Snapshot
1stdibs.com, Inc. reported $22M of revenue in Q2 2025, up -0.4% year over year, with diluted EPS of $-0.12 and an operating margin of -25.8%.
- Revenue
- $22M
- YoY growth
- +-0.4%
- Diluted EPS
- $-0.12
- Operating margin
- -25.8%
$22M
Revenue
+-0.4%
YoY growth
$-0.12
Diluted EPS
-25.8%
Operating margin
01 Key takeaways
What management said
- •David will provide an update on our business, including our strategy and growth opportunities, and Tom will review our second quarter financial results and third quarter outlook.
- •A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release, which you can find on our Investor Relations website, along with the replay of this call.
- •Lastly, please note that all growth comparisons are on a year-over-year basis unless otherwise noted.
- •The second quarter demonstrated continued resilience amidst a dynamic market, with GMV and revenue performing above the midpoint of guidance and adjusted EBITDA exceeding the high-end.
- •The team is committed to executing against a clear set of priorities to enhance the marketplace and re-accelerate growth.
- •From a funnel perspective, we are pleased to report another quarter of conversion growth, a testament to our continuous optimization efforts.
- •Our 2025 roadmap is centered on accelerating organic traffic growth, ensuring competitive pricing for listings and shipping, and optimizing our multi-step conversion funnel.
- •We continue to execute on our organic traffic growth strategy, which is a critical driver of efficient buyer acquisition, given that over 70% of traffic originates from organic sources.
- •Furthermore, we deployed infrastructure improvements that bolstered indexation rates, ensuring that our unique listings are more readily discoverable.
- •While we are keenly aware of the potential shifts this technology could bring, to date, the impact on our organic search traffic has been low.
- •We also continue to optimize our account registration and email opt-in experiences to expand our email audience, which grew for the third consecutive quarter.
- •In particular, highlighting key elements of the 1stDibs promise raised checkout completion rates, especially on mobile web.
What went well
- •GMV and revenue performed above the midpoint of guidance and adjusted EBITDA exceeded the high end of guidance, with results meeting or exceeding guidance across all key metrics.
- •Delivered a seventh consecutive quarter of conversion growth, with both new and returning conversion increasing and trends improving in the second half of the quarter after the early-April tariff-driven slowdown.
- •Continued to gain market share against the contracting luxury home goods market per syndicated credit card data, with management citing market share gains over the past six quarters.
- •Operating expenses fell 4% year-over-year to $21.6 million, reflecting expense discipline; sales and marketing dropped 12% to $8.1 million.
- •Listings grew 3% to nearly 1.9 million and the 2025 seller sentiment survey showed 1stDibs became the primary sales channel for sellers, surpassing their own showrooms for the first time.
What went wrong
- •GMV modestly declined and GMV growth rates decelerated sequentially due to softening traffic and moderating average order value growth.
- •Adjusted EBITDA loss widened to $1.8 million from a $1.6 million loss a year ago, with margin worsening to a loss of 8% from a loss of 7%.
- •Unique sellers fell 21% year-over-year to approximately 5,900 as seller churn remained elevated following subscription pricing optimizations.
- •Traffic growth softened, driven by a slowdown in paid traffic, and consumer GMV declined modestly while furniture and art remained pressured by the soft housing market.
Guidance changes
| Metric | Period | Previous | Current | Change |
|---|---|---|---|---|
| GMV | Q3 2025 | — | $83 million-$89 million, down 2% to up 5% | |
| Net revenue | Q3 2025 | — | $21 million-$22.1 million, down 1% to up 4% | |
| Adjusted EBITDA margin | Q3 2025 | — | loss of 12% to loss of 8% | |
| Gross profit margin | Q3 2025 | — | toward the lower end of the 71%-73% range | |
| Headcount | FY 2025 | — | approximately flat |
Performance breakdown
| Metric | YoY change | Reason |
|---|---|---|
| Net revenue | Flat at $22.1 million | GMV modestly declined while take rates rose approximately 30 basis points on a mix shift to lower value orders. |
| Gross profit | Flat at $15.9 million (72% margin, flat) | Revenue was flat year-over-year and gross margins held steady. |
| Sales and marketing expense | Down 12% to $8.1 million | Performance marketing optimizations and lower headcount-related expenses following a January reduction in force. |
| Technology development expense | Up 8% to $5.9 million | Higher headcount-related costs due to annual merit increases awarded in March. |
| General administrative expense | Down 4% to $6.6 million | Lower headcount-related costs. |
| Active buyers | Up 5% to approximately 64,400 | — |
| On-platform AOV | Flat at nearly $2,600 | A slight mix shift away from higher value orders amid macro uncertainty prompting consumers to defer or trade down on high-value purchases. |
| Median order value | Up 10% to approximately $1,350 | A slight mix shift away from higher value orders. |
| Jewelry GMV | Up high single digits | Jewelry accounted for approximately 20% of total GMV; all other verticals were flat or down. |
Earnings call themes & trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Conversion growth streak | Conversion gains for six consecutive quarters | Seventh consecutive quarter of conversion growth, with trends improving in the second half of the quarter | |
| Machine learning-based pricing | ML pricing models live across all verticals; 1stDibs estimate integrated into product display pages beginning in March | Foundational rollout complete; shifted to refining recommendation accuracy, adding data attributes, and driving higher seller adoption | |
| AI and chatbots in search | — | Actively tracked; impact on organic search traffic remains low to date, an area of ongoing surveillance | |
| Non-endemic advertising | — | Beginning to explore opportunities; no significant near-term revenue impact expected | |
| Seller channel ranking | Showrooms ranked as sellers' primary channel for the past four years | 1stDibs became the primary sales channel for sellers, surpassing their own showrooms for the first time |
Q&A summary
On macro uncertainty, have you seen any changes in the overall environment for luxury home goods since the beginning of the year, even on the margin?
No major changes; both the U.S. housing market (slowest spring selling season in 13 years per Redfin) and luxury home goods demand remain soft, with syndicated credit card data showing the market softened further in Q2. Comparing 1stDibs GMV growth to that data, management believes it has been gaining market share over the past six quarters and can continue based on its product roadmap.
With over 70% of traffic from organic sources, how vulnerable is that mix to the growing share of AI-driven search results and chat interfaces?
Management thinks about it actively and tracks it; over time AI and chatbots are expected to have a significant impact on traffic, but to date there has been no material impact on organic search traffic or the key terms that drive the most traffic. They remain very focused on it and will report back if things change.