By Katherine Hamilton

Shares for ThredUp skyrocketed after the company released preliminary fourth-quarter results that were stronger than its previous outlook.

The second-hand clothing marketplace saw shares rise 45% to $1.89 in Tuesday morning trading. Year to date, the stock is up 36%.

ThredUp said it expects to post between $66.7 million and $67.2 million in revenue from its U.S. operations for the fourth quarter of 2024. The company previously guided for between $58 million and$60 million.

ThredUp's total revenue, which includes the company's divested European business, is expected to be between $74.5 million and $75 million, up from a previous outlook of between $67.2 million and $69.2 million.

It anticipates losses up to 12.6% of its revenue in the U.S. For the combined business, the company expects losses of up to nearly 25%.

"The exclusive focus on our U.S. business, along with the growing impact of the AI-driven enhancements to our product experience, helped to accelerate momentum throughout the quarter," said Chief Executive James Reinhart.

ThredUp on Nov. 30 completed the divestiture of its European operations after launching its online consignment business overseas in the third quarter of 2022.

Companies specializing in secondhand goods are struggling to turn a profit. A lack of inventory, competition from bigger resellers such as eBay and an expensive distribution has weighed on sales for ThredUp and its peers.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

January 14, 2025 10:33 ET (15:33 GMT)

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