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The RealReal’s Q3 Order Volume Jumps 41 Percent From Last Year

Luxury consignment resale platform The RealReal posted third quarter earnings results that bested Wall Street’s revenue estimate and beat the adjusted diluted loss per share forecast by 3 cents.

In a Nutshell: The RealReal saw the acceleration of revenue growth in the quarter. Active buyers for the trailing 12 months reached 542,987, representing an increase of 43 percent year-over-year. Orders reached 577,421, or up 41 percent year-over-year. The average order value rose 4.8 percent to $438 from $418. Gross merchandise value from repeat resale buyers was 81.8 percent, compared with 82.9 percent in the same 2018 quarter.

Net Sales: Total revenues for the quarter ended Sept. 30 skyrocketed 55.3 percent to $80.5 million from $51.8 million. That includes a 52.6 percent hike in consignment and service revenue to $69.8 million and a 75.5 percent jump in direct revenue to $10.7 million.

Earnings: The net loss for the quarter widened slightly to $25.3 million, or 30 cents a diluted share, from $25.1 million, or $3.00, in the year-ago quarter. On an adjusted basis, the diluted EPS loss was 27 cents.

Wall Street was expecting a loss of 30 cents on revenues of $75.9 million.

CEO’s Take: Julie Wainwright, CEO, said the third quarter was very strong and “speaks to the health and vibrancy of our marketplace. [Gross merchandise value] and revenue growth accelerated, and we saw increased leverage in marketing as well as operations and technology.”

The company’s accelerating growth and operating leverage during the quarter “speaks to several unique aspects of our model including high buyer repeat rates,” Wainwright said, “and our flywheel where buyers become consignors and consignors become buyers.”