Rent the Runway Inc
For the period ended Jul 31, 2024. Filed Sep 6, 2024.
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Jul 31, 2024 · Filed Sep 6, 2024
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4. Restructuring and Related Charges
RENT THE RUNWAY, INC.Notes to Condensed Consolidated Financial Statements
- Restructuring and Related Charges
January 2024 Restructuring Plan
On January 9, 2024, the Company announced a restructuring plan to focus its workforce and cost structure on key growth opportunities and support its profitability goals. The plan included a reduction in workforce of approximately 10% of its corporate employees (primarily a reduction in force, with some open role closures/reduced backfills, and excludes potential hiring of new employees or other additions to the Company’s costs and expenses).
Restructuring charges of$0.2 million for severance and related costs were recognized during thesix months ended July 31, 2024 and are reflected in Restructuring charges on the Company’s Condensed Consolidated Statements of Operations. No restructuring charges were recognized during thethree months ended July 31, 2024. Restructuring charges of$2.0 million for severance and related costs were recognized during the year ended January 31, 2024 and were reflected in Restructuring charges on the Company’s Consolidated Statements of Operations. Cumulative charges related to severance and related costs incurred to date in connection with the January 2024 restructuring plan were$2.2 million.
Accrued restructuring charges were$0.2 million and$0.7 million as of July 31, 2024 and January 31, 2024, respectively. The Company may incur additional restructuring charges in the future. The restructuring plan was substantially completed by the end of the second quarter of fiscal year 2024 and is expected to be fully completed by the end of the third quarter of fiscal year 2024.
The Company recorded asset impairment charges of $1.1 million during the quarter and year ended January 31, 2024 related to the discontinuation of a software implementation project in connection with the January 2024 restructuring plan. The charge was reflected in Loss on asset impairment related to restructuring on the Company’s Consolidated Statements of Operations.
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