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: RealReal announces its founder’s departure as the luxury reseller moves on to the next stage of business growth


RealReal Inc. shares reacted positively Tuesday to the news that Julie Wainwright, the luxury-goods reseller’s founder, chair and chief executive, is stepping down, setting the stage for business growth.

“The RealReal continues to make progress on its path to profitability, and I feel now is the right time for the next generation of leadership to guide the company through its next chapter,” Wainwright said in a statement. RealReal

was founded 11 years ago.

CFO Robert Julian and COO Rati Sahi Levesque will step in as interim CEOs, effective June 7.

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“While we certainly respect Ms. Wainwright accomplishments in creating this business and growing it to ~$2 billion in GMV [gross merchandise value] (based on current FY22 guidance), we think the time was right for a change,” wrote Wedbush analysts led by Tom Nikic, who called the news a surprise.

Analysts said the company is moving from a “‘grow at all costs” mentality to one
“more focused on profitability and margins.”

RealReal had a loss of $1.88 a share for full-year 2021 and the FactSet consensus is for a loss of $1.61 a share for 2022. Analysts say the choice of Robert Julian for CFO shows the company’s intentions as he brings experience improving the profitability of businesses like Callaway Golf

and Sportsman’s Warehouse. Julian joined RealReal last year.

Wedbush said there had been concern among the “investment community” that Wainwright “would go along with Mr. Julian’s plan for restrained spending,” but now that isn’t an issue.

“As far as the stock is concerned, we understand that ‘unprofitable e-commerce’ is not a subsector that investors have much appetite for these days, but we like Mr. Julian’s determination to get the business to adjusted-EBITDA profitability by FY24, we think that they’re not as ‘macroexposed’ as it would seem (higher-income customer less impacted by inflation), and at ~$3 the long-term risk/reward here seems positively skewed,” Wedbush said.

RealReal shares closed Tuesday at $3.06, up 5.5% after the news. The stock has plunged nearly 74% for the year to date. The broader S&P 500 index

is down 12.7% this year.

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