Poshmark, Inc. (NASDAQ: POSH), a leading social marketplace for new
and secondhand style, today announced financial results for the
third quarter ended September 30, 2021. The Company posted net
revenues of $79.7 million, which is a 16% year-over-year increase
from the third quarter of 2020. Gross Merchandise Value (“GMV”)
grew 18% year-over-year to $442.5 million, up from $375.4 million
in the same period last year.
“Next month marks a decade since Poshmark's
founding, sparking a new era that puts social engagement and
sustainability at the forefront of the shopping experience. Our
asset-light model, which is both adaptable and responsive to
changing consumer demands and insulated from supply chain
disruption, is uniquely positioned to thrive in the current
environment,” said Manish Chandra, Founder and Chief Executive
Officer of Poshmark. “We delivered a solid quarter and our sixth
consecutive quarter of operating profitability, despite difficult
comparisons and the headwinds of Apple privacy changes, and our
investments in marketing accelerated Trailing-Twelve-Months Active
Buyer growth. We have a long runway of growth ahead, driven by
strategic investments in product innovation, opening our platform
to larger brands with Brand Closets, and expanding authentication
services to cement our marketplace as the trusted choice for
buyers, all of which will help fuel long-term growth of our
business.”
Third Quarter 2021 Key Metrics and
Financial Highlights:
- GMV was $442.5 million, an increase
of 18% year-over-year from $375.4 million in the third quarter of
2020. Quarterly GMV has increased year-over-year for the past 15
quarters.
- Trailing 12 months Active Buyers
reached 7.3 million in the third quarter of 2021, a 17%
year-over-year increase from 6.2 million from the third quarter of
2020.
- Net revenue was $79.7 million, a
16% increase year-over-year from $68.8 million in the third quarter
of 2020.
- Adjusted EBITDA for the third
quarter of 2021 was $0.3 million which decreased from $15.0 million
in the third quarter of 2020. Adjusted EBITDA margin was 0.3% in
the third quarter of 2021.
- GAAP results from operations was a
($7.2) million loss in the third quarter of 2021, compared to
income of $11.7 million in the third quarter of 2020 and includes
$6.7 million and $2.6 million in stock-based compensation,
respectively.
- Non-GAAP results from operations
(excluding stock-based compensation) was ($0.6) million loss,
compared to income of $14.3 million in the third quarter of
2020.
- GAAP diluted net (loss) income per
share attributable to common stockholders was ($0.09) compared to
$0.44 in the third quarter of 2020.
- Cash, cash equivalents, and
marketable securities were $589.0 million as of September 30,
2021.
Business Highlights:
- At the end of July, we expanded our
partnership with Affirm to broaden their Split Pay Products to
include items between $50 to $200, up from $200 previously.
- In September, we entered India, our
third international market, bringing our community and marketplace
to Asia for the first time.
- In October we acquired Suede One, a
platform that combines machine learning, computer vision, and
expert human review to virtually authenticate sneakers.
- At the end of October, we launched
our Brand Closets program, which enables large-scale brands to open
a closet on Poshmark to directly connect, converse with, and sell
to our highly engaged community of over 80 million users, accessing
a new sales channel that is the future of shopping.
Fourth Quarter 2021
Guidance:
- Expected Revenue
range: $80.0
to $82.0 million
- Adjusted EBITDA range:
($7.0) to ($8.0)
million
Webcast and Conference Call
Information: Poshmark, Inc. will host a conference call to
review these results at 1:45 p.m. Pacific Time today, November 9,
2021. Interested parties may listen to the conference call via live
webcast by accessing the Company’s Investor Relations website
(investors.poshmark.com) under the events section. A webcast replay
of the earnings conference call will also be available on the
Poshmark website through the same link following the conference
call this evening, for at least three months thereafter.
About Poshmark, Inc.: Poshmark
is a leading social marketplace for new and secondhand style for
women, men, kids, pets, home, and more. By combining the human
connection of physical shopping with the scale, ease, and selection
benefits of ecommerce, Poshmark makes buying and selling simple,
social, and sustainable. Its community of more than 80 million
registered users across the U.S., Canada, Australia, and India is
driving the future of commerce while promoting more sustainable
consumption. For more information, please visit www.poshmark.com,
and for company news and announcements, please visit
investors.poshmark.com. You can also find Poshmark on Instagram,
Facebook, Twitter, TikTok, Pinterest, and YouTube.
Poshmark intends to use its Investor Relations
website and blog (blog.poshmark.com) to disclose material,
non-public information and to comply with its disclosure
obligations under Regulation FD. From time to time, we will also
disclose this information through our press releases, SEC filings,
or public conference calls and webcasts.
SOURCE: Poshmark, Inc.
Investor Relations Contact:
ir@poshmark.com
Media Relations Contact:
pr@poshmark.com
Forward-Looking Statements:
This press release contains forward-looking statements within the
meaning of the federal securities laws. Forward-looking statements
generally relate to future events or our future financial or
operating performance. In some cases, forward-looking statements
can be identified by words such as “may,” “will,” “shall,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“target,” “projects,” “contemplates,” “believes,” “estimates,”
“predicts,” “potential,” or “continue” or the negative of these
words or other similar terms or expressions that concern our
expectations, strategy, plans, or intentions. These statements
include, but are not limited to, statements that we make relating
to our future financial performance, including our guidance on
financial results for the fourth quarter of 2021.
Forward-looking statements are neither
historical facts nor assurances of future performance.
Forward-looking statements involve substantial risks and
uncertainties that may cause actual results to differ materially
from those that we expect. These risks and uncertainties include,
but are not limited to: our ability to attract new users and
convert users into active buyers and active sellers; our ability to
maintain profitability; the impact of COVID-19 on our business and
our consumers; the growth rates in the markets in which we compete;
our ability to manage growth effectively; our ability to maintain
the vibrancy of our community and trustworthiness of our
marketplace; our dependence on sellers to provide a fulfilling
experience to buyers; and our reliance on third-party shipping
partners such as the United States Postal Service. These risks and
uncertainties are more fully described in our filings with the
Securities and Exchange Commission (SEC), including in the sections
entitled “Risk Factors” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” in our Annual
Report on Form 10-K for the year ended December 31, 2020 and
subsequent Quarterly Reports on Form 10-Q. Additional information
will be provided in our Quarterly Report on Form 10-Q for the three
months ended September 30, 2021 and other filings we make from time
to time with the SEC. Moreover, we operate in a very competitive
and rapidly changing environment. New risks and uncertainties
emerge from time to time, and it is not possible for us to predict
all risks and uncertainties that could cause actual results to
differ materially from those contained in our forward-looking
statements.
The forward-looking statements made in this
press release relate only to management’s beliefs and assumptions
as of this date. We undertake no obligation to update any
forward-looking statements to reflect events or circumstances after
the date of this press release or to reflect new information or the
occurrence of unanticipated events, except as required by law.
Non-GAAP Financial Measures:To
supplement our consolidated financial statements, which are
prepared and presented in accordance with United States generally
accepted accounting principles (GAAP), this press release and the
accompanying tables and the related earnings conference call
contain certain non-GAAP financial measures, including Adjusted
EBITDA, Adjusted EBITDA Margin, Non-GAAP results from operations
(excluding stock-based compensation) and Free Cash Flow. Our
management uses non-GAAP financial measures internally for
financial and operational decision-making and as a means to
evaluate period-to-period comparisons. Non-GAAP financial measures
are not recognized measures for financial statement presentation
under GAAP and do not have standardized meanings, and may not be
comparable to similar measures presented by other public companies.
Non-GAAP financial measures also have certain limitations. For
example, Adjusted EBITDA and Adjusted EBITDA Margin have certain
limitations in that it does not include the impact of certain
expenses that are reflected in our consolidated statements of
operations that are necessary to run our business. As such,
non-GAAP financial measures should be considered as a supplement
to, and not as a substitute for, or in isolation from, the
corresponding measures prepared in accordance with GAAP. We
encourage investors and others to review our financial information
in its entirety, not to rely on any single financial measure, and
to view the non-GAAP financial measures in conjunction with their
respective related GAAP financial measures. Please see the
financial tables below for a reconciliation of the non-GAAP
financial measures to their most directly comparable GAAP financial
measures.
Adjusted EBITDA is a non-GAAP
financial measure we define as net income (loss) attributable to
common stockholders, excluding depreciation and amortization,
stock-based compensation expense, interest income, other expense,
net, and provision (benefit) for income taxes. Adjusted
EBITDA margin is a non-GAAP financial measure calculated
by dividing Adjusted EBITDA for a period by revenue for the same
period. We believe that Adjusted EBITDA and Adjusted EBITDA margin
provide useful information to investors and others in understanding
and evaluating our operating results, enhances the overall
understanding of our past performance and future prospects, and
allows for greater transparency with respect to key financial
metrics used by our management in its financial and operational
decision-making. We also believe that the exclusion of certain
expenses in calculating Adjusted EBITDA and Adjusted EBITDA Margin
facilitates operating performance comparisons on a period-to-period
basis and, in the case of exclusion of the impact of equity-based
compensation and related taxes, excludes an item that we do not
consider to be indicative of our core operating performance.
Non-GAAP
results from operations (excluding stock-based
compensation) is a non-GAAP financial measure that is
calculated as GAAP results from operations plus stock-based
compensation. We believe that adding back stock-based compensation,
as adjustments to our GAAP results from operations for all periods
presented provides a more meaningful comparison between our
operating results from period to period.
Free cash
flow is a non-GAAP financial measure that is calculated as
net cash (used in) provided by operating activities less net cash
used to purchase property and equipment. We believe free cash flow
is an important indicator of our business performance, as it
measures the amount of cash we generate. Accordingly, we believe
that free cash flow provides useful information to investors and
others in understanding and evaluating our operating results in the
same manner as our management.
Operating
Metrics:
GMV
(gross merchandise value) is the total dollar value of transactions
on our platform in a given period, prior to returns and
cancellations, and excluding shipping and sales taxes. GMV is a
measure of the total economic activity generated by our
marketplace, and an indicator of the scale and growth of our
marketplace and the health of our marketplace ecosystem.
Active
buyers are unique users who have purchased at least one
item on our platform in the trailing 12 months preceding the
measurement date, regardless of returns and cancellations.
Poshmark, Inc.Condensed
Consolidated Statements of Operations(in thousands, except
per share data)(unaudited)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
Net revenue |
|
$ |
68,782 |
|
|
$ |
79,650 |
|
|
$ |
192,760 |
|
|
$ |
242,363 |
|
Costs and expenses(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of net revenue, exclusive of depreciation and
amortization |
|
|
11,359 |
|
|
|
12,082 |
|
|
|
31,924 |
|
|
|
37,798 |
|
Operations and support |
|
|
10,135 |
|
|
|
13,199 |
|
|
|
27,871 |
|
|
|
41,062 |
|
Research and development |
|
|
8,083 |
|
|
|
12,325 |
|
|
|
22,226 |
|
|
|
43,574 |
|
Marketing |
|
|
19,173 |
|
|
|
36,385 |
|
|
|
65,449 |
|
|
|
104,578 |
|
General and administrative |
|
|
7,620 |
|
|
|
12,070 |
|
|
|
21,321 |
|
|
|
43,706 |
|
Depreciation and amortization |
|
|
752 |
|
|
|
827 |
|
|
|
2,130 |
|
|
|
2,463 |
|
Total costs and expenses |
|
|
57,122 |
|
|
|
86,888 |
|
|
|
170,921 |
|
|
|
273,181 |
|
Income (loss) from
operations |
|
|
11,660 |
|
|
|
(7,238 |
) |
|
|
21,839 |
|
|
|
(30,818 |
) |
Interest income |
|
|
63 |
|
|
|
77 |
|
|
|
540 |
|
|
|
201 |
|
Other expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of redeemable convertible preferred stock
warrant liability |
|
|
(125 |
) |
|
|
— |
|
|
|
(500 |
) |
|
|
(2,816 |
) |
Change in fair value of the convertible notes |
|
|
(516 |
) |
|
|
— |
|
|
|
(516 |
) |
|
|
(49,481 |
) |
Loss on extinguishment of the convertible notes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,620 |
) |
Other, net |
|
|
(204 |
) |
|
|
(36 |
) |
|
|
(232 |
) |
|
|
(220 |
) |
|
|
|
(845 |
) |
|
|
(36 |
) |
|
|
(1,248 |
) |
|
|
(54,137 |
) |
Income (loss) before provision
(benefit) for income taxes |
|
|
10,878 |
|
|
|
(7,197 |
) |
|
|
21,131 |
|
|
|
(84,754 |
) |
Provision (benefit) for income
taxes |
|
|
105 |
|
|
|
— |
|
|
|
225 |
|
|
|
(30 |
) |
Net income (loss) |
|
$ |
10,773 |
|
|
$ |
(7,197 |
) |
|
$ |
20,906 |
|
|
$ |
(84,724 |
) |
Undistributed earnings
attributable to participating securities |
|
|
(2,643 |
) |
|
|
— |
|
|
|
(12,776 |
) |
|
|
— |
|
Net income (loss) attributable to
common stockholders |
|
$ |
8,130 |
|
|
$ |
(7,197 |
) |
|
$ |
8,130 |
|
|
$ |
(84,724 |
) |
Net income (loss) per share
attributable to common stockholders, basic |
|
$ |
0.65 |
|
|
$ |
(0.09 |
) |
|
$ |
0.65 |
|
|
$ |
(1.18 |
) |
Net income (loss) per share
attributable to common stockholders, diluted |
|
$ |
0.44 |
|
|
$ |
(0.09 |
) |
|
$ |
0.45 |
|
|
$ |
(1.18 |
) |
Weighted-average shares used to
compute net income (loss) per share attributable to common
stockholders, basic |
|
|
12,595 |
|
|
|
76,479 |
|
|
|
12,433 |
|
|
|
71,639 |
|
Weighted-average shares used to
compute net income (loss) per share attributable to common
stockholders, diluted |
|
|
18,390 |
|
|
|
76,479 |
|
|
|
17,924 |
|
|
|
71,639 |
|
(1) Includes
stock-based compensation expense as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations and support |
|
$ |
192 |
|
|
$ |
758 |
|
|
$ |
521 |
|
|
$ |
3,810 |
|
Research and development |
|
|
952 |
|
|
|
3,145 |
|
|
|
2,028 |
|
|
|
16,882 |
|
Marketing |
|
|
397 |
|
|
|
969 |
|
|
|
1,012 |
|
|
|
5,297 |
|
General and administrative |
|
|
1,080 |
|
|
|
1,796 |
|
|
|
2,522 |
|
|
|
12,923 |
|
Total |
|
$ |
2,621 |
|
|
$ |
6,668 |
|
|
$ |
6,083 |
|
|
$ |
38,912 |
|
Poshmark, Inc.Condensed
Consolidated Balance Sheets(in thousands, except share and
per share amounts)(unaudited)
|
|
December 31, |
|
|
September 30, |
|
|
|
2020 |
|
|
2021 |
|
Assets |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
235,834 |
|
|
$ |
589,028 |
|
Marketable securities |
|
|
26,238 |
|
|
|
— |
|
Prepaid expenses and other current assets |
|
|
7,905 |
|
|
|
9,340 |
|
Total current assets |
|
|
269,977 |
|
|
|
598,368 |
|
Property and equipment, net |
|
|
8,447 |
|
|
|
7,899 |
|
Other assets |
|
|
7,010 |
|
|
|
1,816 |
|
Total assets |
|
$ |
285,434 |
|
|
$ |
608,083 |
|
Liabilities, Redeemable
Convertible Preferred Stock and Stockholders’
(Deficit) Equity |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
12,317 |
|
|
$ |
10,620 |
|
Funds payable to customers |
|
|
117,127 |
|
|
|
136,358 |
|
Accrued expenses and other current liabilities |
|
|
35,859 |
|
|
|
39,067 |
|
Total current liabilities |
|
|
165,303 |
|
|
|
186,045 |
|
Redeemable convertible preferred
stock warrant liability |
|
|
3,494 |
|
|
|
— |
|
Long-term portion of deferred
rent and other liabilities |
|
|
4,823 |
|
|
|
3,803 |
|
Convertible notes |
|
|
55,421 |
|
|
|
— |
|
Total liabilities |
|
|
229,041 |
|
|
|
189,848 |
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
Redeemable convertible preferred
stock |
|
|
156,175 |
|
|
|
— |
|
Stockholders’ (deficit)
equity |
|
|
|
|
|
|
|
|
Preferred Stock |
|
|
— |
|
|
|
— |
|
Common stock |
|
|
1 |
|
|
|
— |
|
Class A and Class B common stock |
|
|
— |
|
|
|
8 |
|
Additional paid-in capital |
|
|
28,300 |
|
|
|
631,971 |
|
Treasury stock, at cost |
|
|
— |
|
|
|
(2,651 |
) |
Accumulated deficit |
|
|
(126,509 |
) |
|
|
(211,233 |
) |
Accumulated other comprehensive (loss) income |
|
|
(1,574 |
) |
|
|
140 |
|
Total stockholders’ (deficit) equity |
|
|
(99,782 |
) |
|
|
418,235 |
|
Total liabilities, redeemable convertible preferred stock and
stockholders’ equity |
|
$ |
285,434 |
|
|
$ |
608,083 |
|
Poshmark, Inc.Condensed
Consolidated Statements of Cash Flows(in
thousands)(unaudited)
|
|
Nine Months Ended September 30, |
|
|
|
2020 |
|
|
2021 |
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
20,906 |
|
|
$ |
(84,724 |
) |
Adjustments to reconcile net
income (loss) to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
2,130 |
|
|
|
2,463 |
|
Stock-based compensation |
|
|
6,083 |
|
|
|
38,912 |
|
Change in fair value of redeemable convertible preferred stock
warrant liability |
|
|
500 |
|
|
|
2,816 |
|
Change in fair value of the convertible notes |
|
|
516 |
|
|
|
49,481 |
|
Loss on extinguishment of the convertible notes |
|
|
— |
|
|
|
1,620 |
|
Accretion of discounts and amortization of premiums on marketable
securities, net |
|
|
(125 |
) |
|
|
237 |
|
Other |
|
|
3 |
|
|
|
4 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Prepaid expenses and other assets |
|
|
(4,551 |
) |
|
|
2,302 |
|
Accounts payable |
|
|
10,827 |
|
|
|
(1,697 |
) |
Funds payable to customers |
|
|
31,660 |
|
|
|
19,231 |
|
Accrued expenses and other liabilities |
|
|
240 |
|
|
|
2,188 |
|
Net cash provided by operating activities |
|
|
68,189 |
|
|
|
32,833 |
|
Cash flows from investing
activities |
|
|
|
|
|
|
|
|
Purchases of property and
equipment |
|
|
(1,102 |
) |
|
|
(1,580 |
) |
Purchases of marketable
securities |
|
|
(67,929 |
) |
|
|
— |
|
Maturities of marketable
securities |
|
|
75,957 |
|
|
|
26,000 |
|
Sales of marketable
securities |
|
|
27,208 |
|
|
|
— |
|
Net cash provided by investing activities |
|
|
34,134 |
|
|
|
24,420 |
|
Cash flows from financing
activities |
|
|
|
|
|
|
|
|
Proceeds from initial public
offering, net of underwriting discounts and commissions and
offering costs |
|
|
— |
|
|
|
293,692 |
|
Proceeds from issuance of common
stock warrants |
|
|
— |
|
|
|
100 |
|
Tax withholding related to
vesting of restricted stock units |
|
|
— |
|
|
|
(2,651 |
) |
Proceeds from exercise of stock
options |
|
|
883 |
|
|
|
4,705 |
|
Proceeds from borrowing on
convertible notes |
|
|
50,000 |
|
|
|
— |
|
Net cash provided by financing activities |
|
|
50,883 |
|
|
|
295,846 |
|
Effect of foreign exchange rate
changes on cash and cash equivalents |
|
|
34 |
|
|
|
95 |
|
Net increase in cash and cash equivalents |
|
|
153,240 |
|
|
|
353,194 |
|
Cash and cash
equivalents |
|
|
|
|
|
|
|
|
Beginning of year |
|
|
63,318 |
|
|
|
235,834 |
|
End of year |
|
$ |
216,558 |
|
|
$ |
589,028 |
|
The following table reflects the reconciliation of net income
(loss) to Adjusted EBITDA for each of the periods indicated (in
thousands; unaudited):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
Net income (loss) attributable to common stockholders |
|
$ |
8,130 |
|
|
$ |
(7,197 |
) |
|
$ |
8,130 |
|
|
$ |
(84,724 |
) |
Adjusted to exclude the
following: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization |
|
|
752 |
|
|
|
827 |
|
|
|
2,130 |
|
|
|
2,463 |
|
Stock-based compensation |
|
|
2,621 |
|
|
|
6,668 |
|
|
|
6,083 |
|
|
|
38,912 |
|
Interest income |
|
|
(63 |
) |
|
|
(77 |
) |
|
|
(540 |
) |
|
|
(201 |
) |
Other expense, net |
|
|
845 |
|
|
|
36 |
|
|
|
1,248 |
|
|
|
54,137 |
|
Provision (benefit) for income
taxes |
|
|
105 |
|
|
|
— |
|
|
|
225 |
|
|
|
(30 |
) |
Undistributed earnings
attributable to participating securities |
|
|
2,643 |
|
|
|
— |
|
|
|
12,776 |
|
|
|
— |
|
Adjusted EBITDA |
|
$ |
15,033 |
|
|
$ |
257 |
|
|
$ |
30,052 |
|
|
$ |
10,557 |
|
The following table reflects the reconciliation
of GAAP income (loss) from operations to non-GAAP income (loss)
from operations for each of the periods indicated (in thousands;
unaudited):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
GAAP income (loss) from operations |
|
$ |
11,660 |
|
|
$ |
(7,238 |
) |
|
$ |
21,839 |
|
|
$ |
(30,818 |
) |
Adjusted to exclude the
following: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
2,621 |
|
|
|
6,668 |
|
|
|
6,083 |
|
|
|
38,912 |
|
Non-GAAP income (loss) from
operations |
|
$ |
14,281 |
|
|
$ |
(570 |
) |
|
$ |
27,922 |
|
|
$ |
8,094 |
|
The following table presents a reconciliation of net cash
provided by operating activities to free cash flow for each of the
periods indicated (in thousands; unaudited):
|
|
Nine Months Ended September 30, |
|
|
|
2020 |
|
|
2021 |
|
GAAP net cash provided by operating activities |
|
$ |
68,189 |
|
|
$ |
32,833 |
|
Less: purchases of property and
equipment |
|
|
(1,102 |
) |
|
|
(1,580 |
) |
Non-GAAP free cash flow |
|
$ |
67,087 |
|
|
$ |
31,253 |
|
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