Rent The Runway, Inc. (RENT)
NASDAQ:RENT
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Rent the Runway
(NASDAQ:RENT)
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Rating:45Neutral
Price Target:
$4.50
▼(-8.91% Downside)
Action:ReiteratedDate:02/04/26
The score is held down mainly by weak financial health (negative equity/high leverage indicators, negative EBIT margin, and declining free cash flow) and bearish technicals (below key moving averages with negative MACD). These are partly offset by a more constructive earnings outlook (subscriber/revenue growth and improved guidance) and a liquidity-positive financing update.
Positive Factors
High gross margin
A 72%+ gross margin indicates strong unit economics in core rental operations and pricing power on inventory. Persistently high gross margin provides structural room to absorb customer acquisition and fulfillment costs and supports potential operating leverage as subscription scale increases.
Negative Factors
Negative EBIT margin
A persistently negative EBIT margin signals the core business still loses money at the operating level, implying structural cost or revenue-share pressures. Until operating losses are eliminated, the company will struggle to convert strong gross margins into durable operating profits.
Read all positive and negative factors
Positive Factors
Negative Factors
High gross margin
A 72%+ gross margin indicates strong unit economics in core rental operations and pricing power on inventory. Persistently high gross margin provides structural room to absorb customer acquisition and fulfillment costs and supports potential operating leverage as subscription scale increases.
Read all positive factors
Rent the Runway (RENT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$160.61M
Dividend YieldN/A
Average Volume (3M)56.33K
Price to Earnings (P/E)<0.1
Beta (1Y)2.15
Revenue Growth2.91%
EPS Growth94.12%
CountryUS
Employees912
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Retail
Share Statistics
EPS (TTM)13.81
Shares Outstanding33,390,903
10 Day Avg. Volume50,441
30 Day Avg. Volume56,329
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)-0.17
Price to Sales (P/S)0.10
P/FCF Ratio-0.75
Enterprise Value/Market Cap1.07
Enterprise Value/Revenue0.55
Enterprise Value/Gross Profit3.34
Enterprise Value/Ebitda0.99
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)-19.64
Revenue Forecast (FY)$302.60M
Rent the Runway Business Overview & Revenue Model
Company Description
Rent the Runway, Inc. rents designer wear for women through its stores and online retail. The company offers ready-to-wear, workwear, denim, casual, maternity, outerwear, blouses, knitwear, loungewear, jewelry, handbags, activewear, ski wear, home...
How the Company Makes Money
Rent the Runway generates revenue primarily through its subscription and rental services. The subscription model allows customers to pay a monthly fee for access to a rotating closet of designer fashion, which is a key revenue stream. Additionally...
Rent the Runway Key Performance Indicators (KPIs)
Any
Subscriber Breakdown
Provides a detailed look at the composition of subscribers, revealing trends in customer acquisition, retention, and the overall health of the subscription model.
Provides a detailed look at the composition of subscribers, revealing trends in customer acquisition, retention, and the overall health of the subscription model.
Data provided by:
The Fly
The FlyRent the Runway Earnings Call Summary
Earnings Call Date:Dec 12, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Apr 14, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a generally positive outlook with strong subscriber and revenue growth, reduced debt, and enhancements in customer experience. However, challenges remain with decreased gross margins, higher operating expenses, and negative free cash flow.Positive Updates
Debt Reduction and Recapitalization
The company successfully reduced its total debt from approximately $319 million to approximately $120 million and extended the maturity to 2029, following a strategic recapitalization with new capital from two private equity firms.
Negative Updates
Decreased Gross Margins
Gross margins decreased from 34.7% in Q3 2024 to 29.6% in Q3 2025, primarily due to higher revenue share costs from increased inventory levels.
Read all updates
Q3-2025 Updates
Positive
Negative
Debt Reduction and Recapitalization
The company successfully reduced its total debt from approximately $319 million to approximately $120 million and extended the maturity to 2029, following a strategic recapitalization with new capital from two private equity firms.
Read all positive updates
Company Guidance
In the third quarter of fiscal year 2025, Rent the Runway, Inc. provided optimistic guidance, highlighting significant progress in financial and operational metrics. The company reduced its total debt from approximately $319 million to $120 million, extended its maturity to 2029, and is on track for 11% to 14% year-over-year revenue growth in Q4, compared to 1% in Q4 2024. Q3 saw a 12.4% increase in active subscribers year-over-year, with total revenue rising by 15.4% to $87.6 million. Despite a price increase in August, customer retention and acquisition improved, with inventory-related cancellations down nearly 30% year-over-year in Q3. The Net Promoter Score increased by 43% year-over-year, while the average subscriber visited the app 34% more times, and parts per subscriber rose by 15%. However, the adjusted EBITDA margin decreased to 4.9% of revenue due to higher revenue share expenses, and free cash flow was negative $13.6 million. For fiscal year 2025, the company expects revenue to range between $323.1 million and $325.1 million, with adjusted EBITDA margins between 4.9-5.5% of revenue.Rent the Runway Financial Statement Overview
Summary
Income Statement
45
Neutral
Balance Sheet
30
Negative
Cash Flow
40
Negative
| Breakdown | TTM | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 | Jan 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 314.50M | 306.20M | 298.20M | 296.40M | 203.30M | 157.50M |
| Gross Profit | 51.60M | 67.70M | 60.80M | 55.10M | 8.90M | -23.50M |
| EBITDA | 174.90M | 76.80M | 25.70M | -4.70M | -67.20M | -52.20M |
| Net Income | 10.60M | -69.90M | -113.20M | -138.70M | -211.80M | -171.10M |
Balance Sheet | ||||||
| Total Assets | 231.00M | 509.60M | 534.60M | 336.20M | 447.50M | 320.70M |
| Cash, Cash Equivalents and Short-Term Investments | 50.70M | 77.40M | 84.00M | 154.50M | 247.60M | 95.30M |
| Total Debt | 202.30M | 380.80M | 356.60M | 315.20M | 312.80M | 414.20M |
| Total Liabilities | 266.10M | 692.10M | 656.90M | 371.50M | 376.40M | 459.30M |
| Stockholders Equity | -35.10M | -182.50M | -122.30M | -35.30M | 71.10M | -138.60M |
Cash Flow | ||||||
| Free Cash Flow | -14.40M | -40.70M | -98.20M | -118.70M | -83.40M | -121.50M |
| Operating Cash Flow | -2.20M | 12.90M | -15.70M | -47.70M | -42.30M | -42.80M |
| Investing Cash Flow | -42.20M | -20.10M | -54.60M | -44.30M | -22.50M | -58.40M |
| Financing Cash Flow | 20.70M | -300.00K | 700.00K | -4.00M | 215.20M | 168.50M |
Rent the Runway Technical Analysis
Negative
4.94
Price Trends
6.24
Negative
6.12
Negative
5.40
Negative
Market Momentum
-0.47
Negative
38.02
Neutral
57.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RENT, the sentiment is Negative. The current price of 4.94 is below the 20-day moving average (MA) of 4.99, below the 50-day MA of 6.24, and below the 200-day MA of 5.40, indicating a bearish trend. The MACD of -0.47 indicates Negative momentum. The RSI at 38.02 is Neutral, neither overbought nor oversold. The STOCH value of 57.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RENT.
Rent the Runway Risk Analysis
Rent the Runway disclosed 62 risk factors in its most recent earnings report. Rent the Runway reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rent the Runway Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $126.47M | -2.54 | -21.26% | ― | -8.31% | 36.10% | |
55 Neutral | $38.33M | -151.48 | -675.54% | ― | -12.10% | -44.14% | |
54 Neutral | $468.27M | -60.75 | -12.23% | ― | -0.08% | 73.05% | |
54 Neutral | $3.59B | 28.27 | 22.70% | ― | 2.97% | 9.85% | |
46 Neutral | $169.63M | -16.58 | 0.97% | ― | -7.33% | -114.80% | |
45 Neutral | $160.61M | 0.05 | -6.46% | ― | 2.91% | 94.12% |
* Consumer Cyclical Sector Average
RENT
Rent the Runway
4.81
0.17
3.66%
TLYS
Tilly's
4.15
1.90
84.44%
SFIX
Stitch Fix
3.43
-0.07
-2.00%
CURV
Torrid Holdings
1.71
-3.73
-68.57%
VSCO
Victoria's Secret
44.56
25.01
127.93%
LVLU
Lulu's Fashion Lounge Holdings
13.83
7.23
109.55%
Rent the Runway Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Rent the Runway Amends Credit Agreement, Easing Liquidity Terms
Positive
Feb 3, 2026
On January 28, 2026, Rent the Runway, Inc. entered into a First Amendment to its Amended and Restated Credit Agreement with its lenders and administrative agent, CHS (US) Management LLC, originally dated October 28, 2025, to remove the minimum liq...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.