Rent the Runway narrows losses as FY24 revenue picks up pace

Rental platform Rent the Runway (RTR) has reported narrowing losses for the fiscal year 2024, after results for the fourth quarter continued the positive trajectory seen over much of the period. During the year as a whole, revenue was up 2.7 percent year-over-year reaching 306.2 million dollars, while net losses narrowed from 113.2 million dollars in 2023 to 69.9 million dollars.

Despite gross profit dropping from 119.7 million dollars to 115.9 million dollars, adjusted EBITDA grew, rising from 26.9 million dollars to 46.9 million dollars. RTR’s adjusted EBITDA margin over the year shifted from 9 percent in 2023 to 15.3 percent. As of January 31, 2025, cash and cash equivalents amounted to 77.4 million dollars.

RTR said that the improvement was a result of a “multi-year corporate strategy transformation, which includes a rejuvenated and customer-obsessed team, a commitment to improving customer loyalty and retention, and instilling greater cost discipline”. While this was reflected in an 8 percent increase in customer retention for FY24, the platform’s number of average active subscribers fell 2 percent.

Despite this, co-founder, president and CEO, Jennifer Hyman, said RTR was “now operating on steadier financial footing” following a period of turbulence. “We’ve significantly reduced our cash burn, which is a key proof point that we can operate a more sustainable business,” she added.

Looking ahead, Hyman said the priority was to “grow new customers and strengthen customer loyalty by reinvesting in our inventory”. She added: “We are entering 2025 with strong conviction that we will see business momentum as we continue to execute on our multi-year transformation plan."

For FY25, the company is forecasting a double-digit growth in active subscribers versus 2024, with a free cash flow sitting between -30 million and -40 million dollars. During the first quarter of 2025, RTR said it anticipates revenue of between 68 and 70 million dollars, and an adjusted EBITDA of between -5 and -7 percent of revenue. The company expressed caution over “unknowns around the economy and tariffs as well as timing of potential customer retention improvements” that could impact final results.