Rent the Runway Inc (RENT, Financial) released its 8-K filing on April 15, 2025, detailing its financial performance for the fourth quarter and full fiscal year 2024, which ended on January 31, 2025. The company, known for its innovative e-commerce platform that allows users to rent, subscribe, or buy designer apparel and accessories, reported a revenue of $76.4 million for the fourth quarter, slightly below the analyst estimate of $77.60 million. The annual revenue stood at $306.2 million, also missing the estimated $307.40 million.
Performance and Challenges
Rent the Runway Inc (RENT, Financial) has demonstrated a significant improvement in its cash position, reducing cash consumption from $70.5 million in fiscal year 2023 to a mere $6.6 million in fiscal year 2024. This achievement is attributed to a multi-year corporate strategy transformation focusing on customer loyalty, retention, and cost discipline. Despite these improvements, the company faces challenges with a decline in active subscribers, which decreased by 5% year-over-year to 119,778 by the end of fiscal year 2024.
Financial Achievements and Industry Impact
The company's efforts to operate a nearly break-even business are noteworthy, especially in the Retail - Cyclical industry, where maintaining financial stability is crucial. Rent the Runway Inc (RENT, Financial) reported a net loss of $13.4 million for the fourth quarter, a significant improvement from the $24.8 million loss in the same period the previous year. The adjusted EBITDA for the quarter was $17.4 million, up from $11.2 million, indicating enhanced operational efficiency.
Income Statement and Key Metrics
For the fiscal year 2024, Rent the Runway Inc (RENT, Financial) achieved a gross profit of $115.9 million, with a gross margin of 37.9%, down from 40.1% in the previous year. The net loss for the year was $69.9 million, a substantial reduction from the $113.2 million loss in fiscal year 2023. The company's adjusted EBITDA margin improved to 15.3% from 9.0%.
| Metric | Q4 2024 | FY 2024 |
|---|---|---|
| Revenue | $76.4 million | $306.2 million |
| Net Loss | $(13.4) million | $(69.9) million |
| Adjusted EBITDA | $17.4 million | $46.9 million |
Strategic Initiatives and Future Outlook
Rent the Runway Inc (RENT, Financial) has announced the largest inventory acquisition in its history, planning to double the new inventory in fiscal year 2025. This move is expected to drive subscriber growth and enhance customer loyalty. The company is also expanding its cost-efficient models for inventory acquisition, such as the Share by RTR revenue share program.
We drove significantly reduced cash burn and increased revenue as the company focused on cost discipline in Fiscal Year 2024," said Sid Thacker, Chief Financial Officer of Rent the Runway.
Looking ahead, Rent the Runway Inc (RENT, Financial) anticipates double-digit growth in active subscribers for fiscal year 2025 and aims to achieve free cash flow between $(30) million and $(40) million. The company remains committed to its multi-year transformation plan, focusing on customer experience and inventory reinvestment to sustain business momentum.
Explore the complete 8-K earnings release (here) from Rent the Runway Inc for further details.
