Rent the Runway's Poor Outlook
Plus, Alibaba loses a big Investor.
Today is Thursday, April 13, 2023.
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Rent the Runway's Poor Outlook
Despite posting better-than-expected financial results, shares of Rent the Runway (Nasdaq: RENT) fell by 5.71% in after-hours trading on Wednesday.
Financials: Rent the Runway reported a loss of 40 cents per share in the past quarter and revenue of $75.4 million; both were better than expected.
Details: Revenue grew by 18%, active subscribers increased by 12%, and total subscribers jumped by 8%. The gross margin and gross profit both improved.
But: The problem with Rent the Runway was with its guidance. The company expects full-year revenue to be in the range of $320 million to $330 million, but analysts expected more.
Background: Rent the Runway rose to prominence as a popular e-commerce platform for fashion during the pandemic. But when the lockdowns ended, the company struggled to maintain its customer base and kept losing money.
Stock Price: Rent the Runway’s stock is down 81% since going public in 2021. This year, the stock is up 6%.
Final Thoughts: Although the guidance was poor, it is a good sign that Rent the Runway is inching closer to profitability. And the company expects its active subscriber base to grow by over 25% this year. Could a comeback happen?
Notable Earnings Today: Delta Air Lines (NYSE: DAL), Progressive (NYSE: PGR), Lakeland Industries (Nasdaq: LAKE), Fastenal (Nasdaq: FAST), Infosys (NYSE: INFY).
Notable IPOs Today: Peakstone Realty Trust (NYSE: PKST), Global X PropTech ETF (Nasdaq: PTEC), VCI Global Limited Ordinary Share (Nasdaq: VCIG), Altamira Therapeutics Ltd. Warrant (Nasdaq: CYTOW).
Notable Equity Crowdfunding Campaigns Ending Today: MISE (SMBX), Red Eye Louie’s (StartEngine), ChipBrain (Netcapital), Slated (Wefunder), Transcend Network (Wefunder), IQ Billiards (StartEngine).
Notable Economic Events Today: Jobless Claims (8:30 a.m. ET), Produce Price Index / Core PPI (8:30 a.m. ET).
Alibaba Loses a Big Investor
Shares of the e-commerce giant Alibaba Group (NYSE: BABA) dropped by 1.11% in after-hours trading on Wednesday due to the departure of a big investor.
Details: According to a report from the Financial Times, investment firm Softbank is selling almost all of its remaining shares in Alibaba. The group sold about $7.2 billion in Alibaba shares this year and cut its stake in the company to just 3.8%. Alibaba has not commented on the report yet.
Background: The news comes as Alibaba struggles due to economic challenges in China.
Stock Price: Alibaba’s stock is up 13% in the last 30 days.
Final Thoughts: Despite Softbank selling its shares, there’s still a lot of hype surrounding Alibaba’s soon-to-be-released AI tool.
Harley-Davidson’s CFO Leaves
Harley-Davidson (NYSE: HOG) fell by 4.20% in after-hours trading on Wednesday after Chief Financial Officer Gina Goetter announced plans to step down from the role at the end of April.
Final Thoughts: A formal search process to find a replacement is underway. The stock is down 9% so far this year.
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Trends to Watch
Taking it to the Max: Warner Bros. Discovery unveils new flagship streaming service, ‘Max’ (CNBC)
It is Here: Ethereum’s Shanghai Upgrade Is Complete, Starting New Era of Staking Withdrawals (CoinDesk)
Driving to a Better Future: E.P.A. Lays Out Rules to Turbocharge Sales of Electric Cars and Trucks (The New York Times)
Zucked: It Sounds Like Facebook Is Completely Falling Apart (Futurism)
Inching: Bitcoin Edges Higher as Inflation Cools More Than Expected in March (Decrypt)
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