Rent the Runway (RENT) Q2 2026 earnings summary

Executive summary

• Announced a transformative recapitalization plan to reduce debt from over $340M to $120M, extend maturity to 2029, and inject $20M in new capital from private equity partners.

• Achieved 13.4% year-over-year growth in ending active subscribers, reaching 146,373–146,400, with improved retention and engagement metrics.

• Implemented inventory expansion, nearly doubling inventory units, launching thousands of new styles, and adding dozens of new brands.

• Raised subscription prices in August 2025 for the first time in three years, citing inflation and tariffs.

• Enhanced customer experience through product innovation, organic marketing, and new digital features, with NPS and engagement at multi-year highs.

Financial highlights

• Q2 2025 revenue was $80.9M, up 2.5% year-over-year; gross profit $24.3M (30.0% margin), down from 41.1% YoY.

• Net loss widened to $(26.4)M (margin -32.6%), compared to $(15.6)M YoY.

• Adjusted EBITDA for Q2 2025 was $3.6M (4.4% margin), down from $13.7M (17.4% margin) YoY.

• Free cash flow for the first six months was $(32.9)M, with Q2 free cash flow at $(26.5)M.

• Cash and cash equivalents at July 31, 2025, were $43.6M, down from $77.4M at fiscal year start.

Outlook and guidance

• Q3 2025 revenue expected between $82M and $84M; adjusted EBITDA margin guidance between -2% and 2%.

• Fiscal year 2025 guidance includes double-digit growth in ending active subscribers and free cash flow lower than $(40)M, mainly due to recapitalization costs.

• Expect higher rental product investment and increased operating expenses due to recapitalization.

• Forecast improved operating leverage and margin over the long term as revenue grows.