BROOKLYN, NY—Siddharth Thacker, Chief Financial Officer of Rent the Runway, Inc. (NASDAQ:RENT), recently sold a portion of his holdings in the company. According to a recent SEC filing, Thacker sold a total of 730 shares of Class A Common Stock over two consecutive days.
The transactions, which took place on November 6 and 7, 2024, were executed at prices ranging from $9.32 to $9.72 per share, resulting in total proceeds of $7,020. These sales were conducted to cover taxes upon the vesting of restricted stock units, as per a standing Rule 10b5-1 plan established on June 9, 2023.
Following these transactions, Thacker retains ownership of 49,519 shares of Rent the Runway. The sales were part of a planned strategy to manage tax obligations associated with stock-based compensation.
In other recent news, Rent the Runway has been making notable strides in its financial performance. The company's second-quarter earnings report showed impressive results, with sales and EBITDA surpassing expectations. Revenue for the period reached $78.9 million, a 4.2% increase compared to the previous year, and adjusted EBITDA stood at $13.7 million, making up 17.4% of the total revenue.
Despite a 6.2% decline in active subscribers, the company has raised its full-year revenue guidance, projecting a growth of 2-6% over fiscal 2023. Additionally, Rent the Runway aims to achieve free cash flow breakeven within the year, forecasting a positive cash flow of approximately $6 million in the second half of the year.
In the midst of these developments, Jefferies has maintained a Buy rating on Rent the Runway's shares, even as it adjusted its price target down to $26 from the previous $34. The firm noted that a shift to positive subscription growth could improve market sentiment towards the company, and highlighted the company's internal improvements as potential drivers of sustained multi-year growth and margin acceleration.
In other company news, Rent the Runway is planning to open a store in New York City to enhance customer engagement and is investing in marketing initiatives and brand events to drive sales growth. These are the recent developments that investors and analysts will be monitoring closely.
InvestingPro Insights
As Rent the Runway's CFO Siddharth Thacker adjusts his holdings, investors may find value in examining the company's financial health through the lens of InvestingPro data. Despite the recent stock sale, Rent the Runway boasts impressive gross profit margins of 72.6% for the last twelve months as of Q2 2025, indicating strong pricing power in its clothing rental business model.
However, the company faces challenges. An InvestingPro Tip reveals that Rent the Runway is "quickly burning through cash," which aligns with the reported operating income of -$56.3 million over the same period. This cash burn rate is a critical factor for investors to consider, especially in light of the company's market capitalization of $36.14 million.
Another InvestingPro Tip notes that the "stock has taken a big hit over the last six months," with data showing a -26.51% price total return over that period. This decline may reflect ongoing concerns about the company's path to profitability, as analysts do not anticipate the company will be profitable this year.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Rent the Runway, providing a deeper dive into the company's financial position and market performance.
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