Rent the Runway closes in on profitability with 20% revenue surge

Rent the Runway (NASDAQ:RENT) reported strong financial results for the fourth quarter of fiscal year 2025, ended January 31, 2026, as the company significantly narrowed its losses and expanded its subscriber base.

The results reflect the brand's successful push toward operational efficiency and its continued dominance in the high-end circular fashion market.

Revenue for the quarter climbed to $91.7 million, a 20% increase over the $76.4 million reported in the same period last year.

This growth was underpinned by a robust expansion of its user base, with ending Active Subscribers rising 20.1% to 143,796.

The company’s total subscriber count, which includes those on pause, reached 183,552, signaling healthy long-term retention and brand affinity.

The company also made dramatic strides toward the bottom line, reporting a net loss of just $1.4 million, compared to a $13.4 million loss in the fourth quarter of fiscal 2024.

Net loss as a percentage of revenue improved from (17.5)% to (1.5)% year-over-year, positioning the fashion-tech pioneer on the cusp of GAAP profitability.

Gross profit for the quarter rose 22.9% to $35.4 million, with gross margins expanding to 38.6%.

Adjusted EBITDA remained steady at $18.3 million, representing a 20% margin.

While the EBITDA margin saw a slight contraction from the 22.8% reported a year ago—reflecting increased investments in inventory and marketing to fuel growth—the absolute dollar growth indicates a more sustainable and scalable business model.