Dive Brief:
- Rent the Runway’s focus on customer experience shows signs of paying off as the rental platform increased both active subscribers and satisfaction, executives said on a Q2 2025 earnings call last week.
- The company’s average net promoter score for subscriptions increased 77% year over year, the highest it has been in three years, according to co-founder and CEO Jennifer Hyman.
- The company increased prices for subscriptions on Aug. 1 for the first time in three years to account for inflation and tariffs, which came out to an increase of about $2 per item. “We communicated the change clearly to customers and thus far, the impact has been in line with expectations,” Hyman said.
Dive Insight:
Customer experience plays a central role in Rent the Runway’s turnaround plan. In the second quarter of 2025, the company increased inventory to offer customers more choice, held in-person events to increase engagement, and updated its app and digital experience.
Year-over-year subscriber growth accelerated from the first quarter, Hyman said. Active subscribers increased 13.4% year over year to 146,400 active subscribers in the second quarter of 2025. However, ending active subscribers decreased slightly quarter over quarter due primarily to “seasonally lower subscriber acquisition and retention” in Q2 2025 versus Q1 2025.
Retention, too, increased since last year, Hyman said. “These results show that we're adding more subscribers in a significant way and subscribers are more likely to stay with the service for longer periods of time — both very promising indicators.”
Financial results weren’t as rosy. While revenue grew 2.5% year over year to $80.9 million in the second quarter, gross profit decreased 25% year over year to $24.3 million, according to a company’s earnings report. The company reported a net loss of $26.4 million.
In August, the company announced a recapitalization plan to reduce debt. In a prepared statement, Hyman said the plan provides Rent the Runway with “the financial flexibility we need to fully execute on our turnaround.”
As part of the company’s effort to meet customers where they are, Rent the Runway hosted a dozen events in the second quarter, with more than 1,200 subscribers attending in person and demand exceeding three times that of capacity.
The company also focused on improving the digital subscription experience. It launched a personalized home screen, a rewards program with tiered membership perks and a feature that shows how real members curated styles. In the future, Rent the Runway plans to use AI for review summaries and more accurate fits.
