Rent the Runway (RTR), the New York-based clothing rental platform, has announced record-breaking sales for the third quarter of 2022. The company experienced a 31% increase in total revenue, reaching $77.4 million compared to the same period last year. This growth can be attributed to a double-digit rise in subscriber numbers, with active subscribers jumping by 15% to 134,240 and total subscribers increasing by 17% to 176,167.

Aside from the impressive financial results, Rent the Runway also demonstrated progress in narrowing its losses. The company reported a net loss of $36.1 million for the quarter, which is a significant improvement from the $87.8 million loss in the third quarter of fiscal year 2021.

Jennifer Hyman, CEO and co-founder of Rent the Runway, expressed her satisfaction with the company’s performance. She stated, “We exceeded our Q3 ’22 revenue and adjusted EBITDA guidance,” emphasizing the strong adjusted EBITDA margin achieved during the quarter. Hyman also highlighted RTR’s successful restructuring plan, which is nearing completion. This plan has allowed the company to invest in its customer offerings while significantly reducing cash burn.

Throughout 2022, Rent the Runway has made notable strides in areas such as technology and customer initiatives. Hyman stressed the company’s commitment to delivering even more value to its customers and brand partners in the upcoming year.

Looking ahead, Rent the Runway provided a positive outlook for the full year, forecasting revenue ranging from $293 million to $295 million, with an adjusted EBITDA margin of 1%. Scarlett O’Sullivan, CFO of RTR, expressed confidence in the company’s gross margin and fixed cost leverage improvements, which will contribute to enhanced profitability and a quicker path to free cash flow breakeven. O’Sullivan added that RTR aims to achieve 15% profitability on adjusted EBITDA after product depreciation in the medium-term.

The remarkable financial performance and growth of Rent the Runway reflect the increasing popularity of clothing rental services. As consumers increasingly prioritize sustainability and flexibility in fashion choices, RTR’s expanding subscriber base and improving financials solidify its position as a leader in the fashion rental market.

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Reuters: Rent the Runway says remains on track for profitability as Q3 revenue rises 31%