Business

Rent the Runway (RENT) Revenue for Q3 2021

Jennifer Hyman, Runway Rental

Scott Mlyn | CNBC

Rent the Runway shares fell more than 9% in extended trading on Wednesday after the company recorded increasing third-quarter losses despite a 66% year-on-year increase in sales in its first financial report since publication in late October. …

The market capitalization of the fashion rental platform has nearly halved since its public debut, when it was valued at more than $ 1.7 billion. The stock has dropped roughly 50% since trading began on October 27 at $ 23 a share. On Wednesday, the price closed 10% at $ 11.50.

For fears of investors that Rent the Runway has not yet made a profit. This did not happen in the last quarter, as expenses related to the recent public offering and debt repayment were reflected in earnings. Active subscribers have yet to return to pre-pandemic levels as Rent the Runway expects Americans to return to offices, weddings and concerts in 2022.

Rent the Runway’s net loss for the three-month period ended October 31 nearly doubled to $ 87.8 million, or $ 6.72 per share, up from a loss of $ 44.3 million, or $ 3.98 per share for the year. previously.

Excluding the one-off costs associated with the IPO, Rent the Runway said its net loss was lower than last year.

Revenue rose 66% to $ 59 million from $ 35.5 million.

The company ended the quarter with 116,833 active subscribers, not counting those who suspended their membership, up 78% over the year. According to Rent the Runway, it accounts for about 87% of the active subscriber base that the company had back in 2019.

In just the quarter, the company had 150,075 subscribers, including suspended accounts, up 45% over the year.

Rent the Runway said pre-pandemic subscriber numbers have returned to around 90% in all major subways in the United States, with the exception of New York, Washington, and San Francisco, which are the company’s three largest markets. At the same time, it is said that in the markets of the southern and mountain regions of the country, the activity of subscribers is much higher than in 2019.

Meanwhile, the company has launched a home pickup service in five cities, giving shoppers an easier way to return their orders and save Rent the Runway some money associated with shipping costs, CEO Jenn Hyman said in an interview with Zoom.

“It’s cheaper for us than other return methods,” Hyman said. “This is a small benefit to both our customer experience and our bottom line.”

In the fourth quarter, Rent the Runway expects active subscribers to range from 121,000 to 122,000, with revenues ranging from $ 62.8 million to $ 68.3 million.

Full year sales are expected to be between $ 202 million and $ 202.5 million.

“We saw resilience despite being under the influence of Covid all year,” Hyman said. “And we think our ramp could have been even higher if more big events happened – if more women returned to offices.”

“Therefore, we believe that as the macroeconomic environment normalizes, this will provide an opportunity to rent a runway,” she added.

Rent the Runway also said Wednesday that it paid off roughly a third of its debt before the IPO.

Find the complete Rent the Runway earnings press release here


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