ThredUp Posts 18.5% Q4 Revenue Growth, $14M Adjusted EBITDA and 79.6% Margin
ThredUp’s Q4 revenue climbed 18.5% year-over-year while gross margin narrowed by 80 basis points to 79.6%, with full-year margin at 79.4%. The company produced $14 million of adjusted EBITDA (4.4% of revenue), achieved positive free cash flow, saw new buyer acquisition jump 57%, and expects higher marketing costs.
1. Q4 Financial Performance
ThredUp delivered 18.5% year-over-year revenue growth in Q4 while gross margin declined 80 basis points to 79.6%, with full-year margin at 79.4%. The company generated $14 million of adjusted EBITDA (4.4% of revenue) and achieved positive free cash flow for 2025.
2. Buyer Acquisition and Premium Segment
New buyer acquisition rose 57% year-over-year and active buyers increased 30% over the trailing 12 months as ThredUp tweaked influencer and affiliate strategies. The premium assortment expanded to 17-18% of the business, driving higher average selling prices from holiday items.
3. 2026 Outlook and Investments
ThredUp guides Q1 revenue growth of 12% and notes it will be the smallest quarter before reaccelerating in Q2. Marketing spend will remain a consistent percentage of revenue, customer acquisition costs are expected to rise slightly, and 2026 gross margin is targeted at 78-79% to fund customer satisfaction and new initiatives like TikTok shop.