A maker of authenticated luxury resale, The RealReal runs one of the world's largest online marketplaces for pre-owned designer goods, spanning women's, men's, jewelry, and watches, backed by its own authentication experts and AI trained on tens of millions of past sales. Founder Julie Wainwright, who had steered Pets.com during the dot-com bust, launched it in 2011 from her San Francisco kitchen table, personally driving a rolling rack to pick up clients' closets. The name is a playful twist on "real," signaling that every handbag and watch is verified as genuine.
Revenue rose 17% to $192.6M but net loss widened to $27.2M on an $18.6M non-cash warrant charge.
The consignment fell another 200 as the mix kept shifting toward higher-value items. rose 17% to $192.6M on 22% GMV growth, and held at 74.4%, but net loss widened to $27.2M from $11.4M a year ago because of an $18.6M non-cash loss on warrant revaluation tied to a higher stock price. The core business is growing and leveraging costs, but the take rate slide and a cash balance of $119.1M leave little room for error.
Key takeaways
rose 17% to $192.6M, driven by a 22% increase in GMV to $617.3M from an 8% rise in orders and a 13% increase in average order value.
The consignment declined 200 to 35.9% as the sales mix continued to shift toward higher-value items, a trend that has now persisted for several quarters.
Net loss widened to $27.2M from $11.4M a year earlier, primarily due to an $18.6M non-cash loss from the remeasurement of warrant liability as the company's stock price rose.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 revenue rose 17% to $192.6M driven by 22% GMV growth, while net loss widened to $27.2M on a non-cash warrant charge.
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Total grew 17% to $192.6M, driven by a 22% increase in GMV to $617.3M, reflecting an 8% rise in orders and a 13% increase in AOV.
improved 10 to 74.4%, as a 471-basis-point expansion in direct margin from lower adjustments offset a slight decline in consignment margin.
Operating expenses grew 10% to $145.5M but leveraged as a share of , with operations and technology falling 300 to 39% of revenue on fulfillment efficiencies.
Cash and equivalents ended at $119.1M, down from $124.0M at the end of Q1, and the company used $15.0M in operations for the first half, driven by a seasonal decrease in accrued consignor .
What changed
The Q1 FY2026 watch item on the consignment was answered: it fell further to 35.9% from 36.4% in Q1, confirming the higher-value mix shift continues to pressure the rate rather than recovering.
growth of 17% decelerated from the 19% posted in Q1 FY2026, as the prior-year comparison began to include the 14% growth quarter from Q2 FY2025.
The Chanel litigation watch item from Q1 noted a May 2026 discovery dispute resolution; the filing now discloses that in March 2026 the court denied Chanel's motion to strike a defense and dismissed counterclaims, with the company moving to amend in April 2026, but no trial date or loss estimate is provided.
turned positive in Q2 at $1.6M after a $16.6M use in Q1, though the first-half total remained a $15.0M outflow, consistent with the seasonal pattern of consignor .
What to watch
Q3 FY2026 consignment to see if the 35.9% print stabilizes or declines further as the higher-value mix persists.
Outcome of the company's April 2026 motion to amend counterclaims in the Chanel litigation and whether the case proceeds toward trial.
Q3 FY2026 cash balance and against $119.1M and $231.5M in as seasonal consignor normalize.
Whether the 471-basis-point direct is sustained or reflects a one-time benefit from lower adjustments.
Consignment increased 15% to $148.2M, though the declined 200 to 35.9% due to a sales mix shift toward higher-value items.
Total improved 10 , as a 471 bps expansion in direct margin from lower adjustments offset a slight decline in consignment margin.
Operating expenses grew 10% to $145.5M, with marketing up 18% on higher ad volumes, while operations and technology leveraged 300 to 39% of on fulfillment efficiencies.
Net loss was $27.2M compared to a $11.4M loss a year ago, primarily due to an $18.6M non-cash loss from the remeasurement of tied to a higher stock price.
Cash used in operations was $15.0M for the first half, driven by a $16.4M seasonal decrease in accrued consignor and a $14.5M drop in other accrued liabilities.
Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks in the ordinary course of our business, including fluctuations in interest rates. As of June 30, 2026, we had unrestricted cash and cash equivalents of $119.1 million, which carry a degree of interest rate risk. A hypothetical 10% change in interes…
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We are exposed to market risks in the ordinary course of our business, including fluctuations in interest rates. As of June 30, 2026, we had unrestricted cash and cash equivalents of $119.1 million, which carry a degree of interest rate risk. A hypothetical 10% change in interest rates would not have a material impact on our financial condition or results of operations due to the short-term nature of our cash equivalents holdings. As such, we do not expect a sudden change in market interest rates would have a material impact on our consolidated financial results.
Our costs are subject to inflationary pressures, which we expect to continue, and if those pressures become significant, we may not be able to fully offset such higher costs. Our inability or failure to do so could harm our business, results of operations or financial condition.
Chanel trademark suit and a shareholder class action are the two material proceedings; no loss estimate is provided for either.
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Chanel, Inc. sued the Company in 2018 for trademark infringement, false advertising, and unfair competition; the Company later asserted antitrust .
In March 2026 the court denied Chanel’s motion to strike the and dismissed ; the Company moved to amend counterclaims in April 2026.
The Company states the final outcome of the Chanel litigation is uncertain and cannot predict or reasonably estimate a loss or range of possible losses.
A shareholder class action alleging Securities Act violations was settled in 2022 for $11.0 million, but one opt-out plaintiff is pursuing claims in Marin County Superior Court.
was denied for the opt-out case in July 2025; plaintiff appealed in September 2025, and the Company cannot currently estimate a loss or range of possible losses.
The Company believes other ordinary-course proceedings will not materially affect financial position or liquidity but could materially impact results of operations in a single period.
The RealReal faces risks from a history of losses, reliance on discretionary luxury spending, and execution challenges in supply, retail growth, and new revenue initiatives.
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The company has a history of significant losses, with an of $1.28 billion as of June 30, 2026, and may not achieve or maintain profitability.
growth is uncertain and may continue to decline due to factors like economic downturns, increasing competition, and a strategic shift to focus on higher-value consigned items.
The business depends on attracting a consistent supply of pre-owned luxury goods from individual consignors, and a failure to do so cost-effectively would harm operating results.
Consumer discretionary spending on luxury goods is vulnerable to macroeconomic conditions like recessions, inflation, and geopolitical instability, which could reduce both consignments and purchases.
The company's growth strategies, including a retail store expansion and new streams like third-party advertising, may not succeed and could negatively impact the brand.
The company faces material financial risks from its significant debt load, including $385.2 million in outstanding Notes as of June 30, 2026, and potential from convertible notes and warrants.