CEO and President Rati Levesque said the results reflect a broader shift in how consumers approach luxury fashion, with shoppers using the platform to discover products, assess resale values and decide which items to sell.
“That is the new operating system for luxury ownership, and we are building it,” Levesque said.
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The company is working to strengthen that relationship by attracting new buyers, expanding its supply of luxury goods and improving the shopping and selling experience through technology. New buyers grew more than 20% in the third quarter, while buyers who had been with the platform for at least five years generated 47% of GMV. Gen Z remains its fastest-growing customer group, with buyers in that cohort increasing more than 60% since 2023.
Technology is playing a growing role in that strategy. The company’s AI-powered Athena system is expected to process nearly half of all items by year-end.
Levesque also pointed to the appeal of resale as consumers seek value. The company sees an opportunity to serve sellers looking to unlock value from their closets and buyers seeking more affordable access to luxury brands. Nearly half of luxury consumers now check secondary-market prices before buying new, she said.
Management described the company’s customer base as resilient and expects seasonal holiday shopping and gifting to support higher average order values in the fourth quarter. CFO Ajay Gopal said the company entered the period with strong momentum and confidence in its business trajectory.
Gopal said the company’s marketplace model allows it to adapt as consumer preferences shift across product categories and price points. Orders increased 15% in the third quarter, the company’s strongest order growth since 2022, while average order value rose 8% to $629.
For the quarter ended Sept. 30, The RealReal reported revenue of $206.1 million, up 18.75% from a year earlier, and GMV of $642 million. Adjusted EBITDA reached $17 million, or 8.3% of revenue, while free cash flow totaled $11.3 million. The company ended the quarter with $145 million in cash, cash equivalents and restricted cash.
The RealReal now expects full-year revenue of $806 million to $810 million and GMV of $2.585 billion to $2.6 billion. It projects adjusted EBITDA of $71.1 million to $72.6 million, representing an adjusted EBITDA margin of approximately 8.9% at the midpoint. The company remains on track to reach its medium-term target of a 15% to 20% adjusted EBITDA margin.
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