and I like the it, you look to is the that some you're as X% next I Sean, we is there's this X% growth in with to year, to run issue. just million is, think to from for but your next margin as what at off what into a a headwind $XXX from well perspective trying I'm profitability look so this try as business back to rate shake U.S. of

Sean Sobers

the get business? the a I'm year understanding. of question in impact U.S. this the normal trying like your is And or EBITDA to what U.S. business run happened rate what's for the

Irwin Boruchow

think how next margin a I'm business you guys now self-inflicted trying positive U.S.-only think X% there's the to it's add year. to to and U.S. back issue here that X% the into about from

U.S. about beyond? we about as moving So year scaling profitability and think like should business into how we the next think

Sean Sobers

Okay.

James Reinhart

-- exited mean I'll the if will in the QX year full then in X% way, I U.S., to I X% it go the in you were the to X% QX, Ike, at that QX, think, XXXX, was range. exiting think back we U.S. I Yes. about And business I Sean. is expanding jump be mean in,

get we U.S. as expectation basis a where our into XXXX. whatever is previously, so on consolidated -- we And that stand-alone will guided above be

there the QX can tumult knowing in consolidated so and be that And QX. you around I previously might triangulate guide was above some where think

Sean Sobers

because of I'm could of front it EBITDA Yes. in right, lost didn't but a the it's the little relates say envelope just year. to me, it of going for What probably the would XX,XXX have math, the you back -- say, around I of as buyers, here that million-ish related kind million buyer I the in full to around it's we $X strategy $X

Irwin Boruchow

it. Got

exited you on margin. a last So year X

You've got a from you Is strive headwind kind couple kind kind a It mid-single-digit you margin seems back. of next fair? get the of the U.S. what for of kind would points year. of is like as you that here of into go that

Sean Sobers

correct. sounds That

James Reinhart

Yes, I Yes. that's fair. think

Operator

We'll Rick to Raymond with next move Patel James.

Rakesh Patel

change better in made trying the just to second the negative mid-XQ I'm impact understand you the that that had quarter. in

resulted through the June beginning you can an direction? of walk created positive what And what changed in I in in maybe that the just that the So change guess example the of again impact? negative change us

to -- And what maybe customers. was you on with pulled and like you you back pulling gross XX,XXX time, you're But margins in bit like little your tie can of then than the secondly, sounded at I same in the because hoping lost sounded wanted it promotions, you a you're that it margins that's came accounting. lighter commentary those because why gross with seeing

fully I'm not I understanding So what feel happened. like

James Reinhart

piece, can don't talk Sure. Well to then kick acquisition Sean. over the it and why I about I

or traditional path order, onboarding get to were credits second way you I first may Rick, think where loyalty your have is a third points we for order. fourth it percent order. flexing off yes, the or the And then about mean, incremental we So

flat And so moved we more a had dollar-based credit to system. of

XX% of induce for it instead so XX% Is trial, flexing, it $XX? or And more. off an example, Is $XXX order, $XX your is we off to first of it order were or $XX?

around strategy. could first iterating order of better we is multiple what incentives that or off really was across that were free dollars shipping. And that we type nothing the we a order than there your off with percent orders just was found from straight so And that do

felt And year and out. were the how but we reverted had where been we on we off, those played XX -- we days X. once see back to needed for we didn't we we really prior June confident had that where previously been to And so worse --

So then the structure incentive and structure. the that was offer -- was it

Sean Sobers

And during probably piece, beginning acquisition Rick, on in to we we our I really the end give to the more discounts promotional side. that more But and you at started as gross to much think new gross a favorable customer got the little it right, have started period, opportunities margins quarter, think I margin on were back customers new the that more the existing in why than And benefit XX seen we've the what of gross in the in favorability the as And is of well you QX. purchasers. part U.S. margin of XX.X% mix as we first our that's in margin that offset had gross the having QX. the see kind versus the the

Rakesh Patel

kind Any down the lower than about kinds the maybe higher versus maybe trend getting of quarters? helpful. on prior expected the really like you of or That's and trade that may acquiring just worse that Okay. out consumer end platform? data And behavior secondly, be incremental line might in can zoom the Any changes just you consumers from talk be end?

James Reinhart

think And I especially shopper. discounts budget you're that mean to Rick, they were the to just seeing incrementally that we I as need you through thing, so be the more had consumer, just quarter, that is -- higher the Sure. you biggest discerning, move were right?

really our highly convert compelling you shopper, to them. think premium buyer, $XX,XXX, standard $XX,XXX as they shopper, ever. to needed a offers budget real as year, But have making it, think call engaged that well I I the performed

give make move them where couch they off so a to just of about I'd XX% relative higher, had And purchase. the were year discounts a an that ago example, be shopper to to you Rick, budget for and sort to

year, navigating that buyers really for of struggled. in a of it's now but so feel good and the half that been back segment of about the And the months, we plan few sort we've that

Operator

move to William Carden We'll next Blair. with Dylan

Dylan Carden

curious Okay. sort I'm change start was of why the let's Yes, there. made acquisition. just customer in

James Reinhart

business Yes. said, pretty I cash free of we business, I the the growing. were the U.S. feeling at as think the I beginning mean, positive, good year, flow Dylan,

optimism we we felt with sense And better. messed year time. offer that in -- materialize some new we the been very of think think really in would the I I had not customer a some had

And LTVs looking [indiscernible], were would wider for more something that yield we so what new over we could was that there better customers, time. do

doing were place. potentially new And a better and looking offer mountain very your marketing for top. mix for an it's were something keep could doing looking And as much easy you're organization that so really mix. have across I And a we in across think to us your we put what

And so I fixed was was what get own have But wrong. we areas we it moving that could it and we that in And in that, certain we and and chose, think And retrospect, the we forward. differently. intent. probably done

Dylan Carden

And some change, change wasn't the response in dynamic to competitive market? in it sort of so

James Reinhart

No.

environment we that looking value think those and growth shift from we lifetime -- could looking point, do think are you And we looking buyers for offer, the where lot came off. were way just that materialize but at also we're the I of we would we demand one didn't of -- we it a that we we and we the buyer new just type think can from -- this was channel to think were weakening, into for of like? a sources worse shift for, thought and the had was

Dylan Carden

a moving what lot so with And here. the we're left sort of of guide, pieces on with now there's

incrementality lost strip overhang? were here? impression go leg of XX,XXX last you prior incremental the on of back here? speaking kind I that of sort can of of on you kind the really you buyers, was the call that derisked guide. sort that at of Is the that you If I think the I what's the to away macro or mean takes down it sort seeing goal Is another own macro just of you're own front behavior you're kind the in kind to the there

James Reinhart

I with, mean our I you of the Dylan, there commentary think a board, Starbucks yes, ago, that are kind the consumer think challenged you're companies or -- days consistent some from they buyer are the bridge. of right? give whether Sean XX I across McDonald's, right, -- think, But think consumer, can now peers more is I the lot think the consumer -- were than I I there's it's struggling. that in

And were want the year. bit you worse, ago days beginning right, do piece at Dylan? and the the to so think has world I little revenue bridge Sean, where we the from think for a you XX maybe of gotten certainly

Sean Sobers

Yes, Dylan. Yes.

about So million off if about this think you it's straight That's guide It's pretty like to simple. -- midpoint, our last it's on at down $XX annual basis. Europe. it's the an $XX of million about guide, it's it --

really doing we're then is think buyer a is and guys then then and that about back which there. the U.S., I remaining know the what made is $X remaining so million And million the strategy we million, about we've And impact. and that about $XX macro really that talked made is you change $X active

Operator

next to Dana Telsey Group. We'll move Telsey with the

Dana Telsey

seeing distribution volume, look other it how this do are you What with What customers? and of And the James, structure regular your order increase centers you're bags in going you about expense get capacity for does getting? like terms of promo customers? value forward? terms just lower you think spend. the of cleanup how was of talked to of the to of people or the besides XX% in for what does What in it core discount the a

James Reinhart

lower interesting. history, we QX, than Yes. clothing means. I I that would So any mean, ever right? say had In volume. there Dana, volume is there's mean sold ever we've by of a it's than more in I our lot not

those is on convert. we've to customers further, to average just between for Dana, being the were even $XX think lower-priced we just ThredUp that selling having you $XX, that what for think price products mark our down and I about product found if

pernicious the more, rate. that all discount of is sort same And to so the having then at that you're budget it of right? shopper part is not converting And even that

not they trading that And there customers trading think who think that so -- struggling. that and are we a they're that they is of segment potentially really are we it's down out

cost variable and in the kind structure, DCs fixed overhang. cost cost our our of the any think is don't I so And

Europe I the promotions changes in and then in of that then the weakness was of the think QX. the biggest QX challenge the in some and we in acquisition sort strategic QX made

Operator

or appear additional now to further at turn are I company questions closing would it does time. no this for like to there any And back the it that remarks.

James Reinhart

our in understanding on firm we're joining. we everyone, but ThredUp mistakes, appreciate working and folks done the are Well, work We thank of headed. throughout the and you, very us. the you have do for and overseas Europe. we product Thank teammates all you are things organization where also And to a have that the for make excited ahead of

to next forward look we call. our on you so seeing And

Operator

a today's [indiscernible] you participation. Have conclude Thank for does afternoon. This program. your wonderful

ThredUp (TDUP) 5 Aug 242024 Q2 Earnings call transcript