ThredUp Grows Buyers to Record 1.82M, but Cuts Outlook as Loss Widens

ThredUp grew revenue 7% year over year to $88.2 million in Q3 — a sharp slowdown from the 34% growth it reported in the year-ago quarter — and widened its net loss to $5.5 million from $4.2 million a year earlier.

The top line landed in line with expectations, according to the company. But record demand metrics didn't translate into record economics: active buyers hit an all-time high of 1.82 million, up 16%, and both orders and items sold set records, each up 17%. The problem is what buyers pay. CEO James Reinhart told analysts on a Wednesday call that the price paid per item fell from $21 in Q2 to $18 in June and has stayed there.

Management responded by cutting guidance. ThredUp now expects Q4 revenue of $77 million to $79 million, down from a prior forecast of $85 million to $87 million. Full-year guidance dropped to $337.7 million to $339.7 million.

Why is growth stalling?

Two forces are squeezing the platform. First, the macro backdrop. "Macro challenges remain for our most price-sensitive budget shoppers," Reinhart said. Second, promotion-heavy competitors. He called the amount of money peer-to-peer resale rivals are spending on promotions "frankly shocking."

"As expected, these dollars have eroded some buyer share, especially among our price-sensitive customers," Reinhart said. "Fortunately, we have not observed any impact on our sellers."

His countermove is trading down-market shoppers for higher-value ones. ThredUp is "acquiring a more premium customer at higher levels than ever and deprioritizing lower LTV budget customers," he said.

That's a coherent strategy, but it hasn't stopped the revenue slide — and Reinhart concedes the pressure isn't fading soon. "More money will be spent in the U.S. this year, encouraging people to buy and sell secondhand than we have spent in our lifetime," he said, arguing that rivals are effectively paying to grow a category ThredUp has spent years building.

How rough could the holidays get?

Rough, by the CEO's own account. Retailers are "flushed with tariff refunds" after what he saw in October, which he expects to fuel aggressive Q4 discounting. "ThredUp is not traditionally a strong holiday destination. It's always our weakest quarter of the four," Reinhart said. "Deeper promotions may be required to maintain engagement."

Wall Street isn't waiting for a turnaround. William Blair analysts led by Dylan Carden wrote that the quarter's positives "cannot detract from the simple fact that revenues are now in decline with uncertain inflection." They also flagged the competitive mismatch: Depop is owned by eBay, "which has deep pockets and is fighting against a well-funded private entity with likely public aspirations." The analysts did commend management for setting a dour outlook for 2027 on limited expected improvement in the competitive landscape.

Can AI agents find the buyers?

ThredUp's main competitive bet is agentic commerce — AI shopping agents browsing its inventory. "AI agents are first-class shoppers on ThredUp," Reinhart said. "Our bet is that agents can sift through millions of one-of-a-kind items far more efficiently than any person, and our managed supply gives them clean, structured data to work with."

That bet carries costs. In October, Reinhart discussed the expenses of scaling the company's AI use at the RetailClub AI Festival conference. "I was both surprised and didn't care at all," he said — a line that signals commitment, but not a cost estimate, and investors will want one before crediting the strategy. For now, ThredUp is buying time with premium customers and structured data while better-funded rivals buy the market.