The RealReal, Inc. (REAL) 11 May 222022 Q1 Earnings call transcript

Company Profile

Participants

Caitlin Howe	Vice President of Investor Relations
Julie Wainwright	Founder & Chief Executive Officer
Rati Levesque	President
Robert Julian	Chief Financial Officer
Anna Andreeva	Needham
Michael Binetti	Crédit Suisse
Lauren Schenk	Morgan Stanley
Kunal Madhukar	UBS
Simeon Siegel	BMO Capital Markets
Alec Legg	B. Riley.
Michael McGovern	Bank of America
Ike Boruchow	Wells Fargo
Ashley Helgans	Jefferies
Marvin Fong	BTIG
Oliver Chen	Cowen

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the RealReal's First Quarter 2022 Earnings Results Conference Call. At this time, all participants' lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your first speaker today Caitlin Howe, Vice President of Investor Relations. Thank you. ma'am. ahead go Please

Caitlin Howe

operator. you, Thank

Julian. me today ended Julie for period Officer, our President, to XXst, XXXX, discuss Robert Financial March Chief CEO, Levesque; results our Rati the and Joining Founder Wainwright; and

during Before we begin, risks involve we would like and which uncertainties. make statements, and today's you forward-looking to will known call remind I that unknown

Our such statements. actual results may differ materially from those suggested in

most factors recent presentation about that more and earnings XX-K Today's can information these in risks, the most and our XX-Q. results will also include comparable we certain financial find the non-GAAP quarterly company's in financial measures affect could press subsequent measures, release. forward-looking other Form both which our have historical GAAP and Form to for provided reports operating reconciliations You uncertainties, measures historical on

earnings to Wainwright, the directly on are which release, remarks now like into the press both for will RealReal a session. to website. would a and we Officer available today, earlier introductory then stockholder Julie? go I Julie to we turn addition Chief over In Executive letter of of the our question-and-answer Relations Investor issued call

Julie Wainwright

you, our earnings everyone Caitlin to joining and today. Thank call thank you

quarter's to want crisis results, into take a to moment Before get Ukraine. we acknowledge the humanitarian ongoing the I in

announce this Our in piece the for by are financial this thoughts XXXX. with we for a those are results quarter return to of region. to devastating wish conflict pleased and war better-than-anticipated impacted the a we and resolution first to Today,

Of quarter. and staffing on in drives our the GMV retail fine demand to the increased staff watches, the note e-commerce authentication contrary despite apparel early to call-outs shoes. reported RealReal strong supply COVID-related and due jewelry and was high-value we in our by are in demand, topline sales in rates women's apparel first our growth handbags inventory. trends. platform driven solid normal centers strong levels growth to During and in return resulted quarter, delivered Since

for first leverage financial quarter, to the at and laser-focused generate operating to quarter, expense After during better-than-anticipated year costs. three our adjusted to The profitable and two, in RealReal rely in XXXX. attracting and confirm of inflationary we of we variable and we to pleased we basis the results first guidance delivered the the Notably, XXXX. on number all quarter significant first retaining quarter an fixed operational both these costs. Importantly, be are on of the be number XXXX We continued topline on fixed business to projections full operational RealReal project achieve risk also with the variable assumptions; cost guidance will EBITDA talent. a are on continued transportation targets. our provide And costs disciplined that results. on continue Vision second points and our These targets of least track on pressures one, note in the and number three, sales near-term number on and continued excellence improved XX%; growth productivity; to XXXX

immediate are we steps taking increases. to these costs transportation offset For

good shape. in ops For quarter sales we hiring, and the exited

actively positions, fill we are However, we recruiting grow. to as

demand continue to in strong forward, we Looking see our business.

for highly we ramped believe is luxury now that, And has RealReal option are with a the a the go we demonstrated inflation we market, the XXXX. As Q&A believe unique offering and space. Therefore, increased primary will goods strong prices have our luxury up and value items into in we session. coveted positioned within

Operator

Andreeva [Operator with the line Your Needham. of first comes Anna Thank you. question from Instructions]

open. is line Your

Anna Andreeva

guidance about on primary of a buyers the seeing And the despite run if a Can the compared curious, guiding tougher GMV, for you great much Thank congrats, questions. roughly XQ, you for a market, accelerated quarter. lapping these number so environment. you're bigger The had of to We tough talk and Great. behavior trade from a in cohorts? new much operating couple down and of this compare. you're rate follow-up previous similar just in buyers

quarter-to-date? the consumer are space. Just we've given, sentiment what seeing negative in business so the lot been curious, of Just a Thank hearing much. you in you

Julie Wainwright

We'll answer Robert let the part. second

also should when guidance are we giving are we You the that now into QX. for five weeks recognize QX,

The of So first look buyers. in in where question are pre-COVID in apparel and acting we new estimate. strong other and we is The we growing quarter over more your business didn't faith incredibly measure to buyers biggest been quarterly in actually fast the rate, to was the buying first wouldn't as our the give cohorts, new which have guidance, up if has about time. same our shift cohorts just our But, time. buyers it

apparel So but actually shift, the a new like our is cohorts. previous as buyers

change market So to The there's trade no there. from the down primary measure. hard

because that inflation always were beneficiary Our both been that hit or going player. we when value a we -- premise do a has are of a to be recession, we

demand and I past, away people have we tied But the our So you to site. their can way from tell tracking people moved fashion. ask monitor having do we no year. inventory these our the and in purchasing strong, and it really we'll fast questions us secondary. of to switching purchase monitor people power, is have primary it's we'll again, from every And in that

out go will sometime in survey May. that So

to Now, for let's Robert? QX. guidance go

Robert Julian

projection percent about the QX last We we GMV feel versus for the XX.X% of Anna. for the in QX very We The line. Thanks growth that's on feel of comfortable achievable. in with year. XX-plus growth. for what question, is talked guidance top about It's Yes. range our

projecting. we about we're good what So feel

month point. the As this a we're quarter Julie at into mentioned,

one and have we the and the good months of that three the books feel actually about the see. trends we in So we projections

Anna Andreeva

just I on a Can Great. Just squeeze another follow-up direct sales. one?

growing as that's in highest inventory of about sales think How line for the mix as been. with looking a this think it's percent I just should the we of especially GMV, now ever the the at balance year, quarter?

Robert Julian

Yes.

revenue QX it of as total higher was normal. revenue of And percent XX% QX fact than XX%. in So year That's of revenue. – was was total revenue a direct sell-through. really function In our last it in about as a percent direct

hand the progresses year. absolute direct comparison a the percentage It stays The of than in of So the of we revenue rate inventory did relatively that we in the terms a our that come for because started proportion anticipate drive year the had bit constant revenue to on that down. of different of to total revenue expected year. amount and at We little sold through up last becomes from direct grow as a that half percentage do higher coming second direct. throughout

will There do And do changes. revenue we and reduce time. anticipate are before direct will in direct. do of growth some mentioned time initiatives initiatives And our that we is had always rate as deemphasizing and direct as of the our continue now. part be like decline returns. in comes down. of We paid over grow portion business overall as purchases revenue for from half comes business so or down in things year get should percent comparison vendors out-of-policy the that go that over we that have There have There business over revenue the a and will total we time direct business second we of project consigned to be favor model will The our that direct top revenue as of by will the of businesses we proportion time come deemphasize. and direct probably line driven will our wholesale percentage so well. is That on, from that that on. general goes from the will But the

Anna Andreeva

so much you super Okay. guys. Thank That’s helpful.

Operator

next question the Our of line from Suisse. Michael Binetti with comes Crédit

Your open. line is

Michael Binetti

Hey, guys. our taking Thanks questions for here.

of little to it looks to in the about But a the the on you're a basis the there's acceleration on that retail because XQ think in confident help analysts mentioned US relative little like sound the been at in the to as quarter other line a confidence what of March in then and XQ in and So top bit try we the maybe and it rates up you're XQ? the look of least since your in unfolding couple in is little noise at just growth XQ pre-COVID have just I But seeing of been a you dynamics think in lot well. the more marketplace headed. half boost a have that X-year an in in that here where as end quarter-to-quarter basis. second baking the Maybe obviously world, what a

Julie Wainwright

Yes.

Okay.

unique multiples. sell want quite on a that different of comment, to bit the with have in Before a the – not don't business. we sector we get we're And e-commerce the and a end in going, we're marketplace one marketplace get have business, an e-commerce business I and things we that lumped do we're do we're high of than products

card us countering credit apply So it some and retail of that. that really the doesn't we been basic have to

products. we aware as a So are -- business marketplace whenever don't paying as unique really -- business. we everyone's on but going normal earnings space to of a to in luxury because the we of reports, map attention value We're our with e-commerce certainly the certainly they where sit what's play and in

from to of business. our bit other understanding really that be -- in one people and honest, are So, getting

do. have margin in than and which necessarily different happens we We certainly them more on also marketplaces don't map points than pressure peer-to-peer have what we to the do price

that, turn to with So going it over to Robert. I'm

Robert Julian

in that we year calendarization it's or I growth also forward. and I long-term would an And in was two-year consistent the stack XXXX, years normal. don't And liking a we're the And projecting our QX if growth with a and our plus now the I it revenue was to view in mentioned very to GMV XXXX would with it in that And typical as of and what rate what COVID. would that. in versus three-year think look a each the not the given very expect by XXXX comes over of due say see we what that's I XXXX, revenue think unusual of really XXXX, consistent XX%. is of the proportion change XX%. about before of talked of And is in had going in before. we're you quarters plus return XX.X% quarter then the strange at year. unusual rate our We've our in result very XXXX, now Even seeing in minus you that it's QX

those for feel accurate have reasons, QX forecast top So line. and for a that confident good I we

Michael Binetti

should be on get you if on it means classifications to more and within see start way probably to radar tighten. budgets in perverse ecosystem, the good a thing could seeing follow people's I And thoughts ecosystem different within then, I a guess your that categories? outside as look we of trade your guess on down business your you comments latch you -- that, about trade Are signs down. to to across the any

Julie Wainwright

No. jewelry price more as selling than -- What has we've think more us. has I though take will natural and don't more is or point earlier, higher a apparel, lower fine we're this seen for stated a -- handbag, a rate a but it we which

it returning QX, but back April. So, and to in -- normal our continued normal started trends quarter apparel start to to return in to we're did last QX normal those now

of more down. trade mix category it's a So, shift than a is it

Michael Binetti

lot the a Thanks Okay. for help.

Operator

comes next the from Morgan Schenk question line with of Stanley. Lauren Your

Your line is open.

Lauren Schenk

balance. could the seeing? Thanks. the that on supply if the just trends talk relative mix of you're sort saw inventory to you then, on us a about And quarter? lastly little you And ending fourth then, in that bit Could Great. supply XQ you update

You now mentioned returns versus down few -- help piece? how -- you're or and that us to inventory of much quarters. you. work break direct that next buy over continue you the vendor expecting Could the buy the maybe sorry, the to through is Thank the

Rati Levesque

take were going they sure. are by Yes -- of but similar last healthy. trends And the to question first have part. take the I'll barring year to the part that was I'm quite supply Robert this second concerned,

product behind I think getting we some up of that's us talked labor the have But did about on because We issues that. now. shortages. the site

mix seeing supply trend. same goes, as far the As

come of our We pre-COVID as seller are XX% is continue the to as more from And not back mentioned healthier. healthy. sellers in-home ready-to-wear, stores, side if that's quite on seeing Julie numbers well. to

unit the all pickup all average we for QX. supply that's a conversion, lot and trends target of quite mix, value healthy in So KPIs those or are of supply whether

Robert Julian

wholesale about the $XX our of About that is inventory total XX% our the is of about inventory category. And that's buckets from million in just vendor the a is sheet paid the or activity. we categorized. of balance inventory issue. I'll to to call balances inventory Lauren due your from the $XX of question breakdown get an balance owned or XX% purchased About it different total stated -- that's recovered operational inventory, by of now policy. And XX% upfront what by a And makeup sort of throw our million of which on as lot by

Lauren Schenk

just quarters? that And Where vendor do going of next you great. mix couple follow-up. over Okay, one see the

Robert Julian

declining it fairly see significantly. We

Lauren Schenk

Great. Thanks.

Operator

Your Kunal of next Madhukar line question comes with from the UBS.

is open. line Your

Kunal Madhukar

Hi. for follow-up A questions. the my could, if on Thanks taking just of side. a couple I inventory

sold So, inventory your more obviously, than much expected. through of you you

but So was this increased million, by $X the unexpected $X.X overall million. -- inventory about only

So coming more things And we was to plus ahead policy? the on lot the Julie, people the an like of kind in about able of more be get to And years, out or it are the of that's think unexpected as GMV in future one talking it then a there in expectation year-after-year. paid as we next of, inventory like to which of from value-conscious macro-outlook, is return period-after-period was deliver now, terms the look XX% about. consumers. more that you refer And growth few worsening a will

they And so more how share completely? value-conscious impacted people, will just exit and impact downturn? for does So by be may the inflation the it a more wallet the market

Julie Wainwright

and of our need the answer We're sellers' to business, going luxury become to And which space. is become a sellers which is The is I'm by business impacted at Okay. happens the where tremendously low-cost what the not flywheel business have look the but one different We gives confidence. our buyers' last. a luxury in businesses. resilient bottom things us most always buyers, resilient. phenomenal dollar we luxury in

our for expect very that don't of our very, at is change. the in thing of that what's We we And -- other The lead always consignment. is look a in happening -- of terms us funnel beginning the healthy. actually to getting

sell we -- the the some of market, sell buy people are their But been to Other I imagine are new our this things. if there dropping would in the things going going market their can businesses that and people business drops because end they to have market to You money. the of their need clearly know see being don't evaporates. market or hit that has seen I things

We reason market that penetration because confident our of about have is And of business the our luxury side not overall. phenomenally resilient. the The is low seen rate on at we're all. growth our

with potential we almost in been consignors US over That's less are the have our XX first-time consignors So, beginning X% -- of since of and than of XX% us that can the time. consignors. sign

start the So with to tend their that consigning whole to Once have we're they they the still value value and introducing in of market, introducing consigning they continue. house. trapped us, people

buyers most on As a we're our rate our you know, have site our but high through converting consignors valuable also more purchase become customers, consignors. to

over future the very turn other about I'm it about issue. we Robert that to growth. confident with about to We're And going confident talk positioning. the our are So very to

Robert Julian

Yes.

of in higher inventory sales question Kunal, about grew where So the spite the through. was

purchased same I direct I -- own the XX% of in upfront revenue the to recovered remaining in using categories returns of end and in direct say the end XX% that from paid the the category. the QX vendor between is our would category. terms year inventory So, growth about of the then get equally And before split gave out-of-policy revenue. of by now from was the that where came wholesale

Kunal Madhukar

much. Thank it. Got so you,

Operator

of Your the Siegel next Capital from question with BMO Simeon comes line Markets.

open. is line Your

Simeon Siegel

Thanks. Hi everyone.

think per that just And lot. is on how to say you like-for-like order, for don't Thanks we're forward? any did if about mix? thoughts about then, but still a how going I AOV, GP normalize know the to ASP talking Just

Robert Julian

order gross you not favorite start I'll on per guess guys I know the that's profit because my metric.

I I in an profit QX was it but... increase per about that gross order was think that was $XX believe year-over-year

Julie Wainwright

$XX. It $XX. was a Yes

Robert Julian

was it -- it $XX year. $XX last think I was

So about increase a year-over-year. $X

Julie Wainwright

Yes.

Robert Julian

of ignores profitability, path metric favorite talking up it because to when entire it's was base not year-over-year. but our it cost about my again, sort And you're our

slightly I think sequentially. been it might have down

Julie Wainwright

up And XXXX. ASP. there and just around then since relationship first an transaction between and inverse units AOV ASP. really is question And I AVO per year-over-year can take the is

up, per transaction. are see for go did ASP we as driven then, getting smarter. like-for-like So that we of And units items, out

technology at prices. see often prices price selling and have control average average around up. And heard Day Investor do It's around that. I which good machine We we higher about for driven learning really feel mix, selling we testing all we about when

Simeon Siegel

thank you. of I great. And guess then be I rate within -- know I to And function -- know the the That's take the a AOV. tends

opportunities about we any side? any the on are how thinking rate or changes So take

Julie Wainwright

do opportunities it finalized, take we mostly have at there's of looking spectrum. we're but and do because haven't We do completely some we we we there don't on some opportunities Yes. now, have product lot a but there's of think side, the low some the think the where competition, areas end on rate

Robert Julian

We did that from-- take

Julie Wainwright

driven Yes, out take ready-to-wear, well unbranded up, of but more as we jewelry. goods, it's in is by low-priced also change year on yes, commission driven more last as made taking the rate now

Rati Levesque

think on mean goods, low priced. we I still When say very And price, low-priced I there's opportunity. low an

Simeon Siegel

the luck Perfect. year. Thanks rest for everyone. a the Good lot of

Julie Wainwright

you. Thank

Operator

next comes line Susan Riley. of with B. from Your question Anderson the

Your line open. is

Alec Legg

now the the vendor Alec the for just is afternoon. My any direct -- Susan. revenue, question first on difference Legg back the major return Good out-of-policy Hi. and the on there to option going paid between margins?

Robert Julian

different an what margin market buy margins. in by -- it's for margins of can the in category There items The a gross inventory. just we expected competitive certainly owned are terms

by wholesale, and but are Paid -- category or it's it's difference different by, say wouldn't I the there margins vendor certainly. gross So product Now Get between

Alec Legg

by cost variable your much lot leverage, this like improving leverage versus quarter say a how that was mentioned productivity? of operating of Okay. driven And mix then, you

Robert Julian

Yes.

our nice cost So X,XXX in And saw we variable saw we numbers points expenses cost round we a which was our of cost very versus quarter the of base. XXX two cost in X% quarter prior year basis cost operating part on productivity, variable our variable X,XXX, leverage of basis versus basis on the very on points fixed between points X,XXX prior base. terms leverage that year. productivity them our it stated almost productivity saw almost in roughly on base, in And another the nice of

Alec Legg

question you and Perfect. Very last future? you share for then now the stores just How have the stores do metrics thoughts can the store then And many my strategy. helpful. And neighborhood on this any quarter? around

Rati Levesque

Sure.

We have right are now stores that shoppable. XX

We as of we go. take opportunistic locations we'll as stores three them goods come on just We're find your consignment supply-driven. sellers strategy luxury real go And, XX% expert. far and same both on demand in our the a as continue on up you also stores look have or that side If there. offices definitely an healthy it. last quarter. and supply I off place quite that's the mean, from with the meet are to drop estate our enticing, where can They're yes, and

Julie Wainwright

to year we're openings. way that estimating forward But but an year our -- of have this going goal per is unless our falls done, stores lease may two we extraordinary new in be because

Alec Legg

rest Perfect. of for Thank you. Best the of the luck year.

Julie Wainwright

Thanks.

Operator

of from question of Michael McGovern Bank with America. the line next Your comes

Your is open. line

Michael McGovern

Hey, taking thanks two. question. have for my I

if the year-on-year, the rate to The those pretty consignment obviously, the but call for for just I improvement. just was significantly was implies EBITDA side. on your guidance of slightly. there's margin one, consignment year down was take then, consignment think anything margin some out And wondering I either first full still gross up

of remind should through cost kind kind you change model? I fixed versus that end our you. put are variable of improvement, what of year? the that us leverage productivity the gains into can guess, we the margin So just of Thank cost underpinning

Robert Julian

of take going items. items just slightly. largely So between basis, versus is if a rate rate it's item-by-item mix. high take category either down, on, rate increased And flat low on consignment, up always we've take or of you When rate that fund the our see almost or anything stayed mix take

direct side margin. in I margins we way our it's the report, will the category how on Q, say mix. the that's Same we is the knew that's of expense, actually cleaned expense a by question and shipping that services consigned consigned in on is a So thing the category we itself. include the net in shipping

what again, shipping leverage... change be you been function but might consigned it's What And headwind. being mixed, its services the so see a has little of on a gross a the leverage there and margin I'm on the bit could sorry largely also was question, second shipping a variable -- of, and

Michael McGovern

year the about guidance, the context in of in math, the just lower range in the of just of on guidance get yes losses. improvement full to losses million my full the at Just half the $XX would first in $XX end looking year, to an suggest about of based million of then year

that kind just improvement So I guess, of -- could describe give us margin you can you that? for any context

Robert Julian

our second through I that going on And to to second going see, base. as and QX in I at in the continue about the to mathematically that's productivity part needed as variable our did support mid-single see, fixed you're revenue again, see the seen second the and productivity our primarily half continue I've we half. be that falling cost both of Yes. digits. in profitability business, that and And a have of year, just on of described decline. base. past with in part Investor year, that to in the you leverage the the revenue increased projections with seasonality growth for the include fixed. line think, to cost half But think, think type QX of of revenue what's should percent the to to of cost and continue X% Day QX. expect OpEx Largely of the current you're that X% cost that continue the in the the better of And improved of to variable productivity, base our and you're really with to than to type and top do low- nice our we that increased sort I leverage GMV seasonality to see We talked cost going

Michael McGovern

it. you. Thank Got

Operator

next of comes Boruchow Ike from question Your Fargo. the with line Wells

open. is line Your

Ike Boruchow

questions Robert, you. Hi, guys. two for

the it a know expectations but dynamics I'll that, I that margin for on from of your the Can ask First explicit revenue has year. more perspective. gross line. you this upcoming There's question the gross such and meaningful for mix a asked just direct margin be been about margin more quarter kind are taking place.

it to might for about be how think, line. margin to I helpful gross us the understand think exactly,

Robert Julian

Yes.

to So, a couple that answer of comments question. in

see should proportion guidance is the You improve, results as QX. you coming our margin declines, the revenue business projected that gross QX for extrapolate. and we from in can our And direct of projected the

You you extrapolate second half. have QX, we've can given QX actuals

the you our second the there's from year, in half that margin all versus forward in mix revenue this projected the there a deemphasizing pretty half of in very what again, to communicated terms first of and year the that much versus so, of and see significant of margin due pretty it's consistent increase coming half how is in And initiatives we our versus to will first direct going improvement direct. proportion in in significant second second But we year change. with first the gross a half declining due primarily half And the half.

Ike Boruchow

below year XX.X% as not pressure last But we should QX, gross year-over-year of as margin correct? in from but XQ see much expect maybe in the pressure quarter to another

Robert Julian

in that pressure but pressure see I And of versus lessening going to say that should prior the then sequential itself. to you'll basis second you're would QX, you That's a improvement QX see half year-over-year year. see correct. in a on continue from And

Ike Boruchow

we does that year? kind year when margin flattish of versus get Got it. the of of end the a And to last XX% the kind us lead to gross

Robert Julian

-- to won't I number. specific maybe little would but a say I us not a significant, give down Led

Julie Wainwright

to Well sets also out itself. because it

Robert Julian

Yes.

a bit little flattish probably realm we're maybe is the projecting down, of within yes. what So but

Ike Boruchow

then marketing. one I That's on so And just wanted. last helpful. the That's Yes. all

So got in pretty marketing on of you've leverage line couple good the some the past quarters.

as guys little bit beyond. we those going you the the thinking think of about forward rest I kind get spend and of are the us help compares Can in forward QX challenging just a you more how for year? move marketing

Julie Wainwright

we've don't -- Day, I I know Investor we in -- Marketing what a not it's our spend mean lot. said

so marketing efficient. although dramatically more have of spark mix. of we by And effect We the a get efficiencies variance not nice obviously also expect effect. variable But efficient. fixed very part our aided flywheel really of doing marketing cost driving we're really see it -- good to The gets flywheel job the continuously a

other is dependent with as not people we're on So, business. digital which as helped actually the

Robert Julian

that each reasons And part productivity earlier, in I marketing would our Julie by are area. our the say that getting a our it's and the terms And the for where all gave of marketing functional we're at Julie mentioned it's we in one actually leverage looking we're leverage but just you, group. the at areas really and the is productivity and looking of the reasons most success most and actually, OpEx for support story productivity is efficiency of the

Julie Wainwright

by from aided stores. the are coming stores, new XX% been the of consignors we've And

healthy and We -- supply a buyers aided have level strong had is of And a how and new also quite how so really we bit. from and the get that. that -- stores

Ike Boruchow

Got it.

much. so Thanks Okay.

Operator

Wedbush Nikic, is Your Tom comes Securities. Nikic open. question of from your line line next with the

Unidentified Analyst

for Andrew on for Thanks taking Weiner [ph] Tom. our question. here

Just a quick one.

that sequential GMV rate preventing be be QX? for had confidence QX same that to in there's any us improvement in half? So mostly And seems this implied XX%. at which is here us growth the disruption QX what second it about it behind anything point COVID gives going you the at into that's really about going a acceleration to Is there

Julie Wainwright

-- of Excited have Rati I'm in demand about we once But there's we of a things one for couple the the about going once let different it. to things. on. talk Well, side this. general supply

we sell-through. an shelves once so really the So virtual to up we get back shelf full our on got staffing, aggressive it speak had product to our

ability quarter our in and salespeople in I the while. we tried color? for feel a in is So that. QX we for coming been want retain my directly in how be really good a April. we target on doing ended to as -- have we've you But ended in to the we GMV about and and expect Do remarks something many noted and leads growth actually to add nice way month It's hire more our -- opening so to

Rati Levesque

Yes.

retention, the it's on I mentioned many flows opportunities especially, risk for healthy. is side we And that at Julie which know, supply leads in a like place things said all are mitigate to us during the spot. Julie but there ebbs about top attrition like there hiring have keep and and think are in we of and goes COVID, funnel and very good all as the

Caitlin Howe

this of is QX would Tom The I year Caitlin. other add thing last only we XX%. Hey, is grew

Julie Wainwright

XXXX. a Well, from not shut shut base. that Well, The down. was company in company down that's was

Robert Julian

of Just in data. the actual terms

the So our rate. you would QX was at to But GMV is growth I encourage GMV growth look rate in XX.X%. revenue growth in QX Projected also XX.X%.

revenue QX rate projected year XX.X%. the growth and XX.X% was is rate So this the for of in QX growth revenue

of healthy into direct which on does the has same growth from it growth the the a XX% projections. of GMV terms GMV on than comes year revenue QX prior rates. that about this But it's impact amount doesn't revenue built it because higher in of So a match percentages we're growth and of QX talking versus proportion of more than pretty exactly in

Unidentified Analyst

Thank it. much. you very Got

Operator

Helgans line question from Jefferies. next Ashley the comes with of Your

Your line is open.

Ashley Helgans

for thanks our Good question. Hi. and afternoon taking

just on You've way there price wondering up responding any market growth? is benefit you And platform? the GMV to about then the driving talked your consumers can primary quantify refill values. to are prices increases in Thanks. pricing We're higher your the how

Julie Wainwright

more forecast one when to can we running we of the don't allows So really consideration. color highest anticipated add price get that we Rati expected to is space. for pretty new to I'll do we And optimal what to in velocity up consigners is of consistent. the that due to to It into price also sale and price. And we way let sell-through cadence our need we things centers try accurately know means op out But the set the this. is of not us of important that's it's evolve, be try our take and

not is the sale velocity sale velocity of of has dropped. measurements So of the our for one sell-through

In the drop, we fact price. if lower did would it

is So possible that it to without between want price sales. of balance losing you really highest the velocity finding add more? Do

Rati Levesque

to No, we're $XX right? that's moving are at, we bar, time. if exactly $X price items we're much going that next testing. So right. We something can it's constantly but quantify something we're and really that's sold constantly moving test at And like-for-like quickly how

we're optimizing. So constantly

Julie Wainwright

at up – overall static to -- this items in not last time a -- years. over is the yes our gone all. $XX But And it's in yes, have $XX five

it's dynamic. So

Ashley Helgans

And a drive macro if Okay. Would you Great. items? expect supply weaker just backdrop I as could more. look in to monetize one consumers maybe actually throw higher to their

Julie Wainwright

end mean XXXX really people of in look product making jumped a monetize do. money sort they But the sitting really could their home around on of was found recession. that's a free sort – tail wild started once a I our But business just of in that they I just And forecast. it. I

the to knows I and if of into be go going recession monetize. we one see a Clearly, there, feeling people to inflation, looking weren't there but they'll out no of believe points company. as they of out view other So are personally in we a born or recession what sort are around are if see, can a impact we

Ashley Helgans

Okay. Great. Thanks so much.

Operator

line with Marvin the of from comes BTIG. question next Fong Your

open. is line Your

Marvin Fong

Thanks one tacking to this ask much of for rate. them just all Pretty on ask Great. my I'll take questions.

it think we just going ready-to-wear accretive. take know rate and I is that, apparel forward, As about

in first or versus items sort we thought there's quarter that today about to as of what's the the think mix take we just about portion Do you we rate? more as normalized ready just the are stand apparel a higher wear of your and should rate where for grow So room mix, and be?

Robert Julian

Yeah.

increasing specifics points large can to average take the overall I that few for based look more in very increasing as trend getting basis sell we but So we Not And rate rate to slightly a throughout is We Again I without an you the the projections higher we increase trend as reflected our rate of half second for tell will QX tell rate our of of on do at Marvin the and take this rate trend a you an into year matter mix take as take Robert. on hundred mix. it's items increasing said the take company. show you as that current projection a progresses. current changes, see that's the like something the year. do increase year. is an

Marvin Fong

That's Okay. it. Robert. Thanks, Great.

Operator

question line Cowen. next Your the with of from Chen Oliver comes

Your line is operating.

Oliver Chen

everybody. Hi,

that's processing blockchain And metaverse Cowen on there? with then just lot love had digital and to fruit Would you then lots lower experience pricing. as your speed. finally our at hanging as of surveys great as an left it IDs industry? speaks opportunity of of love intersects topics. customers on love What's views authentication highlights the great Julie a some Thanks. on Colombia there. given We also in ahead automation we at the progress One times made Second your

Julie Wainwright

Okay. can part. the Rati are first you on

Rati Levesque

processing we we some processing did mentioned in like all report the back that, in impact. delays of for times So I'm categories. SLA COVID-related QX early have happy to because time

weeks we and processing is more, is more even we about SLA. that that's automation two as So see well. Overtime, as some our our there decreasing add great

to three significantly We down have next a over vision bring the all that pretty years. categories

track we front by them. mentioned all like that Day about of XX we Investor next areas we Fine targeted be about end as automation continue being also the specifically, the to over on be of there's plan. pricing on we few year And idea handbags a then XX% auto our the one to automated XX% will the So, that be And excited XX items the of in priced with be jewelry, will that and months of handbags. automating mostly will diamond well.

to So really And continue we're take I'll there. target. the traction metaverse. be great on Julie, making let we

Julie Wainwright

Yeah.

a we leader the be So metaverse. into to need don't

metaverse got a still some not going the is this think sex real It's place point person appeal, but at I hang the a is lot to out. like average it's second life.

one. who So neurological reads people someone of But a in consideration. authentication, time counterfeit we've metaverse be relates metaverse. can deep in spending but I'm a of we a I had lot that On in the blockchain, reports, and would a as personal own lot follower be just to about that's as blockchain personally the my real worried it follower in. numbers we come

that to understand buy the they day, at So It really I whatever the brands in, I into mean, do think and could It useful. an the of get people -- nascent if this closer too be to have to opt product to end opt the customers. into I they their into it's cloud. useful they the for think it's impact. be interesting could

However, customer be be it believe and brands case it and privacy issue. a of the don't could in against who may resell used the

jury So know I excited is that, say would about everyone's it. out. the I pretty

is I easily. think It fairly the nascent. can counterfeited be technology

average products old are it. on I apparel think and I it mean, there what even there's are we've -- look at when does for for after that at we day, us, five gets customer end privacy, issues years -- of mean And And around the older. shoes. the it about our got

world consumer. time, and But aware. long adding we've have in. closer like discussion brands a the play it's get I everything be to also cost to And you could benefit to honest, the becomes And be to consumers isn't before something be it there watch. something a for they relevant the it love in product. our considered we us. getting It's experimenting And that I So would when the say, are we know

Oliver Chen

Best helpful. regards. you. Very Thank

Operator

the would Julie, back this now phone any and like time. turn And the there additional at for are no I to questions further line call over to closing comments.

Julie Wainwright

call. all their on the my I want XXXX. for joining continued earnings levels for today express to all Thank team, at strong to RealReal start for and thank our closing, dedication In you us appreciation

It's one members important. to looking million more path of who life are XX thank of We mission our like extend with sharing profitability more luxury forward our on earnings the joining our make believe finally, call. to to further We on than pillars. you key results then, to on and other during And are I'd next progress our our really us sustainable. that's fashion

to So thank you that, we're end very much. call. the And going with

Operator

and may call. participating. Ladies concludes disconnect. Thank today's gentlemen, this you now And conference you for

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