Therealreal Financials
This page shows Therealreal (REAL) financial statements, including the income statement, balance sheet, cash flow statement, and key financial ratios. View 9 years of annual fundamentals and quarterly data, with year-over-year growth rates and compound annual growth rates (CAGR). All figures are derived from SEC filings (10-K and 10-Q reports).
Gross-margin expansion and moderate overhead growth are pulling the business toward self-funding, even as the balance sheet stays stretched.
Gross margin moved from68.5% to74.6% while SG&A grew far slower than revenue, so the operating loss narrowed much faster than sales alone would suggest. That same improvement turned free cash flow positive for two straight years even though operating income stayed negative, a sign that day-to-day cash generation is no longer deteriorating in step with reported losses.
Balance-sheet repair has not kept pace: assets were
Capital intensity is no longer the main drag on cash: operating cash flow reached
Financial Health Signals
Based on FY2025 annual data, averaged across the last 3 years for performance metrics (most-recent year weighted highest). How this score is calculated →
Health score ≠ stock price. This rates the quality of Therealreal's business: profitability, growth, balance sheet strength. It doesn't tell you whether the stock is a good buy at today's price. Not financial advice. Use it alongside valuation analysis and your own research.
Therealreal has an operating margin of -3.5%, meaning the company retains $-3 of operating profit per $100 of revenue. This below-average margin results in a low score of 0/100, suggesting thin profitability after operating expenses. This is up from -9.4% the prior year.
Therealreal's revenue surged 15.4% year-over-year to $692.8M, reflecting rapid business expansion. This strong growth earns a score of 54/100.
Therealreal has elevated debt relative to equity (D/E of -1.98), meaning the company relies heavily on borrowed funds. This high leverage results in a low score of 0/100, reflecting increased financial risk.
Therealreal's current ratio of 0.86 is below the typical benchmark, resulting in a score of 12/100. However, the company holds substantial cash reserves (57% of current liabilities), which buffers actual liquidity risk. Large mature operators often run tight current ratios by design.
Therealreal's free cash flow margin of 2.6% results in a low score of 22/100. Capital expenditures of $18.6M absorb a large share of operating cash flow.
Therealreal passes 3 of 9 financial strength tests. All 1 profitability signals pass (positive income, cash flow, and earnings quality), no leverage/liquidity signals pass (rising debt, declining liquidity, or share dilution), both operating efficiency signals pass.
Therealreal earns $-0.9 in operating income for every $1 of interest expense (-$23.9M vs $27.7M). This narrow margin raises concern about the company's ability to service its debt if operating income declines.
Key Financial Metrics
Earnings & Revenue
Therealreal generated $692.8M in revenue in fiscal year 2025. This represents an increase of 15.4% from the prior year.
Therealreal's EBITDA was $9.1M in fiscal year 2025, measuring earnings before interest, taxes, depreciation, and amortization. This represents an increase of 138.8% from the prior year.
Therealreal earned $-0.70 per diluted share (EPS) in fiscal year 2025. This represents an increase of 43.5% from the prior year.
Cash & Balance Sheet
Therealreal generated $18.4M in free cash flow in fiscal year 2025, representing cash available after capex. This represents an increase of 45.8% from the prior year.
Therealreal held $151.2M in cash against $0 in long-term debt as of fiscal year 2025.
Therealreal had 118M shares outstanding in fiscal year 2025. This represents an increase of 6.4% from the prior year.
Margins & Returns
Therealreal's gross margin was 74.6% in fiscal year 2025, indicating the percentage of revenue retained after direct costs. This is up 0.1 percentage points from the prior year.
Therealreal's operating margin was -3.5% in fiscal year 2025, reflecting core business profitability. This is up 6.0 percentage points from the prior year.
Capital Allocation
Therealreal invested $18.6M in capex in fiscal year 2025, funding long-term assets and infrastructure. This represents an increase of 30.9% from the prior year.
REAL Income Statement
| Metric | Q1'26 | Q4'25 | Q3'25 | Q2'25 | Q1'25 | Q4'24 | Q3'24 | Q2'24 |
|---|---|---|---|---|---|---|---|---|
| Revenue | $189.7M-2.2% | $194.1M+11.8% | $173.6M+5.1% | $165.2M+3.2% | $160.0M-2.4% | $164.0M+11.0% | $147.8M+1.9% | $144.9M |
| Cost of Revenue | $48.4M-1.0% | $48.8M+9.4% | $44.7M+5.0% | $42.5M+6.3% | $40.0M-4.6% | $41.9M+13.2% | $37.0M-1.1% | $37.5M |
| Gross Profit | $141.3M-2.7% | $145.2M+12.6% | $128.9M+5.1% | $122.7M+2.2% | $120.0M-1.7% | $122.1M+10.3% | $110.7M+3.0% | $107.5M |
| R&D Expenses | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| SG&A Expenses | $52.3M+0.7% | $52.0M+0.7% | $51.6M+7.5% | $48.0M-3.9% | $50.0M+7.7% | $46.4M-2.4% | $47.5M+0.9% | $47.1M |
| Operating Income | -$2.3M-136.3% | $6.3M+183.1% | -$7.5M+23.6% | -$9.9M+22.6% | -$12.8M-147.8% | -$5.2M+64.7% | -$14.6M+22.3% | -$18.8M |
| Interest Expense | $7.2M-0.5% | $7.3M+2.4% | $7.1M+0.7% | $7.0M+11.4% | $6.3M+6.8% | $5.9M-0.5% | $5.9M+3.1% | $5.8M |
| Income Tax | $108K-30.3% | $155K+545.8% | $24K-73.0% | $89K-6.3% | $95K-3.1% | $98K+36.1% | $72K+105.7% | $35K |
| Net Income | $38.9M | N/A | -$54.1M-375.5% | -$11.4M-118.2% | $62.4M | N/A | -$17.9M-7.4% | -$16.7M |
| EPS (Diluted) | $-0.07 | N/A | $-0.49-276.9% | $-0.13+7.1% | $-0.14 | N/A | $-0.17+15.0% | $-0.20 |
REAL Balance Sheet
| Metric | Q1'26 | Q4'25 | Q3'25 | Q2'25 | Q1'25 | Q4'24 | Q3'24 | Q2'24 |
|---|---|---|---|---|---|---|---|---|
| Total Assets | $385.9M-5.7% | $409.0M+11.7% | $366.2M+4.8% | $349.4M-12.7% | $400.4M-5.4% | $423.1M+4.1% | $406.3M-0.3% | $407.4M |
| Current Assets | $203.0M-10.8% | $227.5M+24.7% | $182.4M+13.8% | $160.3M-23.0% | $208.1M-10.5% | $232.7M+9.9% | $211.7M+2.1% | $207.4M |
| Cash & Equivalents | $124.0M-18.0% | $151.2M+39.5% | $108.4M+14.9% | $94.3M-32.4% | $139.6M-18.9% | $172.2M+12.4% | $153.2M+1.6% | $150.7M |
| Inventory | $33.9M+10.0% | $30.8M+3.9% | $29.7M+3.2% | $28.8M+8.7% | $26.5M+12.3% | $23.6M+18.4% | $19.9M-5.7% | $21.1M |
| Accounts Receivable | $24.9M+4.5% | $23.8M-2.1% | $24.3M+6.9% | $22.8M-18.0% | $27.8M+98.8% | $14.0M-12.5% | $16.0M-3.0% | $16.4M |
| Goodwill | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Total Liabilities | $745.3M-9.6% | $824.6M+9.8% | $751.3M+9.3% | $687.6M-6.6% | $736.4M-11.3% | $830.5M+10.5% | $751.7M+1.2% | $742.7M |
| Current Liabilities | $241.1M-8.8% | $264.2M+16.9% | $226.1M+13.3% | $199.5M-16.9% | $240.0M-3.5% | $248.7M+10.2% | $225.7M+6.6% | $211.8M |
| Long-Term Debt | $144.2M | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Total Equity | -$359.4M+13.5% | -$415.5M-7.9% | -$385.1M-13.8% | -$338.2M-0.6% | -$336.1M+17.5% | -$407.4M-17.9% | -$345.4M-3.0% | -$335.3M |
| Retained Earnings | -$1.3B+3.0% | -$1.3B-3.1% | -$1.3B-4.5% | -$1.2B-1.0% | -$1.2B+5.0% | -$1.3B-5.8% | -$1.2B-1.5% | -$1.2B |
REAL Cash Flow Statement
| Metric | Q1'26 | Q4'25 | Q3'25 | Q2'25 | Q1'25 | Q4'24 | Q3'24 | Q2'24 |
|---|---|---|---|---|---|---|---|---|
| Operating Cash Flow | -$16.6M-133.6% | $49.5M+156.2% | $19.3M+641.5% | -$3.6M+87.4% | -$28.3M-201.0% | $28.0M+208.5% | $9.1M+234.3% | -$6.8M |
| Capital Expenditures | $7.5M+102.5% | $3.7M+51.4% | $2.4M-68.8% | $7.8M+65.5% | $4.7M-7.2% | $5.1M+26.2% | $4.0M+34.2% | $3.0M |
| Free Cash Flow | -$24.1M-152.6% | $45.8M+171.3% | $16.9M+248.5% | -$11.4M+65.5% | -$33.0M-243.9% | $22.9M+354.0% | $5.0M+151.7% | -$9.8M |
| Investing Cash Flow | -$10.6M-53.8% | -$6.9M-23.3% | -$5.6M+48.2% | -$10.8M-84.9% | -$5.9M+33.6% | -$8.8M-36.3% | -$6.5M-30.6% | -$5.0M |
| Financing Cash Flow | -$16K-110.1% | $158K-56.0% | $359K+101.2% | -$30.9M-2203.2% | $1.5M+1211.4% | -$132K+18.5% | -$162K+95.4% | -$3.5M |
| Dividends Paid | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Share Buybacks | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
REAL Financial Ratios
| Metric | Q1'26 | Q4'25 | Q3'25 | Q2'25 | Q1'25 | Q4'24 | Q3'24 | Q2'24 |
|---|---|---|---|---|---|---|---|---|
| Gross Margin | 74.5%-0.3pp | 74.8%+0.6pp | 74.3%0.0pp | 74.3%-0.7pp | 75.0%+0.6pp | 74.4%-0.5pp | 74.9%+0.8pp | 74.2% |
| Operating Margin | -1.2%-4.4pp | 3.2%+7.6pp | -4.3%+1.6pp | -6.0%+2.0pp | -8.0%-4.8pp | -3.1%+6.7pp | -9.9%+3.1pp | -13.0% |
| Net Margin | 20.5% | N/A | -31.1%-24.3pp | -6.9%-45.9pp | 39.0% | N/A | -12.1%-0.6pp | -11.5% |
| Return on Equity | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Return on Assets | 10.1% | N/A | -14.8%-11.5pp | -3.3%-18.8pp | 15.6% | N/A | -4.4%-0.3pp | -4.1% |
| Current Ratio | 0.84-0.0 | 0.86+0.1 | 0.810.0 | 0.80-0.1 | 0.87-0.1 | 0.940.0 | 0.94-0.0 | 0.98 |
| Debt-to-Equity | -2.07-0.1 | -1.98-0.0 | -1.95+0.1 | -2.03+0.2 | -2.19-0.2 | -2.04+0.1 | -2.18+0.0 | -2.22 |
| FCF Margin | -12.7%-36.3pp | 23.6%+13.9pp | 9.7%+16.6pp | -6.9%+13.7pp | -20.6%-34.6pp | 14.0%+10.5pp | 3.4%+10.2pp | -6.7% |
Note: Shareholder equity is negative (-$415.5M), which causes debt-to-equity and return on equity ratios to appear negative or not meaningful. This can occur from accumulated losses or large share buyback programs.
Note: The current ratio is below 1.0 (0.86), indicating current liabilities exceed current assets, which may suggest potential short-term liquidity concerns.
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Frequently Asked Questions
What is Therealreal's annual revenue?
Therealreal (REAL) reported $692.8M in total revenue for fiscal year 2025. This represents a 15.4% change compared to the previous fiscal year. Revenue measures the total income earned from the company's primary business operations before any expenses are deducted.
How fast is Therealreal's revenue growing?
Therealreal (REAL) revenue grew by 15.4% year-over-year, from $600.5M to $692.8M in fiscal year 2025.
What is Therealreal's EBITDA?
Therealreal (REAL) had EBITDA of $9.1M in fiscal year 2025, measuring earnings before interest, taxes, depreciation, and amortization.
What is Therealreal's gross margin?
Therealreal (REAL) had a gross margin of 74.6% in fiscal year 2025, indicating the percentage of revenue retained after direct costs of goods sold.
What is Therealreal's operating margin?
Therealreal (REAL) had an operating margin of -3.5% in fiscal year 2025, reflecting the profitability of core business operations before interest and taxes.
What is Therealreal's free cash flow?
Therealreal (REAL) generated $18.4M in free cash flow during fiscal year 2025. This represents a 45.8% change compared to the previous fiscal year. Free cash flow represents the cash a company generates after accounting for capital expenditures, and is widely used to assess financial flexibility and shareholder value.
What is Therealreal's operating cash flow?
Therealreal (REAL) generated $37.0M in operating cash flow during fiscal year 2025, representing cash generated from core business activities.
What are Therealreal's total assets?
Therealreal (REAL) had $409.0M in total assets as of fiscal year 2025, including both current and long-term assets.
What are Therealreal's capital expenditures?
Therealreal (REAL) invested $18.6M in capital expenditures during fiscal year 2025, funding long-term assets and infrastructure.
What is Therealreal's current ratio?
Therealreal (REAL) had a current ratio of 0.86 as of fiscal year 2025, which is below 1.0, which may suggest potential liquidity concerns.
What is Therealreal's debt-to-equity ratio?
Therealreal (REAL) had a debt-to-equity ratio of -1.98 as of fiscal year 2025, measuring the company's financial leverage by comparing total debt to shareholder equity.
Why is Therealreal's debt-to-equity ratio negative or unusual?
Therealreal (REAL) has negative shareholder equity of -$415.5M as of fiscal year 2025, which causes the debt-to-equity ratio to appear negative or not meaningful. This can occur when accumulated losses exceed invested capital, or after large share buyback programs. Other solvency metrics like the current ratio or interest coverage may be more informative.
What is Therealreal's Piotroski F-Score?
Therealreal (REAL) has a Piotroski F-Score of 3 out of 9, indicating weak financial health. The F-Score evaluates nine binary signals across profitability (positive ROA, positive cash flow, improving ROA, earnings quality), leverage (decreasing debt, improving liquidity, no share dilution), and operating efficiency (improving gross margin, improving asset turnover). Scores of 7 to 9 indicate strong and improving fundamentals. Learn more in our complete guide to financial health indicators.
Can Therealreal cover its interest payments?
Therealreal (REAL) has an interest coverage ratio of -0.9x, meaning it can struggle to cover its interest obligations. This ratio divides operating income by interest expense. Ratios above 5x indicate strong debt-servicing ability, while ratios below 2x suggest the company may face difficulty meeting interest payments if earnings decline. Learn more in our complete guide to financial health indicators.
How financially healthy is Therealreal?
Therealreal (REAL) scores 15 out of 100 on our Financial Profile, indicating weak overall financial health. This composite score evaluates six dimensions: profitability (operating margin), revenue growth, leverage (debt-to-equity), liquidity (current ratio), cash flow quality (free cash flow margin), and shareholder returns (return on equity). Each dimension is normalized against standard financial benchmarks. Learn more in our complete guide to financial health indicators.