Rent the Runway, Inc.

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 3.5 million lifetime customers across all of our offerings and we had 196,147 ending Total Subscribers 1 (active and paused) as of April 30, 2026. We had 155,692 Active Subscribers as of April 30, 2026. The majority of our revenue is highly recurring and is generated by our subscribers. For the three months ended April 30, 2026 and 2025, respectively, 90% 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 3.5 million lifetime customers across all of our offerings and we had 186,019 ending Total Subscribers 1 (active and paused) as of July 31, 2026. We had 140,826 Active Subscribers as of July 31, 2026. The majority of our revenue is highly recurring and is generated by our subscribers. For the six months ended July 31, 2026 and 2025, respectively, 90% and 89% of our total revenue (including Reserve and Resale revenue) was generated by subscribers while they were active or paused.

Previous wording

The variety, breadth and quantity of products we carry is important to our business, and we strategically manage the capital efficient acquisition of a high volume of items every year. We have successfully disproved the myth that fashion apparel items and accessories only last one season as we are able to rent or “turn” our products multiple times over many years. We price our rental items at a fraction of their retail or comparable value, creating an attractive price and value proposition for our subscribers and customers.

Current wording

The variety, breadth and quantity of products we carry is important to our business, and we strategically manage the capital efficient acquisition of a high volume of items every year. The fashion apparel items and accessories we offer often last beyond one season as we are able to rent or “turn” our products multiple times over multiple years. We price our rental items at a fraction of their retail or comparable value, aiming to create an attractive price and value proposition for our subscribers and customers.

Previous wording

Key Fiscal First Quarter and Recent Business Highlights:

Current wording

Key Fiscal Second Quarter and Recent Business Highlights:

Previous wording

•155,692 and 147,157 ending Active Subscribers 2, respectively, representing an increase of 5.8% year-over-year;

Current wording

•140,826 and 146,373 ending Active Subscribers 2, respectively, representing a change of (3.8)% year-over-year;

Previous wording

•149,744 and 133,468 Average Active Subscribers 3, respectively, representing an increase of 12.2% year-over-year;

Current wording

•148,259 and 146,765 Average Active Subscribers 3, respectively, representing an increase of 1.0% year-over-year;

Previous wording

•196,147 and 182,209 ending Total Subscribers (including paused subscribers), respectively, representing an increase of 7.6% year-over-year;

Current wording

•186,019 and 185,102 ending Total Subscribers (including paused subscribers), respectively, representing an increase of 0.5% year-over-year;

Previous wording

•Gross Profit was $23.3 million and $21.9 million, respectively, representing a gross margin of 25.9% and 31.5%, respectively;

Current wording

•Gross Profit was $35.3 million and $24.3 million, respectively, representing a gross margin of 36.1% and 30.0%, respectively;

Previous wording

•Adjusted EBITDA was $(0.8) million and $(1.3) million, respectively, representing an Adjusted EBITDA margin of (0.9)% and (1.9)%, respectively;

Current wording

•Adjusted EBITDA was $12.6 million and $3.6 million, respectively, representing an Adjusted EBITDA Margin of 12.9% and 4.4%, respectively.

Previous wording

•Net cash (used in) provided by financing activities was $(0.2) million and $(0.7) million, respectively;

Current wording

•Net cash (used in) provided by financing activities was $(0.3) million and $(1.4) million, respectively;

Previous wording

•Net cash (used in) provided by operating activities as a percentage of revenue was (4.2)% and 11.9% and net cash used in investing activities as a percentage of revenue was (10.9)% and (21.1)%, respectively; and

Current wording

•Net cash (used in) provided by operating activities as a percentage of revenue was (2.7)% and (1.5)% and net cash used in investing activities as a percentage of revenue was (8.8)% and (20.4)%, respectively; and

Previous wording

We acquire and monetize products in three ways: Wholesale, Share by RTR and Exclusive Designs. Wholesale items are acquired directly from brand partners, typically at a discount to Wholesale price. Share by RTR items are acquired directly from brand partners on consignment, at zero or a fraction of the Wholesale cost with performance-based revenue share payments to our brand partners over time. Exclusive Designs items are designed using our data in collaboration with our brand partners. These units are manufactured through third-party partners with an upfront fee and, in most cases, minimal revenue share payments to our brand partners over time.

Current wording

We acquire and monetize products in three primary ways: Wholesale, Share by RTR and Exclusive Designs. Wholesale items are acquired directly from brand partners, typically at a discount to Wholesale price. Share by RTR items are acquired directly from brand partners on consignment, at zero or a fraction of the Wholesale cost with performance-based revenue share payments to our brand partners over time. Exclusive Designs items are designed using our data in collaboration with our brand partners. These units are manufactured through third-party partners with an upfront fee and, in most cases, minimal revenue share payments to our brand partners over time.

Previous wording

In fiscal year 2025, 31% of new items were acquired through Wholesale, 57% through Share by RTR and 12% through Exclusive Designs, compared to 30% Wholesale, 48% Share by RTR and 22% Exclusive Designs in fiscal year 2024. In total, approximately 69% of new items were acquired through Share by RTR and Exclusive Designs, our more capital-efficient channels in fiscal year 2025 and approximately 70% in fiscal year 2024. 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 plan to acquire fewer rental product units year-over-year in fiscal year 2026 and we expect the total percentage of units acquired through our more capital-efficient channels to increase in fiscal year 2026 versus fiscal year 2025, with an increase in the percentage of units acquired through our Share by RTR and Exclusive Designs programs versus fiscal year 2025. 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 lower capital expenditures for purchases of rental product in fiscal year 2026 relative to fiscal year 2025 primarily due to a lower proportion of rental product acquired through Wholesale in fiscal year 2026.

Current wording

In fiscal year 2025, 31% of new items were acquired through Wholesale, 57% through Share by RTR and 12% through Exclusive Designs, compared to 30% Wholesale, 48% Share by RTR and 22% Exclusive Designs in fiscal year 2024. In total, approximately 69% of new items were acquired through Share by RTR and Exclusive Designs, our more capital-efficient channels in fiscal year 2025 and approximately 70% in fiscal year 2024. 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 plan to acquire fewer rental product units year-over-year in fiscal year 2026 and we expect the total percentage of units acquired through our more capital-efficient channels to increase in fiscal year 2026 versus fiscal year 2025, with an increase in the percentage of units acquired through our Share by RTR and Exclusive Designs programs versus fiscal year 2025. We expect to incur lower capital expenditures for purchases of rental product in fiscal year 2026 relative to fiscal year 2025 primarily due to a lower proportion of rental product acquired through Wholesale in fiscal year 2026.

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. We are focused on our community-driven organic growth marketing strategy that is intended to drive improved brand awareness and acquisition. Our acquisitions are also reliant on new customer promotions. Our promotional strategy is subject to change depending on business and market conditions.

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 product. In the second half of fiscal year 2026, we are focused on prioritizing paid marketing optimization and efficiency. Our acquisitions are also reliant on new customer promotions. Our promotional strategy is subject to change depending on business and market conditions.

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. 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.

Current wording

Ability to Achieve Leverage in our Cost Structure. Improving operational efficiency of our platform is imperative to improving 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. 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.

Previous wording

Over time, we expect to improve our margins, profitability and cash flow, and we believe we will continue to benefit from economies of scale. We are focused on driving additional efficiencies in our operating expenses and growing profitability to also cover rental product depreciation, in addition to fulfillment, revenue share and operating expenses.

Current wording

Over time, we expect to improve our margins, profitability and cash flow, and we believe we will continue to benefit from economies of scale. We are focused on driving additional efficiencies in our operating expenses and improving profitability to also cover rental product depreciation, in addition to fulfillment, revenue share and operating expenses.

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, 2026, we had 155,692 Active Subscribers, an increase from 147,157 as of April 30, 2025. The increase in Active Subscribers was driven primarily by a higher base of active subscribers at the end of the fourth quarter of fiscal year 2025 compared to the fourth quarter of fiscal year 2024, in addition to higher subscriber acquisitions partially offset by a year-over-year increase in the rate of pause and year-over-year decrease in retention.

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, 2026, we had 140,826 Active Subscribers, a decrease from 146,373 as of July 31, 2025. The decrease in Active Subscribers was driven primarily by a year-over-year increase in the rate of pause and a year-over-year decrease in the number of subscribers acquired, partially offset by a higher base of active subscribers at the end of the first quarter of fiscal year 2026 compared to the first quarter of fiscal year 2025, in addition to a year-over-year increase in retention.

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, 2026, we had 149,744 Average Active Subscribers, an increase from 133,468 as of April 30, 2025. The year-over-year increase in Average Active Subscribers was primarily due to a higher base of active subscribers at the end of the fourth quarter of fiscal year 2025 compared to the fourth quarter of fiscal year 2024, in addition to higher subscriber acquisitions partially offset by a year-over-year increase in the rate of pause and year-over-year decrease in retention.

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, 2026, we had 148,259 Average Active Subscribers, an increase from 146,765 as of July 31, 2025. The year-over-year increase in Average Active Subscribers was primarily due to a higher base of active subscribers at the end of the first quarter of fiscal year 2026 compared to the first quarter of fiscal year 2025, partially offset by a lower base of active subscribers at the end of the second quarter of fiscal year 2026 compared to the second quarter of fiscal year 2026.

Previous wording

Gross Profit was $23.3 million for the three months ended April 30, 2026 compared to $21.9 million for the three months ended April 30, 2025, representing Gross Margins of 25.9% and 31.5%, respectively. Gross Profit for the three months ended April 30, 2026 increased primarily due to higher Revenue partially offset by higher Rental Product Depreciation and Revenue Share costs, as well as higher Fulfillment expenses. Gross Margin for the three months ended April 30, 2026 decreased primarily due to higher Rental Product Depreciation and Revenue Share costs as a percentage of Revenue partially offset by lower Fulfillment costs as a percentage of Revenue.

Current wording

Gross Profit was $35.3 million for the three months ended July 31, 2026 compared to $24.3 million for the three months ended July 31, 2025, representing Gross Margins of 36.1% and 30.0%, respectively. Gross Profit was $58.6 million for the six months ended July 31, 2026 compared to $46.2 million for the six months ended July 31, 2025, representing Gross Margins of 31.2% and 30.7%, respectively. Gross Profit for the three and six months ended July 31, 2026 increased primarily due to higher Revenue partially offset by higher Rental Product Depreciation and Revenue Share costs, as well as higher Fulfillment expenses. Gross Margin for the three months ended July 31, 2026 increased because of lower Fulfillment costs and lower Rental Product Deprecation and Revenue Share costs as a percentage of Revenue. Gross Margin for the six months ended July 31, 2026 increased primarily due to lower Fulfillment costs as a percentage of revenue partially offset by higher Rental Product Depreciation and Revenue Share costs as a percentage of Revenue.

Previous wording

Adjusted EBITDA and Adjusted EBITDA Margin: We define Adjusted EBITDA as net loss, adjusted to exclude interest expense, rental product depreciation, other depreciation and amortization, share-based compensation expense, write-off of liquidated assets, non-recurring adjustments, non-ordinary course legal expenses, income tax (benefit) expense, other income and expense, and other gains / losses. Adjusted EBITDA margin is defined as Adjusted EBITDA calculated as a percentage of total revenue, net for a period.

Current wording

Adjusted EBITDA and Adjusted EBITDA Margin: We define Adjusted EBITDA as net loss, adjusted to exclude interest expense, rental product depreciation, other depreciation and amortization, share-based compensation expense, write-off of liquidated assets, non-recurring adjustments, non-ordinary course legal expenses, non-ordinary course executive transition costs, income tax (benefit) expense, other income and expense, and other gains / losses. Adjusted EBITDA margin is defined as Adjusted EBITDA calculated as a percentage of total revenue, net for a period.

Previous wording

Net Loss was $(18.9) million for the three months ended April 30, 2026 compared to $(26.1) million for the three months ended April 30, 2025, representing margins of (21.0)% and (37.5)%, respectively. Net Loss decreased year-over-year primarily due to lower reported Interest Expense, higher Gross Profit, and lower Marketing and Technology costs partially offset by higher General and Administrative expenses. Adjusted EBITDA was $(0.8) million for the three months ended April 30, 2026 compared to $(1.3) million for the three months ended April 30, 2025, representing margins of (0.9)% and (1.9)%, respectively. Adjusted EBITDA increased year-over-year primarily due to higher Revenue partially offset by higher Revenue Share costs within Rental Product Depreciation and Revenue Share, Fulfillment costs, and higher General and Administrative Expenses. Adjusted EBITDA Margin increased year-over-year primarily due to lower Technology, Marketing, and General and Administrative expenses as a percentage of Revenue partially offset by higher Revenue Share expenses as a percentage of Revenue.

Current wording

Adjusted EBITDA was $12.6 million for the three months ended July 31, 2026 compared to $3.6 million for the three months ended July 31, 2025, representing margins of 12.9% and 4.4%, respectively. Adjusted EBITDA increased year-over-year primarily due to higher Revenue partially offset by higher Revenue Share costs within Rental Product Depreciation and Revenue Share and higher Fulfillment costs. Adjusted EBITDA Margin increased year-over-year primarily due to lower General and Administrative, Fulfillment, Technology, and Marketing expenses as a percentage of Revenue partially offset by higher Revenue Share expenses as a percentage of Revenue. Adjusted EBITDA was $11.8 million for the six months ended July 31, 2026 compared to $2.3 million for the six months ended July 31, 2025, representing margins of 6.3% and 1.5%, respectively. Adjusted EBITDA increased year-over-year primarily due to higher Revenue partially offset by higher Revenue Share costs within Rental Product Depreciation and Revenue Share and higher General and Administrative Expenses. Adjusted EBITDA Margin increased year-over-year primarily due to lower General and Administrative, Fulfillment, Technology, and Marketing expenses as a percentage of Revenue partially offset by higher Revenue Share expenses as a percentage of Revenue.

Previous wording

Subscription and Reserve Rental Revenue. We generate Subscription and Reserve rental revenue from Subscription and Reserve rental fees. The majority of our revenue is generated by our Subscription offering, which we are prioritizing. 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 increased revenue per subscriber in the third quarter of fiscal year 2025 and which we expect will continue to do so over the coming quarters. We also implemented a shipping charge for subscription plans in June 2026 which we expect to be temporary. This charge is expected to increase revenue per subscriber beginning in Q2 2026. 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 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. The majority of our revenue is generated by our Subscription offering. 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 increased revenue per subscriber in the third quarter of fiscal year 2025 and subsequent quarters. We also implemented a shipping charge for Subscription plans in June 2026 which we expect to be temporary. This charge increased revenue per subscriber beginning in Q2 2026. 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 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

Other Revenue. We generate Other revenue primarily from the sale of products while they are in rental condition. We offer the ability for subscribers and customers to purchase products at a discount to retail price. Payment for the sale of products occurs upon order confirmation while the associated revenue is recognized either at the time the sold product is delivered or when purchased, if the item is already at home with the customer. From time to time, Other revenue may include revenue generated from pilots and other growth and business development initiatives which may cause quarterly fluctuations in the Other revenue line.

Current wording

Other Revenue. We generate Other revenue primarily from our Resale offering, i.e., the sale of products while they are in rental condition. We offer the ability for subscribers and customers to purchase products at a discount to retail price. Payment for the sale of products occurs upon order confirmation while the associated revenue is recognized either at the time the sold product is delivered or when purchased, if the item is already at home with the customer. From time to time, Other revenue may include revenue generated from pilots and other growth and business development initiatives which may cause quarterly fluctuations in the Other revenue line.

Previous wording

Other Income / (Expense). Other income / (expense) consists primarily of proceeds from monetizing tax credits associated with growth and Irish refundable tax credits.

Current wording

Other Income / (Expense). Other income / (expense) consists primarily of recoveries on lost shipments and tax credits.

Previous wording

Total Revenue, Net. Total revenue, net was $89.9 million for thethree months ended April 30, 2026, an increase of $20.3 million, or 29.2%, compared to $69.6 million for thethree months ended April 30, 2025. This increase was driven by higher Subscription and Reserve rental revenue and higher Other revenue. Infiscal year 2026, we expect revenue to increase due to higher Subscription prices and a larger subscription customer base due to a particular focus on increasing our Active Subscribers year-over-year.

Current wording

Total Revenue, Net. Total revenue, net was $97.7 million for thethree months ended July 31, 2026, an increase of $16.8 million, or 20.8%, compared to $80.9 million for thethree months ended July 31, 2025. This increase was driven by higher Subscription and Reserve rental revenue and higher Other revenue. Infiscal year 2026, we expect revenue to increase due to higher Subscription prices and a larger Subscription customer base due to a particular focus on increasing our Active Subscribers year-over-year.

Previous wording

Subscription and Reserve Rental Revenue. Subscription and Reserve rental revenue was $77.7 million for thethree months ended April 30, 2026, an increase of $15.7 million, or 25.3%, compared to $62.0 million for thethree months ended April 30, 2025. This increase was primarily driven by higher revenue per subscriber and higher average active subscribers, partially offset by lower Reserve rental revenue.

Current wording

Subscription and Reserve Rental Revenue. Subscription and Reserve rental revenue was $83.8 million for thethree months ended July 31, 2026, an increase of $14.6 million, or 21.1%, compared to $69.2 million for thethree months ended July 31, 2025. This increase was primarily driven by higher revenue per subscriber and higher average Active Subscribers, partially offset by lower Reserve rental revenue.

Previous wording

Other Revenue. Other revenue was $12.2 million for thethree months ended April 30, 2026, an increase of$4.6 million, or 60.5%, compared to $7.6 million for thethree months ended April 30, 2025. This increase was primarily driven by higher items purchased per Average Active Subscriber, higher average selling price per item and higher Average Active Subscribers. Other revenue represented 13.6% of total revenue, compared to 10.9% in the same period last year.

Current wording

Other Revenue. Other revenue was $13.9 million for thethree months ended July 31, 2026, an increase of $2.2 million, or 18.8%, compared to $11.7 million for thethree months ended July 31, 2025. This increase was primarily driven by an increase in items purchased per Average Active Subscriber, higher average selling price per item and higher Average Active Subscribers. Other revenue represented 14.2% of total revenue, compared to 14.5% in the same period last year.

Previous wording

Other Depreciation and Amortization. Other depreciation and amortization was $2.2 million for thethree months ended April 30, 2026, a decrease of $(0.5) million, or (18.5)%, compared to $2.7 million for the three months ended April 30, 2025. 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 $2.1 million for thethree months ended July 31, 2026, a decrease of $(0.5) million, or (19.2)%, compared to $2.6 million for the three months ended July 31, 2025. 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 $(0.3) million for thethree months ended April 30, 2026, a decrease in expense of $6.0 million, or (95.2)%, compared to $(6.3) million for thethree months ended April 30, 2025. The decrease was driven by reduced interest expense following the New Credit Agreement, as the modification of the existing debt, which was part of the October 2025 recapitalization transactions, was accounted for as a troubled debt restructuring. This decrease was partially offset by interest expense recognized on the new term loans issued to Nexus and STORY3 as part of the recapitalization transactions and lower interest income. Of the $(0.3) million total interest expense in the three months ended April 30, 2026, $2.2 million related to debt premium amortization, $(2.7) million related to paid-in-kind interest, and $0.2 million was the net of interest earned, financing lease and other interest, compared to $0.6 million of the net of cash interest, interest earned, financing lease and other interest and $(6.9) million of debt discount amortization in the three months ended April 30, 2025.

Current wording

Interest Income / (Expense), Net. Interest expense, net was $(0.2) million for thethree months ended July 31, 2026, a decrease in expense of $6.7 million, or (97.1)%, compared to $(6.9) million for thethree months ended July 31, 2025. The decrease was driven by reduced interest expense following the New Credit Agreement, as the modification of the existing debt, which was part of the October 2025 recapitalization transactions, was accounted for as a troubled debt restructuring. This decrease was partially offset by interest expense recognized on the new term loans issued to Nexus and STORY3 as part of the recapitalization transactions, interest expense recognized as a result of the Second Amendment to the New Credit Agreement, and lower interest income. Of the $(0.2) million total interest expense in the three months ended July 31, 2026, $2.3 million related to debt premium amortization, $(2.7) million related to paid-in-kind interest, and $0.2 million was the net of interest earned, financing lease and other interest, compared to $(7.2) million related to paid-in-kind interest, $(3.6) million of the net of cash interest, interest earned, financing lease and other interest and $3.9 million of debt discount amortization in the three months ended July 31, 2025.

Previous wording

Other Income / (Expense), Net. Other income / (expense), net was $1.1 million for the three months ended April 30, 2026, an increase from $0.1 million for the three months ended April 30, 2025 primarily due to tax credits and recoveries on lost shipments.

Current wording

Other Income / (Expense), Net. Other income / (expense), net was $1.3 million for the three months ended July 31, 2026, an increase from $0.6 million for the three months ended July 31, 2025 primarily due to tariff refunds and recoveries on lost shipments.

Previous wording

Costs and Expenses. Total costs and expenses were $109.6 million for thethree months ended April 30, 2026, an increase of $20.3 million, or 22.7%, comp ared to $89.3 million for thethree months ended April 30, 2025. This increase was primarily driven by higher Rental Product Depreciation and Revenue Share costs, higher Fulfillment costs, higher G&A costs, partially offset by lower Marketing, Other Depreciation & Amortization and Technology costs.

Current wording

Costs and Expenses. Total costs and expenses were $215.1 million for the six months ended July 31, 2026, an increase of $24.8 million, or 13.0%, compared to $190.3 million for the six months ended July 31, 2025. This increase was driven by higher Rental Product Depreciation and Revenue Share costs, higher Fulfillment expenses, and higher G&A expenses, partially offset by lower Other Depreciation and Amortization costs, Marketing expenses and Technology expenses.

Previous wording

Fulfillment. Fulfillment expenses were $23.6 million for thethree months ended April 30, 2026, an increase of $3.2 million, or 15.7%, representing 26.3% of revenue, compared to $20.4 million for thethree months ended April 30, 2025, representing 29.3% of revenue. The increase in fulfillment dollars wasprimarily driven by an increase in orders due to higher average active subscribers, higher transportation costs due to carrier rate increases, and increases in warehouse processing costs. Fulfillment costs decreased as a percentage of revenue due primarily to higher revenue per order partially offset by higher transportation and processing costs per order.

Current wording

Fulfillment. Fulfillment expenses were$47.1 million for thesix months ended July 31, 2026, anincrease of$4.2 million, or 9.8%, representing 25.1% of revenue, compared to $42.9 million for thesix months ended July 31, 2025, representing 28.5% of revenue. The increase in fulfillment dollars wasprimarily driven by an increase in orders due to higher average active subscribers, higher transportation costs due to carrier rate increases, and increases in warehouse processing costs. Fulfillment costs decreased as a percentage of revenue due primarily to higher revenue per order partially offset by higher transportation and processing costs per order.

Previous wording

Technology. Technology expenses were $9.4 million for thethree months ended April 30, 2026, adecrease of$(0.2) million, or(2.1)%, compared to $9.6 million for thethree months ended April 30, 2025. Technology expenses were 10.5% of revenue for the three months ended April 30, 2026 compared to 13.8% for the same period last year primarily due to operating leverage from higher Revenue. Technology related share-based compensation expense was $0.2 million for the three months ended April 30, 2026 and was $0.3 million for the same period last year.

Current wording

Technology. Technology expenses were$19.2 million for thesix months ended July 31, 2026, adecrease of$(0.2)million, or(1.0)%, compared to $19.4 million for thesix months ended July 31, 2025. Technology expenses were 10.2% of revenue for the six months ended July 31, 2026 compared to 12.9% for the same period last year primarily due to operating leverage from higher Revenue. Technology related share-based compensation expense was $0.3 million for the six months ended July 31, 2026 and was $0.5 million for the same period last year.

Previous wording

Marketing. Marketing expenses were $8.0 million for the three months ended April 30, 2026, a decrease of $(0.6) million, or (7.0)%, compared to $8.6 million for the three months ended April 30, 2025. This decrease was driven primarily by lower paid marketing expenses and lower marketing employee expenses. Marketing expenses unrelated to personnel costs were $7.3 million in the three months ended April 30, 2026 and 8.1% of revenue, compared to $7.9 million and 11.4% of total revenue for the same period last year.

Current wording

Marketing. Marketing expenses were $15.4 million for the six months ended July 31, 2026, a decrease of $(0.6) million, or (3.8)%, compared to $16.0 million for the six months ended July 31, 2025. This decrease was driven primarily by lower paid marketing expenses and lower marketing employee expenses. Marketing expenses unrelated to personnel costs were $14.0 million in the six months ended July 31, 2026 and 7.5% of revenue, compared to $14.4 million and 9.6% of total revenue for the same period last year.

Previous wording

General and Administrative. General and administrative (“G&A”) expenses were $23.4 million for the three months ended April 30, 2026, an increase of $2.7 million, or 13.0%, compared to $20.7 million for the three months ended April 30, 2025. This increase was driven primarily by an increase in credit card fees due to the increase in revenue, an increase in employee, occupancy and other G&A expenses. G&A expenses as a percentage of revenue were 26.0%, compared to 29.7% last year, as we saw increased operating leverage. G&A related share-based compensation expense was $1.3 million for the three months ended April 30, 2026 and was $1.2 million for the three months ended April 30, 2025.

Current wording

General and Administrative. General and administrative (“G&A”) expenses were $47.2 million for the six months ended July 31, 2026, an increase of $1.9 million, or 4.2%, compared to $45.3 million for the six months ended July 31, 2025. This increase was driven primarily by an increase in credit card fees due to the increase in revenue and an increase occupancy and other G&A expenses. G&A expenses as a percentage of revenue were 25.2%, compared to 30.1% last year, as we saw increased operating leverage. G&A related share-based compensation expense was $1.9 million for the six months ended July 31, 2026 and was $2.4 million for the six months ended July 31, 2025.

Previous wording

Rental Product Depreciation and Revenue Share. Rental product depreciation and revenue share was $43.0 million for thethree months ended April 30, 2026, an increase of $15.7 million, or 57.5%, compared to $27.3 million for thethree months ended April 30, 2025. The increase was primarily driven by higher revenue share expenses due to higher Share by RTR units acquired and utilized during the period. Rental product depreciation and revenue share was 47.8% of revenue in the three months ended April 30, 2026, up from 39.2% 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 $81.9 million for the six months ended July 31, 2026, an increase of $20.5 million, or 33.4%, compared to $61.4 million for the six months ended July 31, 2025. The increase was primarily driven by higher revenue share expenses due to higher Share by RTR units acquired and utilized during the period. Rental product depreciation and revenue share was 43.7% of revenue in the six months ended July 31, 2026, up from 40.8% in the same period last year.

Previous wording

Net Loss was $(18.9) million for the three months ended April 30, 2026 compared to $(26.1) million for the three months ended April 30, 2025. Net Loss as a percentage of revenue was (21.0)%, and (37.5)% for the three months ended April 30, 2026 and 2025, respectively. Net Loss decreased year-over-year primarily due to lower reported Interest Expense, higher Gross Profit, and lower Marketing and Technology costs partially offset by higher General and Administrative expenses.

Current wording

Net Loss was $(12.9) million for the three months ended July 31, 2026 compared to $(26.4) million for the three months ended July 31, 2025. Net Loss as a percentage of revenue was (13.2)%, and (32.6)% for the three months ended July 31, 2026 and 2025, respectively. Net Loss was $(31.8) million for the six months ended July 31, 2026 compared to $(52.5) million for the six months ended July 31, 2025. Net Loss as a percentage of revenue was (17.0)%, and (34.9)% for the six months ended July 31, 2026 and 2025, respectively. Net Loss decreased year-over-year primarily due to lower reported Interest Expense and higher Gross Profit partially offset by higher General and Administrative and Securities Litigation expenses.

Previous wording

Our Adjusted EBITDA was $(0.8) million for the three months ended April 30, 2026 compared to $(1.3) million for the three months ended April 30, 2025, representing margins of (0.9)% and (1.9)%, respectively. Adjusted EBITDA increased year-over-year primarily due to higher Revenue partially offset by higher Revenue Share costs within Rental Product Depreciation and Revenue Share, Fulfillment costs, and higher General and Administrative Expenses. Adjusted EBITDA Margin increased year-over-year primarily due to lower Technology, Marketing, and General and Administrative expenses as a percentage of Revenue partially offset by higher Revenue Share expenses as a percentage of Revenue.

Current wording

Our Adjusted EBITDA was $12.6 million for the three months ended July 31, 2026 compared to $3.6 million for the three months ended July 31, 2025, representing margins of 12.9% and 4.4%, respectively. Our Adjusted EBITDA was $11.8 million for the six months ended July 31, 2026 compared to $2.3 million for the six months ended July 31, 2025, representing margins of 6.3% and 1.5%, respectively. Adjusted EBITDA increased year-over-year primarily due to higher Revenue partially offset by higher Revenue Share costs within Rental Product Depreciation and Revenue Share and Fulfillment costs. Adjusted EBITDA Margin increased year-over-year primarily due to lower General and Administrative, Fulfillment, Technology, and Marketing expenses as a percentage of Revenue partially offset by higher Revenue Share expenses as a percentage of Revenue.

Previous wording

(1)Includes debt (premium) discount amortization of $(2.2) million in the three months ended April 30, 2026 and $6.9 million in the three months ended April 30, 2025.

Current wording

(1)Includes debt (premium) discount amortization of $(2.3) million in the three months ended July 31, 2026, $(3.9) million in the three months ended July 31, 2025, $(4.5) million in the six months ended July 31, 2026 and $3.0 million in the six months ended July 31, 2025.

Previous wording

(5)Non-recurring adjustments for the three months ended April 30, 2026 includes $0.1 million of costs related to public company SOX readiness.

Current wording

(5)Non-recurring adjustments for the three and six months ended July 31, 2026 includes none and $0.1 million of costs related to public company SOX readiness. Non-recurring adjustments for the three and six months ended July 31, 2025 includes $2.0 million of transaction related costs.

Previous wording

(6)Non-ordinary course legal fees for the three months ended April 30, 2026 and 2025 includes $0.6 million and $0.6 million of costs related to securities lawsuits and non-recurring legal fees, respectively.

Current wording

(6)Non-ordinary course legal fees for the three and six months ended July 31, 2026 includes $0.7 million and $1.3 million of costs related to securities lawsuits and non-recurring legal fees. 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.