GigaCloud Technology (NASDAQ:GCT) founder and CEO Larry Wu said the company is continuing to scale its global B2B marketplace for large and bulky goods, particularly furniture, as it leans on growth in Europe, third-party sellers and its supplier-fulfilled retailing model.
Speaking at the 21st Annual Needham TMT and Consumer Conference, Wu described GigaCloud as an operator of a global marketplace, gigab2b.com, designed to help wholesalers and retailers transact in big and bulky products. He said the company’s broader ambition is to become “the infrastructure” for digitizing the global supply chain for such items.
Wu Highlights Recent Financial Performance
Wu said GigaCloud recently reported first-quarter 2025 revenue of $660 million, up 32% year over year. Net income was $38 million, which he said represented 41% growth, while earnings per share rose 53% year over year, helped by the company’s share repurchase program.
He also emphasized the company’s balance sheet, saying GigaCloud is debt-free and has about $380 million in cash. Wu noted that the company does have liabilities, but said most are tied to lease contracts for warehouses it operates globally.
According to Wu, GigaCloud’s marketplace has total gross merchandise value of $1.7 billion and supports 1,377 sellers or suppliers doing business with roughly 12,000 resellers or retailers worldwide. He also said the company has spent more than $100 million on share repurchases over the past three years, compared with $41 million raised in its initial public offering. Last year, he said, GigaCloud generated roughly $190 million in cash from operations.
Wu said GigaCloud has also used operating cash for acquisitions, including the $87 million purchase of Noble House, an e-commerce company specializing in outdoor furniture, out of bankruptcy. He also cited an $18 million acquisition of a furniture company focused on brick-and-mortar distribution, as well as the acquisition of Wondersign, a SaaS provider that distributes furniture e-catalogs to retail stores.
Europe Drives Growth as Company Expands Beyond U.S.
Wu said GigaCloud’s business has become more geographically diversified. He said the company previously generated about 70% of its revenue from the U.S., while also stating that the U.S. represented 71% and Europe represented 33% of the business in the most recent quarter referenced in the presentation.
He said Europe has been an important source of growth given what he described as a less favorable macroeconomic environment for discretionary consumer spending in the U.S. Wu said European revenue grew 86% year over year in the latest quarter.
In the Q&A session with Needham equity research analyst Stefanos Crist, Wu said GigaCloud does not currently plan to add new geographic coverage. He said the company believes it already has a large addressable market in the U.S. and Europe.
Wu said Europe is more fragmented than the U.S. because of different languages and legal systems, making operations more difficult. However, he said that fragmentation also allows GigaCloud to provide value by offering a unified ecosystem for customers selling across countries digitally.
Supplier-Fulfilled Retailing Model Remains Central
Wu spent much of the presentation discussing GigaCloud’s supplier-fulfilled retailing model, or SFR, which he said is a trademarked model promoted by the company. Under SFR, suppliers hold inventory while retailers keep samples or sell against supplier inventory, with products shipped directly from the supplier to the consumer after a sale.
Wu said this model is designed for categories such as furniture, which he described as non-standard, bulky and highly fragmented on both the manufacturing and retail sides. He said the approach reduces redundant logistics touch points and helps retailers avoid inventory forecasting risks across large numbers of low-volume SKUs.
“No retailer or reseller is supposed to hold any inventory,” Wu said in describing the model. “The inventory is always stored in the warehouse of the supplier or the manufacturer.”
Wu said suppliers often need infrastructure support because many manufacturers are small and require help balancing inventory and fulfilling orders across regions. He said that creates demand for a provider such as GigaCloud to facilitate transactions and logistics.
Third-Party Marketplace Continues to Grow
Wu said GigaCloud’s marketplace is now dominated by third-party activity, with first-party operations representing 43% of the marketplace and third-party activity representing 57%. He said first-party operations helped the company address the early “chicken and egg” challenge of attracting both buyers and sellers when the marketplace launched.
In Europe, which Wu described as a newer market compared with the U.S., he said first-party activity still represents 86%, while third-party activity represents 14%. However, he said third-party activity in Europe grew 500% year over year in the latest quarter discussed.
Asked by Crist about the long-term mix between first-party and third-party activity, Wu said GigaCloud expects third-party growth to continue outpacing first-party growth because of the large number of suppliers participating in the ecosystem. He said the company does not have a target mix, preferring to let the market develop naturally.
Wu said first-party operations contribute more profitability in dollar terms, while third-party operations are more asset-light and allow growth with less inventory risk.
Infrastructure Includes Warehouses, Ports and Software
Wu said GigaCloud offers about 80,000 SKUs, with furniture as its largest category. He said furniture represents roughly 70% of total GMV, while the company also facilitates transactions in categories such as fitness equipment, bath products, auto parts and toys.
He described GigaCloud’s infrastructure as having both software and physical layers. The software stack connects transacting parties and enables digital commerce, while the physical layer includes warehouses and logistics capabilities.
Wu said GigaCloud operates 36 distribution centers globally, handles 35,000 containers annually and uses 19 ports as shipping destinations. He said the company operates roughly 12 million square feet of warehouse space.
Wu also noted that the company has received recognition from Forbes, Time, Newsweek and Furniture Today, and said he was recognized as EY Entrepreneur of the Year for the Greater Los Angeles area in 2024.
About GigaCloud Technology (NASDAQ:GCT)
GigaCloud Technology Inc (NASDAQ:GCT) is a China-based provider of software-as-a-service (SaaS) and cloud computing solutions tailored for cross-border e-commerce. The company’s core offering, its Supply Chain Embedded E-commerce as a Service (SCEaaS) platform, integrates procurement, order management, warehousing, logistics and payment services into a unified cloud-based system. This end-to-end digital supply chain solution is designed to help small and medium-sized Chinese exporters efficiently connect with global buyers without the need to build and maintain their own infrastructure.
Through its modular, subscription-based SaaS model, GigaCloud enables merchants to scale operations on demand and minimize upfront capital expenditures.
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