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Clothing rental company Rent the Runway reveals drop in revenue in IPO filing

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A person walks through clothes in the storage area of ​​Rent the Runway’s Dream Fulfillment Center in Secaucus, New Jersey, United States on September 11, 2019. Photo taken on September 11, 2019. REUTERS / Andrew Kelly / Files

Oct. 4 (Reuters) – Clothing rental company Rent the Runway released its documents for an IPO in the United States on Monday, joining a group of retailers seeking to capitalize on the record boom in capital markets since the last year.

In its filing with the U.S. Securities and Exchange Commission, the Brooklyn, New York-based company revealed an almost 39% drop in revenue for fiscal 2020.

Rent the Runway, which was founded in 2009, allows users to rent clothes and purchase second-hand items from over 750 designer brands. She had confidentially filed an application for registration in July. Read more

The company reported 2020 revenue of $ 157.5 million, up from $ 256.9 million a year earlier. Its net loss widened to $ 171.1 million in the same period, from $ 153.9 million a year earlier.

The company’s revenue was also affected in the first half of this fiscal year, with revenue down 9% for the six-month period ended July 31.

Rent the Runway raised funds last year at a valuation of $ 750 million, below its previous valuation of $ 1 billion, Bloomberg News reported in June. (https://bloom.bg/3mt348h)

The demand for second-hand clothing has jumped in recent months as customers become more aware of their carbon footprint, increasing revenues for the Stitch Fix subscription hairdressing service (SFIX.O) and the resale store in ThredUp line (TDUP.O).

Positive investor sentiment and fertile market conditions for new listings have also helped other retailers like eyewear company Warby Parker (WRBY.N) and Roger Federer-backed shoemaker On Holding AG (ONON.N) to make their market debut last month. Read more

Goldman Sachs & Co, Morgan Stanley and Barclays are the main underwriters of the offer. Rent the Runway will list its shares on the Nasdaq under the symbol “RENT”.

Report by Niket Nishant in Bangalore; Editing by Shailesh Kuber

Our Standards: Thomson Reuters Trust Principles.


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