thredUP (TDUP) Stock Forecast & Price Target

ThredUp Inc reported a remarkable 33.6% revenue growth, reaching $82.2 million, which exceeded both its guidance and market expectations, highlighting strong demand through increased orders and active buyers. The company's proactive approach to customer acquisition, resulting in an 81% surge in new customers in October, indicates an effective strategy aided by lower acquisition costs and enhanced personalization through AI technology. Additionally, ThredUp's upward revision of its FY25 revenue forecast to between $307 million and $309 million, surpassing previous estimates, underscores a positive outlook driven by robust revenue momentum and operational efficiency.

ThredUp Inc. has adjusted its full-year gross margin outlook to 79.0%-79.2%, which, while a modest improvement from previous estimates, represents a decline from FY24's rate of 79.7%. The company has also projected a significant deceleration in sales growth, expecting only a ~10% year-over-year increase in Q4, a sharp decline from the ~25% growth anticipated in Q3. Additionally, rising operating expenses, which increased to 84.7% of sales, alongside potential consumer financial strain due to broader macroeconomic factors, indicate a negative outlook for the company's financial performance moving forward.