Poshmark Drops on Wider-Than-Expected Loss

Poshmark slumped after the social marketplace for new and used items reported a wider first-quarter loss per share on 42% higher revenue.
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Shares of Poshmark  (POSH) - Get Report slumped after the social marketplace for new and used items for people, pets and the home reported a wider first-quarter loss per share on 42% higher revenue.

The GAAP figure for Q1 missed the consensus estimate, while revenue and the adjusted loss were stronger than analysts expected. Poshmark's second-quarter outlook is in line with forecasts. 

The Redwood City, Calif., company posted a loss of $1.19 a share compared with a loss of 89 cents a share in the year-earlier quarter. The latest adjusted loss was 33 cents a share. Revenue reached $81 million from $57.1 million.

A survey of analysts by FactSet produced consensus estimates of a GAAP net loss of 37 cents a share, or an adjusted loss of 42 cents a share, on revenue of $77.2 million.

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On March 12 Poshmark had estimated its first-quarter revenue in a range of $75.5 million to $77.5 million. That range came in below what at the time had been the FactSet consensus estimate of analysts of $79.2 million.

The outlook at the time prompted a number of analysts to cut their one-year price targets on the stock, even as they remained optimistic about the company's prospects as the economy reopened.

At last check, Poshmark shares were trading down 11% at $39. They closed the regular Wednesday trading session down 0.6% at $43.78.

The stock has bounced off its 52-week low above $36, set on April 20.

Poshmark reported that first-quarter gross merchandise value increased 43% from a year earlier to $441 million. FactSet’s survey was looking for $421 million.

"We are optimistic that as consumers begin to leave their homes and engage in social activities once again,” pent-up demand for apparel may drive “more frequent and a wider range of apparel and accessory purchases, benefiting our marketplace,” Founder and Chief Executive Manish Chandra said in a statement.

For the second quarter, Poshmark is projecting revenue to range from $79 million to $81 million, bracketing the FactSet estimate of $80.8 million.

Poshmark sees Q2 earnings before interest, taxes, depreciation and amortization coming in at $1.5 million to $2.5 million. FactSet's call, $2.3 million, is above the midpoint of the range.

The company went public in mid-January at $42 a share and in its first day of trading more than doubled to $101.50.