The RealReal has been building the infrastructure layer for that shift — and artificial intelligence is what’s making it scalable. The company posted its fourth consecutive quarter of double-digit gross merchandise value (GMV) growth in Q1, its third consecutive quarter above 20%.

AI Drives Operations

Athena, The RealReal’s proprietary AI-powered intake system, is automating the repetitive, data-driven parts of processing, authentication and cataloging. It is freeing authentication experts to focus on judgment-intensive work. At the end of Q1, 35% of items were fully flowing through Athena. The company is targeting nearly 50% by year end.

Athena was a material driver of operating leverage in Q1. Operations and technology costs leveraged 320 basis points year over year. That follows 330 basis points of leverage in 2025. CFO Ajay Gopal said operations and technology will continue to be a key source of margin expansion as the company scales.

Later this year, The RealReal is rolling out an automated storage and retrieval system at its New Jersey authentication center. The system adds automation, increases capacity by 35% and lets the company handle more volume without opening additional warehouses.

AI is also reshaping pricing. The company recently introduced AI-powered image embedding into its pricing models. By incorporating visual data, the models better account for the physical characteristics of luxury items when determining market value. That produces better comparables and higher earnings estimates for consignors.

“We have 15 years of proprietary data to leverage AI,” CEO Rati Levesque said on the earnings call. “Our objective is to find efficiencies, shorten our service level agreement with the customer, and take dollars out of the unit cost.”

On the buyer experience, the company is rolling out AI-powered recommendations and developing agentic and conversational search. Levesque said every item on the platform is unique, which makes conversational search particularly powerful in luxury resale. Features are expected to roll out through 2026.

Luxury Resale Goes Mainstream

The RealReal’s customer base is about 50% Gen Z and millennial. Those cohorts are driving resale adoption as a shopping behavior, not an occasional transaction. Levesque said first-time buyers are spending more on their first purchase, a signal of growing trust in the platform.

The flywheel is accelerating. In Q1, 43% of new consignors came from the active buyer base. Those buyers-turned-consignors, whom the company calls RealRailers, spend 50% more time on the platform than the average customer. Trailing 12-month active buyers grew 10% year over year. Average order value grew 15%, driven by a mix shift into higher-value items including watches, jewelry and handbags.

My Closet, a product suite giving consignors real-time estimated value, price tracking and trend intelligence, is in development. A pricing estimator for sellers launched to a select group during the quarter. The company is building toward a one-click consign experience for buyers who already own items purchased through the platform.

What Else Stood Out

• The RealReal is extending its supply network internationally, building a partner base in Italy, France and Japan through its dropship channel.
• The RealReal is extending its supply network internationally, building a partner base in Italy, France and Japan through its dropship channel.
• Levesque said the company is seeing no change in consumer trends despite macroeconomic pressure from higher fuel costs and the Middle East conflict. Buyer and consignor behavior remains resilient.
• Higher-income customers represent a meaningful part of the base, and the value proposition of luxury resale is resonating across income cohorts.
• Two new store locations are opening in 2026, in San Francisco and Boston. Sellers who engage with a store deliver 40% more value than those who don’t. Stores are part of the supply strategy, not just a retail channel.

Topline Results and Outlook

Q1 2026 GMV was $606 million, up 24% year over year and up 32% on a two-year stacked basis. Total revenue was $190 million, up 19% year over year. Consignment revenue grew 18%. Direct revenue grew 26%. Gross profit was $141 million, up 18% year over year, at a 74.5% gross margin.

For Q2, The RealReal guided GMV of $590 million to $600 million, up 17% to 19% year over year and 32% on a two-year basis. Revenue is expected to be $186 million to $189 million, up 13% to 14% year over year.