Shares of Rent the Runway (NASDAQ:RENT) surged on Thursday, blowing past the 50-, 100- and 200-day moving averages to a 6-month high on the heels of Q4 and fiscal 2023 results that exceeded the company’s top and bottom-line guidance, along with upbeat remarks from the company’s CEO and CFO during the Q4 earnings call.
RENT rallied more than 60% in Wednesday’s after-hours trading and was launched another 200% higher during Thursday’s regular session.
In a call with analysts, CEO Jennifer Hyman said she sees the company “turning a corner” towards growth with “historical high Q4 and full year adjusted EBITDA.”
“Throughout fiscal year 2023, we executed various cost reductions, including the January 2024 restructuring to realign the business behind growth while cutting costs. All of these margin and cost improvements that we have already completed make us confident that we will achieve free cash flow breakeven in FY2024,” Hyman said.
CFO Sid Thacker added that the combination of revenue growth along with operating and capital efficiency will reduce business and investment risk “considerably” in 2024 and that the company’s “increasingly strategic position within the changing retail and apparel industry, combined with the growing market is accelerating progress towards a capital light model.”
After the close on Wednesday, the company reported a loss of $7.02, which narrowed from $8.07 a year ago but was wider than Street expectations by $1.13. Total sales increased 0.5% and beat estimates by $1.39M.
For 2024, revenue is expected to increase by 1% to 6% from 2023 revenue of $298.2M versus the estimated $312.5M.
Shares were last trading with a gain of 131%.