The RealReal Earnings: What To Look For From REAL

Jabin Bastian /
2022/11/07 2:30 am EST

Secondhand luxury marketplace The RealReal (NASDAQ: REAL) will be reporting results tomorrow after market close. Here's what to look for.

Last quarter The RealReal reported revenues of $154.4 million, up 47.2% year on year, in line with analyst expectations. It was a slower quarter for the company, with underwhelming revenue guidance for the full year. The company reported 889 thousand paying users, up 21.7% year on year.

Is The RealReal buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting The RealReal's revenue to grow 25.5% year on year to $149.2 million, slowing down from the 52.7% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.40 per share.

The RealReal Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company missed Wall St's revenue estimates three times over the last two years.

Looking at The RealReal's peers in the consumer internet segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. Airbnb delivered top-line growth of 28.9% year on year, beating analyst estimates by 1.26% and Etsy reported revenues up 11.6% year on year, exceeding estimates by 5.36%. Airbnb traded down 3.21% on the results, Etsy was up 8.29%. Read our full analysis of Airbnb's results here and Etsy's results here.

The whole tech sector has been facing a sell-off since late last year and while some of the consumer internet stocks have fared somewhat better, they have not been spared, with share price declining 4.95% over the last month. The RealReal is up 5.92% during the same time, and is heading into the earnings with analyst price target of $5.40, compared to share price of $1.43.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.