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Rent the Runway Sees Rebound in Subscribers, and Aims to Add More Styles to Keep Them
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Good morning, CFOs. Rent the Runway’s plans for appealing to subscribers; European audit regulators have concerns about the potential elimination of the PCAOB; plus, leaders at the G-7 summit talk trade with President Trump.
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Rent the Runway has cut roughly $40 million in costs over the past three years as the business struggles with changing tastes and new competitors. PHOTO: ANDREW KELLY/REUTERS
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Rent the Runway’s active-subscriber numbers have rebounded after hitting a multiyear low earlier this year, and the online clothing-rental company is making its largest-ever investment in inventory to keep the momentum going.
The company had over 147,000 active subscribers renting wares from Gucci, Ulla Johnson, Oscar de la Renta and many other labels at the end of its first quarter ended April 30, up nearly 23% from the previous quarter. While the company often sees a surge of subscribers in the late spring just before proms and graduations followed by the June wedding season, its latest count tops first-quarter figures in recent years.
Whether Rent the Runway remains an appealing option will depend in part on whether consumers, some of whom are spending more cautiously, decide that monthly apparel rental fees—ranging from roughly $100 to $315—are worth it. Rent the Runway’s finance chief, Sid Thacker, thinks they will, particularly as the company adds to the brands and styles it offers.
“We’re providing all of this at tremendous value,” he said. “Customers are getting thousands of dollars worth of clothing for around $100-plus per month.”
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Content from our sponsor: Deloitte
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Are These Building Blocks Part of Your AI Governance Program?
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Enhanced AI governance can increase brand equity and trust, inform decision-making at the highest levels, and reduce potential remediation costs. Here are five ways to get there. Read More
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📆 Earnings
📈 Economic Indicators
The Census Bureau reports retail and food services sales for May.
The National Association of Home Builders releases its Housing Market Index for June.
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EU Regulators Say Potential Elimination of U.S. Audit Watchdog Would Disrupt Inspections For Years
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Dozens of European audit regulators have expressed concerns about a U.S. Congress proposal to fold the Public Company Accounting Oversight Board into the Securities and Exchange Commission, saying the move would disrupt their cooperation for years.
If the potential legislation is passed, no U.S. audit regulator could carry out inspections of EU auditors to U.S.-listed companies for likely a few years until new agreements are set, say the Committee of European Auditing Oversight Bodies, which represents 27 PCAOB counterparts across the European Union, in a June 13 letter to the PCAOB.
"This would undermine trust and confidence in the U.S. capital markets," the group says.
The House last month passed a broader tax bill that included the provision to eliminate the PCAOB. The Senate is now evaluating the bill.
—Mark Maurer
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What Else Matters to CFOs
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President Trump said he and Canada’s prime minister were debating how to come to an agreement. PHOTO: CHIP SOMODEVILLA/GETTY IMAGES
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World leaders are using this week’s Group of Seven summit in Canada to talk trade with President Trump, seeking to ease tensions over tariffs.
Japan, the European Union, Canada and Mexico hoped face time with Trump would help them persuade the president to lower at least some of his most onerous tariffs in exchange for a range of concessions, such as higher military spending, action against China and cuts to tariffs and other trade barriers on U.S. companies.
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President Trump’s aggressive deportation push has slammed into an economic reality: Key industries in the U.S. rely heavily on workers living in the U.S. illegally, many of them for decades.
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Stocks rebounded from a bruising Friday and oil prices fell, with investors growing optimistic about a quick de-escalation in the Israel-Iran conflict.
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Exclusive: Tensions between OpenAI and Microsoft over the future of their famed AI partnership are flaring up.
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Activist investor Barington Capital Group has built a stake in Victoria’s Secret and believes the lingerie retailer hasn’t lived up to its full potential.
📰 Other headlines
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$7.4 Billion
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The settlement amount that all 55 attorneys general signed onto with Purdue Pharma and the Sackler family for their role in the opioid crisis.
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The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy.
Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew.
You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.
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