For the third quarter Rent the Runway’s total revenue rose by 31 per cent. The fashion rental and subscription company saw its active subscriber numbers increase 15 per cent while total subscribers grew 17 per cent. During the quarter, 28 per cent of its subscribers also paid more to add at least one additional rental item each month. Adjusted ebitda margin for the quarter was up significantly versus the same period last year.
The American company’s restructuring plan, now substantially complete, allows it to invest in customer proposition while significantly improving cash burn. Rent the Runway made considerable progress in 2022 in key foundational technology and customer initiatives and over the coming year looks forward to providing even more value to customers and brand partners.
Looking ahead, Rent the Runway believes that gross margin and fixed cost leverage improvements can help the company navigate potentially rougher macro conditions while improving profitability and accelerating the path to free cash flow breakeven. As a result, Rent the Runway is raising the annual adjusted ebitda margin outlook and over the medium-term hopes to generate 15 per cent profitability on adjusted ebitda after product depreciation. Inflation is making Rent the Runway more appealing to a broader swath of customers who cut across incomes and geographies.
