THREDUP’S Q3 2026 EARNINGS: WHATNOT PRICING, DIRECT LISTING AND RESALE GROWTH

Introduction

Reviewing ThredUp’s Form 10-Q for the quarter ended September 30, 2026, and listening to its November 4 earnings call provided several interesting points. The company reported more buyers, orders and items sold, while also describing pressure from promotional activity, budget conscious consumers and rapidly growing competition from peer-to-peer resale marketplaces.

Management also provided early information about several newer initiatives, including live selling on Whatnot and Direct Listing. A few of the figures caught my attention and gave me something to examine more closely. Below are a few highlights.

Third Quarter 2026 Results

Compared with the third quarter of 2025, ThredUp reported:

• Revenue of $88.2 million, an increase of 7.4% or approximately $6.1 million.

• Gross margin of 78.2% down 120 basis points from 79.4% primarily because labor and packaging costs represented a larger percentage of revenue.

• A net loss of $5.5 million, widening from $4.2 million.

• Adjusted EBITDA of $3.5 million, compared with $3.8 million one year earlier.

Buyers, Orders and Merchandise

ThredUp ended the quarter with approximately 1.82 million active buyers, an increase of 16%. The company defines an active buyer as someone who has made at least one purchase during the preceding 12 months.

Orders increased 17% to approximately 1.89 million. Management also said ThredUp recorded its highest quarterly gross merchandise value and sold 17% more items than it had in the prior year period. ir.thredup.com

CEO James Reinhart described the quarter as another record for new buyers acquired, active buyers, orders and website sessions. He also said customers purchased more merchandise from ThredUp during the quarter than ever before.

Those records came with pricing pressure. ThredUp said the overall amount paid per item had increased from $19 in the fourth quarter of 2024 to $21 in the second quarter of 2026. Beginning in June 2026, however, it fell to $18 and remained there through the third quarter. Management attributed the decline to promotions and other pricing actions intended to convert increasingly price sensitive shoppers. That provides important context for ThredUp’s comments about the prices obtained through Whatnot.

Some Positives and Some Pressures

The results contained encouraging indicators:

• Clean Out Kit requests increased 30% year to date.

• ThredUp welcomed a record number of sellers.

• Premium merchandise represented a growing share of the supply it processed.

• Management said the company’s supply had “never been stronger.”

At the same time, the company identified several challenges:

• Macroeconomic pressure remains particularly pronounced among its most price sensitive shoppers.

• ThredUp expects the holiday shopping environment to remain highly promotional.

• Peer-to-peer fashion resale competition is increasing.

• Management said competitors’ marketing spending and order and shipping subsidies had taken some share among ThredUp’s budget oriented customers.

• ThredUp reduced its fourth quarter outlook and said October had been softer than expected.

ThredUp’s comments about Whatnot caught my attention because the company appears prepared to make live selling a much larger part of its business. What started with its first show on September 29 could involve dozens of hosts, as many as 10 studios and up to 18 hours of daily programming by the end of the year.

ThredUp Is “All In” on Live Selling

During the call, Reinhart said ThredUp was “all in on live selling” from studios located inside its distribution centers. By the end of 2026 ThredUp expects to have dozens of hosts, as many as 10 studios and up to 18 hours of daily streaming across multiple live selling

platforms. Its first Whatnot show took place on September 29, and I wrote about the launch in a September 30 post. ir.thredup.com

ThredUp Disclosed Two Notable Early Findings.

First, 75%of the customers who purchased from ThredUp through Whatnot had never previously purchased through ThredUp’s regular marketplace. Second, when ThredUp

compared similarly aged merchandise sold through the two channels, it reported that the median live selling average selling price, or ASP, was 52% higher on Whatnot. Management

also said Whatnot buyers pay shipping, returns are less frequent, coupon codes are not used and orders can be fulfilled through ThredUp’s existing distribution infrastructure. Reinhart described the resulting unit economics as superior. That 52% figure immediately

caught my attention.

What Sits Behind the 52%?

I have watched more than a dozen ThredUp shows on Whatnot. My observations are not scientific or representative of every show, but I saw many items sell for less than $10, while relatively few exceeded $25. Meanwhile, ThredUp’s regular website includes plenty of merchandise priced above those amounts.

That made me wonder what actual prices sit behind the reported 52% increase. I have

no reason to doubt ThredUp’s figure. But it does not necessarily mean Whatnot is generating high selling prices. It may mean that selected items are producing better prices on Whatnot than comparable merchandise would generate after aging and being discounted on ThredUp’s regular marketplace. That distinction matters.

ThredUp separately reported that the overall price paid per item across its core business had fallen to $18 beginning in June. That is not necessarily the core marketplace median used in the Whatnot comparison. The 52% calculation concerned the median selling

prices of similarly aged merchandise sold through Whatnot and ThredUp’s core marketplace. The company did not disclose either of the two median prices underlying that calculation.

Without those prices, we know the percentage difference but not the actual prices being compared. The increase could represent, for example, a movement from $6 to approximately $9 or from $20 to more than $30. Those scenarios would have very different implications, even though each would produce roughly the same percentage increase.

The lower priced example would be reasonably consistent with what I observed during the shows. A relative improvement could be real even when the final selling price remains below $10.

The comparison also concerns similarly aged merchandise rather than identical items. That is understandable because secondhand products are generally one of a kind. It nevertheless introduces other variables, including brand, size, condition, style, starting bid, the host’s presentation and the number of bidders watching at that particular moment.

Better Relative Pricing Is Not Necessarily High Pricing

ThredUp’s Whatnot result is probably best understood as a claim of better relative pricing for comparable inventory, not evidence that the channel is producing high prices overall.

That distinction is particularly relevant because ThredUp acknowledged that aging inventory is requiring greater discounting on its regular marketplace. Reinhart gave the example of merchandise that previously might have sold for $20 but now requires a price of approximately $17 or $18 as it ages.

If placing that merchandise into a live show avoids promotional discounts, attracts multiple bidders and encourages bundled purchases, Whatnot may produce a better result than leaving the same type of merchandise on ThredUp’s website. That could be valuable even when the auction price remains modest.

What I will be watching is whether live selling can continue to produce better relative prices as ThredUp expands from its early shows to dozens of hosts, multiple studios and as many as 18 hours of daily programming.

The early results are encouraging for ThredUp, but the larger test will be whether the channel can attract new customers and move merchandise efficiently as it grows. The 52%

statistic gives us two useful pieces of the story: the direction of the price difference and its reported size. The actual median prices are the missing third piece needed to determine what the result represents in dollars.

What Does ThredUp Mean by Knowing “How to Price” an Auction?

Another comment about live selling prices caught my attention. Reinhart said ThredUp possesses the data needed to know how to price and merchandise inventory for a live selling format. The merchandising portion makes sense. ThredUp can use its data to decide which brands, categories, sizes and styles may appeal to Whatnot audiences.

The pricing portion is less clear to me because these are auctions. In the shows I watched, items generally began at either $1 or $5, and bidders determined the final selling price.

ThredUp’s data could still help it decide which items to place on Whatnot, which to retain on its regular marketplace, which themed show may provide the best audience and whether to begin an auction at $1, $5 or another amount.

Still, when many auctions begin at one of two low price points, I am curious about how much of the company’s pricing data is applied before the bidding begins. Perhaps

ThredUp considers a $1 or $5 opening bid part of a broader pricing strategy designed to encourage participation rather than predict the eventual selling price. The final result, however, still depends on which buyers are watching and how many decide to bid.

Is 200,000 Direct Listings a Lot, or a Little?

Comments about Direct Listing was another part of the earnings call that made me perk up.

ThredUp said the program, which was launched widely in June, had reached a roughly $10 million annualized GMV run rate. It also reported more than 200,000 available Direct Listings, with average listing prices more than twice those on its core marketplace.

To put the 200,000 listings into perspective, an episode of Retail Razor featuring ThredUp Chief Strategy and Legal Officer Alon Rotem described ThredUp as having approximately five million one-of-a-kind items available at any given time. retailrazor.com

If those two figures are reasonably comparable, Direct Listings would represent approximately 4% of ThredUp’s available inventory. That made the number seem relatively small to me, although Direct Listing had been widely available for only a few months.

ThredUp also said it deliberately slowed the program’s growth in late August while refining its shipping, cart and checkout functions, with plans to accelerate again during the holiday season. The 200,000 figure therefore reflects a program that was still being developed rather than one that had already reached its intended scale.

The program’s $10 million annualized GMV run rate also shows that Direct Listing is producing completed transactions rather than simply accumulating available inventory.

Additional figures would make its early development easier to follow:

• The number of sellers who have created Direct Listings.

• The number of buyers who have purchased them.

• The percentage of available Direct Listings that result in completed sales.

• The average or median time required to sell an item.

• The average completed sale price, rather than only the average listing price.

• The percentage of Direct Listing buyers who are new to ThredUp.

• The percentage who return for another purchase.

These figures would show whether participation is broadening among both buyers and sellers, how quickly the merchandise moves and whether its higher listing prices are translating into completed sales. For now, the 200,000 listings and $10 million annualized GMV run rate show that Direct Listing has moved beyond a concept. The next question is how large a place it can earn alongside ThredUp’s much larger managed marketplace.

The Larger Picture for ThredUp

ThredUp’s results show how competitive the secondhand market has become. More people may be willing to buy and sell used clothing, but buyers are also becoming more selective about what they purchase and how much they will pay. At the same time, marketplaces are competing for their attention through promotions, subsidized shipping and different shopping experiences.

ThredUp’s October 26 Holiday Resale Report found that 62% of the Americans surveyed planned to buy secondhand during the 2026 holiday season. It also found that 53% had sold, or expected to sell, personal items to help pay for the holidays. (GlobalData conducted the survey among 2,123 U.S. adults.)

Those findings suggest that consumers are becoming increasingly comfortable with secondhand. They also have more places to shop, including peer-to-peer marketplaces, managed-consignment businesses, live-selling platforms and traditional retailers offering resale programs. Sellers have more choices about where and how to offer their merchandise too.

ThredUp is responding to that competition through several selling formats. Its core marketplace, Direct Listing and Whatnot each provide a different experience for buyers and sellers. Creator storefronts and AI-assisted shopping could add still more ways for people to discover ThredUp’s inventory.

The company already has millions of items, an established Clean Out operation and the infrastructure required to process secondhand merchandise at scale. Its challenge is to use those advantages to retain buyers while competitors are spending heavily to attract them, and to determine which of its newer initiatives can make a meaningful contribution.

I will be watching whether Whatnot continues to attract people who have never purchased from ThredUp, whether those buyers return and whether Direct Listing grows beyond its early base of 200,000 available listings. The initial figures give ThredUp reasons to continue developing both programs. It is still too early, however, to know how important either one will become to the company’s overall business.

Full Disclosure: This post reflects my personal opinions and observations and is intended for informational purposes only. It should not be considered professional, financial or legal advice. I have not attended all of ThredUp's live shows on Whatnot. These are fast paced

shows, with merchandise and comments moving quickly, so my observations are based on what was visible and stated in real time, and unintentional oversights are possible. This post does not cover all buying and selling rules for either platform. Please consult ThredUp and Whatnot websites for complete and current policies. I have sold through both ThredUp's consignment model and Direct Listing, and all of my transactions have been satisfactory.

I have no professional relationship with ThredUp or Whatnot and was not compensated to write this post. All images were created by Perplexity AI.