The RealReal (REAL) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue grew 11% year-over-year to $148 million, with GMV up 6% to $433 million, driven by strong consignment sales and improved take rate.

• Adjusted EBITDA turned positive at $2.3 million, a $9.3 million improvement year-over-year, marking the second consecutive quarter of profitability.

• Net loss narrowed to $17.9 million, or (12.1)% of revenue, compared to $(23) million, or (17.2)% in Q3 2023, reflecting improved operating leverage and cost controls.

• Active buyers grew 7% year-over-year to 389,000, with average order value up 2% to $522, reflecting strong consumer demand.

• The company raised full-year 2024 guidance for GMV, revenue, and Adjusted EBITDA, citing continued momentum and strong supply trends.

Financial highlights

• Consignment revenue grew 14% year-over-year to $116.9 million, with take rate stable at 38.6%; direct revenue declined 10% to $15.6 million.

• Gross profit was $111 million, up $17 million year-over-year, with gross margin reaching a record 74.9%–75%, up 430 basis points.

• Shipping services revenue increased 17% to $15.2 million, driven by higher order volume and increased shipping fees.

• Adjusted EBITDA margin was 1.6% of revenue, compared to (5.2)% in Q3 2023.

• Cash and cash equivalents at quarter-end were $153–$168 million.

Outlook and guidance

• Q4 2024 GMV expected at $484–$500 million (7–11% growth); revenue at $158–$165 million.

• Full-year 2024 GMV guidance raised to $1.81–$1.83 billion; revenue to $595–$602 million.

• Full-year 2024 Adjusted EBITDA guidance raised to $4.7–$7.7 million; Q4 Adjusted EBITDA expected at $6.5–$9.5 million.

• Management expects continued operating losses and negative cash flows in the near term but believes current cash reserves are sufficient for at least the next 12 months.

• Focus remains on profitable growth, optimizing take rates, and investing in technology and automation.