San Francisco, October 29 /PRNewswire/ — The RealReal, Inc. (Nasdaq: REAL), the world's largest authenticated online luxury consignment marketplace, today announced its financial results for the third quarter ended September 30, 2026. In the third quarter of 2026, gross merchandise value (GMV) and total revenue increased by 23% and 19%, respectively, compared to the third quarter of 2025. Consignment revenue grew 18% year-over-year, and direct sales revenue increased 19% year-over-year.
The gross profit margin for the quarter was 74.9%, an increase of 64 basis points compared to the same period in 2025. The adjusted EBITDA margin for the third quarter was 8.3%, up 290 basis points year-over-year.
The RealReal’s CEO, Rati Levesque, said, “Q3 was another record quarter for The RealReal, with GMV, revenue, and orders all reaching all-time quarterly highs—orders grew 15% year-over-year, marking the strongest quarterly order growth since 2022. At the same time, we expanded our adjusted EBITDA margin by 290 basis points, and earlier this month we completed a key refinancing that extended our debt maturity profile and laid the foundation for continued deleveraging over the coming years.”
Levesque added, “Behind these results is a fundamental shift in how people buy luxury fashion, and our specially built platform is driving this change. Customers are increasingly beginning their shopping journey with us and engaging with us beyond transactions—to discover what to buy, track what they own, and decide when to sell. This is the new operating system for luxury fashion ownership, and this is exactly what we are building. Our performance this quarter has strengthened our confidence in the direction of our business and our ability to execute, and we are raising our full-year outlook.”
Q3 Highlights
- GMV reached $642 million, a 23% increase compared to the same period in 2025.
- Total revenue amounted to $206 million, representing a 19% increase compared to the same period in 2025.
- Gross profit was $154 million, an increase of $25 million compared to the same period in 2025.
- Gross profit margin was 74.9%, an increase of 64 basis points compared to the same period in 2025.
- Net profit was $16 million, representing 7.8% of total revenue; compared to a net loss of $54 million, or 31.1% of total revenue, in the same period last year. The net profit for the third quarter of 2026 included a $21.2 million non-cash adjustment due to changes in the fair value of warrant liabilities.
- Adjusted EBITDA was $17 million, representing 8.3% of total revenue; compared to $9.3 million, or 5.4% of total revenue, in the same period last year.
- Basic net income per share under GAAP was $0.13, compared to a net loss of $0.47 per share in the same period last year; diluted net loss per share was $0.04, compared to a net loss of $0.49 per share in the same period last year.
- On a non-GAAP basis, basic and diluted net income per ordinary share was $0.02, compared to a net loss per ordinary share of $0.04 in the same period last year.
- Over the past 12 months, there were 1.152 million active buyers, a 13% year-over-year increase.
- The average order value (AOV) is $629, an 8% year-over-year increase.
Q4 and full-year 2026 guidance
Based on market conditions as of October 29, 2026, the company has raised its full-year guidance. Additionally, the company provided guidance for the fourth quarter of 2026 for GMV, total revenue, and adjusted EBITDA, with adjusted EBITDA being a non-GAAP financial measure.
The company has not reconciled forward-looking adjusted EBITDA to net income (loss), the most directly comparable GAAP measure, because it cannot reasonably predict the ultimate outcomes of certain reconciling items, such as payroll tax expenses related to employee stock transactions and other factors beyond the company’s control, or additional items that may arise, without incurring unreasonable effort. As a result, the company cannot assess the potential significance of this unavailable information, which could materially impact future net income (loss) amounts.
Live streaming and video conferencing
The RealReal will hold a conference call around 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) today to review its third-quarter results. A live webcast of the call and related materials are available online at investor.therealreal.com. A replay of the webcast will also be available on the same website. To participate in the conference call, please register via the following link:
https://the-realreal-earnings-call-q3-2026.open-exchange.net/registration
About The RealReal, Inc.
The RealReal is the world’s largest authenticated online marketplace for pre-owned luxury goods, trusted by a community of 45 million members. The company offers an end-to-end consignment model spanning fashion, fine jewelry and watches, art, and home goods, enabling customers to easily buy and sell luxury items anywhere. By combining rigorous, expert-led authentication with artificial intelligence and proprietary technology, The RealReal optimizes operations and pricing while simplifying the customer experience. With 15 years of proprietary data and over 55 million items sold, The RealReal has become the premier destination for modern luxury resale, redefining the lifecycle of luxury goods.
Forward-looking statements
This press release contains forward-looking statements regarding The RealReal’s future performance, among other matters, which are based on the company’s current expectations, forecasts, and assumptions and involve risks and uncertainties. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “could,” “expect,” “plan,” “anticipate,” “target,” “consider,” “project,” “believe,” “estimate,” “predict,” “intend,” “potential,” “continue,” or “ongoing,” or the negative of these terms or other similar expressions. These statements include, but are not limited to, statements about future operating and financial results, including our strategy, plans, commitments, goals, and objectives, particularly in the context of uncertain macroeconomic trends, financial guidance, expected growth for 2026, the anticipated impact of generative AI, and financial targets, goals, and forecasts. Actual results may differ materially from those predicted or implied, and reported results should not be considered indicators of future performance. Other factors that may cause or contribute to such differences include, but are not limited to: our ability to successfully complete and realize the anticipated benefits of our balance sheet strengthening plan, inflation, macroeconomic uncertainty, geopolitical instability, inability to sustainably obtain consignment inventory supply, pricing pressure on the consignment market due to discounts on new goods in the market, inability to operate our product sales and fulfillment business efficiently and effectively, labor shortages, and other factors.
For more information regarding factors that may affect the company’s operating results, refer to the company’s most recent Form 10-K annual report for the year ended December 31, 2025, and subsequent Form 10-Q quarterly reports, in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These filings are available on the company’s investor relations website at https://investor.therealreal.com or on the U.S. Securities and Exchange Commission website at www.sec.gov. Readers should not place undue reliance on forward-looking statements in this press release, which are based on information available to the company as of the date of this release. The company undertakes no obligation to update such statements.
Non-GAAP financial measures
To supplement the unaudited and condensed financial statements prepared in accordance with generally accepted accounting principles ("GAAP"), this earnings press release, along with the accompanying tables and related earnings conference call, includes certain non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA as a percentage of total revenue ("adjusted EBITDA margin"), free cash flow, non-GAAP net income (loss) attributable to common shareholders, and non-GAAP net income (loss) per share attributable to common shareholders, both basic and diluted. The company provides reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures in this press release.
The company does not recommend that investors view these non-GAAP financial measures in isolation or as a substitute for financial information prepared in accordance with GAAP. Investors should also note that the non-GAAP financial measures used by the company may differ from those used by other companies, including those in the same industry, and may be calculated differently.
Adjusted EBITDA is a key performance indicator used by management to evaluate operating performance. Because adjusted EBITDA facilitates internal comparisons of historical operating performance on a more consistent basis, the company uses this metric as a tool for overall performance assessment, measuring the effectiveness of business strategies, and business planning. Adjusted EBITDA may not be directly comparable to similarly titled metrics used by other companies.
The company defines adjusted EBITDA as net income (loss) excluding interest income, interest expense, income tax provisions (benefits), depreciation, and amortization, and further excluding stock-based compensation expenses, employer payroll taxes related to employee stock transactions, debt extinguishment gains, changes in the fair value of warrant liabilities, and certain one-time expenses. Employer payroll taxes related to employee stock transactions are tied to the vesting or exercise of related equity awards and the price of the company’s common stock at the time of vesting, and may vary between periods independent of the company’s operating performance. Adjusted EBITDA has certain limitations because it excludes certain expenses that are necessary to the company’s operations and have been recorded in the operating statements; therefore, it should not be considered a substitute for net income (loss) or any other financial performance measure calculated and presented in accordance with GAAP.
In particular, excluding certain expenses when calculating adjusted EBITDA and adjusted EBITDA margin helps facilitate period-over-period comparisons of operating performance; when excluding the impact of stock-based compensation and related payroll taxes on employee stock transactions, items deemed not reflective of core operating performance are removed. However, investors should understand that stock-based compensation and related payroll taxes represent a significant recurring expense in the company’s business and an important component of employee compensation. Therefore, the company believes that adjusted EBITDA and adjusted EBITDA margin provide useful information to investors and other stakeholders for understanding and evaluating operating results, in a manner consistent with management and the board of directors.
Free cash flow is a non-GAAP financial measure calculated as net cash provided by (used in) operating activities minus net cash used for the purchase of fixed assets and capitalized proprietary software development costs. The company considers free cash flow an important metric for evaluating business performance, as it reflects the amount of cash generated by the company. Therefore, the company believes free cash flow provides useful information to investors and other stakeholders for understanding and assessing operating results in a manner consistent with management’s perspective.
Non-GAAP net income (loss) per share attributable to common shareholders, both basic and diluted, is a non-GAAP financial measure calculated by adding stock-based compensation expenses, income tax provisions (benefits), payroll tax expenses related to employee stock transactions, debt extinguishment gains, changes in the fair value of warrant liabilities, and certain one-time expenses to GAAP net income (loss), and then dividing by the weighted-average number of shares outstanding. The company believes that making these adjustments prior to calculating per-share amounts across all reported periods provides a more meaningful comparison of operating results between periods.
The table below reconciles net income (loss) to adjusted EBITDA for the periods presented (in thousands of U.S. dollars):
To calculate non-GAAP basic and diluted net income (loss) per share attributable to common shareholders, the following reconciliation table shows the adjustment from GAAP net income (loss) to non-GAAP net income (loss) attributable to common shareholders, which is the most directly comparable GAAP financial measure (amounts in thousands of U.S. dollars, except for shares and per-share data):
The table below reconciles net cash provided (used) by operating activities to free (negative) cash flow for the periods presented (in thousands of U.S. dollars):
Key Financial and Operational Metrics: