UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 7, 2022
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code: (415 ) 402-5202
Not Applicable
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On March 7, 2022, ThredUp Inc. (the "Company") issued a press release announcing its financial results for the quarter and full year ended December 31, 2021. A copy of the press release is attached hereto as Exhibit 99.1. In addition, a copy of the supplemental financial information is attached hereto as Exhibit 99.2. The press release and supplemental financial information are incorporated herein by reference.
The information in this current report on Form 8-K and the exhibits attached hereto is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: March 7, 2022 | THREDUP INC. | ||||||||||
| By: | /s/ Sean Sobers | ||||||||||
Sean Sobers | |||||||||||
| Chief Financial Officer | |||||||||||
| (Principal Financial and Accounting Officer) | |||||||||||
thredUP Announces Fourth Quarter and Full Year 2021 Results
•All-time quarterly revenue high of $72.9 million, representing 68% growth year-over-year. Fourth quarter gross margin of 66% and gross profit growth of 62% year-over-year.
•Annual revenue of $251.8 million, representing 35% growth year-over-year. Annual gross margin of 70.7% and gross profit growth of 39% year-over-year.
•Record number of Active Buyers of 1.7 million and Orders of 1.7 million in Q4 2021, representing growth of 36% and 69% year-over-year, respectively. Record annual orders of 5.3 million, representing growth of 34% year-over-year.
•Remix acquisition closed in Q4 2021, kickstarting our international expansion.
•Established new Resale-as-a-Service (RaaS) programs with adidas, Crocs, and Michael Stars.
Oakland, CA – March 7, 2022 – ThredUp Inc. (Nasdaq: TDUP), one of the largest online resale platforms for women’s and kids’ apparel, shoes, and accessories, announced today its preliminary financial results for the fourth quarter and full year ended December 31, 2021.
“We ended our first year as a public company with another quarter of strong financial performance,” said James Reinhart, CEO and co-founder at thredUP. “In 2022, we expect our continued investment in our infrastructure both domestically and internationally will enable us to keep building the foundation for the future of resale on the internet.”
Fourth Quarter 2021 Financial Highlights
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•Revenue: Total revenue of $72.9 million, an increase of 68% year-over-year.
•Gross Profit and Gross Margin: Gross profit totaled $48.2 million representing growth of 62% year-over-year. Gross margin was 66.1% as compared to 68.5% in the fourth quarter last year largely due to the Q4 acquisition of Remix.
•Net Loss: The GAAP net loss was $17.9 million, or 24.6% of revenue, for the fourth quarter 2021, compared to a GAAP net loss of $17.0 million, or 39.1% of revenue, for the fourth quarter 2020.
•Adjusted EBITDA and EBITDA Margin: The Adjusted EBITDA loss was $10.5 million, or 14.5% of revenue, for the fourth quarter 2021, compared to the Adjusted EBITDA loss of $12.2 million, or 28.2% of revenue, for the fourth quarter 2020.
•Active Buyers and Orders: Active Buyers of 1.7 million and Orders of 1.7 million growing 36% and 69%, respectively, over the comparable quarter last year.
Full Year 2021 Financial Highlights
•Revenue: Total revenue of $251.8 million, an increase of 35% year-over-year.
•Gross Profit and Gross Margin: Gross profit totaled $178.1 million representing growth of 39% year-over-year. Gross margin expanded to 70.7% from 68.9% last year.
•Net Loss: The GAAP net loss was $63.2 million, or 25.1% of revenue, for the full year 2021, compared to a GAAP net loss of $47.9 million, or 25.7% of revenue, for the full year 2020.
•Adjusted EBITDA and EBITDA Margin: The Adjusted EBITDA loss was $36.5 million, or 14.5% of revenue, for the full year 2021, compared to the Adjusted EBITDA loss of $33.4 million, or 18.0% of revenue, for the full year 2020.
•Orders: Record orders of 5.3 million for the full year 2021, growing 34% over 4.0 million for the full year 2020.
Recent Business Highlights
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•Opened two dedicated processing centers: In addition to opening its Dallas, TX distribution center, thredUP is expanding its processing power by bringing two new processing centers online in Grapevine, TX and Lebanon, TN.
•Resale-as-a-Service (RaaS): thredUP announced a number of new RaaS programs with adidas, Crocs, and Michael Stars and more.
•Closed Remix acquisition: Acquisition closed in Q4 2021, kickstarting our international expansion.
•New Remix facility in Europe: thredUP pursues its international expansion with a new custom-built distribution center in Europe to support Remix’s growth, which will ultimately support over three times the capacity of its current DC.
•Bolstered ESG leadership: Seth Levey hired as first-ever Head of Public Policy and Sustainability to lead thredUP’s ESG strategy.
Financial Outlook
For the first quarter 2022, thredUP expects:
•Revenue in the range of $70 million to $72 million
•Gross margin in the range of 65% to 67%
•Adjusted EBITDA margin loss in the range of 19.0% to 17.0%
For the full fiscal year 2022, thredUP expects:
•Revenue in the range of $330 million to $340 million
•Gross margin in the range of 64% to 66%
•Adjusted EBITDA margin loss in the range of 15.5% to 13.5%
Conference Call and Webcast Information
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•Conference Call: The live call is accessible in the U.S. and Canada at +1 888-394-8218 (code 6055297) and outside of the U.S. and Canada at +1 646-828-8193 (code 6055297).
•Webcast: The live and archived webcast and related earnings materials will be available at thredUP’s investor relations website: ir.thredup.com.
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ThredUp Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
| December 31, | December 31, | ||||||||||
| 2021 | 2020 | ||||||||||
| Assets | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 84,550 | $ | 64,485 | |||||||
| Marketable securities | 121,277 | — | |||||||||
| Accounts receivable, net | 4,136 | 1,823 | |||||||||
| Inventory, net | 9,825 | 3,519 | |||||||||
| Other current assets | 8,625 | 5,332 | |||||||||
| Total current assets | 228,413 | 75,159 | |||||||||
| Operating lease right-of-use assets | 39,340 | 23,656 | |||||||||
| Property and equipment, net | 55,466 | 41,131 | |||||||||
| Goodwill | 12,238 | — | |||||||||
| Intangible assets | 13,854 | — | |||||||||
| Other assets | 11,515 | 2,965 | |||||||||
| Total assets | $ | 360,826 | $ | 142,911 | |||||||
| Liabilities, Convertible Preferred Stock and Stockholders’ Equity | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable | $ | 13,336 | $ | 9,386 | |||||||
| Accrued and other current liabilities | 45,253 | 32,541 | |||||||||
| Seller payable | 19,125 | 13,724 | |||||||||
| Operating lease liabilities, current | 3,931 | 3,643 | |||||||||
| Current portion of long-term debt | 7,768 | 3,270 | |||||||||
| Total current liabilities | 89,413 | 62,564 | |||||||||
| Operating lease liabilities, non-current | 36,997 | 21,574 | |||||||||
| Long-term debt | 27,559 | 31,190 | |||||||||
| Other non-current liabilities | 1,123 | 2,719 | |||||||||
| Total liabilities | 155,092 | 118,047 | |||||||||
| Convertible preferred stock | — | 247,041 | |||||||||
| Stockholders’ equity | |||||||||||
| Common stock | 10 | 1 | |||||||||
| Additional paid-in capital | 522,161 | 29,989 | |||||||||
| Accumulated other comprehensive loss | (1,094) | — | |||||||||
| Accumulated deficit | (315,343) | (252,167) | |||||||||
| Total stockholders’ equity (deficit) | 205,734 | (222,177) | |||||||||
| Total liabilities, convertible preferred stock and stockholders’ equity | $ | 360,826 | $ | 142,911 | |||||||
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ThredUp Inc.
Consolidated Statements of Operations
(in thousands, except share and per share data)
(unaudited)
| Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Consignment | $ | 44,758 | $ | 34,211 | $ | 186,114 | $ | 138,096 | |||||||||||||||
| Product | 28,121 | 9,222 | 65,678 | 47,919 | |||||||||||||||||||
| Total revenue | 72,879 | 43,433 | 251,792 | 186,015 | |||||||||||||||||||
| Cost of revenue: | |||||||||||||||||||||||
| Consignment | 10,257 | 9,087 | 41,856 | 34,184 | |||||||||||||||||||
| Product | 14,434 | 4,611 | 31,804 | 23,683 | |||||||||||||||||||
| Total cost of revenue | 24,691 | 13,698 | 73,660 | 57,867 | |||||||||||||||||||
| Gross profit | 48,188 | 29,735 | 178,132 | 128,148 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Operations, product and technology | 36,624 | 27,928 | 128,079 | 101,408 | |||||||||||||||||||
| Marketing | 15,281 | 10,252 | 63,625 | 44,765 | |||||||||||||||||||
| Sales, general and administrative | 14,608 | 7,802 | 48,814 | 28,564 | |||||||||||||||||||
| Total operating expenses | 66,513 | 45,982 | 240,518 | 174,737 | |||||||||||||||||||
| Operating loss | (18,325) | (16,247) | (62,386) | (46,589) | |||||||||||||||||||
| Interest expense | (524) | (440) | (2,275) | (1,305) | |||||||||||||||||||
| Other income, net | 961 | (258) | 1,565 | 73 | |||||||||||||||||||
| Loss before provision for income taxes | (17,888) | (16,945) | (63,096) | (47,821) | |||||||||||||||||||
| Provision for income taxes | 23 | 56 | 80 | 56 | |||||||||||||||||||
| Net loss | $ | (17,911) | $ | (17,001) | $ | (63,176) | $ | (47,877) | |||||||||||||||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (0.18) | $ | (1.33) | $ | (0.82) | $ | (4.14) | |||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 97,802,444 | 12,819,530 | 77,091,959 | 11,565,443 | |||||||||||||||||||
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ThredUp Inc.
Consolidated Statements of Comprehensive Loss
(in thousands)
(unaudited)
| Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Net Loss | $ | (17,911) | $ | (17,001) | $ | (63,176) | $ | (47,877) | |||||||||||||||
| Other comprehensive loss, net of tax: | |||||||||||||||||||||||
| Foreign currency translation adjustments | (729) | — | (729) | — | |||||||||||||||||||
| Unrealized gain (loss) on available-for-sale debt securities | (337) | — | (365) | — | |||||||||||||||||||
| Total comprehensive loss | $ | (18,977) | $ | (17,001) | $ | (64,270) | $ | (47,877) | |||||||||||||||
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ThredUp Inc.
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
| Twelve months ended December 31, | |||||||||||
| 2021 | 2020 | ||||||||||
| Cash flows from operating activities | |||||||||||
| Net loss | $ | (63,176) | $ | (47,877) | |||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||
| Depreciation and amortization | 9,155 | 5,581 | |||||||||
| Stock-based compensation expense | 12,959 | 7,336 | |||||||||
| Reduction in the carrying amount of right-of-use assets | 3,985 | 4,034 | |||||||||
| Changes in fair value of convertible preferred stock warrants and others | 2,342 | 561 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable, net | (1,189) | 229 | |||||||||
| Inventory, net | (2,741) | 374 | |||||||||
| Other current and non-current assets | (6,326) | 32 | |||||||||
| Accounts payable | 871 | 3,469 | |||||||||
| Accrued and other current liabilities | 9,251 | 5,182 | |||||||||
| Seller payable | 5,072 | 4,407 | |||||||||
| Operating lease liabilities | (3,964) | (3,824) | |||||||||
| Other non-current liabilities | (1,258) | 1,391 | |||||||||
| Net cash used in operating activities | (35,019) | (19,105) | |||||||||
| Cash flows from investing activities | |||||||||||
| Purchases of marketable securities | (125,217) | — | |||||||||
| Maturities of marketable securities | 2,800 | — | |||||||||
| Purchases of non-marketable equity investment | (3,750) | — | |||||||||
| Acquisition of business, net of cash acquired | (23,581) | — | |||||||||
| Purchase of property and equipment | (19,828) | (19,424) | |||||||||
| Net cash used in investing activities | (169,576) | (19,424) | |||||||||
| Cash flows from financing activities | |||||||||||
| Proceeds from debt issuance, net of issuance costs | 4,625 | 18,352 | |||||||||
| Repayment of debt | (4,000) | (1,190) | |||||||||
| Proceeds from issuance of Class A common stock upon initial public offering and the follow-on offering, net of underwriting discounts and commissions | 226,905 | — | |||||||||
| Proceeds from exercise of common stock options and withholding taxes for the net share settlement of restricted stock units | 5,177 | 2,170 | |||||||||
| Payment of costs for the initial public offering and the follow-on offering | (4,729) | (1,117) | |||||||||
| Proceeds from issuance of convertible preferred stock, net of issuance costs | — | — | |||||||||
| Proceeds from ESPP purchase | 982 | — | |||||||||
| Net cash provided by financing activities | 228,960 | 18,215 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (64) | — | |||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents | 24,301 | (20,314) | |||||||||
| Cash, cash equivalents and restricted cash and cash equivalents | |||||||||||
| Beginning of period | 67,539 | 87,853 | |||||||||
| End of period | $ | 91,840 | $ | 67,539 | |||||||
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ThredUp Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except percentages)
(unaudited)
| Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Adjusted EBITDA Reconciliation: | |||||||||||||||||||||||
| Net loss | (17,911) | $ | (17,001) | $ | (63,176) | $ | (47,877) | ||||||||||||||||
| Depreciation and amortization | 3,008 | 1,713 | 9,155 | 5,581 | |||||||||||||||||||
| Stock-based compensation expense | 3,570 | 2,279 | 12,959 | 7,336 | |||||||||||||||||||
| Acquisition and offering related expenses | 251 | — | 1,271 | — | |||||||||||||||||||
| Interest expense | 524 | 440 | 2,275 | 1,305 | |||||||||||||||||||
| Change in fair value of convertible preferred stock warrant liability | — | 285 | 930 | 201 | |||||||||||||||||||
| Provision for income taxes | 23 | 56 | 80 | 56 | |||||||||||||||||||
| Adjusted EBITDA | $ | (10,535) | $ | (12,228) | $ | (36,506) | $ | (33,398) | |||||||||||||||
| Adjusted EBITDA margin % | (14.5) | % | (28.2) | % | (14.5) | % | (18.0) | % | |||||||||||||||
Investors
ir@thredup.com
Media
media@thredup.com
About thredUP
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
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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. With thredUP’s Resale-as-a-Service, some of the world’s leading brands and retailers are leveraging our platform to deliver customizable, scalable resale experiences to their customers. 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 press release 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 press release include, but are not limited to, guidance on financial results for the first quarter and full year of 2022; 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; our ability to successfully integrate and realize the benefits of our past or future strategic acquisitions or investments; the success of our
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RaaSⓇ model and the timing and plans for future RaaSⓇ clients; and our ability to attract new Active Buyers.
The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission (“SEC”), including, but not limited to, risks detailed in our upcoming Annual Report on Form 10-K for the year ended December 31, 2021. The forward-looking statements in this press release 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 press release.
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 press release and the accompanying tables contain non-GAAP financial measures: Adjusted EBITDA and Adjusted EBITDA margin. In addition to our results determined in accordance with GAAP, we believe that Adjusted EBITDA and Adjusted EBITDA margin, non-GAAP measures, are useful in evaluating our operating performance. We use
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Adjusted EBITDA and Adjusted EBITDA margin 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 and Adjusted EBITDA margin, 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 and Adjusted EBITDA margin is 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 below for Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with GAAP. We calculate Adjusted EBITDA as net loss adjusted to exclude, where applicable in a given period, depreciation and amortization, stock-based compensation expense, acquisition, offering and other expenses, interest expense, change in fair value of convertible preferred stock warrant liability and provision for income taxes.
Investors are encouraged to review our results determined in accordance with GAAP and the reconciliation of Adjusted EBITDA to net loss. 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. 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 Adjusted EBITDA in order to calculate forward-looking Adjusted EBITDA margin is not available without unreasonable effort. However, for the first quarter of 2022 and full year 2022, depreciation and amortization is expected to be $2.9
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million and $15.5 million, respectively. In addition, for the first quarter of 2022 and full year 2022, stock-based compensation expense is expected to be $4.0 million and $17.9 million, respectively. These items are uncertain, depend on various factors, and could result in projected net loss being materially less than is indicated by the currently estimated Adjusted EBITDA margin.
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ThredUp Inc.
Fourth Quarter and Full Year 2021 Supplemental Financials
Key Financial Metrics for the Fourth Quarter
•Revenue of $72.9 million
•vs. $43.4 million in Q4’FY 2020
•Growth of 67.8% Y/Y
•Gross profit of $48.2 million
•vs. $29.7 million in Q4’FY 2020
•Growth of 62.1% Y/Y
•Gross margin of 66.1%
•vs. 68.5% in Q4’FY 2020
•GAAP net loss of $17.9 million
•vs. $17.0 million loss in Q4’FY 2020
•Adjusted EBITDA loss of $10.5 million
•vs. $12.2 million loss in Q4’FY 2020
•Adjusted EBITDA margin loss of 14.5%
•vs. loss of 28.2% in Q4’FY 2020
•Cash, cash equivalents, restricted cash and short-term marketable securities were $213.1 million at the quarter end
•Total quarter Active Buyers of 1.691 million
•vs. 1.240 million in Q4’FY 2020
•An increase of 36.4% Y/Y
•Total Orders of 1.682 million
•vs. 0.998 million in Q4’FY 2020
•An increase of 68.5% Y/Y
Key Financial Metrics for the Full Year 2021
•Revenue of $251.8 million
•vs. $186.0 million in FY 2020
•Growth of 35.4% Y/Y
•Gross profit of $178.1 million
•vs. $128.1 million in FY 2020
•Growth of 39.0% Y/Y
•Gross margin of 70.7%
•vs. 68.9% in FY 2020
•GAAP net loss of $63.2 million
•vs. $47.9 million loss in FY 2020
•Adjusted EBITDA loss of $36.5 million
•vs. $33.4 million loss in FY 2020
•Adjusted EBITDA margin loss of 14.5%
•vs. loss of 18.0% in FY 2020
•Cash, cash equivalents, restricted cash and short-term marketable securities were $213.1 million at the year end
•Total Active Buyers of 1.691 million
•vs. 1.240 million in FY 2020
•An increase of 36.4% Y/Y
•Total Orders of 5.328 million
•vs. 3.965 million in FY 2020
•An increase of 34.4% Y/Y
Conference Call and Webcast
•The live call is accessible in the U.S and Canada at +1 888-394-8218 (code 6055297) and outside of the U.S. and Canada at +1 646-828-8193 (code 6055297)
•The live and archived webcast and all related earnings materials will be available at thredUP’s investor relations website: ir.thredup.com
Financial Outlook
For first quarter 2022, thredUP expects:
•Revenue in the range of $70 million to $72 million
•Gross margin in the range of 65% to 67%
•An adjusted EBITDA margin loss in the range of 19.0% to 17.0%
•Depreciation and amortization of approximately $2.9 million
•Stock-based compensation of approximately $4.0 million
•Weighted-average shares of approximately 99.4 million
For fiscal year 2022, thredUP expects:
•Revenue in the range of $330 million to $340 million
•Gross margin in the range of 64% to 66%
•An adjusted EBITDA margin loss in the range of 15.5% to 13.5%
•Depreciation and amortization of approximately $15.5 million
•Stock-based compensation of approximately $17.9 million
•Weighted-average shares of approximately 100.5 million
Fourth Quarter 2021 Supplemental Financials
| ThredUp Inc. | |||||||||||||||||||||||||||||
| Condensed Consolidated Income Statements | |||||||||||||||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||||||||||||||
| Three Months Ended | December 31, 2019 | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||||||||
| Consignment revenue | $ | 32,026 | $ | 35,314 | $ | 34,914 | $ | 33,657 | $ | 34,211 | $ | 44,688 | $ | 48,597 | $ | 48,071 | $ | 44,758 | |||||||||||
| Product revenue | 12,611 | 13,001 | 12,421 | 13,275 | 9,222 | 10,992 | 11,362 | 15,203 | 28,121 | ||||||||||||||||||||
| Total revenue | 44,637 | 48,315 | 47,335 | 46,932 | 43,433 | 55,680 | 59,959 | 63,274 | 72,879 | ||||||||||||||||||||
| Cost of revenue: | |||||||||||||||||||||||||||||
| Cost of consignment revenue | 7,599 | 8,816 | 8,297 | 7,984 | 9,087 | 10,832 | 10,687 | 10,080 | 10,257 | ||||||||||||||||||||
| Cost of product revenue | 5,660 | 6,873 | 6,027 | 6,172 | 4,611 | 5,130 | 5,140 | 7,100 | 14,434 | ||||||||||||||||||||
| Total cost of revenue | 13,259 | 15,689 | 14,324 | 14,156 | 13,698 | 15,962 | 15,827 | 17,180 | 24,691 | ||||||||||||||||||||
| Gross profit | 31,378 | 32,626 | 33,011 | 32,776 | 29,735 | 39,718 | 44,132 | 46,094 | 48,188 | ||||||||||||||||||||
| Gross margin % of revenue | 70.3 | % | 67.5 | % | 69.7 | % | 69.8 | % | 68.5 | % | 71.3 | % | 73.6 | % | 72.8 | % | 66.1 | % | |||||||||||
| Operating expenses | |||||||||||||||||||||||||||||
| Operations, product and technology | 25,580 | 25,475 | 22,149 | 25,856 | 27,928 | 28,312 | 31,062 | 32,081 | 36,624 | ||||||||||||||||||||
| Marketing | 12,674 | 13,001 | 10,898 | 10,614 | 10,252 | 15,446 | 15,957 | 16,941 | 15,281 | ||||||||||||||||||||
| Sales, general and administrative | 7,971 | 7,433 | 6,438 | 6,891 | 7,802 | 10,638 | 10,999 | 12,569 | 14,608 | ||||||||||||||||||||
| Total operating expenses | 46,225 | 45,909 | 39,485 | 43,361 | 45,982 | 54,396 | 58,018 | 61,591 | 66,513 | ||||||||||||||||||||
| Operating expenses % of revenue | 103.6 | % | 95.0 | % | 83.4 | % | 92.4 | % | 105.9 | % | 97.7 | % | 96.8 | % | 97.3 | % | 91.3 | % | |||||||||||
| Operating income (loss) | (14,847) | (13,283) | (6,474) | (10,585) | (16,247) | (14,678) | (13,886) | (15,497) | (18,325) | ||||||||||||||||||||
| Operating loss % of revenue | (33.3) | % | (27.5) | % | (13.7) | % | (22.6) | % | (37.4) | % | (26.4) | % | (23.2) | % | (24.5) | % | (25.1) | % | |||||||||||
| Interest expense | (365) | (273) | (224) | (368) | (440) | (559) | (573) | (619) | (524) | ||||||||||||||||||||
| Other (expense) income, net | 271 | 341 | 41 | (51) | (258) | (907) | 93 | 1,418 | 961 | ||||||||||||||||||||
| Income (loss) before provision for income taxes | (14,941) | (13,215) | (6,657) | (11,004) | (16,945) | (16,144) | (14,366) | (14,698) | (17,888) | ||||||||||||||||||||
| Provision for (benefit from) income taxes | 36 | — | — | — | 56 | 27 | 13 | 17 | 23 | ||||||||||||||||||||
| Net income (loss) | $ | (14,977) | $ | (13,215) | $ | (6,657) | $ | (11,004) | $ | (17,001) | $ | (16,171) | $ | (14,379) | $ | (14,715) | $ | (17,911) | |||||||||||
| Net income margin % | (33.6) | % | (27.4) | % | (14.1) | % | (23.4) | % | (39.1) | % | (29.0) | % | (24.0) | % | (23.3) | % | (24.6) | % | |||||||||||
| ThredUp Inc. | |||||||||||||||||||||||||||||
| Adjusted EBITDA Reconciliation | |||||||||||||||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||||||||||||||
| Three Months Ended | December 31, 2019 | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | ||||||||||||||||||||
| Adjusted EBITDA reconciliation | |||||||||||||||||||||||||||||
| Net income (loss) | $ | (14,977) | $ | (13,215) | $ | (6,657) | $ | (11,004) | $ | (17,001) | $ | (16,171) | $ | (14,379) | $ | (14,715) | $ | (17,911) | |||||||||||
| Add (deduct): | |||||||||||||||||||||||||||||
| Depreciation and amortization | 1,090 | 1,245 | 1,198 | 1,425 | 1,713 | 2,038 | 1,861 | 2,248 | 3,008 | ||||||||||||||||||||
| Stock-based compensation expense | 5,118 | 1,442 | 1,966 | 1,649 | 2,279 | 3,498 | 2,896 | 2,995 | 3,570 | ||||||||||||||||||||
| Acquisition and offering related expenses | — | — | — | — | — | — | — | 1,020 | 251 | ||||||||||||||||||||
| Interest expense | 365 | 273 | 224 | 368 | 440 | 559 | 573 | 619 | 524 | ||||||||||||||||||||
| Change in value of preferred stock warrant | (3) | (172) | (1) | 89 | 285 | 930 | — | — | — | ||||||||||||||||||||
| Provision for income taxes | 36 | — | — | — | 56 | 27 | 13 | 17 | 23 | ||||||||||||||||||||
| Adjusted EBITDA | $ | (8,371) | $ | (10,427) | $ | (3,270) | $ | (7,473) | $ | (12,228) | $ | (9,119) | $ | (9,036) | $ | (7,816) | $ | (10,535) | |||||||||||
| Adjusted EBITDA margin % | (18.8) | % | (21.6) | % | (6.9) | % | (15.9) | % | (28.2) | % | (16.4) | % | (15.1) | % | (12.4) | % | (14.5) | % | |||||||||||
| ThredUp Inc. | |||||||||||||||||||||||||||||
| Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses | |||||||||||||||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||||||||||||||
| Three Months Ended | December 31, 2019 | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | ||||||||||||||||||||
| Operations, product and technology | $ | 25,580 | $ | 25,475 | $ | 22,149 | $ | 25,856 | $ | 27,928 | $ | 28,312 | $ | 31,062 | $ | 32,081 | $ | 36,624 | |||||||||||
| Marketing | 12,674 | 13,001 | 10,898 | 10,614 | 10,252 | 15,446 | 15,957 | 16,941 | 15,281 | ||||||||||||||||||||
| Sales, general and administrative | 7,971 | 7,433 | 6,438 | 6,891 | 7,802 | 10,638 | 10,999 | 12,569 | 14,608 | ||||||||||||||||||||
| Total operating expenses | 46,225 | 45,909 | 39,485 | 43,361 | 45,982 | 54,396 | 58,018 | 61,591 | 66,513 | ||||||||||||||||||||
| Less: Total stock based compensation | 5,118 | 1,442 | 1,966 | 1,649 | 2,279 | 3,498 | 2,896 | 2,995 | 3,570 | ||||||||||||||||||||
| Total non-GAAP operating expenses | $ | 41,107 | $ | 44,467 | $ | 37,519 | $ | 41,712 | $ | 43,703 | $ | 50,898 | $ | 55,122 | $ | 58,596 | $ | 62,943 | |||||||||||
| Non-GAAP operating expenses as a % of revenue | 92.1 | % | 92.0 | % | 79.3 | % | 88.9 | % | 100.6 | % | 91.4 | % | 91.9 | % | 92.6 | % | 86.4 | % | |||||||||||
| ThredUp Inc. | |||||||||||||||||||||||||||||
| Stock Based Compensation Details | |||||||||||||||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||||||||||||||
| Three Months Ended | December 31, 2019 | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | ||||||||||||||||||||
| Stock Based Compensation | |||||||||||||||||||||||||||||
| Operations, product and technology | $ | 2,479 | $ | 715 | $ | 870 | $ | 987 | $ | 1,167 | $ | 1,350 | $ | 984 | $ | 1,024 | $ | 883 | |||||||||||
| Marketing | 687 | 174 | 283 | 278 | 332 | 437 | 289 | 341 | 338 | ||||||||||||||||||||
| Sales, general and administrative | 1,952 | 553 | 813 | 384 | 780 | 1,711 | 1,623 | 1,630 | 2,349 | ||||||||||||||||||||
| Total | $ | 5,118 | $ | 1,442 | $ | 1,966 | $ | 1,649 | $ | 2,279 | $ | 3,498 | $ | 2,896 | $ | 2,995 | $ | 3,570 | |||||||||||
| ThredUp Inc. | |||||||||||||||||
| Condensed Consolidated Balance Sheets | |||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||
| December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | |||||||||||||
| Assets | |||||||||||||||||
| Current assets | |||||||||||||||||
| Cash and cash equivalents | $ | 64,485 | $ | 246,514 | $ | 173,058 | $ | 160,912 | $ | 84,550 | |||||||
| Marketable securities | — | — | 57,382 | 100,762 | 121,277 | ||||||||||||
| Accounts receivable, net | 1,823 | 1,726 | 1,545 | 1,895 | 4,136 | ||||||||||||
| Inventory, net | 3,519 | 3,482 | 4,362 | 4,106 | 9,825 | ||||||||||||
| Other current assets | 5,332 | 3,168 | 6,425 | 7,773 | 8,625 | ||||||||||||
| Total current assets | 75,159 | 254,890 | 242,772 | 275,448 | 228,413 | ||||||||||||
| Operating lease right-of-use assets | 23,656 | 22,338 | 21,272 | 20,455 | 39,340 | ||||||||||||
| Property and equipment, net | 41,131 | 43,562 | 45,490 | 49,451 | 55,466 | ||||||||||||
| Goodwill | — | — | — | — | 12,238 | ||||||||||||
| Intangible assets | — | — | — | — | 13,854 | ||||||||||||
| Other assets | 2,965 | 2,980 | 2,837 | 4,864 | 11,515 | ||||||||||||
| Total assets | $ | 142,911 | $ | 323,770 | $ | 312,371 | $ | 350,218 | $ | 360,826 | |||||||
| Liabilities and Stockholder's Equity | |||||||||||||||||
| Current liabilities | |||||||||||||||||
| Accounts payable | $ | 9,386 | $ | 14,540 | $ | 11,359 | $ | 8,407 | $ | 13,336 | |||||||
| Accrued and other current liabilities | 32,541 | 37,720 | 39,515 | 46,427 | 45,253 | ||||||||||||
| Seller payable | 13,724 | 15,194 | 16,709 | 18,306 | 19,125 | ||||||||||||
| Operating lease liabilities, current | 3,643 | 3,095 | 2,845 | 2,757 | 3,931 | ||||||||||||
| Current portion of long-term debt | 3,270 | 5,736 | 7,746 | 7,757 | 7,768 | ||||||||||||
| Total current liabilities | 62,564 | 76,285 | 78,174 | 83,654 | 89,413 | ||||||||||||
| Operating lease liabilities, non-current | 21,574 | 20,811 | 20,029 | 19,225 | 36,997 | ||||||||||||
| Long-term debt | 31,190 | 33,320 | 31,393 | 29,478 | 27,559 | ||||||||||||
| Non-current liabilities | 2,719 | 1,927 | 1,937 | 2,187 | 1,123 | ||||||||||||
| Total liabilities | 118,047 | 132,343 | 131,533 | 134,544 | 155,092 | ||||||||||||
| Convertible preferred stock | 247,041 | — | — | — | — | ||||||||||||
| Common stock | 1 | 9 | 9 | 10 | 10 | ||||||||||||
| Additional paid in capital | 29,989 | 459,756 | 463,582 | 513,124 | 522,161 | ||||||||||||
| Accumulated other comprehensive loss | — | — | (36) | (28) | (1,094) | ||||||||||||
| Accumulated deficit | (252,167) | (268,338) | (282,717) | (297,432) | (315,343) | ||||||||||||
| Total stockholder's (deficit) equity | (222,177) | 191,427 | 180,838 | 215,674 | 205,734 | ||||||||||||
| Total liabilities and stockholder's equity | $ | 142,911 | $ | 323,770 | $ | 312,371 | $ | 350,218 | $ | 360,826 | |||||||
| ThredUp Inc. | |||||||||||||||||
| Condensed Consolidated Cash Flows | |||||||||||||||||
| (in thousands, unaudited) | |||||||||||||||||
| Three Months Ended | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | December 31, 2021 | ||||||||||||
| Cash flows from operating activities | |||||||||||||||||
| Net loss | $ | (17,001) | $ | (16,171) | $ | (14,379) | $ | (14,715) | $ | (17,911) | |||||||
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||||||||||||
| Depreciation and amortization | 1,713 | 2,038 | 1,861 | 2,248 | 3,008 | ||||||||||||
| Stock-based compensation expense | 2,279 | 3,498 | 2,896 | 2,995 | 3,570 | ||||||||||||
| Reduction of the carrying amount of right-of-use assets | 1,152 | 1,318 | 1,066 | 817 | 784 | ||||||||||||
| Changes in fair value of convertible preferred stock warrants and others | 395 | 1,048 | 131 | 589 | 574 | ||||||||||||
| Changes in operating assets and liabilities: | |||||||||||||||||
| Accounts receivable, net | (803) | 97 | 181 | (350) | (1,117) | ||||||||||||
| Inventory, net | 343 | 37 | (880) | 256 | (2,154) | ||||||||||||
| Other current and non-current assets | 208 | (457) | (2,907) | (1,356) | (1,606) | ||||||||||||
| Accounts payable | (2,560) | 4,722 | (2,006) | (2,142) | 297 | ||||||||||||
| Accrued and other current liabilities | 930 | 4,784 | 3,387 | 5,911 | (4,831) | ||||||||||||
| Seller payable | 384 | 1,470 | 1,515 | 1,597 | 490 | ||||||||||||
| Operating lease liabilities | (973) | (1,311) | (1,032) | (892) | (729) | ||||||||||||
| Other non-current liabilities | (309) | 4 | — | — | (1,262) | ||||||||||||
| Net cash (used in) provided by operating activities | (14,242) | 1,077 | (10,167) | (5,042) | (20,887) | ||||||||||||
| Cash flows from investing activities | |||||||||||||||||
| Purchases of marketable securities | — | — | (57,418) | (45,297) | (22,502) | ||||||||||||
| Purchases of non-marketable equity investment | — | — | — | — | (3,750) | ||||||||||||
| Acquisition of business, net of cash acquired | — | — | — | — | (23,581) | ||||||||||||
| Purchase of property and equipment | (5,065) | (4,099) | (4,900) | (6,208) | (4,621) | ||||||||||||
| Maturities of marketable securities | — | — | — | 1,600 | 1,200 | ||||||||||||
| Net cash used in investing activity | (5,065) | (4,099) | (62,318) | (49,905) | (53,254) | ||||||||||||
| Cash flows from financing activities | |||||||||||||||||
| Proceeds from debt issuances, net of issuance costs | 4,925 | 4,625 | — | — | — | ||||||||||||
| Repayment of debt | — | — | — | (2,000) | (2,000) | ||||||||||||
| Proceeds from issuance of Class A common stock upon initial public offering and the follow-on offering, net of underwriting discounts and commissions | — | 180,284 | — | 46,621 | — | ||||||||||||
| Proceeds from exercise of common stock options and withholding taxes for the net share settlement of RSU’s | 360 | 1,875 | 930 | 948 | 1,424 | ||||||||||||
| Payment of costs for the initial public offering and follow-on offering | (466) | (1,733) | (1,900) | (618) | (478) | ||||||||||||
| Proceeds from ESPP purchase | — | — | — | — | 982 | ||||||||||||
| Net cash (used in) provided by financing activities | 4,819 | 185,051 | (970) | 44,951 | (72) | ||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | — | — | — | — | (64) | ||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents | (14,488) | 182,029 | (73,455) | (9,996) | (74,277) | ||||||||||||
| Cash, cash equivalents and restricted cash and cash equivalents | |||||||||||||||||
| Beginning of period | 82,027 | 67,539 | 249,568 | 176,113 | 166,117 | ||||||||||||
| End of period | $ | 67,539 | $ | 249,568 | $ | 176,113 | $ | 166,117 | $ | 91,840 | |||||||
About ThredUp Inc.
thredUP 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. With thredUP’s Resale-as-a-Service, some of the world's leading brands and retailers are leveraging our platform to deliver customizable, scalable resale experiences to their customers. 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 financial supplement 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 financial supplement include, but are not limited to, guidance on financial results for the first quarter and full year of 2022; 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; our ability to successfully integrate and realize the benefits of our past or future strategic acquisitions or investments; the success of our RaaSⓇ model and the timing and plans for future RaaSⓇ clients; 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, but not limited to, risks detailed in our upcoming Annual Report on Form 10-K for the year ended December 31, 2021. The forward-looking statements in this financial supplement 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.
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 and Adjusted EBITDA margin. In addition to our results determined in accordance with GAAP, we believe that Adjusted EBITDA and Adjusted EBITDA margin, non-GAAP measures, are useful in evaluating our operating performance. We use Adjusted EBITDA and Adjusted EBITDA margin 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 and Adjusted EBITDA margin, 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 and Adjusted EBITDA margin is 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 below for Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with GAAP. We calculate Adjusted EBITDA as net loss adjusted to exclude, where applicable in a given period, depreciation and amortization, stock-based compensation expense, acquisition, offering and other expenses, interest expense, change in fair value of convertible preferred stock warrant liability and provision for income taxes.
Investors are encouraged to review our results determined in accordance with GAAP and the reconciliation of Adjusted EBITDA to net loss. 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. 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 Adjusted EBITDA in order to calculate forward-looking Adjusted EBITDA margin is not available without unreasonable effort. However, for the first quarter of 2022 and full year 2022, depreciation and amortization is expected to be $2.9 million and $15.5 million, respectively. In addition, for the first quarter of 2022 and full year 2022, stock-based compensation expense is expected to be $4.0 million and $17.9
million, respectively. These items are uncertain, depend on various factors, and could result in projected net loss being materially less than is indicated by the currently estimated Adjusted EBITDA margin.