ThredUp Inc

ThredUp has shown strong performance with active buyers, orders, and revenue all exceeding expectations, growing 25%, 19%, and 15% year-over-year, respectively. Management has guided for an acceleration across every trend in Q2, and the previous quarter's performance has positively influenced full-year guidance, which we believe remains conservative. A significant development is the expansion of the direct listing program, allowing sellers to list their own items, which has resulted in average sales prices more than double that of traditional clean-out kits. This program represents potential upside that we have not yet factored into our five-year estimates.

ThredUp’s share price has been extremely weak over the past six months despite continued strength in the underlying business. Recent financial performance has increased our confidence in our five-year target of $30+ per share. We view this disconnect between price and fundamentals as a compelling opportunity and added to the position during the quarter. Revenue grew ~18% year over year, while new buyer growth accelerated to +57%. The company guided to 13% revenue growth and 160 basis points of EBITDA margin expansion in 2026, both ahead of consensus expectations. Taken together, these results support our view that ThredUp remains in the early stages of a multi-year inflection, where growth and profitability scale in tandem.

ThredUp (TDUP) has faced challenges recently, but we fully expect it to be a leading gainer again. The stock has fallen significantly, which we view as an overreaction to quarterly results. This presents a compelling opportunity for us to add to our position, as we believe the company has strong growth potential in the online resale market. The current valuation does not reflect the long-term opportunity that ThredUp represents, and we are optimistic about its ability to rebound.

ThredUp delivered an excellent third quarter, with revenue up approximately 34% year over year, one of the fastest growth rates in its recent history. Adjusted EBITDA improved to $3.8 million, or a 4.6% margin, from roughly breakeven last year, while active buyers increased about 26%, driven by strong new buyer acquisition. Management also raised full year revenue guidance, signaling confidence in the outlook. Notably, management highlighted that new buyer growth accelerated to 81% year over year in October, up from 54% in Q3, following a rebrand and the launch of a new product recommendation feed in late September. These dislocations between price and fundamentals are common in the types of businesses we invest in and have led us to add to the position. ThredUp remains our largest holding.

ThredUp delivered an impressive quarter. Revenue rose 16% year over year to $77.7 million — the company’s fastest pace in several years and adjusted EBITDA increased roughly ~100% year over year, highlighting the strong operating leverage inherent in the model. Customer metrics were equally encouraging. Active buyers grew 17% to 1.47 million, while new buyer acquisition surged 74%. Management raised full-year guidance and now expects approximately 15% revenue growth, and an adjusted EBITDA margin of about 4%. We continue to see significant upside from here.

Thredup is undergoing a significant inflection point that’s rapidly shifting investor perception of the business. The company delivered strong Q1 results, beating expectations and raising guidance for Q2 and the full year. While the stock has already had a strong run year-to-date, we continue to see meaningful upside over the coming years as Thredup scales into its existing fulfillment center capacity.

ThredUp preannounced strong results in January, pointing to a meaningful acceleration in both revenue growth and margin expansion. In March, the company issued conservative 2025 guidance, which we believe positions it well to continue to outperform market expectations. Due to having a market cap of just $400 million, ThredUp remains largely under the radar—but we expect that to change over the next 12–18 months as its improving fundamentals attract broader investor attention. It’s currently a top three position in the portfolio, and we believe its best days remain ahead.