San Francisco-based luxury secondhand platform The RealReal has reported widening losses in its first quarter results as the company feels the impact of Covid-19.
For the three months to 31 March, losses widened to 38.3 million dollars compared to 23.2 million dollars in the same period last year.
Despite that, the company’s total revenue grew 11 percent to 78.2 million dollars, while its gross merchandise value (GMV) was up 15 percent to 257.6 million dollars.
The firm’s GMV had been trending as expected through early March, up over 30 percent year-on-year until the second week of March. However, that was significantly impacted as local directives limited operations in the company’s warehouses. Since 17 March when Bay Area shelter-in-place directives went into effect, GMV declined approximately 40 - 45 percent year-on-year.
However, during the last two weeks of April, GMV trends improved “modestly”.
“Since we announced preliminary first quarter results on April 14, our operations continued to be constrained by shelter-in-place directives, resulting in a significant GMV headwind,” CEO of The RealReal Julie Wainwright said in a statement. “Faced with the unknown duration of the pandemic, we’ve focused on reducing operating expenses to weather these new challenges and preserving liquidity to ensure we are well positioned for the future.”
Wainwright added: “Given the strength of our balance sheet, customer satisfaction, high buyer and consignor repeat rates, and technology innovations driving efficiency, I’m confident we’re well positioned to bounce back quickly once the economy stabilizes and capitalize on the significant opportunity in front of us.”
Photo credit: The RealReal, Facebook