The Q3 guidance for negative EBITDA margin signals a seasonal step-back, but the reaffirmed FY26 guidance and strong Q2 margin expansion provide a counterbalance. Monitor subscriber trends closely in Q3; any further decline in active subscribers would be a negative signal. The permanent CEO appointment removes leadership uncertainty, but the stock's historical volatility around earnings suggests caution.
Price Chart
Executive Summary
Rent The Runway reported Q2 FY2026 revenue of $97.7M (+20.8% YoY), a net loss of $(12.9)M (improved from $(26.4)M YoY), and positive Adjusted EBITDA of $12.6M (12.9% margin). The company reaffirmed its FY26 revenue and Adjusted EBITDA guidance but guided Q3 revenue down to $87-90M with negative EBITDA margin of -3% to -6%, signaling a seasonal step-back. Active subscribers declined 3.8% YoY to 140,826, a concerning trend despite strong revenue growth from higher spend per subscriber. The filing also announced Paige Thomas as permanent CEO, ending the interim period, and Teri Bariquit as Chair of the Board, providing leadership stability after a transition period.
Key Financial Metrics
Key Facts
- Revenue grew 20.8% YoY to $97.7M, an all-time high.
- Net loss improved to $(12.9)M from $(26.4)M YoY.
- Adjusted EBITDA was $12.6M (12.9% margin), up from $3.6M (4.4% margin) YoY.
- Active subscribers fell 3.8% YoY to 140,826, while Average Active Subscribers rose 1.0% to 148,259.
- Q3 FY2026 guidance: Revenue $87-90M, Adjusted EBITDA margin -3% to -6%.
- FY2026 guidance reaffirmed: double-digit revenue growth, Adjusted EBITDA margin 4-7%.
- Paige Thomas appointed permanent CEO, effective Sept 14, 2026; Teri Bariquit becomes non-executive Chair.
- Cash and cash equivalents $29.0M, down from $50.4M at Jan 31, 2026.
- Securities litigation expense of $6.1M in Q2.
Financial Impact
Revenue $97.7M (+20.8% YoY), net loss $(12.9)M, Adjusted EBITDA $12.6M, Q3 guidance $87-90M revenue with negative EBITDA margin
Risk Factors
- Active subscriber decline of 3.8% YoY despite revenue growth, indicating reliance on higher spend per subscriber.
- Q3 guidance for negative EBITDA margin (-3% to -6%) suggests seasonal weakness.
- Cash burn: cash dropped from $50.4M to $29.0M in six months; free cash flow was $(21.6)M.
- Securities litigation expense of $6.1M adds uncertainty.
- Macroeconomic risks including fuel surcharges and tariffs not incorporated into guidance.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3360272 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 26, 2026 1d ago | 8-K | $2.69 | awaiting T+1 | — | $2.70 (−0.37%) |
Oct 23, 2026 4d ago | Insider Cluster | $2.82 $2.70 | ▼ −4.26% | ▼ −4.82% | $2.70 (−4.26%) |
Oct 23, 2026 4d ago | SC 13D/A | $2.82 $2.70 | ▲ +4.26% | ▲ +4.82% | $2.70 (+4.26%) |
Oct 16, 2026 11d ago | SC 13D/A | $1.86 $2.02 | ▲ +8.60% | ▲ +8.27% | $2.70 (+45.16%) |
Oct 14, 2026 13d ago | 8-K | $1.81 $1.76 | ▼ −2.76% | ▼ −1.66% | $2.70 (+49.17%) |
Oct 1, 2026 26d ago | EFFECT | $1.65 $1.55 | ▲ +6.06% | ▲ +6.80% | $2.70 (−63.64%) |
Sep 30, 2026 27d ago | 8-K | $1.65 $1.65 | · 0.00% | ▲ +0.18% | $2.70 (−63.64%) |
Sep 28, 2026 29d ago | S-1/A | $1.61 $1.68 | ▼ −4.35% | ▼ −4.53% | $2.70 (−67.70%) |
Sep 18, 2026 5w ago | 144 | $1.86 $1.94 | ▲ +4.30% | ▲ +2.75% | $2.70 (+45.16%) |
Sep 15, 2026 6w ago | 8-K | $1.94 $1.93 | ▼ −0.52% | ▼ −1.65% | $2.70 (+39.18%) |
US Market Status
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