Poshmark Inc, a well-known platform for secondhand apparel, disappointed investors with its forecast for the holiday quarter following its failure to meet revenue estimates. In the third quarter, the company reported a 16% increase in revenue to $79.7 million, falling short of the average estimate of $82.7 million by analysts. As a result, the announcement led to an 18% decline in Poshmark’s shares during extended trading. This setback comes shortly after its competitors, ThredUp Inc and RealReal, both exceeded their third-quarter revenue estimates.

The growing demand for resale platforms like Poshmark, ThredUp, and RealReal can be attributed to the challenges traditional retailers face, such as supply chain disruptions and shortages of new clothing. With fewer options for new apparel, consumers are turning to the secondhand market. This trend has intensified the competition within the sector.

To combat the rising costs and supply bottlenecks, traditional clothing retailers have been increasing their prices. In response, ThredUp announced a forecast that surpassed estimates for fourth-quarter revenue. The company plans to lower prices in an effort to attract customers.

In addition to increased competition, Poshmark has also been affected by Apple Inc’s new privacy controls. These controls make it more challenging for third-party apps, including Poshmark, to track iPhone users without their consent.

The challenges for Poshmark continue to mount as established apparel brands like Levi Strauss & Co and Urban Outfitters Inc enter the secondhand market. This further intensifies the competition in the space.

Moving forward, Poshmark expects its fourth-quarter revenue to be between $80 million and $82 million, falling short of analysts’ estimates of $85.2 million.

Although Poshmark’s third-quarter revenue fell below expectations, the company remains a significant player in the expanding secondhand apparel market. By utilizing social media marketing strategies and adapting to changing privacy controls, Poshmark aims to maintain its position in the competitive industry and attract new customers during the upcoming holiday season.

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Poshmark Official Website
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