The Maze: ThredUp, a U.S. online marketplace for secondhand clothing, sold 17% more items in the third quarter than a year earlier. Its CEO said buyers paid $18 per item from June onward, down from $21 earlier in 2026. ThredUp also kept a smaller share of revenue after direct costs than a year earlier. For resale operators that handle the clothes themselves, the quarter shows how a discount can help move stock while the work of handling each garment still eats into the sale.
Source: ThredUp Newsroom. An archival photo shows racks of individual garments at a ThredUp distribution center.
The Details:
More orders, heavier discounts. ThredUp recorded 1.89 million orders in the quarter, up 17% from a year earlier. Revenue grew 7% to $88.2 million. The company says a higher average order value helped revenue while deeper discounts offset some of the gain. Average order value compares whole baskets year over year. The drop from $21 to $18 describes what shoppers paid per item, with the decline starting in June. CEO James Reinhart said the pricing pressure was strongest on older stock, while ThredUp tried to protect prices on newer listings.
Handling costs took a bigger share. In ThredUp’s Clean Out service, people mail in used clothes. The company inspects and photographs accepted items, lists them online and ships them to buyers. It reported $69 million in gross profit, up from $65.2 million. But gross margin, the share of revenue left after direct costs, fell from 79.4% to 78.2%. ThredUp’s filing points mainly to labor and packaging costs rising as a share of revenue. The company brought in more gross profit in total, while keeping less of each revenue dollar after those costs.
Rivals can cut the price at checkout. On November 3, Poshmark, where sellers list and ship their own items, introduced temporary $0.99 standard shipping on eligible U.S. orders with no minimum purchase. That lowers the cost of buying even a single low-priced item. The offer began after ThredUp’s third quarter ended. It illustrates the kind of competition ThredUp faces heading into the holidays. ThredUp forecasts fourth-quarter revenue of $77 million to $79 million, about 2% below last year at the midpoint.
MarketMaze Take: A markdown can pay for itself at ThredUp if it frees space for items that sell faster or at better prices. The company has already done the work of taking in, inspecting and listing the older garment. It still has to pick, pack and ship it when it sells. The test for a managed reseller is how much extra gross profit a promotion generates across the discounted items and the stock that replaces them. ThredUp’s quarterly totals show the pressure. They leave open how much demand would have arrived at full price.
