Rent the Runway Shares Surge 17% on Q1 Earnings Beat, 20 Stocks Moving Premarket

Rent the Runway shares rose 17% in pre-market trading after the company reported better-than-expected quarterly results, including losses of $6.58 per share and sales of $69.6 million. Other stocks moving in pre-market trading include Bluejay Diagnostics, Eyenovia, and Tesla, while losers include Vera Therapeutics, lululemon athletica, and DocuSign.

Rent the Runway, Inc. (RENT) reported its financial results for the first quarter of fiscal year 2025, with the company's stock rising 17% in pre-market trading. The company reported a net loss of $6.58 per share and revenue of $69.6 million. Despite the losses, the company highlighted improvements in customer retention and subscriber growth, which contributed to the positive market reaction.

Key Highlights

- Customer Retention: Rent the Runway reported the strongest quarterly customer retention in four years, with a 24% increase in new inventory receipts compared to the previous year.
- Subscriber Growth: The company saw a 1% increase in ending active subscribers to 147,157, the highest quarter-ending active subscriber count in its history.
- Inventory Strategy: Rent the Runway launched 36 new brands and over 1,000 new styles, with plans to increase inventory receipts by +134% year-over-year for the remainder of the year.

Financial Performance

- Revenue: Revenue was $69.6 million, a 7.2% decrease year-over-year from $75.0 million in the first quarter of fiscal year 2024.
- Gross Profit: Gross profit was $21.9 million, down 22.9% from $28.4 million in the first quarter of fiscal year 2024.
- Net Loss: Net loss was $(26.1) million, compared to $(22.0) million in the first quarter of fiscal year 2024.
- Adjusted EBITDA Margin: Adjusted EBITDA margin was (1.9)%, compared to 8.7% in the first quarter of fiscal year 2024.

Outlook

Rent the Runway expects revenue of between $76 million and $80 million for the second fiscal quarter of 2025 and double-digit growth in ending active subscribers for the full year. The company also expects free cash flow of between $(30) million and $(40) million for fiscal year 2025.

Market Reaction

Other stocks moving in pre-market trading include Bluejay Diagnostics, Eyenovia, and Tesla, while losers include Vera Therapeutics, lululemon athletica, and DocuSign.

References

[1] https://investors.renttherunway.com/news-releases/news-release-details/rent-runway-inc-announces-first-quarter-2025-results