Rent the Runway, Inc. Announces Second Quarter 2026 Results
Revenue Grew to $97.7M, up 20.8% YoY
Gross margin expansion of 609 basis points
Reaffirms FY26 Guidance for Revenue and Adjusted EBITDA
Announces Paige Thomas as Chief Executive Officer and President and Teri Bariquit as Chair of the Board
NEW YORK, Sept. 11, 2026 (GLOBE NEWSWIRE) -- Rent the Runway, Inc. (“Rent the Runway” or "RTR") (NASDAQ: RENT), the company transforming the way women get dressed, today reported financial results for the fiscal quarter ended July 31, 2026.
Second quarter results reflect continued execution against our plan, with total revenue of $97.7 million, up 20.8% YoY. Net loss was $(12.9) million, or (13.2)% of revenue, compared to $(26.4) million, or (32.6)% of revenue, in the second quarter of fiscal year 2025. Adjusted EBITDA was $12.6 million, or 12.9% of revenue, compared to $3.6 million, or 4.4% of revenue, in the second quarter of fiscal year 2025, driven by gross margin expansion of 609 basis points and disciplined control of operating expenses. We also continued to see growth in our add-on business, with add-on bookings increasing 81% year-over-year in Q2 and 33% of subscribers using an add-on during the quarter, up from 29% a year ago, driven primarily by higher subscriber engagement with our assortment and membership flexibility.
A key focus in 2026 remains on Discovery, and this quarter we completed the rollout of AI-powered outfits generation to all customers, delivering on the commitment we set out at the start of the fiscal year. We also concentrated our resources on the core rental and selling businesses, stepping back from several pilots and smaller initiatives to focus on the experience our customers value most.
Rent the Runway also announced today that Paige Thomas has been appointed Chief Executive Officer and President and member of the Board of Directors, effective September 14, 2026, succeeding Teri Bariquit, who has served as Interim CEO and President since May 2026. Ms. Bariquit has been appointed non-executive Chair of the Board of Directors, effective the same date, and will work closely with Ms. Thomas to support the transition. Dhiren Fonseca, will step down as Executive Chairman, and continue as a member of the Board. The Board of Directors thanks and acknowledges Mr. Fonseca for his leadership during the period of transition.
Ms. Thomas brings over 30 years of retail leadership to the role. She joined Rent the Runway as Chief Commercial Officer in June 2026, and previously served as Chief Merchant and Product Innovation Officer at Signet Jewelers, President and CEO of Saks OFF 5TH, and spent more than a decade at Nordstrom, including five years leading Nordstrom Rack.
"Rent the Runway is operating from a focused foundation, with a core rental business that continues to grow and a customer who is telling us what she values most," said Teri Bariquit, Interim CEO and President of Rent the Runway. "This quarter we concentrated our resources on that core, delivered capabilities against the discovery experience we committed to at the start of the year, and began building a 2027 plan centered on transforming the business. I want to thank Dhiren for his leadership as Executive Chairman through this transition, and I am confident in the company Paige is stepping into.”
"I'm focused on listening to our customer and making every decision through her lens, doubling down on fashion and what makes this fashion service platform unique, while executing with operational excellence," said Paige Thomas, CEO of Rent the Runway. "This is not a new direction—it's an acceleration of the strong foundation the team has built. The path is clear, and I've never been more excited to lead the team forward."
Recent Business Highlights
- AI-Powered Outfits Generation Now Live to All Customers: In May 2026, we piloted outfits generation, and by the end of June the experience was live to all customers. Customers can now discover complete looks rather than individual items, making it easier to imagine what to wear together. Engagement with the feature in our app is running approximately 35% and during the pilot, customers with the experience added items to their bag approximately 12% more often than those without it.
- Using AI to Help Customers See Themselves in the Product: In August 2026, we rolled out avatars within the outfits experience to all customers, so they can see recommended looks on a variety of figures. We also began piloting virtual try-on tools, designed to show a customer how a specific item will look on them before renting or buying.
- Sharpened Focus on the Core Business: We concentrated our resources on our rental and selling offerings this quarter. We paused the online marketplace pilot until it can be fully integrated with the core rental experience, we paused on-site advertising and monetization to prioritize a premium experience, and we are no longer pursuing new B2B dry cleaning business opportunities while continuing to serve our existing partner. Those resources are moving to the parts of the business our customer values most, including Reserve, which carries our strongest satisfaction scores.
"Second quarter results were strong with revenues that reflect an all-time high for the company and profit margin expansion that is driven by our operating discipline and highlights how we intend to run the business,” said Dave Loretta, Interim Chief Financial Officer and Treasurer of Rent the Runway. “We remain committed to strengthening our liquidity position with the improved free cash flow in the first half and additional funding support from our investor group."
Second Quarter 2026 Key Metrics and Financial Highlights
- Revenue was $97.7 million, a 20.8% increase year-over-year from $80.9 million in the second quarter of fiscal year 2025.
- 140,826 ending Active Subscribers, representing a change of (3.8)% from 146,373 at the end of the second quarter of fiscal year 2025.
- 148,259 Average Active Subscribers, representing an increase of 1.0% from 146,765 at the end of the second quarter of fiscal year 2025.
- 186,019 ending Total Subscribers, representing an increase of 0.5% from 185,102 at the end of the second quarter of fiscal year 2025.
- Gross Profit was $35.3 million, representing an increase of 45.3% from $24.3 million in the second quarter of fiscal year 2025. Gross Margin was 36.1%, as compared to 30.0% in the second quarter of fiscal year 2025.
- Net Loss was $(12.9) million, as compared to $(26.4) million in the second quarter of fiscal year 2025. Net Loss as a percentage of revenue was (13.2)%, as compared to (32.6)% in the second quarter of fiscal year 2025.
- Adjusted EBITDA was $12.6 million, as compared to $3.6 million in the second quarter of fiscal year 2025. Adjusted EBITDA Margin was 12.9%, as compared to 4.4% in the second quarter of fiscal year 2025.
- Net cash (used in) provided by operating activities was $(5.0) million, as compared to $(2.2) million in the second quarter of fiscal year 2025.
- Net cash used in investing activities was $(16.6) million, as compared to $(30.7) million in the second quarter of fiscal year 2025.
- Cash and Cash Equivalents was $29.0 million, as compared to $43.6 million in the second quarter of fiscal year 2025.
Outlook
For the fiscal third quarter of 2026, Rent the Runway expects:
- Revenue of between $87 million and $90 million
- Adjusted EBITDA Margin1 of between negative 3% and negative 6%
For fiscal year 2026, Rent the Runway expects:
- Reaffirming Double-Digit Revenue Growth versus fiscal year 2025, led primarily by continued product and inventory experience improvements.
- Reaffirming Adjusted EBITDA Margin2 of between 4% and 7%
- Updating Rental Product Acquired3 in the range of $53-55 million versus $74.9 million in fiscal year 2025.
There are unknowns around the economy, such as fuel surcharges, tariffs, and other macroeconomic developments, which are not incorporated into our expectations and that can materially affect actual results for fiscal year 2026 versus our current expectations. Our outlook is based on current conditions and assumptions and does not contemplate material deterioration, including volatility in these factors or from our decision to pass on fuel surcharges to customers; accordingly, actual results may differ materially if such conditions change.
1 Represents a non-GAAP financial measure. As more fully described in the Non-GAAP Financial Measures section of this release, a reconciliation of Adjusted EBITDA Margin for the third quarter of fiscal year 2026 is not available without unreasonable efforts.
2 Represents a non-GAAP financial measure. As more fully described in the Non-GAAP Financial Measures section of this release, a reconciliation of Adjusted EBITDA Margin for fiscal year 2026 is not available without unreasonable efforts.
3 Purchases of Rental Product as presented on the Consolidated Statement of Cash Flows may vary from Rental Product Acquired due to timing of payments for rental product. Rental Product Acquired reflects the cost of owned rental product received in the period.
Earnings Presentation, Conference Call and Webcast
Rent the Runway will host a conference call and webcast to discuss its second quarter 2026 financial results and provide a business update today, September 11, 2026 at 8:30 am ET.
The financial results and live webcast will be accessible through the Investor Relations section of Rent the Runway’s website at https://investors.renttherunway.com/ under the “Events” section. To access the call through a conference line, dial 1-877-407-3982 (in the U.S.) or 1-201-493-6780 (international callers).
A replay of the conference call will be posted shortly after the call and will be available for at least fourteen days. To access the replay, dial 1-844-512-2921 (in the U.S.) or 1-412-317-6671 (international callers). The access code for the replay is 13761570.
About Rent the Runway, Inc.
Founded in 2009, Rent the Runway is disrupting the trillion-dollar fashion industry and changing the way women get dressed through the Closet in the Cloud. RTR’s mission has remained the same since its founding: powering women to feel their best every day. Through RTR, customers can subscribe, rent items a-la-carte and shop resale from hundreds of designer brands. The Closet in the Cloud offers a wide assortment of millions of items for every occasion, from evening wear and accessories to ready-to-wear, workwear, denim, casual, maternity, outerwear, blouses, knitwear, loungewear, jewelry, handbags, activewear and ski wear. RTR has built a two-sided discovery engine, which connects deeply engaged customers and differentiated brand partners on a powerful platform built around its brand, data, logistics and technology. RTR has been named to CNBC’s “Disruptor 50” five times in ten years, and has been placed on Fast Company’s Most Innovative Companies list four times.
Forward-Looking Statements: This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements. These statements include, but are not limited to, guidance and underlying assumptions for the third fiscal quarter of 2026 and the fiscal year 2026, and statements regarding the anticipated success of our CEO and Board chair transitions, our sharpened business strategies and priorities, the impact of potential product and customer experience improvements, the impact and volume of our new inventory, the success of our AI investments and initiatives, and our position for sustained growth. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. In some cases, you can identify forward-looking statements because they contain words such as “aim,” “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “toward,” “will,” or “would,” or the negative of these words or other similar terms or expressions. You should not put undue reliance on any forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved, if at all. Forward-looking statements are based on information available at the time those statements are made and were based on current expectations, estimates, forecasts, and projections as well as the beliefs and assumptions of management as of that time with respect to future events. These statements are subject to risks and uncertainties, many of which involve factors or circumstances that are beyond our control, that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this press release may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. These risks and uncertainties include our ability to drive future growth or manage our growth effectively; the highly competitive and rapidly changing nature of the global fashion industry; risks related to the macroeconomic environment, including war in the Middle East and fuel surcharges; changes in global trade policies, tariffs, and other measures that could restrict international trade; our ability to cost-effectively grow our customer base; any failure to attract or retain customers; our ability to accurately forecast customer demand, acquire and manage our offerings effectively and plan for future expenses; risks arising from the restructuring of our operations; our reliance on the effective operation of proprietary technology systems and software as well as those of third-party vendors and service providers; risks related to shipping, logistics and our supply chain; risks related to AI technology; our failure to manage our current leadership transitions; our failure to comply with the covenants under our credit agreement; our ability to remediate our material weaknesses in our internal control over financial reporting; our ability to comply with laws and regulations applicable to our business; our reliance on the experience and expertise of our senior management and other key personnel; our ability to adequately obtain, maintain, protect and enforce our intellectual property and proprietary rights; compliance with data privacy, data security, data protection and consumer protection laws and industry standards; risks associated with our brand and manufacturing partners; our reliance on third parties to provide payment processing infrastructure underlying our business; our dependence on online sources to attract consumers and promote our business which may be affected by third-party interference or cause our customer acquisition costs to rise; failure by us, our brand partners, or third party manufacturers to comply with our vendor code of conduct or other laws; risks related to our debt; our noncompliance with Nasdaq Marketplace Rule 5606(c)(2)(A), which requires listed companies to have at least three audit committee members; and risks related to our Class A capital stock and ownership structure.
Additional information regarding these and other risks and uncertainties that could cause actual results to differ materially from the expectations is included in our Quarterly Report on Form 10-Q for the quarter ended April 30, 2026, as will be updated in our Quarterly Report on Form 10-Q for the quarter ended July 31, 2026. Except as required by law, we do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise.
Key Business and Financial Metrics
Active Subscribers is defined as the number of subscribers with an active membership as of the last day of any given period and excludes paused subscribers. Total Subscribers represents the number of subscribers with an active or paused membership as of the last day of the period and excludes subscribers who had an active or paused subscription during the period, but ended their subscription prior to the last day of the fiscal period.
Average Active Subscribers is defined as the mean of the beginning of quarter and end of quarter Active Subscribers for a quarterly period; and for other periods, represents the mean of the Average Active Subscribers of every quarter within that period.
Gross Profit is defined as total revenue less costs related to activities to fulfill customer orders and rental product acquisition costs, presented as fulfillment and rental product depreciation and revenue share, respectively, on the consolidated statement of operations. We depreciate owned apparel assets over three years and owned accessory assets over two years, net of 20% and 30% salvage values, respectively, and recognize the depreciation on a straight-line basis and remaining cost of items when sold or retired on our consolidated statement of operations. Rental product depreciation expense is time-based and reflects all rental product items we own. We use Gross Profit and Gross Profit as a percentage of revenue, or Gross Margin, to measure the continued efficiency of our business after the cost of our products and fulfillment costs are included.
Non-GAAP Financial Measures
This press release and the accompanying tables contain the non-GAAP financial measures of Adjusted EBITDA, Adjusted EBITDA margin, free cash flow, and free cash flow margin. In addition to our results determined in accordance with GAAP, we believe that Adjusted EBITDA and Adjusted EBITDA margin are useful in evaluating our performance and free cash flow and free cash flow margin are useful in evaluating our performance and liquidity. Adjusted EBITDA is a key performance measure used by management to assess our operating performance and the operating leverage of our business prior to capital expenditures. These non-GAAP financial metrics are not meant to be considered as indicators of our financial performance in isolation from or as a substitute for our financial information prepared in accordance with GAAP and should be read only in conjunction with financial information presented on a GAAP basis. There are limitations to the use of the non-GAAP financial metrics presented in this press release. For example, our non-GAAP financial metrics may not be comparable to similarly titled measures of other companies. Other companies, including companies in our industry, may calculate non-GAAP financial metrics differently than we do, limiting the usefulness of those measures for comparative purposes.
We define Adjusted EBITDA as net loss, adjusted to exclude interest expense, rental product depreciation, other depreciation and amortization, share-based compensation expense, write-off of liquidated assets, non-recurring adjustments, non-ordinary course legal fees, non-ordinary course executive transition costs, income tax (benefit) expense, other income and expense, and other gains / losses. Adjusted EBITDA margin is defined as Adjusted EBITDA calculated as a percentage of total revenue, net for a period.
We define free cash flow as net cash used in operating activities and net cash used in investing activities on a combined basis. Free cash flow margin is defined as free cash flow as a percentage of revenue.
The reconciliation of presented non-GAAP financial metrics to the most directly comparable GAAP financial measure is presented below. We encourage reviewing the reconciliation in conjunction with the presentation of the non-GAAP financial metrics for each of the periods presented. In future periods, we may exclude similar items, may incur income and expenses similar to these excluded items, and may include other expenses, costs and non-recurring items. Reconciliations of Adjusted EBITDA margin expectations for fiscal year 2026 and Q3 2026 to the most directly comparable GAAP measures are not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity, and low visibility with respect to the charges excluded from these non-GAAP measures, in particular, share-based compensation expense, and non-recurring expenses, which can have unpredictable fluctuations based on unforeseen activity that is out of our control and/or cannot reasonably be predicted.
Investor Contact
Investor Relations
investors@renttherunway.com
Media Contact
Press
press@renttherunway.com
| Rent the Runway, Inc. | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (in millions) | |||||||
| (unaudited) | |||||||
| July 31, | January 31, | ||||||
| 2026 | 2026 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 29.0 | $ | 50.4 | |||
| Restricted cash, current | 4.0 | 4.5 | |||||
| Prepaid expenses and other current assets | 11.5 | 11.8 | |||||
| Total current assets | 44.5 | 66.7 | |||||
| Restricted cash | 4.2 | 4.2 | |||||
| Rental product, net | 84.1 | 86.0 | |||||
| Fixed assets, net | 22.9 | 24.0 | |||||
| Intangible assets, net | 1.9 | 2.0 | |||||
| Operating lease right-of-use assets | 27.5 | 29.3 | |||||
| Other assets | 7.3 | 8.8 | |||||
| Total assets | $ | 192.4 | $ | 221.0 | |||
| Liabilities and Stockholders’ Equity (Deficit) | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 4.4 | $ | 9.9 | |||
| Accrued expenses and other current liabilities | 36.5 | 29.1 | |||||
| Deferred revenue | 13.0 | 12.0 | |||||
| Customer credit and gift card liabilities | 6.5 | 6.6 | |||||
| Operating lease liabilities | 5.7 | 5.6 | |||||
| Total current liabilities | 66.1 | 63.2 | |||||
| Long-term debt, net | 157.5 | 156.6 | |||||
| Operating lease liabilities | 32.8 | 35.7 | |||||
| Other liabilities | 1.5 | 1.6 | |||||
| Total liabilities | 257.9 | 257.1 | |||||
| Stockholders’ equity (deficit) | |||||||
| Class A common stock | — | — | |||||
| Class B common stock | — | — | |||||
| Preferred stock | — | — | |||||
| Additional paid-in capital | 1,066.7 | 1,064.3 | |||||
| Accumulated deficit | (1,132.2 | ) | (1,100.4 | ) | |||
| Total stockholders’ equity (deficit) | (65.5 | ) | (36.1 | ) | |||
| Total liabilities and stockholders’ equity (deficit) | $ | 192.4 | $ | 221.0 | |||
| Rent the Runway, Inc. | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (in millions, except share and per share amounts) | |||||||||||||||
| (unaudited) | |||||||||||||||
| Three Months Ended July 31, | Six Months Ended July 31, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Revenue: | |||||||||||||||
| Subscription and Reserve rental revenue | $ | 83.8 | $ | 69.2 | $ | 161.5 | $ | 131.2 | |||||||
| Other revenue | 13.9 | 11.7 | 26.1 | 19.3 | |||||||||||
| Total revenue, net | 97.7 | 80.9 | 187.6 | 150.5 | |||||||||||
| Costs and expenses: | |||||||||||||||
| Fulfillment | 23.5 | 22.5 | 47.1 | 42.9 | |||||||||||
| Technology | 9.8 | 9.8 | 19.2 | 19.4 | |||||||||||
| Marketing | 7.4 | 7.4 | 15.4 | 16.0 | |||||||||||
| General and administrative | 23.8 | 24.6 | 47.2 | 45.3 | |||||||||||
| Rental product depreciation and revenue share | 38.9 | 34.1 | 81.9 | 61.4 | |||||||||||
| Other depreciation and amortization | 2.1 | 2.6 | 4.3 | 5.3 | |||||||||||
| Total costs and expenses | 105.5 | 101.0 | 215.1 | 190.3 | |||||||||||
| Operating loss | (7.8 | ) | (20.1 | ) | (27.5 | ) | (39.8 | ) | |||||||
| Interest income / (expense), net | (0.2 | ) | (6.9 | ) | (0.5 | ) | (13.2 | ) | |||||||
| Other income / (expense), net | 1.3 | 0.6 | 2.4 | 0.7 | |||||||||||
| Securities litigation expense | (6.1 | ) | — | (6.1 | ) | — | |||||||||
| Net loss before income tax benefit / (expense) | (12.8 | ) | (26.4 | ) | (31.7 | ) | (52.3 | ) | |||||||
| Income tax benefit / (expense) | (0.1 | ) | — | (0.1 | ) | (0.2 | ) | ||||||||
| Net loss | $ | (12.9 | ) | $ | (26.4 | ) | $ | (31.8 | ) | $ | (52.5 | ) | |||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (0.38 | ) | $ | (6.23 | ) | $ | (0.95 | ) | $ | (12.49 | ) | |||
| Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 33,576,091 | 4,237,890 | 33,501,272 | 4,203,550 | |||||||||||
| Rent the Runway, Inc. | |||||||
| Condensed Consolidated Statements of Cash Flows | |||||||
| (in millions) | |||||||
| (unaudited) | |||||||
| Six Months Ended July 31, | |||||||
| 2026 | 2025 | ||||||
| OPERATING ACTIVITIES | |||||||
| Net loss | $ | (31.8 | ) | $ | (52.5 | ) | |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
| Rental product depreciation and write-offs | 20.8 | 21.6 | |||||
| Write-off of rental product sold | 7.7 | 7.5 | |||||
| Other depreciation and amortization | 4.3 | 5.3 | |||||
| Proceeds from rental product sold | (13.3 | ) | (11.8 | ) | |||
| (Gain) / loss from liquidation of rental product | 0.1 | (0.4 | ) | ||||
| Accrual of paid-in-kind interest | 5.4 | 7.2 | |||||
| Amortization of debt (premium) discount | (4.5 | ) | 3.0 | ||||
| Share-based compensation expense | 2.2 | 2.9 | |||||
| Changes in operating assets and liabilities: | |||||||
| Prepaid expenses and other current assets | 0.3 | (3.2 | ) | ||||
| Operating lease right-of-use assets | 1.8 | 1.4 | |||||
| Other assets | 1.5 | (1.2 | ) | ||||
| Accounts payable, accrued expenses and other current liabilities | 2.5 | 18.7 | |||||
| Deferred revenue and customer credit liabilities | 0.9 | 1.3 | |||||
| Operating lease liabilities | (2.8 | ) | (2.2 | ) | |||
| Other liabilities | (0.1 | ) | 0.2 | ||||
| Net cash (used in) provided by operating activities | (5.0 | ) | (2.2 | ) | |||
| INVESTING ACTIVITIES | |||||||
| Purchases of rental product | (27.7 | ) | (42.0 | ) | |||
| Proceeds from liquidation of rental product | 0.8 | 1.6 | |||||
| Proceeds from sale of rental product | 13.3 | 11.8 | |||||
| Purchases of fixed and intangible assets | (3.0 | ) | (2.1 | ) | |||
| Net cash (used in) provided by investing activities | (16.6 | ) | (30.7 | ) | |||
| FINANCING ACTIVITIES | |||||||
| Proceeds from issuance of common stock | 0.2 | — | |||||
| Other financing payments | (0.5 | ) | (1.4 | ) | |||
| Net cash (used in) provided by financing activities | (0.3 | ) | (1.4 | ) | |||
| Net (decrease) increase in cash and cash equivalents and restricted cash | (21.9 | ) | (34.3 | ) | |||
| Cash and cash equivalents and restricted cash at beginning of period | 59.1 | 86.5 | |||||
| Cash and cash equivalents and restricted cash at end of period | $ | 37.2 | $ | 52.2 | |||
| Rent the Runway, Inc. | |||||
| Condensed Consolidated Statements of Cash Flows | |||||
| (in millions) | |||||
| (unaudited) | |||||
| Six Months Ended July 31, | |||||
| 2026 | 2025 | ||||
| Supplemental Cash Flow Information: | |||||
| Cash payments (receipts) for: | |||||
| Interest paid on loans | $ | 2.8 | $ | — | |
| Fixed operating lease payments, net | 5.9 | 5.7 | |||
| Fixed assets and intangibles received in the prior period | 0.2 | — | |||
| Rental product received in the prior period | 1.6 | 2.7 | |||
| Non-cash financing and investing activities: | |||||
| Purchases of fixed assets and intangibles not yet settled | $ | 0.3 | $ | 0.1 | |
| Purchases of rental product not yet settled | 1.4 | 4.4 | |||
Rent the Runway, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(in millions)
(unaudited)
The following table presents a reconciliation of net loss and net loss as a percentage of revenue, the most comparable GAAP financial measures, to Adjusted EBITDA and Adjusted EBITDA Margin, respectively, for the periods presented:
| Three Months Ended July 31, | Six Months Ended July 31, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| (in millions) | (in millions) | ||||||||||||||
| Net loss | $ | (12.9 | ) | $ | (26.4 | ) | $ | (31.8 | ) | $ | (52.5 | ) | |||
| Interest (income) / expense, net(1) | 0.2 | 6.9 | 0.5 | 13.2 | |||||||||||
| Rental product depreciation | 14.7 | 15.9 | 28.5 | 29.1 | |||||||||||
| Other depreciation and amortization(2) | 2.1 | 2.6 | 4.3 | 5.3 | |||||||||||
| Share-based compensation(3) | 0.7 | 1.4 | 2.2 | 2.9 | |||||||||||
| Write-off of liquidated assets(4) | 0.3 | 0.5 | 0.9 | 1.2 | |||||||||||
| Non-recurring adjustments(5) | — | 2.0 | 0.1 | 2.0 | |||||||||||
| Non-ordinary course legal fees (6) | 0.7 | 1.4 | 1.3 | 2.0 | |||||||||||
| Executive transition (7) | 1.8 | — | 1.8 | — | |||||||||||
| Income tax (benefit) / expense | 0.1 | — | 0.1 | 0.2 | |||||||||||
| Other (income) / expense, net(8) | (1.3 | ) | (0.6 | ) | (2.4 | ) | (0.7 | ) | |||||||
| Securities litigation expense | 6.1 | — | 6.1 | — | |||||||||||
| Other (gains) / losses(9) | 0.1 | (0.1 | ) | 0.2 | (0.4 | ) | |||||||||
| Adjusted EBITDA | $ | 12.6 | $ | 3.6 | $ | 11.8 | $ | 2.3 | |||||||
| Net Loss as a percentage of revenue | (13.2)% | (32.6)% | (17.0)% | (34.9)% | |||||||||||
| Adjusted EBITDA Margin(10) | 12.9 | % | 4.4 | % | 6.3 | % | 1.5 | % | |||||||
(1) Includes debt (premium) discount amortization of $(2.3) million in the three months ended July 31, 2026, $(3.9) million in the three months ended July 31, 2025, $(4.5) million in the six months ended July 31, 2026 and $3.0 million in the six months ended July 31, 2025.
(2) Reflects non-rental product depreciation and capitalized software amortization.
(3) Reflects the non-cash expense for share-based compensation.
(4) Reflects the write-off of the remaining book value of liquidated rental product that had previously been held for sale.
(5) Non-recurring adjustments for the three and six months ended July 31, 2026 includes none and $0.1 million of costs related to public company SOX readiness. Non-recurring adjustments for the three and six months ended July 31, 2025 includes $2.0 million of transaction related costs.
(6) Non-ordinary course legal fees for the three and six months ended July 31, 2026 includes $0.7 million and $1.3 million of costs related to securities lawsuits and non-recurring legal fees. Non-ordinary course legal fees for the three and six months ended July 31, 2025 includes $1.4 million and $2.0 million of costs related to securities lawsuits and non-recurring legal fees including transaction related costs.
(7) Executive transition for the three and six months ended July 31, 2026 includes $1.8 million of costs related to the transitions of the Chief Executive Officer and Executive Chair roles.
(8) Includes other (income) / expense recognized in the period.
(9) Includes gains / losses recognized in relation to foreign exchange, operating lease terminations and the related surrender of fixed assets (see “Note 4 - Leases – Lessee Accounting” in the Notes to the Condensed Consolidated Financial Statements).
(10) Adjusted EBITDA Margin calculated as Adjusted EBITDA as a percentage of revenue.
Rent the Runway, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(in millions)
The following table presents a reconciliation of net cash (used in) provided by operating activities, the most comparable GAAP financial measure, to Free Cash Flow and Free Cash Flow Margin for the periods presented:
| Six Months Ended July 31, | ||||||||
| 2026 | 2025 | |||||||
| (in millions) | ||||||||
| Net cash (used in) provided by operating activities | $ | (5.0 | ) | $ | (2.2 | ) | ||
| Purchases of rental product | (27.7 | ) | (42.0 | ) | ||||
| Proceeds from liquidation of rental product | 0.8 | 1.6 | ||||||
| Proceeds from sale of rental product | 13.3 | 11.8 | ||||||
| Purchases of fixed and intangible assets | (3.0 | ) | (2.1 | ) | ||||
| Free Cash Flow | $ | (21.6 | ) | $ | (32.9 | ) | ||
| Free Cash Flow Margin | (11.5)% | (21.9)% | ||||||
