The RealReal, which claims to be the largest marketplace for luxury second-hand goods (with 27 million members), is off to a good start this year. The San Francisco-based company reported solid revenue growth and “strong operating expenses”. Its gross merchandise value (GMV) increased by 31% to $428 million.
“We are pleased with our financial results, which exceeded our expectations. This strong growth is especially notable given the covid-related absences in our authentication centres. In the first quarter, we will continue to generate significant leverage on our fixed and variable operating expenses,” said Julie Wainwright, Founder and CEO of The RealReal.
Slightly widened losses.
In more detail, the pure-player’s total revenues were up 48% to $147 million. However, its losses widened slightly to $57 million from $56 million in the first quarter of 2021.
As a result, its adjusted Ebitda was $35.3 million or 24.1% of revenue compared to $35.6 million and 36.1% of revenue (CA) in Q1 2021.
The number of active buyers in the last 12 months increased by 21% to 828,000. The average order value was $487, an increase of 3%. This was driven by the higher number of products ordered, and partially reduced by the lower average price. This was due to the evolution of the mix, with an increase in demand for ready-to-wear.
Julie Wainwright, continues to see the future as rosy with “continued strong demand despite recent geopolitical events and macro-economic uncertainties”. The surge in inflation and prices in the luxury market reinforces her and her team’s belief in The RealReal model. The RealReal offers “unique and highly desirable items” online.
As a result, the company believes it is well on its way to “a solid year”. And Robert Julian, The RealReal’s CFO, confirmed the forecast for the full 2022 financial year. He maintained a range of $2-2.1m for GMV, $635-665m for total revenue and $80-100m for adjusted Ebitda.
Featured photos : © The RealReal