Rent the Runway Pops on Revenue Beat

Rent The Runway (NASDAQ: RENT) surged 16.9% Thursday after its quarterly revenue came in well above Wall Street forecasts and the fashion rental company issued an upbeat sales forecast. The company also said its restructuring process was substantially complete.

Gross Profit was $31.8 million, representing an increase of 60% from $19.9 million in the third quarter of 2021. Gross Margin was 41.1%, as compared to 33.7% in the third quarter of fiscal year 2021.

Net Loss was $(36.1) million, as compared to $(87.8) million in the third quarter of fiscal year 2021. Net Loss as a percentage of revenue was (46.6)%, as compared to (148.8)% in the third quarter of fiscal year 2021.

In the three months ended October 31, 2022, Net Loss included $5.8 million of restructuring and related charges.

Adjusted EBITDA was $6.6 million, as compared to $(5.6) million in the third quarter of fiscal year 2021. Adjusted EBITDA margin was 8.5%, as compared to (9.5)% in the third quarter of fiscal year 2021.

Said CEO Jennifer Hyman, "I'm pleased to share that we exceeded our Q3 '22 Revenue and Adjusted EBITDA guidance. Revenue for the quarter was $77.4 million, up 31% compared to Q3 '21. We’re proud of our strong Adjusted EBITDA margin this quarter, which was up significantly versus the same period last year. We are also raising guidance for the year despite a tough environment."

RENT shares rocketed 33 cents, or 23.9%, to $1.69.