thredUP (TDUP) Stock Forecast & Price Target

ThredUp Inc. reported a notable revenue increase of 33.6%, reaching $82.2 million, exceeding both the company's guidance and market expectations, highlighting strong demand reflected in active buyers and order growth of 25.6% and 37.2% year-over-year, respectively. The company experienced its highest month of new customer acquisition in October, with an 81% rise attributed to lower acquisition costs and enhanced AI-driven personalization, suggesting a positive trajectory for customer engagement. Furthermore, ThredUp has raised its fiscal year 2025 revenue expectations to a range of $307 million to $309 million, surpassing previous guidance, signaling robust growth potential that aligns with enhanced operational efficiencies.

ThredUp Inc. has narrowed its full-year gross margin outlook to 79.0%-79.2%, reflecting a decline from the prior year’s rate of 79.7%, which suggests underlying pressures on profitability. Sales growth is expected to decelerate significantly in Q4, with a projection of approximately 10% year-over-year growth, compared to 25% in Q3, indicating worsening momentum amid macroeconomic challenges. Additionally, the company's operating expenses have increased to 84.7% of sales, coupled with external factors like consumer financial strain and uncertain economic conditions, which further contribute to a negative outlook for the stock.