thredUP (TDUP) Stock Forecast & Price Target

ThredUp Inc. reported a significant revenue growth of 33.6% to $82.2 million, exceeding both company guidance and market consensus, largely due to an increase in orders and active buyers, which rose 37.2% and 25.6% year-over-year, respectively. The company is projecting FY25 revenues between $307 million and $309 million, an upward revision from previous estimates and ahead of prior consensus estimates, indicating strong expectations for continued growth. Additionally, ThredUp's focus on a streamlined domestic-only model and the utilization of AI-driven tools to improve buyer and seller experiences suggest a robust foundation for sustainable long-term growth.

ThredUp Inc. has experienced a noticeable decline in its gross margin outlook, adjusting to 79.0%-79.2% for the full year, which is lower than the previous guidance and down from FY24's rate of 79.7%. A significant slowdown in sales growth is anticipated in Q4, projected at only around 10% year-over-year as opposed to the 25% seen in Q3, indicating weakening consumer demand. Furthermore, the increase in operating expenses to 84.7% of sales and the presence of macroeconomic uncertainties, including rising interest rates and fluctuating consumer confidence, contribute to a negative outlook for the company's financial performance moving forward.