August 11, 2021
Second-hand retailer Poshmark Inc predicted Tuesday that third-quarter sales would be far below estimates and warned that its marketing efforts were being adversely affected by Apple’s new privacy policies on tracking digital advertising.
Apple announced a rule in April requiring developers to ask for permission to collect data to track users across various websites and apps, a policy that Facebook had criticized, alleging that this can potentially harm customers.
Poshmark plunged 7% in after-hours trading and was more than 25% below their January IPO price.
Poshmark, which relies on social media marketing to attract shoppers, felt the impact of Apple’s new policy at the end of the second quarter and is likely to continue to feel the effects in the current quarter.
The company expects third-quarter revenue to be between $81 million and $83 million, with the median slightly below the $82.4 million estimates.
Poshmark, however, remains confident that the impact of Apple’s policy will be temporary, as the retailer has spent heavily on alternatives such as TV commercials and connections with celebrities such as Marie Kondo.
Poshmark’s sales rose 22% to $81.8 million in the second quarter, above Refinitiv IBES ‘estimate of $80.3 million, as it attracted thrifty young shoppers looking for greener ways to buy everything from used T-shirts to fancy boutique dresses.
For more information, read the original story in Reuters.
