Fashion rental company Rent the Runway discloses drop in revenue in IPO filing

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A man walks through clothing in the storage area of ​​Rent the Runway’s “Dream Fulfillment Center” in Sequoias, New Jersey, US, September 11, 2019. Image taken on September 11, 2019. REUTERS/Andrew Kelly/Files
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(Businesshala) – Fashion rental company Rent the Runway made public its paperwork for US stock market flotation on Monday, joining a slew of retailers to capitalize on a record jump in capital markets from last year.

in its filing Here Along with the US Securities and Exchange Commission, the Brooklyn, New York-based company disclosed a nearly 39% drop in revenue for fiscal year 2020.

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Rent the Runway, which was founded in 2009, lets users rent clothes and shop for second-hand merchandise from over 750 designer brands. It had applied for listing confidentially in July.

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

The company’s top-line also suffered a setback in the first half of this fiscal, with revenue declining 9% for the six months ended July 31.

Rent the fund raised by Runway at a valuation of $750 million last year, down from its previous valuation of $1 billion, Businesshala News reported in June. (bloom.bg/3mt348h)

Demand for vintage clothing has soared in recent months as customers become increasingly aware of their carbon footprint, with revenues increasing at subscription-based styling service Stitch Fix and online resale shop ThredUp.

Positive investor sentiment and fertile market conditions for new listings also helped other retailers such as eyewear company Warby Parker and Roger Federer-backed Shoemaker On Holding AG debut their market last month.

Goldman Sachs & Company, Morgan Stanley and Barclays are the principal underwriters of the offering. Rent the Runway will list its stock on the Nasdaq under the symbol “Rent”.

Reporting by Niket Nishant in Bengaluru; Editing by Shailesh Kuber

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