The RealReal, Inc.

Q2 GMV was $617 million, up 22% year over year, and revenue was $193 million, up 17%. Adjusted EBITDA came in at $13.5 million, or 7% of revenue, up 290 basis points year over year. Gross profit was $143 million, up 17%, and gross margin expanded 10 basis points to 74.4%. Orders rose 8% and average order value increased 13% to $659. Take rate was 35.9%, down 200 basis points year over year due to a shift toward higher-value items. The company ended the quarter with $134 million in cash, cash equivalents and restricted cash, generated $2 million of operating cash flow, and had $4 million of capex. For Q3, management guided to GMV of $610 million to $620 million, revenue of $194 million to $198 million, and adjusted EBITDA of $13.5 million to $14.5 million. For full year 2026, it now expects GMV of $2.535 billion to $2.565 billion, revenue of $788 million to $797 million, and adjusted EBITDA of $66 million to $69 million, which implies an 8.5% margin at the midpoint and about 240 basis points of margin improvement versus 2025.

Rati Levesque said the quarter showed the company’s strategy compounding, with stronger supply, better buyer quality, and more engaged sellers. She emphasized The RealReal’s full-service, trust-based model, saying the company’s possession-and-authentication approach is hard for competitors to match and increasingly relevant as consumers seek confidence in luxury resale. Her tone was upbeat and confident, especially around AI, flywheel effects, and the company’s ability to adapt quickly as luxury demand shifts.

Ajay Gopal highlighted the financial leverage in the model, pointing to 22% GMV growth, 17% revenue growth, and adjusted EBITDA margin expansion to 7%. He said gross margin was 74.4%, total operating expenses leveraged about 470 basis points, and capex was $4 million, with full-year PP&E spending still expected at 2% to 3% of revenue. He also noted $134 million of cash and said the company generated $2 million of operating cash flow and expects strong positive free cash flow in Q3 and Q4, while continuing to prioritize deleveraging.

Analysts asked about retail demand weakness, higher-value item mix, AOV sustainability, AI pricing, the AI shopping assistant, dropship expansion, headcount efficiency, return rates, and capital allocation. Management said consumer demand remained resilient, supply was strong, and the higher-value mix was favorable because those items carry lower take rates but better dollar profit per transaction. On AI and automation, they said Athena is on track to process nearly 50% of items by year-end and pricing now uses over 100 data points, while the Google conversational shopping test is aimed at better discovery and conversion. On capital allocation, Ajay said the company remains focused on strengthening the balance sheet and has reduced total debt by slightly over $80 million over the last couple of years.