ThredUp Inc. - FORM 8-K - EX-99.2 - May 12, 2021

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Exhibit 99.2
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ThredUp Inc.
First Quarter 2021 Supplemental Financials

Key Financial Metrics for the Quarter

•Record revenue of $55.7 million
◦vs. $48.3 million in Q1’FY 2020
◦Growth of 15.2% Y/Y
•Record gross profit of $39.7 million
◦vs. $32.6 million in Q1’FY 2020
◦Growth of 21.7% Y/Y
•Gross margin of 71%
◦vs. 68% in Q1’FY 2020
◦Growth of 380 basis points Y/Y
•GAAP net loss of $16.2 million
◦vs. $13.2 million in Q1’FY 2020
•Adjusted EBITDA loss of $9.1 million
◦vs. $10.4 million in Q1’FY 2020
◦An improvement of 12.5% Y/Y
•Adjusted EBITDA margin loss of 16.4%
◦vs. loss of 21.6% in Q1’FY 2020
◦An improvement of 520 basis points Y/Y
•Cash, cash equivalents and marketable securities were $250 million at the quarter end
•Total quarter Active Buyers of 1.29 million
◦vs. 1.13 million in Q1’FY 2020
◦An increase of 14% Y/Y
•Total Orders of 1.13 million
◦vs. 956,000 in Q1’FY 2020
◦An increase of 18% Y/Y

Conference Call and Webcast

•The live call is accessible in the U.S and Canada at +1 800-367-2403 (code 8375215) and outside of the U.S. and Canada at +1 334-777-6978 (code 8375215)
•The live and archived webcast and all related earnings materials will be available at thredUP’s investor relations website: ir.thredup.com


Business Outlook

For second quarter 2021, thredUP expects:
•Revenue in the range of $53 million to $55 million
•Gross margin in the range of 70% to 72%
•An adjusted EBITDA margin loss in the range of 28% to 23%
•Depreciation and amortization of approximately $2 million
•Stock-based compensation of approximately $3 million
•Weighted-average shares of approximately 95 million
For fiscal year 2021, thredUP expects:
•Revenue in the range of $223 million to $229 million
•Gross margin in the range of 70% to 72%
•An adjusted EBITDA margin loss in the range of 20% to 16%
•Depreciation and amortization of approximately $8 million
•Stock-based compensation of approximately $11 million
•Weighted-average shares of approximately 78 million

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ThredUp Inc.
First Quarter 2021 Supplemental Financials
ThredUp Inc.
Condensed Consolidated Income Statements
(in thousands, unaudited)
Period EndingQ1 2019Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Revenue:
Consignment revenue$16,399 $22,000 $27,338 $32,026 $35,314 $34,914 $33,657 $34,211 $44,688 
Product revenue16,708 18,118 18,612 12,611 13,001 12,421 13,275 9,222 10,992 
Total revenue33,107 40,118 45,950 44,637 48,315 47,335 46,932 43,433 55,680 
Cost of revenue:
Cost of consignment revenue4,209 5,119 5,837 7,599 8,816 8,297 7,984 9,087 10,832 
Cost of product revenue7,903 7,402 7,579 5,660 6,873 6,027 6,172 4,611 5,130 
Total cost of revenue12,112 12,521 13,416 13,259 15,689 14,324 14,156 13,698 15,962 
Gross profit20,995 27,597 32,534 31,378 32,626 33,011 32,776 29,735 39,718 
Gross margin % of revenue63.4 %68.8 %70.8 %70.3 %67.5 %69.7 %69.8 %68.5 %71.3 %
Operating expenses
Operations, product and technology16,397 19,270 20,831 25,580 25,475 22,149 25,856 27,928 28,312 
Marketing9,250 9,499 13,557 12,674 13,001 10,898 10,614 10,252 15,446 
Sales, general and administrative4,065 5,018 5,199 7,971 7,433 6,438 6,891 7,802 10,638 
Total operating expenses29,712 33,787 39,587 46,225 45,909 39,485 43,361 45,982 54,396 
Operating expenses % of revenue89.7 %84.2 %86.2 %103.6 %95.0 %83.4 %92.4 %105.9 %97.7 %
Operating income (loss)(8,717)(6,190)(7,053)(14,847)(13,283)(6,474)(10,585)(16,247)(14,678)
Operating loss % of revenue(26.3)%(15.4)%(15.3)%(33.3)%(27.5)%(13.7)%(22.6)%(37.4)%(26.4)%
Interest and other (expense) income, net(670)(399)(191)(94)68 (183)(419)(698)(1,466)
Income (loss) before provision for income taxes(9,387)(6,589)(7,244)(14,941)(13,215)(6,657)(11,004)(16,945)(16,144)
Provision for (benefit from) income taxes— — — 36 — — — 56 27 
Net income (loss)$(9,387)$(6,589)$(7,244)$(14,977)$(13,215)$(6,657)$(11,004)$(17,001)$(16,171)
Net income margin %(28.4)%(16.4)%(15.8)%(33.6)%(27.4)%(14.1)%(23.4)%(39.1)%(29.0)%

ThredUp Inc.
Adjusted EBITDA Reconciliation
(in thousands, unaudited)
Period EndingQ1 2019Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Adjusted EBITDA reconciliation
Net income (loss)$(9,387)$(6,589)$(7,244)$(14,977)$(13,215)$(6,657)$(11,004)$(17,001)$(16,171)
Add (deduct):
Depreciation and amortization1,064 1,076 1,044 1,090 1,245 1,198 1,425 1,713 2,038 
Stock-based compensation expense681 938 941 5,118 1,442 1,966 1,649 2,279 3,498 
Interest expense296 388 379 365 273 224 368 440 559 
Change in value of preferred stock warrant(6)18 (3)(3)(172)(1)89 285 930 
Loss on extinguishment of debt432 — — — — — — — — 
Provision for income taxes— — — 36 — — — 56 27 
Adjusted EBITDA$(6,920)$(4,169)$(4,883)$(8,371)$(10,427)$(3,270)$(7,473)$(12,228)$(9,119)
Adjusted EBITDA margin %(20.9)%(10.4)%(10.6)%(18.8)%(21.6)%(6.9)%(15.9)%(28.2)%(16.4)%

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ThredUp Inc.
First Quarter 2021 Supplemental Financials (continued)

ThredUp Inc.
Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses
(in thousands, unaudited)
Period EndingQ1 2019Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Operations, product and technology$16,397 $19,270 $20,831 $25,580 $25,475 $22,149 $25,856 $27,928 $28,312 
Marketing9,250 9,499 13,557 12,674 13,001 10,898 10,614 10,252 15,446 
Sales, general and administrative4,065 5,018 5,199 7,971 7,433 6,438 6,891 7,802 10,638 
Total operating expenses29,712 33,787 39,587 46,225 45,909 39,485 43,361 45,982 54,396 
Less: Total stock based compensation681 938 941 5,118 1,442 1,966 1,649 2,279 3,498 
Total non-GAAP operating expenses$29,031 $32,849 $38,646 $41,107 $44,467 $37,519 $41,712 $43,703 $50,898 
Non-GAAP operating expenses as a % of revenue87.7 %81.9 %84.1 %92.1 %92.0 %79.3 %88.9 %100.6 %91.4 %
ThredUp Inc.
Stock Based Compensation Details
(in thousands, unaudited)
Period EndingQ1 2019Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Stock Based Compensation
Operations, product and technology$432 $480 $486 $2,479 $715 $870 $987 $1,167 $1,349 
Marketing52 137 142 687 174 283 278 332 437 
Sales, general and administrative197 321 313 1,952 553 813 384 780 1,712 
Total$681 $938 $941 $5,118 $1,442 $1,966 $1,649 $2,279 $3,498 

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ThredUp Inc.
First Quarter 2021 Supplemental Financials (continued)

ThredUp Inc.
Condensed Consolidated Balance Sheets
(in thousands, unaudited)
Period EndingQ1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Assets
Current assets
Cash and cash equivalents$69,874 $79,827 $78,760 $64,485 $246,514 
Accounts receivable, net2,390 2,178 1,020 1,823 1,726 
Inventory, net3,842 3,328 3,862 3,519 3,482 
Other current assets5,012 2,688 4,257 5,332 3,168 
Total current assets81,11888,02187,89975,159254,890
Operating lease right-of-use assets17,675 25,408 24,808 23,656 22,338 
Property and equipment, net29,519 34,187 37,900 41,131 43,562 
Other assets3,441 3,496 3,144 2,965 2,980 
Total assets$131,753 $151,112 $153,751 $142,911 $323,770 
Liabilities and Stockholder's Equity
Current liabilities
Accounts payable$6,038 $10,785 $11,893 $9,386 $14,540 
Accrued and other current liabilities28,039 28,161 30,883 32,541 37,720 
Seller payable10,535 12,385 13,340 13,724 15,194 
Operating lease liabilities, current3,297 3,432 3,838 3,643 3,095 
Current portion of long-term debt2,744 — 1,318 3,270 5,736 
Total current liabilities50,653 54,763 61,272 62,564 76,285 
Operating lease liabilities, non-current15,290 23,213 22,352 21,574 20,811 
Long-term debt13,868 24,525 28,217 31,190 33,320 
Non-current liabilities606 1,734 2,684 2,719 1,927 
Total liabilities80,417 104,235 114,525 118,047 132,343 
Convertible preferred stock246,905 246,905 247,041 247,041 — 
Common stock1 1 1 1 9 
Additional paid in capital21,935 24,133 27,350 29,989 459,756 
Accumulated deficit(217,505)(224,162)(235,166)(252,167)(268,338)
Total stockholder's (deficit) equity(195,569)(200,028)(207,815)(222,177)191,427 
Total liabilities and stockholder's equity$131,753 $151,112 $153,751 $142,911 $323,770 







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ThredUp Inc.
First Quarter 2021 Supplemental Financials (continued)

ThredUp Inc.
Condensed Consolidated Cash Flows
(in thousands, unaudited)
Period EndingQ1 2020Q2 2020Q3 2020Q4 2020Q1 2021
Cash flows from operating activities
Net loss$(13,215)$(6,657)$(11,004)$(17,001)$(16,171)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization1,245 1,198 1,425 1,713 2,038 
Stock-based compensation expense1,442 1,966 1,649 2,279 3,498 
Reduction of the carrying amount of right-of-use assets873 992 1,017 1,152 1,318 
Changes in fair value of convertible preferred stock warrants and others(126)119 173 395 1,048 
Changes in operating assets and liabilities:
Accounts receivable, net(338)212 1,158 (803)97 
Inventory, net51 514 (534)343 37 
Other current and non-current assets(1,977)2,113 (312)208 (457)
Accounts payable1,122 5,239 (332)(2,560)4,722 
Accrued and other current liabilities1,791 121 2,340 930 4,784 
Seller payable1,218 1,850 955 384 1,470 
Operating lease liabilities(1,186)(793)(872)(973)(1,311)
Other non-current liabilities(2)761 941 (309)4 
Net cash (used in) provided by operating activities(9,102)7,635 (3,396)(14,242)1,077 
Cash flows from investing activities
Purchase of property and equipment(4,673)(6,022)(3,664)(5,065)(4,099)
Net cash used in investing activity(4,673)(6,022)(3,664)(5,065)(4,099)
Cash flows from financing activities
Proceeds from debt issuances, net of issuance costs— 8,427 5,000 4,925 4,625 
Repayment of debt(714)(476)— — — 
Proceeds from issuance of Class A common stock upon initial public offering, net of underwriting discounts and commissions— — — — 180,284 
Proceeds from exercise of common stock options10 232 1,568 360 1,875 
Payment of costs for the initial public offering (81)— (570)(466)(1,733)
Net cash (used in) provided by financing activities(785)8,183 5,998 4,819 185,051 
Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents(14,560)9,796 (1,062)(14,488)182,029 
Cash, cash equivalents and restricted cash and cash equivalents
Beginning of period87,853 73,293 83,089 82,027 67,539 
End of period$73,293 $83,089 $82,027 $67,539 $249,568 
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About ThredUp Inc.
thredUP is transforming resale with technology and a mission to inspire a new generation of consumers to think secondhand first. By making it easy to buy and sell secondhand, thredUP has become one of the world’s largest resale platforms for women’s and kids’ apparel, shoes and accessories. Sellers love thredUP because we make it easy to clean out their closets and unlock value for themselves or for the charity of their choice while doing good for the planet. Buyers love shopping value, premium and luxury brands all in one place, at up to 90% off estimated retail price. Our proprietary operating platform is the foundation for our managed marketplace and consists of distributed processing infrastructure, proprietary software and systems and data science expertise. In 2018, we extended our platform with thredUP Resale-As-A-Service (RaaS), which facilitates modern resale for a number of the world’s leading brands and retailers. thredUP has processed over 100 million unique secondhand items from 35,000 brands across 100 categories. By extending the life cycle of clothing, thredUP is changing the way consumers shop and ushering in a more sustainable future for the fashion industry.
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of the federal securities laws, which are statements that involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “shall,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements in this presentation include, but are not limited to, guidance on financial results for the second quarter and full year of 2021; statements about future operating results and our long term growth; the momentum of our business; the growth rates in the markets in which we compete; the impact of the COVID-19 pandemic on consumer behavior and our business; our investments in technology and infrastructure; and our ability to attract new Active Buyers.
The forward-looking statements contained in this presentation are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission (“SEC”), including in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations'' in the final prospectus for our initial public offering filed on March 26, 2021 and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021. The forward-looking statements in this presentation are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements, except as required by law. These forward-looking statements should not be relied upon as representing thredUP’s views as of any date subsequent to the date of this presentation.
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Additional information regarding these and other factors that could affect thredUP's results is included in thredUP’s SEC filings, which may be obtained by visiting our Investor Relations website at ir.thredup.com or the SEC's website at www.sec.gov.
Operating Metrics
An Active Buyer is a thredUP buyer who has made at least one purchase in the last twelve months. A thredUP buyer is a customer who has created an account in our marketplace. A thredUP buyer is identified by a unique email address and a single person could have multiple thredUP accounts and count as multiple Active Buyers.
Orders are defined as the total number of orders placed by buyers across our marketplace, including through our RaaS partners, in a given period, net of cancellations.
Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA margin and non-GAAP operating expenses. In addition to our results determined in accordance with GAAP, we believe that Adjusted EBITDA, Adjusted EBITDA margin and non-GAAP operating expenses, non-GAAP measures, are useful in evaluating our operating performance. We use Adjusted EBITDA, Adjusted EBITDA margin and non-GAAP operating expenses to evaluate and assess our operating performance and the operating leverage in our business, and for internal planning and forecasting purposes. We believe that Adjusted EBITDA, Adjusted EBITDA margin and non-GAAP operating expenses, when taken collectively with our GAAP results, may be helpful to investors because it provides consistency and comparability with past financial performance and assists in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results. Adjusted EBITDA. Adjusted EBITDA margin and non-GAAP operating expenses are presented for supplemental informational purposes only, should not be considered a substitute for financial information presented in accordance with GAAP and may be different from a similarly-titled non-GAAP measure used by other companies.
A reconciliation is provided above for Adjusted EBITDA to net loss and non-GAAP operating expenses to total operating expenses, respectively, the most directly comparable financial measures stated in accordance with GAAP. We calculate Adjusted EBITDA as net loss adjusted to exclude depreciation and amortization, stock-based compensation expense, interest expense, change in fair value of convertible preferred stock warrant liability and provision for income taxes. We calculate non-GAAP operating expenses as total operating expenses less stock based compensation expenses.
Investors are encouraged to review our results determined in accordance with GAAP and the reconciliation of Adjusted EBITDA to net loss and non-GAAP operating expenses to total operating expenses. thredUP is not providing a quantitative reconciliation of forward-looking guidance of Adjusted EBITDA to net loss because certain items are out of thredUP’s control or cannot be reasonably predicted.
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Historically, these items have included, but are not limited to, depreciation and amortization, stock-based compensation expense, change in fair value of convertible preferred stock warrant liability and provision for income taxes. Accordingly, a reconciliation for forward-looking Adjusted EBITDA is not available without unreasonable effort. However, for the second quarter of 2021 and full year 2021 depreciation and amortization is expected to be $2 million and $8 million, respectively. In addition, for the second quarter of 2021 and full year 2021 stock-based compensation expense is expected to be $3 million and $11 million, respectively. These items are uncertain, depend on various factors, and could result in projected net loss being materially less than is indicated by currently estimated Adjusted EBITDA.

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