RENT Rent The Runway, Inc.
Price Chart
Executive Summary
Rent the Runway reported Q1 (ended Apr 30, 2026) revenue of $89.9M (+29% YoY), ahead of its own guidance, and narrowed net loss to -$18.9M from -$26.1M, with Active Subscribers up 5.8% YoY. However, gross margin compressed to 25.9% from 31.5%, operating cash flow turned negative (-$3.8M vs +$8.3M), cash balance dropped sharply to $37.1M, and the company reaffirmed FY26 guidance with a leaner capex plan — the mixed signals and continuing leadership vacuum make this a neutral read-through for the stock.
Key Financial Metrics
Actionable Insight
Top-line momentum (29% growth) is real, but the deteriorating gross margin, negative cash flow, and thin cash balance (~$37M) raise questions about runway without additional capital. Q2 guidance ($91-$95M revenue, 5-8% EBITDA margin) implies near-term stability, but the new CEO appointment and lack of a permanent CFO add execution risk. Watch for Q2 cash flow trajectory and any financing needs.
Key Facts
- Total revenue $89.9M (+29.2% YoY) exceeded guidance; add-on revenue +70.4% YoY
- Active Subscribers 155,692 (+5.8% YoY); Total Subscribers 196,147 (+7.6% YoY)
- Gross margin fell to 25.9% from 31.5% YoY, driven by higher rental product depreciation ($43.0M vs $27.3M)
- Net loss improved to -$18.9M (21% of revenue) from -$26.1M (37.5% of revenue)
- Adjusted EBITDA -$0.8M (margin -0.9%) vs -$1.3M (-1.9%) — still negative
- Operating cash flow -$3.8M vs +$8.3M YoY; free cash flow -$13.6M vs -$6.4M
- Cash and equivalents $37.1M, down from $50.4M at Jan 2026 and $70.4M a year ago
- Reaffirmed FY26 guidance: double-digit revenue growth, Adj. EBITDA margin 4%-7%, Rental Product Acquired $45M-$50M
- New interim CEO/President Teri Bariquit (ex-Nordstrom CMO) appointed; permanent CEO search ongoing
- EPS reported as diluted loss per share -$0.57 vs -$6.26 (Q1 FY25) on massively higher share count (33.4M vs 4.2M)
Financial Impact
Revenue beat guidance at $89.9M; gross margin erosion of 560 bps YoY signals cost pressure from inventory investment; cash burn -$3.8M operating and -$13.6M free-cash-flow materially worse than prior year.
Risk Factors
- Cash burn at -$13.6M FCF per quarter on $37M cash suggests limited runway without improved operations or financing
- Gross margin compression (560 bps) from inventory investment may persist if rental product depreciation continues to outpace revenue growth
- Interim CEO and CFO structure introduces execution uncertainty; permanent CEO search outcome is a key catalyst
- Macro risks (tariffs, fuel surcharges) explicitly not incorporated into guidance — downside risk if realized
Market Snapshot
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3305987 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
|
Jun 3, 2026
2d ago
|
8-K
| $3.71 awaiting T+1 | awaiting T+1 | — | $3.33 (−10.38%) |
|
Jun 3, 2026
2d ago
|
Press Release
| $3.71 awaiting T+1 | awaiting T+1 | — | $3.33 (−10.38%) |
|
Jun 1, 2026
4d ago
|
DEFA14A
| $3.97 $3.72 | ▲ +6.30% | ▲ +6.44% | $3.33 (+16.25%) |
|
May 21, 2026
15d ago
|
8-K
| $3.66 $3.66 | · 0.00% | ▲ +0.45% | $3.33 (+9.15%) |
|
May 19, 2026
16d ago
|
Press Release
| $3.79 $3.66 | ▼ −3.43% | ▼ −3.62% | $3.33 (−12.27%) |
|
May 13, 2026
23d ago
|
PRESS-RELEASE / 8-K
| $4.17 $4.13 | ▲ +0.96% | ▲ +1.74% | $3.33 (+20.26%) |
|
Apr 15, 2026
7w ago
|
8-K
| $5.27 $5.57 | ▲ +5.69% | ▲ +5.44% | $3.33 (−36.91%) |
|
Apr 15, 2026
7w ago
|
424B5
| $5.27 $5.57 | ▲ +5.69% | ▲ +5.44% | $3.33 (−36.91%) |
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Apr 14, 2026
7w ago
|
8-K
| $5.22 $5.27 | ▲ +0.96% | ▲ +0.18% | $3.33 (−36.30%) |
|
Apr 14, 2026
7w ago
|
Press Release
| $5.22 $5.27 | ▲ +0.96% | ▲ +0.18% | $3.33 (−36.30%) |
US Market Status
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