real-20250331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

___________________________________________________

FORM 10-Q

___________________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission File Number: 001-38953

___________________________________________________

The RealReal, Inc.

(Exact Name of Registrant as Specified in its Charter)

___________________________________________________


Delaware			45-1234222
( State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
55 Francisco Street Suite 400 San Francisco, CA			94133
(Address of principal executive offices)			(Zip Code)

(855) 435-5893

(Registrant’s telephone number, including area code)

__________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common stock, $0.00001 par value

REAL

The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 1, 2025, the registrant had 113,095,329 shares of common stock, $0.00001 par value per share, outstanding.

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		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Balance Sheets as of March 31, 202 5 and December 31, 20 2 4	1
	Condensed Statements of Operations for the Three Months Ended March 31, 202 5 and 20 2 4	2
	Condensed Statements of Stockholders’ Equity (Deficit) as of March 31, 202 5 and 20 2 4	3
	Condensed Statements of Cash Flows for the Three Months Ended March 31, 202 5 and 20 2 4	5
	Notes to Unaudited Condensed Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4.	Controls and Procedures	42

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	44
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62
Item 3.	Defaults Upon Senior Securities	62
Item 4.	Mine Safety Disclosures	62
Item 5.	Other Information	62
Item 6.	Exhibits	63
	Signatures	64

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NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial position, business strategy and plans, objectives of management for future operations, long term operating expenses, the opening of additional retail stores in the future, the development of our automation technology, expectations for capital requirements and the use of proceeds from our initial public offering, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” included under Part II, Item 1A below and elsewhere in this Quarterly Report on Form 10-Q, as well as in our other filings with the Securities and Exchange Commission (SEC). Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Some of the key factors that could cause actual results to differ from our expectations include:

•our future financial performance, including our expectations regarding our revenue, cost of revenue, operating expenses, and our ability to achieve and maintain future profitability, in particular with respect to the impacts of macroeconomic uncertainty and geopolitical instability;

• our ability to return to historic levels of revenue growth and to effectively expand our operations;

• our ability to achieve anticipated savings in connection with our reduction in workforce and associated real estate reduction plan;

• our ability to successfully implement our growth strategies;

• our strategies, plans, objectives and goals;

• the market demand for authenticated, pre-owned luxury goods and new and pre-owned luxury goods in general and the online market for luxury goods;

• our ability to compete with existing and new competitors in existing and new markets and offerings;

• our ability to attract and retain consignors and buyers;

• our ability to increase the supply of luxury goods offered through our online marketplace;

• our ability to timely and effectively scale our operations;

• our ability to enter international markets;

• the accuracy and reliability of our authentication processes and methods;

• our ability to optimize, operate and manage our authentication centers;

• our ability to develop and protect our brand;

• our ability to comply with laws and regulations;

• our expectations regarding outstanding litigation;

• the reliable performance of our network infrastructure and content delivery process;

• our ability to detect and prevent data security breaches and fraud;

• our expectations and management of future growth;

• our expectations concerning relationships with third parties;

• economic and industry trends, projected growth or trend analysis;

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• changes to trade policies or trade relationships and any impact therefrom;

• changes or fluctuations in consumer discretionary spending;

• seasonal sales fluctuations;

• our ability to add capacity, capabilities and automation to our operations; and

• our ability to attract and retain key personnel.

In addition, statements such as “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q and, although we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted a thorough inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this Quarterly Report on Form 10-Q, whether as a result of any new information, future events or otherwise.

iii

Table of Contents

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

THE REALREAL, INC.

Condensed Balance Sheets

(In thousands, except share and per share data)

(Unaudited)


	March 31, 2025		December 31, 2024
Assets
Current assets
Cash and cash equivalents	$	139,602	$	172,212
Accounts receivable, net	27,750		13,961
Inventory, net	26,472		23,583
Prepaid expenses and other current assets	14,323		22,913
Total current assets	208,147		232,669
Property and equipment, net	97,608		94,443
Operating lease right-of-use assets	73,972		75,714
Restricted cash	14,859		14,911
Other assets	5,781		5,358
Total assets	$	400,367	$	423,095
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable	$	19,764	$	11,004
Accrued consignor payable	82,278		89,718
Operating lease liabilities, current portion	22,862		22,835
Convertible Senior Notes, net, current portion	26,704		26,653
Other accrued and current liabilities	88,384		98,466
Total current liabilities	239,992		248,676
Operating lease liabilities, net of current portion	82,527		85,790
Convertible Senior Notes, net	234,723		276,807
Non-convertible notes, net	137,495		134,470
Warrant liability	36,081		78,584
Other noncurrent liabilities	5,618		6,144
Total liabilities	736,436		830,471
Commitments and contingencies (Note 11)
Stockholders’ deficit:
Common stock, $0.00001 par value; 500,000,000 shares authorized as of March 31, 2025 and December 31, 2024; 113,094,079 and 111,242,479 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively	1		1
Additional paid-in capital	855,357		846,450

Accumulated deficit	(1,191,427)		(1,253,827)
Total stockholders’ deficit	(336,069)		(407,376)
Total liabilities and stockholders’ deficit	$	400,367

SEC Form 10-Q filed by The RealReal Inc.