Rent the Runway, Inc.
For the period ended Jul 31, 2025. Filed Sep 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jul 31, 2025 · Filed Sep 12, 2025
RENT$2.19-3.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-04-30; filed 2025-06-06.
0001468327-25-000097
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-07-31; filed 2025-09-12.
0001468327-25-000176
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 146 previous paragraphs and 174 current paragraphs.
79 unchanged; 54 reworded; 35 added; 13 removed; 0 previous and 6 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (35)
Current report
•Announced the Recapitalization Transactions. See Note 15 — “Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more information.
Current report
•Continued deployment of our bold inventory strategy: As of August 2025, we have posted almost twice the inventory units compared to the prior year, with 323% more styles in May, 235% more in June, and 253% more in July. Year to date, we have added thousands of new styles and dozens of new brands to the platform.
Current report
•Increased customer engagement: Engagement with new inventory in the second quarter of fiscal year 2025 overperformed last year across every key metric, including share of views (up 84% year-over-year), hearts per style (up 15% year-over-year), and new units at home (up 57% year-over-year). Second quarter of fiscal year 2025 average subscription net promoter score was up 77% versus the prior year.
Current report
•Increased revenue share units and launched new exclusive brand collaborations: Revenue share units from existing revenue share partners are up 40% year-over-year, and total revenue share units are up 119% year-over-year. We plan to add 80+ new brands in fiscal year 2025, with 56 already launched in the first half of fiscal year 2025, and have launched seven new exclusive brand collaborations year to date.
Current report
•Organic social delivered its strongest quarter in years: Through 11 new social series, a new ‘face of RTR,’ and a fresh approach to our influencer strategy, second quarter of fiscal year 2025 overall engagement with our social media channels is up ~800% year-over-year and views are up 175% year-over-year.
Current report
•Enhanced the subscription experience to be more personalized, rewarding, and engaging: Introduced a new personalized home screen that we estimate will drive a significant increase in engagement, a rewards program with tiered membership perks, and the ability to preview "coming soon" styles.
Current report
•Increased prices of our subscription plans to respond to inflationary and tariff pressures: Implemented first pricing adjustment in three years on August 1, 2025, with an average increase of $2 per item.
Current report
•Revenue was $80.9 million and $78.9 million, respectively, representing 2.5% growth year-over-year;
Current report
•Net Loss was $(26.4) million and $(15.6) million, respectively. Net Loss as a percentage of revenue was (32.6)% and (19.8)%, respectively; and
Current report
•Revenue was $150.5 million and $153.9 million, respectively, representing a change of (2.2)% year-over-year;
Current report
•Gross Profit was $46.2 million and $60.8 million, respectively, representing a gross margin of 30.7% and 39.5%, respectively;
Current report
•Adjusted EBITDA was $2.3 million and $20.2 million, respectively, representing an Adjusted EBITDA margin of 1.5% and 13.1%, respectively;
Current report
•Net cash (used in) provided by operating activities was $(2.2) million and $6.8 million, and net cash used in investing activities was $(30.7) million and $(12.7) million, respectively;
Current report
•Cash and Cash Equivalents was $43.6 million and $76.6 million, respectively.
Current report
Recapitalization Transactions
Current report
See Note 15 — “Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more information.
Current report
Net Loss was $(26.4) million for the three months ended July 31, 2025 compared to $(15.6) million for the three months ended July 31, 2024, representing margins of (32.6)% and (19.8)%, respectively. Net Loss increased year over year primarily due to the impact of higher revenue share costs, G&A expenses, fulfillment costs, technology costs, and a reduction in Other Income, partially offset by an increase in Revenue. Net Loss was $(52.5) million for the six months ended July 31, 2025 compared to $(37.6) million for the six months ended July 31, 2024, representing margins of (34.9)% and (24.4)%, respectively. Net Loss increased year over year primarily due to the impact of higher revenue share costs, lower revenue, higher fulfillment costs, higher interest expense and higher technology costs versus the prior year, partially offset by lower rental product depreciation and write-offs, other depreciation and amortization and marketing expense.
Current report
Subscription and Reserve Rental Revenue. Subscription and Reserve rental revenue was $69.2 million for thethree months ended July 31, 2025, an increase of $0.7 million, or 1.0%, compared to $68.5 million for thethree months ended July 31, 2024. This increase was primarily driven by higher Average Active Subscribers, partially offset by a decrease in average revenue per subscriber. The decrease in revenue per subscriber was driven primarily by higher promotional spending and impact of changes in program mix of active subscribers. Reserve rental revenue was largely unchanged year-over-year.
Current report
Costs and Expenses. Total costs and expenses were $101.0 million for thethree months ended July 31, 2025, an increase of $12.5 million, or 14.1%, comp ared to $88.5 million for thethree months ended July 31, 2024. This increase wasprimarily driven by higher Rental Product Depreciation and Revenue Share costs, higher Fulfillment costs, and higher Technology costs.
Current report
Technology. Technology expenses were $9.8 million for thethree months ended July 31, 2025, an increase of$1.1 million, or 12.6%, compared to $8.7 million for thethree months ended July 31, 2024. Technology expenses were 12.1% of revenue for the three months ended July 31, 2025 compared to 11.0% for the same period last year due to higher technology related employee costs. Technology related share-based compensation expense was $0.2 million for the three months ended July 31, 2025 and was $0.5 million for the same period last year.
Current report
General and Administrative. General and administrative (“G&A”) expenses were $24.6 million for the three months ended July 31, 2025, an increase of $2.4 million, or 10.8%, compared to $22.2 million for the three months ended July 31, 2024. This increase was driven primarily by expenses relating to the Recapitalization Transactions, partially offset by lower share-based compensation expense, gain on the liquidation of rental product and gain on asset disposal and lease termination. G&A expenses as a percentage of revenue were 30.4%, compared to 28.1% last year. G&A related share-based compensation expense was $1.2 million for the three months ended July 31, 2025 and was $1.9 million for the three months ended July 31, 2024.
Current report
In fiscal year 2025, we expect G&A expenses to increase in the next several fiscal quarters due to costs relating to the Recapitalization Transactions. The Company is currently evaluating the impact of the Recapitalization Transactions on the Company’s consolidated financial statements.
Current report
Restructuring Charges. There were no restructuring charges for the three months ended July 31, 2025 and July 31, 2024 for severance and related costs in connection with the January 2024 restructuring plan.
Current report
Comparison of thesix months ended July 31, 2025 and 2024
Current report
Other Revenue. Other revenue was$19.3 million for thesix months ended July 31, 2025, flat compared to thesix months ended July 31, 2024. Other revenue represented 12.8% of total revenue, up from 12.5% in the same period last year.
Current report
Fulfillment. Fulfillment expenses were$42.9 million for thesix months ended July 31, 2025, anincrease of$1.7 million, or 4.1%, representing 28.5% of revenue, compared to $41.2 million for thesix months ended July 31, 2024, representing 26.8% of revenue. The increase in fulfillment expenses as a percentage of revenue was primarily driven by higher transportation costs due to carrier rate increases and increases in warehouse processing costs.
Current report
Technology. Technology expenses were$19.4 million for thesix months ended July 31, 2025, anincrease of$1.1 million, or 6.0%, compared to $18.3 million for thesix months ended July 31, 2024. Technology expenses were 12.9% of revenue for the six months ended July 31, 2025 compared to 11.9% for the same period last year due to higher technology related employee costs. Technology related share-based compensation expense was $0.5 million for the six months ended July 31, 2025 and was $1.1 million for the same period last year.
Current report
Marketing. Marketing expenses were $16.0 million for the six months ended July 31, 2025, a decrease of $(0.8) million, or (4.8)%, compared to $16.8 million for the six months ended July 31, 2024. This decrease was driven primarily by lower consulting costs and brand marketing expenses. Marketing expenses unrelated to personnel costs were $14.4 million in the six months ended July 31, 2025 and 9.6% of revenue, compared to $15.3 million and 9.9% of total revenue for the same period last year.
Current report
In fiscal year 2025, we expect G&A expenses to increase in the next several fiscal quarters due to costs relating to the Recapitalization Transactions. We are currently evaluating the impact of the Recapitalization Transactions on our consolidated financial statements..
Current report
Rental Product Depreciation and Revenue Share. Rental product depreciation and revenue share was$61.4 million for thesix months ended July 31, 2025, anincrease of$9.5 million, or 18.3%, compared to $51.9 million for thesix months ended July 31, 2024. The increase was primarily driven by higher Share by RTR units acquired. Rental product depreciation and revenue share was 40.8% of revenue in the six months ended July 31, 2025, up from 33.7% in the same period last year primarily due tothe factors discussed above.
Current report
Other Depreciation and Amortization. Other depreciation and amortization was$5.3 million for thesix months ended July 31, 2025, adecrease of$(1.3) million, or(19.7)%, compared to $6.6 million for the six months ended July 31, 2024. This decrease was primarily driven by lower depreciation and amortization associated with machinery and equipment.
Current report
Other Income / (Expense), Net. Other income / (expense), net was $0.7 million for the six months ended July 31, 2025, an increase of $0.5 million, compared to $0.2 million for the six months ended July 31, 2024.
Current report
Our Adjusted EBITDA was $3.6 million for the three months ended July 31, 2025 compared to $13.7 million for the three months ended July 31, 2024, representing margins of 4.4% and 17.4%, respectively. Our Adjusted EBITDA was $2.3 million for the six months ended July 31, 2025 compared to $20.2 million for the six months ended July 31, 2024, representing margins of 1.5% and 13.1%, respectively. Adjusted EBITDA Margin decreased for the three and six months ended July 31, 2025 primarily due to higher revenue share and fulfillment costs as a percentage of revenue.
Current report
(5)Non-recurring adjustments for the three and six months ended July 31, 2025 includes $2.0 million of transaction related costs.
Current report
On August 20, 2025, the Company entered into an exchange agreement (the “Exchange Agreement”) with its existing lender, CHS US Investments LLC, as part of a broader recapitalization intended to improve the Company’s capital structure, enhance financial flexibility, and extend debt maturities. Upon the closing of the Recapitalization Transactions, the Company shall enter into an amended and restated credit agreement (the “New Credit Agreement”), by and among the Company, as borrower, CHS (US) Management LLC, as administrative agent, and CHS US Investments LLC, Gateway Runway, LLC (“Nexus”) and S3 RR Aggregator, LLC (“Story3”) (collectively, the “Investor Group”). The New Credit Agreement, when entered into in accordance with the terms of the Exchange Agreement, will amend and restate the 2025 Amended Facility and provide for $120 million in aggregate principal amount of term loans comprised of (x) $100 million of the Company’s existing outstanding indebtedness owing to CHS US Investments LLC under the 2025 Amended Facility to be exchanged on a dollar-for-dollar cashless basis for new term loans under the New Credit Agreement and (y) $20 million of new money term loans to be provided by the Investor Group upon the closing of the Recapitalization Transactions. All such term loans would mature on the fourth anniversary of the closing of the Recapitalization Transactions and bear interest, at the Company’s option, at either (i) a bank reference rate plus 4.00% or (ii) term SOFR plus 5.00%, in each case per annum. The New Credit Agreement would modify the 2025 Amended Facility in certain other respects, including by temporarily reducing the minimum liquidity maintenance covenant from $30 million to $15 million through February 20, 2027, after which the original covenant level resumes. Pursuant to the Exchange Agreement, the remaining outstanding indebtedness owing to CHS US Investments LLC under the 2025 Amended Facility would be contributed by CHS US Investments LLC to the Company upon the closing of the Recapitalization Transactions in exchange for newly issued shares of the Company’s Class A common stock, equal to 86% of the Company’s outstanding shares (after giving effect to the Conversions, but before giving effect to the Rights Offering and the MIP Pool). Our total indebtedness as of July 31, 2025 was $343.9 million. See “Note 15 - Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more information.
Removed paragraphs (13)
Previous report
•Began deploying our new rental product strategy on site: Our historic investment in rental product began reaching customers, with a 24% increase in new rental product receipts in the first quarter of fiscal year 2025 versus the first quarter of fiscal year 2024. In the first quarter of fiscal year 2025, we launched 36 new brands and over 1,000 new styles. We expect that the remainder of the year will be even more impactful, with rental product receipts expected to increase +134% year-over-year. We also expect to launch over 40 new brands and post over 2,700 new styles.
Previous report
•Expanded rental product from pillar brands: In the first quarter of fiscal year 2025, we released four new collaborations with Sea NY, Plan C, Ganni and Simon Miller, and increased the number of styles from popular brands like Staud, Ulla Johnson, Veronica Beard, and Tanya Taylor. Pillar brands are leading the way in customer engagement, with more demand, love rate, and hearts per style.
Previous report
•Continued to demonstrate that RTR is a valuable marketing channel for many brands, providing an effective way for them to reach new customers outside of traditional marketing channels.
Previous report
•Improved the new member experience, providing white glove service to early term customers: In the first quarter of fiscal year 2025, we launched styling support, a 60-day customer promise where customers can get new items sent to them at no cost if they’re unsatisfied with any of the items in their order, and called 50% of new members to ensure they had a smooth introduction. By the end of the second quarter of fiscal year 2025, we anticipate 100% of our early term customers will receive a call.
Previous report
•Introduced highly requested product features, including back-in-stock notifications: Historically the most requested new feature, beginning in the first quarter of fiscal year 2025, customers can request to be notified when an item is back in stock. As of June 1, 25% of all subscribers engaged with back in stock notifications and 48% of subscribers successfully added a back in stock item to their bag from a notification.
Previous report
•Reconnected with our customers: Through authentic, transparent communications and branding and unique member experiences, we’ve shown our customers we heard them during the first quarter of fiscal year 2025 and we’ve continued this campaign in the second quarter of fiscal year 2025.
Previous report
•Increased customer engagement: We’ve seen higher engagement with our Spring 2025 rental product, which has 23% higher share of views, 46% more hearts, and a 14% higher love rate than our Spring 2024 buy. Customers are also adding more items to their shipments, with gross bookings of April 2025 add-on spots up 11% versus the prior year.
Previous report
•Launched a new organic media strategy: We engaged with our opinionated community members on Reddit and introduced new content series on social media, including new spokespeople and highlights of our team. The engagement rate on our social channels is up 163% since we launched our new strategy in April and May as compared to the two months prior.
Previous report
•Revenue was $69.6 million and $75.0 million, respectively, representing a decrease of (7.2)% year-over-year;
Previous report
•Net cash (used in) provided by operating activities was $8.3 million and $4.6 million, and net cash used in investing activities was $(14.7) million and $(6.0) million, respectively;
Previous report
•Cash and Cash Equivalents was $70.4 million and $82.0 million, respectively.
Previous report
Technology. Technology expenses were $9.6 million for thethree months ended April 30, 2025, flat compared to $9.6 million for thethree months ended April 30, 2024. Technology expenses were 13.8% of revenue for the three months ended April 30, 2025 compared to 12.8% for the same period last year as we saw decreased operating leverage due to lower revenue. Technology related share-based compensation expense was $0.3 million for the three months ended April 30, 2025 and was $0.6 million for the same period last year.
Previous report
In fiscal year 2025, we expect G&A expenses to decrease as a percentage of revenue compared to fiscal year 2024 due to operating leverage driven by higher revenue growth.
Reworded paragraphs (54)
Previous wording
We give customers ongoing access to our “unlimited closet” — with thousands of styles by hundreds of designer brands — through our Subscription offering or the ability to rent a-la-carte through our Reserve offering. We also give our subscribers and customers the ability to buy our products through our Resale offering, which offers customers pre-loved styles from our closet at a discount to retail price, up to 90% off of designer retail value. These offerings allow us to engage and serve our subscribers and customers across diverse use cases from everyday life to special occasions. We have served approximately 3 million lifetime customers across all of our offerings and we had 182,209 ending Total Subscribers 1 (active and paused) as of April 30, 2025. We had 147,157 Active Subscribers as of April 30, 2025. The majority of our revenue is highly recurring and is generated by our subscribers. For the three months ended April 30, 2025 and 2024, respectively, 88% and 88% of our total revenue (including Reserve and Resale revenue) was generated by subscribers while they were active or paused.
Current wording
We give customers ongoing access to our “unlimited closet” — with thousands of styles by hundreds of designer brands — through our Subscription offering or the ability to rent a-la-carte through our Reserve offering. We also give our subscribers and customers the ability to buy our products through our Resale offering, which offers customers pre-loved styles from our closet at a discount to retail price, up to 90% off of designer retail value. These offerings allow us to engage and serve our subscribers and customers across diverse use cases from everyday life to special occasions. We have served approximately 3 million lifetime customers across all of our offerings and we had 185,102 ending Total Subscribers 1 (active and paused) as of July 31, 2025. We had 146,373 Active Subscribers as of July 31, 2025. The majority of our revenue is highly recurring and is generated by our subscribers. For the six months ended July 31, 2025 and 2024, respectively, 89% and 89% of our total revenue (including Reserve and Resale revenue) was generated by subscribers while they were active or paused.
Previous wording
Key Fiscal First Quarter and Recent Business Highlights:
Current wording
Key Fiscal Second Quarter and Recent Business Highlights:
Previous wording
•147,157 and 145,837 ending Active Subscribers 2, respectively, representing an increase of 1% year-over-year;
Current wording
•146,373 and 129,073 ending Active Subscribers 2, respectively, representing an increase of 13.4% year-over-year;
Previous wording
•133,468 and 135,896 Average Active Subscribers 3, respectively, representing a change of (2)% year-over-year;
Current wording
•146,765 and 137,455 Average Active Subscribers 3, respectively, representing an increase of 6.8% year-over-year;
Previous wording
•182,209 and 185,346 ending Total Subscribers (including paused subscribers), respectively, representing a change of (2)% year-over-year;
Current wording
•185,102 and 175,087 ending Total Subscribers (including paused subscribers), respectively, representing an increase of 5.7% year-over-year;
Previous wording
•Gross Profit was $21.9 million and $28.4 million, respectively, representing a gross margin of 31.5% and 37.9%, respectively;
Current wording
•Gross Profit was $24.3 million and $32.4 million, respectively, representing a gross margin of 30.0% and 41.1%, respectively;
Previous wording
•Adjusted EBITDA was $(1.3) million and $6.5 million, respectively, representing an Adjusted EBITDA margin of (1.9)% and 8.7%, respectively;
Current wording
•Adjusted EBITDA was $3.6 million and $13.7 million, respectively, representing an Adjusted EBITDA Margin of 4.4% and 17.4%, respectively.
Previous wording
•Net Loss was $(26.1) million and $(22.0) million, respectively. Net Loss as a percentage of revenue was (37.5)% and (29.3)%, respectively, and included $0.2 million of restructuring and related charges for the three months ended April 30, 2024;
Current wording
•Net Loss was $(52.5) million and $(37.6) million, respectively. Net Loss as a percentage of revenue was (34.9)% and (24.4)%, respectively, and included $0.2 million of restructuring and related charges for thesix months ended July 31, 2024;
Previous wording
•Net cash (used in) provided by operating activities as a percentage of revenue was 11.9% and 6.1% and net cash used in investing activities as a percentage of revenue was (21.1)% and (8.0)%, respectively; and
Current wording
•Net cash (used in) provided by operating activities as a percentage of revenue was (1.5)% and 4.4% and net cash used in investing activities as a percentage of revenue was (20.4)% and (8.3)%, respectively; and
Previous wording
In fiscal year 2024, 30% of new items were acquired through Wholesale, 48% through Share by RTR and 22% through Exclusive Designs, compared to 39% Wholesale, 33% Share by RTR and 28% Exclusive Designs in fiscal year 2023. In total, approximately 70% of new items were acquired through Share by RTR and Exclusive Designs, our more capital-efficient channels in fiscal year 2024 and approximately 61% in fiscal year 2023. Both our purchasing power and the diversification into Share by RTR and Exclusive Designs have led to a decrease in rental product capital expenditures (or Purchases of Rental Product as presented in the Condensed Consolidated Statement of Cash Flows) as a percentage of revenue over time. We expect the total percentage of units acquired through our more capital-efficient channels to be unchanged in fiscal year 2025 versus fiscal year 2024, with an increase in the percentage of units acquired through our Share by RTR program versus fiscal year 2024. We plan to further decrease the percentage of units acquired through Wholesale and increase the percentage of units acquired through our more capital-efficient channels over the longer term. We expect to incur higher purchases of rental product in fiscal year 2025 relative to fiscal year 2024 in connection with our strategy to approximately double the new rental product added to our site and made available to our customers in fiscal year 2025.
Current wording
In fiscal year 2024, 30% of new items were acquired through Wholesale, 48% through Share by RTR and 22% through Exclusive Designs, compared to 39% Wholesale, 33% Share by RTR and 28% Exclusive Designs in fiscal year 2023. In total, approximately 70% of new items were acquired through Share by RTR and Exclusive Designs, our more capital-efficient channels in fiscal year 2024 and approximately 61% in fiscal year 2023. Both our purchasing power and the diversification into Share by RTR and Exclusive Designs have led to a decrease in rental product capital expenditures (or Purchases of Rental Product as presented in the Condensed Consolidated Statement of Cash Flows) as a percentage of revenue over time. We expect the total percentage of units acquired through our more capital-efficient channels to be largely unchanged in fiscal year 2025 versus fiscal year 2024, with an increase in the percentage of units acquired through our Share by RTR program versus fiscal year 2024. We plan to further decrease the percentage of units acquired through Wholesale and increase the percentage of units acquired through our more capital-efficient channels over the longer term. We expect to incur higher purchases of rental product in fiscal year 2025 relative to fiscal year 2024 in connection with our strategy to approximately double the new rental product added to our site and made available to our customers in fiscal year 2025.
Previous wording
We provide a flexible offering that allows our subscribers to customize their subscription as their everyday life changes, choosing to pause and reactivate their membership as needed. We have also historically seen that many subscribers who cancel their subscription will return and resubscribe when membership again makes sense for their everyday life. Customer acquisition is dependent on organic growth, the effectiveness of our paid marketing strategy and the availability of and satisfaction with our rental product. Our acquisitions are also reliant on new customer promotions. Our promotional strategy is subject to change depending on business and market conditions. In fiscal year 2024, we have focused, and plan to continue to focus in fiscal year 2025, on improving both the availability of and satisfaction with our rental product for our Reserve and Subscription customers.
Current wording
We provide a flexible offering that allows our subscribers to customize their subscription as their everyday life changes, choosing to pause and reactivate their membership as needed. We have also historically seen that many subscribers who cancel their subscription will return and resubscribe when membership again makes sense for their everyday life. Customer acquisition is dependent on organic growth, the effectiveness of our paid marketing strategy and the availability of and satisfaction with our rental product. Our acquisitions are also reliant on new customer promotions. Our promotional strategy is subject to change depending on business and market conditions. In fiscal year 2024, we focused, and plan to continue to focus in fiscal year 2025, on improving both the availability of and satisfaction with our rental product for our Reserve and Subscription customers.
Previous wording
Purchases of rental product includes the cost of Wholesale products acquired in the period and other ancillary costs such as freight, where applicable. Many factors impact the purchases of rental product including our depth and acquisition mix strategy, the proportion of subscribers to total customers, timing of when those subscribers are acquired, the formality of styles, brand assortment, opportunities in the market and timing of when the rental product is received and paid for. Purchases of rental product as a percentage of revenue in fiscal year 2024 was 16% as a result of a greater proportion of rental product acquired through our Share by RTR channel combined with fewer units of rental product purchased compared to fiscal year 2023. Purchases of rental product as a percentage of revenue was 26% and 21% in fiscal year 2023 and 2022, respectively. We anticipate this percentage to increase in fiscal year 2025 compared with fiscal year 2024, despite a greater proportion of Share by RTR units, due to a significant increase in units of rental product purchased. Due to seasonality factors, we track our progress on purchases of rental product as a percentage of revenue on a full year basis, as quarterly expenditures are not necessarily reflective of full year trends. As of April 30, 2025, the quarterly and annual spend levels for rental product capital expenditures for fiscal year 2025 under our 2025 Amended Facility have not yet been finalized. The deadline to agree on such levels was extended from March 31, 2025 to May 30, 2025 and then further extended to July 31, 2025.
Current wording
Purchases of rental product includes the cost of Wholesale products acquired in the period and other ancillary costs such as freight, where applicable. Many factors impact the purchases of rental product including our depth and acquisition mix strategy, the proportion of subscribers to total customers, timing of when those subscribers are acquired, the formality of styles, brand assortment, opportunities in the market and timing of when the rental product is received and paid for. Purchases of rental product as a percentage of revenue in fiscal year 2024 was 16% as a result of a greater proportion of rental product acquired through our Share by RTR channel combined with fewer units of rental product purchased compared to fiscal year 2023. Purchases of rental product as a percentage of revenue was 26% and 21% in fiscal year 2023 and 2022, respectively. We anticipate this percentage to increase in fiscal year 2025 compared with fiscal year 2024, despite a greater proportion of Share by RTR units, due to a significant increase in units of rental product purchased. Due to seasonality factors, we track our progress on purchases of rental product as a percentage of revenue on a full year basis, as quarterly expenditures are not necessarily reflective of full year trends. As of July 31, 2025, the quarterly and annual spend levels for rental product capital expenditures for fiscal year 2025 under our 2025 Amended Facility were eliminated under the Fourteenth Amendment to the debt facility. See “Note 15 - Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more details.
Previous wording
Ability to Achieve Leverage in our Cost Structure. Improving operational efficiency of our platform is imperative to increasing profitability. We expect certain of our operating costs to increase as order volume increases and as we make investments to grow subscribers and revenue and to enhance the customer experience. In September 2022, we announced a restructuring plan that reduced operating expenses by approximately $27 million in the four quarters following the restructuring compared to the annualized run rate for the second quarter of fiscal year 2022. In January 2024, we announced a restructuring plan that generated total annual operating expense savings of approximately $12 million, which primarily included the 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. Though we anticipate quarterly fluctuations in operating leverage, we expect our fixed costs to decrease as a percentage of total revenue in fiscal year 2025, and over time we anticipate that our operating costs will grow more slowly than our total revenue on an annual basis. As of April 30, 2025, the quarterly and annual spend levels for rental product capital expenditures for fiscal year 2025 under our 2025 Amended Facility have not yet been finalized. The deadline to agree on such levels was extended from March 31, 2025 to May 30, 2025 and then further extended to July 31, 2025.
Current wording
Ability to Achieve Leverage in our Cost Structure. Improving operational efficiency of our platform is imperative to increasing profitability. We expect certain of our operating costs to increase as order volume increases and as we make investments to grow subscribers and revenue and to enhance the customer experience. In September 2022, we announced a restructuring plan that reduced operating expenses by approximately $27 million in the four quarters following the restructuring compared to the annualized run rate for the second quarter of fiscal year 2022. In January 2024, we announced a restructuring plan that generated total annual operating expense savings of approximately $12 million, which primarily included the 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. Though we anticipate quarterly fluctuations in operating leverage over time we anticipate that our operating costs will grow more slowly than our total revenue on an annual basis. As of July 31, 2025, the quarterly and annual spend levels for rental product capital expenditures for fiscal year 2025 under our 2025 Amended Facility were eliminated under the Fourteenth Amendment to the debt facility. See “Note 15 - Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more details.
Previous wording
We use Adjusted EBITDA to assess our operating performance and the operating leverage of our business prior to capital expenditures. We also measure the cash consumption of the business including capital expenditures by assessing net cash used in operating activities and net cash used in investing activities on a combined basis. The 2023 Amended Facility reduced our cash interest payments during fiscal year 2024 and reduced our cash interest payments during fiscal year 2025 relative to the original agreement, which we expect to improve our overall liquidity.
Current wording
We use Adjusted EBITDA to assess our operating performance and the operating leverage of our business prior to capital expenditures. We also measure the cash consumption of the business including capital expenditures by assessing net cash used in operating activities and net cash used in investing activities on a combined basis. See also “Note 3 - Liquidity” and “Note 15 - Subsequent Events” in the Notes to the Condensed Consolidated Financial Statements for more details regarding our 2025 Amended Facility and Recapitalization Transactions, which we expect to improve our overall liquidity.
Previous wording
We continue to take actions to adjust to the changing business environment and related inflationary pressure. For example, in light of potential pricing sensitivity in the current macro-economic environment, we are focused on investing in our customer and delivering even more value to her, and emphasizing the value proposition of our offering in our marketing materials. In addition, we increased wage rates during the first quarter of fiscal year 2025 to attract and retain talent at our fulfillment centers. We expect to continue to be impacted by rising labor costs in the future. Transportation costs decreased as a percentage of revenue in fiscal year 2024 due to higher revenue per order and the benefits of our September 2023 transportation contract with a major national carrier. While we expect to be able to reduce transportation costs as a percentage of revenue for fiscal year 2025, we plan to continue to mitigate longer-term rising costs by seeking to optimize shipping methods and improve contractual and pricing terms; however, unpredictable changes in global trade policies and tariffs or other significant macroeconomic or geopolitical developments may negatively impact our ability to meet our current expectations and objectives. Although we continue to face a challenging and unpredictable environment, we plan to invest in our customers, manage our staffing and further leverage our transportation partners to help to drive growth and efficiencies in our business.
Current wording
We continue to take actions to adjust to the changing business environment and related inflationary pressure. For example, we implemented a price increase for our subscription plans in August 2025 and we remain focused on investing in our customer and delivering even more value to her, and emphasizing the value proposition of our offering in our marketing materials. In addition, we increased wage rates during the first quarter of fiscal year 2025 to attract and retain talent at our fulfillment centers. We expect to continue to be impacted by rising labor costs in the future. Transportation costs decreased as a percentage of revenue in fiscal year 2024 due to higher revenue per order and the benefits of our September 2023 transportation contract with a major national carrier. While we expect to be able to reduce transportation costs as a percentage of revenue for fiscal year 2025, we plan to continue to mitigate longer-term rising costs by seeking to optimize shipping methods and improve contractual and pricing terms; however, unpredictable changes in global trade policies and tariffs or other significant macroeconomic or geopolitical developments may negatively impact our ability to meet our current expectations and objectives. Although we continue to face a challenging and unpredictable environment, we plan to invest in our customers, manage our staffing and further leverage our transportation partners to help to drive growth and efficiencies in our business.
Previous wording
Active Subscribers: Active Subscribers represents the number of subscribers with an active membership as of the last day of any given period and excludes paused subscribers. As of April 30, 2025, we had 147,157 Active Subscribers, slightly higher year-over-year. The increase in Active Subscribers was driven primarily by increased promotional activity and an improvement in retention during the first quarter of fiscal year 2025 as compared to the prior year as we focused on improving our customer experience through increased rental product and the rollout of multiple product improvements.
Current wording
Active Subscribers: Active Subscribers represents the number of subscribers with an active membership as of the last day of any given period and excludes paused subscribers. As of July 31, 2025, we had 146,373 Active Subscribers, an increase from 129,073 as of July 31, 2024. The increase in Active Subscribers was driven primarily by higher subscriber acquisitions, increased promotional activity and an improvement in retention during the second quarter of fiscal year 2025 as compared to the prior year as we focused on improving our customer experience through increased rental product and the rollout of multiple product improvements.
Previous wording
Average Active Subscribers: Average Active Subscribers represents the mean of the beginning of quarter and end of quarter Active Subscribers for a quarterly period; and for other periods, represents the mean of the Average Active Subscribers of every quarter within that period. As of April 30, 2025, we had 133,468 Average Active Subscribers, a decrease from 135,896 as of April 30, 2024. The year over year decline in Average Active Subscribers was primarily due to the lower base of Ending Active Subscribers at the end of fiscal year 2024 compared to fiscal year 2023.
Current wording
Average Active Subscribers: Average Active Subscribers represents the mean of the beginning of quarter and end of quarter Active Subscribers for a quarterly period; and for other periods, represents the mean of the Average Active Subscribers of every quarter within that period. As of July 31, 2025, we had 146,765 Average Active Subscribers, an increase from 137,455 as of July 31, 2024. The year over year increase in Average Active Subscribers was primarily due to the higher base of Ending Active Subscribers at the end of the first quarter of fiscal year 2025 compared to the first quarter of fiscal year 2024, and a higher level of acquisitions, increased promotional activity, and stronger retention in the second quarter of fiscal year 2025 as compared to the prior year.
Previous wording
Gross Profit was $21.9 million for the three months ended April 30, 2025 compared to $28.4 million for the three months ended April 30, 2024, representing Gross Margins of 31.5% and 37.9%, respectively. Gross Profit and Gross Margin for the three months ended April 30, 2025 decreased primarily due to the impact of higher revenue share costs and fulfillment costs as a percentage of sales, partially offset by lower rental product depreciation as a percentage of sales.
Current wording
Gross Profit was $24.3 million for the three months ended July 31, 2025 compared to $32.4 million for the three months ended July 31, 2024, representing Gross Margins of 30.0% and 41.1%, respectively. Gross Profit was $46.2 million for the six months ended July 31, 2025 compared to $60.8 million for the six months ended July 31, 2024, representing Gross Margins of 30.7% and 39.5%, respectively. Gross Profit and Gross Margin for the three and six months ended July 31, 2025 decreased primarily due to the impact of higher revenue share costs and fulfillment costs as a percentage of sales.
Previous wording
Net Loss was $(26.1) million for the three months ended April 30, 2025 compared to $(22.0) million for the three months ended April 30, 2024, representing margins of (37.5)% and (29.3)%, respectively. Net Loss increased year over year primarily due to the impact of higher revenue share costs, other expenses, fulfillment costs and interest expense as a percentage of sales. Adjusted EBITDA was $(1.3) million for the three months ended April 30, 2025 compared to $6.5 million for the three months ended April 30, 2024, representing margins of (1.9)% and 8.7%, respectively. Adjusted EBITDA margin decreased year over year primarily due to higher revenue share and fulfillment costs as a percentage of revenue in addition to lower revenue.
Current wording
Adjusted EBITDA was $3.6 million for the three months ended July 31, 2025 compared to $13.7 million for the three months ended July 31, 2024, representing margins of 4.4% and 17.4%, respectively. Adjusted EBITDA margin decreased year over year primarily due to higher revenue share and fulfillment costs as a percentage of revenue. Adjusted EBITDA was $2.3 million for the six months ended July 31, 2025 compared to $20.2 million for the six months ended July 31, 2024, representing margins of 1.5% and 13.1%, respectively. Adjusted EBITDA margin decreased year over year primarily due to higher revenue share and fulfillment costs as a percentage of revenue in addition to lower revenue.
Previous wording
Subscription and Reserve Rental Revenue. We generate Subscription and Reserve rental revenue from subscription and Reserve rental fees. We recognize subscription fees ratably over the subscription period, commencing on the date the subscriber enrolls in a subscription program. These fees are collected upon enrollment and any revenue from an unrecognized portion of the subscription period is deferred to the following fiscal period. We recognize Reserve fees over the rental period, which starts on the date of delivery of the product to the customer. Reserve orders can be placed up to four months prior to the rental start date (increased from two months prior to the rental start date beginning in June 2024) and the customer’s payment form is charged upon order confirmation. We defer recognizing the rental fees and any related promotions for Reserve rentals until the date of delivery, and then recognize those fees evenly over the four- or eight-day rental period.
Current wording
Subscription and Reserve Rental Revenue. We generate Subscription and Reserve rental revenue from subscription and Reserve rental fees. We recognize subscription fees ratably over the subscription period, commencing on the date the subscriber enrolls in a subscription program. These fees are collected upon enrollment and any revenue from an unrecognized portion of the subscription period is deferred to the following fiscal period. We implemented a price increase for our subscription plans in August 2025, which we expect will generally increase revenue per subscriber over time. We recognize Reserve fees over the rental period, which starts on the date of delivery of the product to the customer. Reserve orders can be placed up to four months prior to the rental start date (increased from two months prior to the rental start date beginning in June 2024) and the customer’s payment form is charged upon order confirmation. We defer recognizing the rental fees and any related promotions for Reserve rentals until the date of delivery, and then recognize those fees evenly over the four- or eight-day rental period.
Previous wording
General and Administrative. General and administrative (“G&A”) expenses consist of all other personnel and related costs for customer service, finance, tax, legal, human resources, fashion and photography and fixed operations costs. General and administrative expenses also includes occupancy costs (including warehouse-related), professional services, credit card fees, general corporate and warehouse expenses, other administrative costs, and gains and losses associated with asset disposals and operating lease terminations. We expect to incur lower fixed cost G&A as a percentage of revenue in the short term due to higher expected revenue driving operating leverage. Over the longer term, these expenses may increase as we grow our infrastructure to support the overall growth of the business. Rent expense and other facilities-related costs may increase in the future due to inflation or to support overall business growth and fulfillment efficiencies. While these expenses may vary from period to period as a percentage of total revenue, we expect them to decrease as a percentage of total revenue over the longer term.
Current wording
General and Administrative. General and administrative (“G&A”) expenses consist of all other personnel and related costs for customer service, finance, tax, legal, human resources, fashion and photography and fixed operations costs. General and administrative expenses also includes occupancy costs (including warehouse-related), professional services, credit card fees, general corporate and warehouse expenses, other administrative costs, and gains and losses associated with asset disposals and operating lease terminations. In fiscal year 2025, we expect G&A expenses to increase in the next several fiscal quarters due to costs relating to the Recapitalization Transactions. We are currently evaluating the impact of the Recapitalization Transactions on our consolidated financial statements. Over the longer term, these expenses may increase as we grow our infrastructure to support the overall growth of the business. Rent expense and other facilities-related costs may increase in the future due to inflation or to support overall business growth and fulfillment efficiencies. While these expenses may vary from period to period as a percentage of total revenue, we expect them to decrease as a percentage of total revenue over the longer term.
Previous wording
Total Revenue, Net. Total revenue, net was $69.6 million for thethree months ended April 30, 2025, a decrease of $(5.4) million, or (7.2)%, compared to $75.0 million for thethree months ended April 30, 2024. This decrease was primarily driven by lower revenue per subscriber, lower Average Active Subscribers, and lower Other Revenue. Infiscal year 2025, we expect revenue to increase as we work towards growing our customer base, improving the customer experience and continuing to focus on our resale revenue.
Current wording
Total Revenue, Net. Total revenue, net was $80.9 million for thethree months ended July 31, 2025, an increase of $2.0 million, or 2.5%, compared to $78.9 million for thethree months ended July 31, 2024. This increase was primarily driven by higher Other revenue and higher Subscription and Reserve rental revenue. Infiscal year 2025, we expect revenue to increase due to higher expected subscription prices and as we work towards growing our customer base, improving the customer experience and continuing to focus on our resale revenue.
Previous wording
Other Revenue. Other revenue was $7.6 million for thethree months ended April 30, 2025, a decrease of $(1.3) million, or (14.6)%, compared to $8.9 million for thethree months ended April 30, 2024. This decrease was primarily driven by a decrease in the items purchased per subscriber, partially offset by an increase in the average selling price per unit. Other revenue represented 10.9% of total revenue, up from 11.9% in the same period last year.
Current wording
Other Revenue. Other revenue was $11.7 million for thethree months ended July 31, 2025, an increase of $1.3 million, or 12.5%, compared to $10.4 million for thethree months ended July 31, 2024. This increase was primarily driven by an increase in the items purchased per subscriber. Other revenue represented 14.5% of total revenue, up from 13.2% in the same period last year.
Previous wording
Fulfillment. Fulfillment expenses were $20.4 million for thethree months ended April 30, 2025, a decrease of $(0.2) million, or (1.0)%, representing 29.3% of revenue, compared to $20.6 million for thethree months ended April 30, 2024, representing 27.5% of revenue. The increase in fulfillment expenses as a percentage of revenue was primarily driven by higher transportation costs due to carrier rate increases.
Current wording
Fulfillment. Fulfillment expenses were $22.5 million for thethree months ended July 31, 2025, an increase of $1.9 million, or 9.2%, representing 27.8% of revenue, compared to $20.6 million for thethree months ended July 31, 2024, representing 26.1% of revenue. The increase in fulfillment expenses as a percentage of revenue was primarily driven by higher transportation costs due to carrier rate increases and higher warehouse processing costs.
Previous wording
In fiscal year 2025, we expect fulfillment expenses as a percentage of total revenue to decrease compared to fiscal year 2024 as a result of anticipated higher revenue per order and continued processing efficiencies.
Current wording
In fiscal year 2025, we expect fulfillment expenses as a percentage of total revenue to decrease compared to fiscal year 2024 as a result of anticipated higher revenue per order.
Previous wording
Marketing. Marketing expenses were $8.6 million for the three months ended April 30, 2025, a decrease of $(0.4) million, or (4.4)%, compared to $9.0 million for the three months ended April 30, 2024. This decrease was driven primarily by lower personnel related costs. Marketing expenses unrelated to personnel costs were $7.9 million in the three months ended April 30, 2025 and 11.4% of revenue, compared to $8.2 million and 10.9% of total revenue for the same period last year.
Current wording
Marketing. Marketing expenses were $7.4 million for the three months ended July 31, 2025, a decrease of $(0.4) million, or (5.1)%, compared to $7.8 million for the three months ended July 31, 2024. This decrease was driven primarily by lower consulting costs and lower brand marketing expenses. Marketing expenses unrelated to personnel costs were $6.5 million in the three months ended July 31, 2025 and 8.0% of revenue, compared to $7.1 million and 9.0% of total revenue for the same period last year.
Previous wording
Rental Product Depreciation and Revenue Share. Rental product depreciation and revenue share was $27.3 million for thethree months ended April 30, 2025, an increase of $1.3 million, or 5.0%, compared to $26.0 million for thethree months ended April 30, 2024. The increase was primarily driven by higher Share by RTR units acquired and the higher base of rental product. Rental product depreciation and revenue share was 39.2% of revenue in the three months ended April 30, 2025, up from 34.7% in the same period last year primarily due tothe factors discussed above.
Current wording
Rental Product Depreciation and Revenue Share. Rental product depreciation and revenue share was $34.1 million for thethree months ended July 31, 2025, an increase of $8.2 million, or 31.7%, compared to $25.9 million for thethree months ended July 31, 2024. The increase was primarily driven by higher Share by RTR units acquired. Rental product depreciation and revenue share was 42.2% of revenue in the three months ended July 31, 2025, up from 32.8% in the same period last year primarily due tothe factors discussed above.
Previous wording
Other Depreciation and Amortization. Other depreciation and amortization was $2.7 million for thethree months ended April 30, 2025, a decrease of $(0.6) million, or (18.2)%, compared to $3.3 million for the three months ended April 30, 2024. This decrease was primarily driven by lower depreciation and amortization associated with machinery and equipment.
Current wording
Other Depreciation and Amortization. Other depreciation and amortization was $2.6 million for thethree months ended July 31, 2025, a decrease of $(0.7) million, or (21.2)%, compared to $3.3 million for the three months ended July 31, 2024. This decrease was primarily driven by lower depreciation and amortization associated with machinery and equipment.
Previous wording
Interest Income / (Expense), Net. Interest expense, net was $(6.3) million for thethree months ended April 30, 2025, an increase in expense of $0.7 million, or 12.5%, compared to $(5.6) million for thethree months ended April 30, 2024. This increase was driven by higher paid-in-kind (“PIK”) interest from the 2025 Amended Facility and lower interest earned. Of the $(6.3) million total interest expense in the three months ended April 30, 2025, $0.6 million was the net of interest earned, financing lease and other interest and $(6.9) million was debt discount amortization, compared to $0.8 million net of cash interest, interest earned, financing lease and other interest and $(6.4) million of debt discount amortization in the three months ended April 30, 2024.
Current wording
Interest Income / (Expense), Net. Interest expense, net was $(6.9) million for thethree months ended July 31, 2025, an increase in expense of $0.9 million, or 15.0%, compared to $(6.0) million for thethree months ended July 31, 2024. This increase was driven by higher interest from the 2025 Amended Facility, and lower interest earned partially offset by lower debt discount amortization. Of the $(6.9) million total interest expense in the three months ended July 31, 2025, $(7.2) million of PIK interest, $(3.6) million was the net of cash interest earned, financing lease and other interest and $3.9 million was debt discount amortization, compared to $0.7 million net of cash interest earned, financing lease and other interest and $(6.7) million of debt discount amortization in the three months ended July 31, 2024.
Previous wording
Other Income / (Expense), Net. Other income / (expense), net was $0.1 million for the three months ended April 30, 2025, unchanged from $0.1 million for the three months ended April 30, 2024.
Current wording
Other Income / (Expense), Net. Other income / (expense), net was $0.6 million for the three months ended July 31, 2025 compared to $0.1 million for the three months ended July 31, 2024.
Previous wording
Subscription and Reserve Rental Revenue. Subscription and Reserve rental revenue was $62.0 million for thethree months ended April 30, 2025, a decrease of $(4.1) million, or (6.2)%, compared to $66.1 million for thethree months ended April 30, 2024. This decrease was primarily driven by lower revenue per subscriber and lower Average Active Subscribers. The decrease in revenue per subscriber was driven primarily by higher promotional spending.
Current wording
Subscription and Reserve Rental Revenue. Subscription and Reserve rental revenue was$131.2 million for thesix months ended July 31, 2025, adecrease of$(3.4) million, or(2.5)%, compared to$134.6 million for thesix months ended July 31, 2024. This decrease was primarily driven by lower average revenue per subscriber partially offset by higher average subscribers and lower Reserve rental revenue.The decrease in revenue per subscriber was driven primarily by higher promotional spending and the impact of changes in program mix of active subscribers.
Previous wording
Costs and Expenses. Total costs and expenses were $89.3 million for thethree months ended April 30, 2025, a decrease of $(2.2) million, or (2.4)%, comp ared to $91.5 million for thethree months ended April 30, 2024. This decrease was primarily driven by lower General & Administrative costs partially offset by higher Rental Product Depreciation and Revenue Share costs.
Current wording
Costs and Expenses. Total costs and expenses were $190.3 million for thesix months ended July 31, 2025, anincrease of $10.3 million, or 5.7%, comp ared to $180.0 million for thesix months ended July 31, 2024. This increase was primarily driven by higher Rental Product Depreciation and Revenue Share costs partially offset by lower General & Administrative costs.
Previous wording
General and Administrative. General and administrative (“G&A”) expenses were $20.7 million for the three months ended April 30, 2025, a decrease of $(2.1) million, or (9.2)%, compared to $22.8 million for the three months ended April 30, 2024. This decrease was driven primarily by lower share-based compensation expense, gain on the liquidation of rental product and exchange rate and cost savings from the January 2024 restructuring plan. G&A expenses as a percentage of revenue were 29.7%, compared to 30.4% last year, as we saw increased operating leverage with a lower cost base post-restructuring. G&A related share-based compensation expense was $1.2 million for the three months ended April 30, 2025 and was $2.4 million for the three months ended April 30, 2024.
Current wording
General and Administrative. General and administrative (“G&A”) expenses were $45.3 million for the six months ended July 31, 2025, an increase of $0.3 million, or 0.7%, compared to $45.0 million for the six months ended July 31, 2024. This increase was driven primarily by transaction related expenses partially offset by lower share-based compensation expense, gain on the liquidation of rental product and exchange rate and cost savings from the January 2024 restructuring plan. G&A expenses as a percentage of revenue were 30.1%, compared to 29.2% last year, as we saw increased operating leverage with a lower cost base post-restructuring. G&A related share-based compensation expense was $2.4 million for the six months ended July 31, 2025 and was $4.3 million for the six months ended July 31, 2024.
Previous wording
Restructuring Charges. Restructuring charges were $0.2 million for the three months ended April 30, 2024 for severance and related costs in connection with the January 2024 restructuring plan. These charges are reflected in Restructuring charges on our Consolidated Statement of Operations.
Current wording
Restructuring Charges. Restructuring charges were $0.2 million for the six months ended July 31, 2024 for severance and related costs in connection with the January 2024 restructuring plan. These charges are reflected in Restructuring charges on our Consolidated Statement of Operations.
Previous wording
Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin are key performance measures used by management to assess our operating performance and the operating leverage of our business prior to capital expenditures. Net Loss was $(26.1) million for the three months ended April 30, 2025 compared to $(22.0) million for the three months ended April 30, 2024. Net Loss as a percentage of revenue was (37.5)%, and (29.3)% for the three months ended April 30, 2025 and 2024, respectively, and included $0.2 million of restructuring and related charges during the three months ended April 30, 2024. Net Loss increased year over year primarily due to the impact of higher revenue share costs, other expenses, fulfillment costs and interest expense as a percentage of sales. Our Adjusted EBITDA was $(1.3) million for the three months ended April 30, 2025 compared to $6.5 million for the three months ended April 30, 2024, representing margins of (1.9)% and 8.7%, respectively. Adjusted EBITDA Margin decreased for the three months ended April 30, 2025 primarily due to higher revenue share and fulfillment costs as a percentage of revenue in addition to lower revenue.
Current wording
Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin are key performance measures used by management to assess our operating performance and the operating leverage of our business prior to capital expenditures. Net Loss was $(26.4) million for the three months ended July 31, 2025 compared to $(15.6) million for the three months ended July 31, 2024. Net Loss as a percentage of revenue was (32.6)%, and (19.8)% for the three months ended July 31, 2025 and 2024, respectively. Net Loss was $(52.5) million for the six months ended July 31, 2025 compared to $(37.6) million for the six months ended July 31, 2024. Net Loss as a percentage of revenue was (34.9)%, and (24.4)% for the six months ended July 31, 2025 and 2024, respectively, and included $0.2 million of restructuring and related charges during the six months ended July 31, 2024. Net Loss for the three months ended July 31, 2025 increased year over year primarily due to the impact of higher revenue share costs, G&A expenses, fulfillment costs, technology costs, and a reduction in Other Income, partially offset by an increase in Revenue. Net Loss for the six months ended July 31, 2025 increased year over year primarily due to the impact of higher revenue share costs, lower revenue, higher fulfillment costs, higher interest expense and higher technology costs versus the prior year, partially offset by lower rental product depreciation and write-offs, other depreciation and amortization and marketing expense.
Previous wording
(1)Includes debt discount amortization of $6.9 million in the three months ended April 30, 2025 and $6.4 million in the three months ended April 30, 2024.
Current wording
(1)Includes debt discount amortization of $(3.9) million in the three months ended July 31, 2025, $6.7 million in the three months ended July 31, 2024, $3.0 million in the six months ended July 31, 2025 and $13.1 million in the six months ended July 31, 2024.
Previous wording
(5)Non-ordinary course legal fees for the three months ended April 30, 2025 includes $0.6 million of costs related to securities lawsuits and non-recurring legal fees.
Current wording
(6)Non-ordinary course legal fees for the three and six months ended July 31, 2025 includes $1.4 million and $2.0 million of costs related to securities lawsuits and non-recurring legal fees including transaction related costs.
Previous wording
(6)Reflects restructuring charges primarily related to severance and related costs in connection with the January 2024 restructuring plan.
Current wording
(7)Reflects restructuring charges primarily related to severance and related costs in connection with the January 2024 restructuring plan.
Previous wording
(7)Includes other (income) / expense recognized in the period.
Current wording
(8)Includes other (income) / expense recognized in the period.
Previous wording
(8)Includes gains / losses recognized in relation to foreign exchange, operating lease terminations and the related surrender of fixed assets (see “Note 5 - Leases – Lessee Accounting” in the Notes to the Condensed Consolidated Financial Statements).
Current wording
(9)Includes gains / losses recognized in relation to foreign exchange, operating lease terminations and the related surrender of fixed assets (see “Note 5 - Leases – Lessee Accounting” in the Notes to the Condensed Consolidated Financial Statements).
Showing the first 40 of 54 pairs. Open the source sections for the rest.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Wehave achieved the following operating and financial results for the six months ended July 31, 2025 and 2024, respectively:
Current report — wording carried from elsewhere
Total Revenue, Net. Total revenue, net was $150.5 million for thesix months ended July 31, 2025, adecrease of$(3.4) million, or(2.2)%, compared to $153.9 million for thesix months ended July 31, 2024. This decrease was primarily driven by lower Subscription and Reserve rental revenue. Infiscal year 2025, we expect revenue to increase due to higher expected subscription prices and as we work towards growing our customer base, improving the customer experience and continuing to focus on our resale revenue.
Current report — wording carried from elsewhere
In fiscal year 2025, we expect fulfillment expenses as a percentage of total revenue to decrease compared to fiscal year 2024 as a result of anticipated higher revenue per order.
Current report — wording carried from elsewhere
In fiscal year 2025, we expect technology expenses to decrease as a percentage of total revenue compared to fiscal year 2024 as a result of improved operating leverage due to higher expected revenue.
Current report — wording carried from elsewhere
In fiscal year 2025, we expect marketing expenses to decrease as a percentage of total revenue compared to fiscal year 2024. The timing of our marketing expenses during the year will depend in part on the timing of marketing campaigns.
Current report — wording carried from elsewhere
Interest Income / (Expense), Net. Interest expense, net was$(13.2) million for thesix months ended July 31, 2025, anincrease in expense of$1.6 million, or 13.8%, compared to $(11.6) million for thesix months ended July 31, 2024. This increase was driven by higher interest from the 2025 Amended Facility and lower interest earned partially offset by lower debt discount amortization. Of the $(13.2) million total interest expense in the six months ended July 31, 2025, $(7.2) million of PIK interest, $(3.0) million was the net of interest earned, financing lease and other interest and $(3.0) million was debt discount amortization, compared to $1.5 million net of interest earned, financing lease and other interest and ($13.1) million of debt discount amortization in the six months ended July 31, 2024.