1stdibs (DIBS) Q1 2026 Earnings Transcript

Chief Executive Officer — David Rosenblatt Chief Financial Officer — Thomas Etergino Head of Investor Relations and Corporate Development — Kevin LaBuz Need a quote from a Motley Fool analyst? Email pr@fool.com Operator: Good morning, everyone. Thank you for joining us, and welcome to the 1stdibs Q1 2026 Earnings Conference Call. [Operator Instructions] I would now like to hand the call over to Kevin LaBuz, Head of Investor Relations and Corporate Development. Kevin, please go ahead. Kevin LaBuz: Good morning and welcome to the 1stDibs earnings call for the quarter ended March 31, 2026. I m Kevin LaBuz, Head of Investor Relations and Corporate Development. Joining me today are Chief Executive Officer, David Rosenblatt; and Chief Financial Officer, Tom Etergino. David will provide an update on our business, including our strategy and growth opportunities, and Tom will review our first quarter financial results and second quarter outlook. This call will be available via webcast on our Investor Relations website at investors.1stDibs.com. Before we begin, please keep in mind that our remarks include forward-looking statements, including, but not limited to, statements regarding guidance and future financial performance, market demand, growth prospects, business plans, strategic initiatives, business and economic trends and competitive position. Our actual results may differ materially from those expressed or implied in these forward-looking statements as a result of risks and uncertainties, including those described in our SEC filings. Any forward-looking statements that we make on this call are based on our beliefs and assumptions as of today, and we disclaim any obligation to update them, except to the extent required by law. Additionally, during the call, we will present GAAP and non-GAAP financial measures. 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 made on a year-over-year basis, unless otherwise noted. I will now turn the call over to our CEO, David Rosenblatt. David? David Rosenblatt: Thanks, Kevin. Good morning, everyone. A quarter ago, we shared our expectations for our performance in 2026, disciplined execution, durable profitability and steady road map progress. The first quarter delivered on all 3. Our top line results reflect the deliberate sales and marketing reductions we enacted late last year, and our bottom line results reflect the structural cost work we have been executing since 2022. We are on track across revenue, cost and product development, and our 2026 financial framework remains unchanged. The demand environment remains challenging. The U.S. housing market continues to hover near a 30-year low, weighing on consumer appetite for luxury home goods. While the near-term backdrop is soft, the long-term opportunity is significant. For example, there are approximately 5 million U.S. households worth at least $5 million, and our active buyer base of approximately 58,300 represents a fraction of that addressable market. Our goal, however, is to generate growth irrespective of the timing of a market recovery. Once conditions normalize, we will be in a strong position to accelerate growth. Turning to the financials. Our performance reflects both market conditions and the decisions we made last year to optimize our cost structure. GMV and revenue were $89.7 million and $22.4 million, down 5% and 1%, respectively, which is a result not only of market conditions, but also of our decision to reduce performance marketing spending by nearly 50% in the fourth quarter of 2025. Adjusted EBITDA of $600,000 above the midpoint of guidance is proof that our financial model is now capable of generating adjusted EBITDA profitability even in a challenging external environment. We have fundamentally reengineered our business, lowering expenses and headcount since late 2022 to ensure future revenue recovery flows disproportionately to the bottom line. With that context, let me walk you through the quarter s performance. Funnel trends remained consistent. Traffic declines driven primarily by our pullback in performance marketing and substantial sales and marketing headcount reductions were partially offset by our 10th consecutive quarter of conversion growth and higher average order values. This conversion growth is the direct result of sustained product investment, and it gives us confidence that our road map is working. Underpinning these results is a deliberate shift in how we are allocating resources. While total operating expenses declined 11%, technology development spending grew 10%, a reflection of our conviction that product and engineering is our highest ROI investment. The returns are compounding. AI-assisted development now accounts for over 50% of our new code, up from approximately 30% last quarter,

1stdibs (DIBS) Q1 2026 Earnings Transcript

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1stdibs (DIBS) Q1 2026 Earnings Transcript

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