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Poshmark‘s revenue topped analysts’ estimates, in its first financial report since going public in January. But the online seller of secondhand clothing issued a weaker-than-expected sales outlook for the current quarter.
Poshmark’s stock tumbled more than 6% in after-hours trading.
Founder and Chief Executive Manish Chandra said in an interview that demand for apparel is still suppressed in parts of the U.S., where tighter Covid restrictions remain in place.
“Different parts of the country are behaving quite differently,” Chandra said, citing Florida as a strong growth market where customers are searching Poshmark for dresses and bathing suits, whereas New York is still catching up. “So, we are accounting for the state-wide differences.”
For the quarter ended Dec. 31, Poshmark’s loss narrowed to $4.06 million, or 31 cents per share, from a loss of $14.75 million, or $1.20 per share, a year earlier. After adjusting for one-time items, the company earned 5 cents a share during the quarter.
Revenue climbed 27% to $69.32 million from $54.74 million a year earlier. That was higher than the average revenue estimate of $68 million, reported by Refinitiv.
For the first quarter, Poshmark is calling for revenue to fall within a range of $75.5 million to $77.5 million. Analysts had been calling for $79.2 million on average.
“Our platform is super adaptable and flexible,” Chandra said. “That has allowed us to be a growth engine in 2020, compared to a lot of other places that have suffered.”
Poshmark filed to go public in December and opened its first day of trading on the Nasdaq on Jan. 14, at at $97.50 per share. The stock has fallen since, hitting an all-time intraday low of $44.11 last Friday. Shares closed Thursday up nearly 16%, at $59.46.
Founded in 2011, the company’s online marketplace for secondhand clothes, shoes and accessories is akin to eBay and Etsy. Poshmark connects buyers with sellers, who often list items from their own closet. And it makes money by taking a cut of every transaction.
Consumers, especially younger ones, are increasingly turning to these types of internet marketplaces for secondhand goods. A number of players are looking to gain market share, including luxury consignment site TheRealReal, sneaker reseller StockX and virtual thrift store ThredUp. The latter filed for its IPO earlier this month.
Cowen & Co. has previously estimated that the resale market in the U.S. is valued at $30 billion to $35 billion.