(RENT) 2023 Q4 法說會逐字稿

Welcome to Rent the Runway fourth quarter and fiscal year 2023 earnings results conference call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone. As a reminder, this conference is being recorded. I would now like to turn the call over to Rent the Runways, Chief Legal and Administrative Officer, Cara Schembri. Thank you. You may begin.

歡迎參加 Rent the Runway 第四季和 2023 財年財報電話會議。此時所有參與者都處於只聽模式。正式演講後將舉行問答環節。如果有人在會議期間需要接線員協助，請按電話上的星號零。提醒一下，本次會議正在錄製中。我現在想將電話轉給 Rent the Runways 首席法律和行政官 Cara Schembri。謝謝。你可以開始了。

Good afternoon, everyone, and thanks for joining us today. And during this call we will make references to our Q4 fiscal year 2023 earnings presentation, which can be found in the Events and Presentations section of our Investor Relations website.

大家下午好，感謝您今天加入我們。在本次電話會議中，我們將參考 2023 財年第四季的收益演示，該演示可以在我們投資者關係網站的活動和演示部分找到。

Before we begin we would like to remind you that this call will include forward looking statements. These statements include our future expectations regarding financial results, guidance and targets, market opportunities and our growth. These statements are subject to various risks, uncertainties and assumptions that could cause our actual results to differ materially. These risks, uncertainties and assumptions are detailed in this afternoon's press release as well as our filings with the SEC, including our Form 10-K that will be filed within the next few days. We have no obligation to revise or update any forward-looking statements or information except as required by law.

在開始之前，我們想提醒您，本次電話會議將包含前瞻性陳述。這些陳述包括我們對財務表現、指導和目標、市場機會和成長的未來預期。這些陳述受到各種風險、不確定性和假設的影響，可能導致我們的實際結果出現重大差異。這些風險、不確定性和假設在今天下午的新聞稿以及我們向 SEC 提交的文件中進行了詳細說明，其中包括我們將在未來幾天內提交的 10-K 表格。除法律要求外，我們沒有義務修改或更新任何前瞻性陳述或資訊。

During this call, we will also reference certain non-GAAP financial information. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Reconciliations of GAAP to non-GAAP measures can be found in our press release.

在本次電話會議中，我們也會參考某些非 GAAP 財務資訊。此非 GAAP 財務資訊的呈現不應被孤立地考慮或作為根據 GAAP 呈現的財務資訊的替代。公認會計原則與非公認會計原則措施的調節可以在我們的新聞稿中找到。

Slide presentation posted on our investor website and in our SEC filings.

幻燈片簡報發佈在我們的投資者網站和 SEC 文件中。

And with that, I'll turn it over to Jenn.

有了這個，我會把它交給 Jenn。

Hi, everyone. Thanks for joining us. We're pleased to share that we exceeded top and bottom line guidance for fiscal year 2023 and believe we are ending the year in a great position for both growth and profitability in fiscal year 2024, we believe 2024 will be a milestone year for Rent the Runway as we're committed to delivering free cash flow breakeven and showing the strength of our business model.

大家好。感謝您加入我們。我們很高興地告訴大家，我們超出了2023 財年的營收和利潤指引，並相信我們在2024 財年的增長和盈利能力方面都處於有利地位，我們相信2024 年將是Rent the 的里程碑式的一年Runway，因為我們致力於提供自由現金流盈虧平衡並展示我們商業模式的實力。

Our results in Q4 '23 show the stability of our business and that we've turned the corner towards growth. We achieved historical high Q4 and full year adjusted EBITDA of $11.2 million and $26.9 million, respectively. Q4 adjusted EBITDA was strong, most notably because of record sales success from our tribe before you buy business where our subscribers purchase items, they already have at home have already worn and already loves. We believe that tried to buys Q4 success was primarily due to investments we made into our pricing strategy and technology earlier in 2023, which drove significant increases in customer conversion.

我們 23 年第 4 季的業績顯示了我們業務的穩定性，並且我們已經扭轉了成長的局面。我們第四季和全年調整後 EBITDA 分別達到 1,120 萬美元和 2,690 萬美元的歷史最高水準。第四季度調整後的 EBITDA 強勁，最值得注意的是，我們的部落在購買業務之前取得了創紀錄的銷售成功，我們的訂閱者購買的物品，他們已經在家裡已經穿過並且已經喜歡了。我們認為，第四季度嘗試購買的成功主要歸功於我們在 2023 年初對定價策略和技術的投資，這推動了客戶轉換率的顯著增加。

For full year 2023, we grew our onsite inventory resell business by 36% by both significantly increasing the number of customers transacting and increasing the units purchased per subscriber. We view this as a strong continued revenue driver in 2024 and beyond. This business line drive strong margins to the business and enabled us to fund quicker inventory newness while also increasing customer loyalty as subscribers viewed trying before they buy to be a key value proposition of our subscription program. Throughout 2023, we made tangible improvements to our customer experience that are showing up in our metrics. Subscription net promoter score is at the highest consistent level that's been in several years and improved 20 points from a low in Q2 '23 to highs in Q4 that our continuing customer loyalty rate is also up 10% year-over-year.

2023 年全年，我們的現場庫存轉售業務成長了 36%，方法是大幅增加客戶交易數量和增加每位訂閱者購買的數量。我們認為這是 2024 年及以後強勁的持續收入驅動力。該業務線為業務帶來了強勁的利潤，使我們能夠更快地為庫存更新提供資金，同時還提高了客戶忠誠度，因為訂閱者認為在購買前嘗試是我們訂閱計劃的關鍵價值主張。 2023 年，我們對客戶體驗做出了實際的改進，這些改進體現在我們的指標中。訂閱淨推薦值處於幾年來的最高水平，從 2023 年第二季度的低點提高到第四季度的高點 20 個百分點，我們的持續客戶忠誠度也同比增長 10%。

These are solid indicators to us that the positive virality of rent, the runway is coming back and growth is ahead the place where we've made the biggest strides in 2023 was around our inventory position. In late '22, we identified that we had to correct for low inventory depth and saw throughout Q1 and Q2 that lower in-stock rates were leading to higher rates of customer churn. We quickly actioned against this and made tremendous improvements to the inventory experienced by the back half of 2023 depth on new styles have doubled and our Q4 in-stock rate was nearly 50% higher than Q4 2022.

這些對我們來說都是可靠的指標，表明租金的積極病毒式傳播、跑道正在回歸，增長即將到來，我們在 2023 年取得最大進步的地方是我們的庫存狀況。在 22 年末，我們發現必須修正庫存深度過低的問題，並在第一季和第二季發現較低的庫存率導致較高的客戶流失率。我們迅速採取行動，對庫存進行了巨大改進，到 2023 年下半年，新款深度增加了一倍，我們第四季度的庫存率比 2022 年第四季高出近 50%。

Inventory churn rate, which represents churners who cite inventory as the primary reason for leaving subscription decreased by 35% in Q4 2023 relative to Q1 through Q3 2023. What we hope this conveys to current and potential investors is that we're nimble in running our business can pivot due to our data-driven culture, and we have the focus and execution prowess to find solutions quickly. Not only did we make major strides in 2023 on inventory depth, we ensured that our selection continued to get more high end and desirable with access to the most coveted designer brands in line with our core psychographic.

與2023 年第一季至第三季相比，2023 年第四季的庫存流失率（代表將庫存作為退出訂閱主要原因的流失者）下降了35%。我們希望這向當前和潛在投資者傳達的是，我們能夠靈活地運營我們的庫存由於我們的數據驅動文化，業務可以發生轉變，並且我們擁有快速找到解決方案的專注力和執行能力。 2023 年，我們不僅在庫存深度方面取得了重大進展，還確保我們的選擇繼續變得更加高端和理想，能夠接觸到符合我們核心心理特徵的最令人垂涎​​的設計師品牌。

In Q4 of 2023, we launched luxury special occasion wear into our assortment, which was received with great excitement from our customers. You can expect to see us see us continue to partner with the best designer brands in the industry to grow our businesses together with many exciting new designer launches on the platform planned for 2024 we believe Brent, the runway continues to hold the premium brand positioning in the market appealing to a sophisticated customer who wants to use us for her busy life of work events travel and weekends. A powerful example of rent. The runway continuing to elevate our premium positioning and premium service is the 1-on-1 texting concierge service we launched in beta in May '23 and now serves nearly 40% of our first 90 day customers.

2023 年第四季度，我們在產品系列中推出了奢華特殊場合服裝，受到了客戶的熱烈歡迎。您可以期待看到我們繼續與業內最好的設計師品牌合作，發展我們的業務，併計劃於2024 年在該平台上發布許多令人興奮的新設計師產品，我們相信布倫特(Brent)時裝秀將繼續保持高端品牌定位該市場吸引了成熟的客戶，他們希望在繁忙的工作、活動、旅行和週末生活中使用我們的服務。租金的一個強有力的例子。繼續提升我們的優質定位和優質服務的主線是我們於 23 年 5 月推出的測試版一對一短信禮賓服務，現在為我們的前 90 天客戶中的近 40% 提供服務。

In 2023, we saw that one-on-one communication with customers improved early term retention by answering questions, styling customers and helping them get the most out of their membership. We plan to continue to scale our concierge program as part of a new 360 degree lifecycle strategies we're implementing and view it as a compelling loyalty lever in 2024 for the various customer segments.

2023 年，我們發現，與客戶的一對一溝通透過回答問題、塑造客戶風格並幫助他們充分利用會員資格，提高了早期保留率。我們計劃繼續擴大我們的禮賓服務計劃，作為我們正在實施的新的 360 度生命週期策略的一部分，並將其視為 2024 年各個客戶群的一個引人注目的忠誠度槓桿。

Lastly, we've spent in fiscal year 2023 taking action to achieve free cash flow breakeven in fiscal year 2024. First, we have focused on continued improvements to our margins. Fulfillment costs as a percentage of revenue were 29% of revenue in fiscal 2023 compared to 31% in fiscal 2022, driven by continued efficiencies in our warehouses and consolidation of our shipping needs at competitive rates we have moved towards a more capital light inventory model with a third of our inventory procured on consignment with little to no upfront payment and 28% of our inventory acquired in '23 from our exclusive designs program where I Rent the Runway collaborates with some of the top designers in the world on exclusive collections at much lower cost than wholesale procurement, our December debt restructuring eliminated cash interest through Q1 of 2025.

最後，我們在 2023 財年採取行動，在 2024 財年實現自由現金流盈虧平衡。首先，我們專注於持續提高利潤率。 2023 財年，配送成本佔收入的比例為29%，而2022 財年為31%，這得益於我們倉庫的持續效率以及以具有競爭力的價格整合我們的運輸需求，我們已經轉向資本更輕的庫存模式我們三分之一的庫存是透過寄售方式採購的，幾乎沒有預付款，28% 的庫存是在23 年從我們的獨家設計項目中採購的，在該項目中，I Rent the Runway 與世界上一些頂級設計師合作，以低得多的價格推出獨家系列由於成本高於批發採購，我們 12 月的債務重組消除了截至 2025 年第一季度的現金利息。

Lastly, 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 fiscal year 2024.

最後，在整個 2023 財年，我們執行了各種成本削減措施，包括 2024 年 1 月的重組，以在削減成本的同時重新調整業務成長背後的力量。我們已經完成的所有這些利潤和成本改善，讓我們有信心在 2024 財年實現自由現金流盈虧平衡。

Now I would like to turn to 2024. Our primary focus in 2024 as growth and our strategy to focus our resources and energy into two avenues, reinvigorating full-stack marketing of our brand to widen our funnel of potential customers and digital product innovation to increase customer conversion and loyalty. We think now is the perfect time to put our foot back on the gas pedal as it relates to marketing as our inventory is in a great position and the customer experience is as premium as it's ever been, as we've shared before, for almost the entirety of rent runways existence, the business grew organically fueled by customers deep love for our brand service and mission of female empowerment, which made them willing advocates of Rent the Runway with their friends. I still believe that the most powerful channel to build brands is authentic word of mouth though today, more of that word of mouth can happen on social media in addition to in real life experiences. The good news is despite being pretty quiet on the marketing front, for the past few years, we are working from a base of high brand awareness and a significant amount of latent brand love that we believe we have the ability to reactivate our first step was hiring an experienced new Chief Marketing Officer on March fourth. We welcome Natalie McGrath onto the team from Afterpay, where she was responsible for accelerating that brand's impressive growth. Natalie has 20 plus years of marketing experience at the intersection of fashion, retail and tech working for brands like Net-a-Porter.

現在我想談談2024 年。我們2024 年的主要關注點是成長，我們的策略是將我們的資源和精力集中到兩個途徑，重振我們品牌的全端行銷，以擴大我們的潛在客戶管道和數位產品創新，以增加客戶轉換率和忠誠度。我們認為現在是重新踩油門的最佳時機，因為這與行銷有關，因為我們的庫存處於有利位置，而且客戶體驗一如既往地優質，正如我們之前分享的那樣，幾乎自Rent the Runway 存在以來，客戶對我們的品牌服務和女性賦權使命的熱愛推動了業務的有機成長，這使他們願意與朋友一起成為Rent the Runway 的擁護者。我仍然相信，打造品牌最強大的管道是真實的口碑，儘管如今，除了現實生活中的體驗之外，社群媒體上還可能出現更多的口碑。好消息是，儘管在行銷方面相當安靜，但在過去的幾年裡，我們正在以高品牌知名度和大量潛在品牌熱愛為基礎開展工作，我們相信我們有能力重新激活我們的第一步3 月4日招募一位經驗豐富的新首席行銷長。我們歡迎 Natalie McGrath 加入 Afterpay 團隊，她負責加速品牌的驚人成長。 Natalie 在時尚、零售和科技領域擁有 20 多年的行銷經驗，曾為 Net-a-Porter 等品牌工作。

Hey, Alexander Wang and boohoo over the next few months you can expect to see us focus on the following five buckets of marketing opportunity, one, building mid-funnel consideration marketing plans focused on driving customer reasons to believe and supporting incremental convergence to scaling new marketing channels with a social first approach. This means diversifying away from a solely bottom of the funnel, Meta and Google landscape into many channels that drive new traffic to the site and widen our prospect funnel. Three, rebuilding our lifecycle engine and customer marketing approach for refocusing on a creative strategy that supports customer key segments needs to discovery of new trends, saving time and use case based shopping. Our creative strategy is centered around and supercharged our approach to content and five, reinvesting in our reserve rental business. While we expect it may take a few quarters for marketing to ramp up. Our goal is to reactivate the dynamic beloved nature of the rent, the runway brand, and we'll measure our performance through our organic growth and traffic. Throughout 2024 our customers, we'll see and hear from us a lot more as we plan to activate in real life via partnerships, PR influencers, celebrity and most importantly, content that brings our own customers and mission of female empowerment back to the center of our brand stories.

嘿，Alexander Wang 和boohoo，在接下來的幾個月裡，您可以期待看到我們專注於以下五類行銷機會，一是製定漏斗中部考慮行銷計劃，重點是推動客戶相信並支持增量融合以擴展新業務採用社交優先方法的行銷管道。這意味著從單一的漏斗底部、Meta 和 Google 景觀多元化到許多管道，為網站帶來新的流量並拓寬我們的潛在客戶漏斗。第三，重建我們的生命週期引擎和客戶行銷方法，重新專注於支援客戶關鍵細分市場需求的創意策略，以發現新趨勢，節省時間和基於用例的購物。我們的創意策略圍繞並強化我們的內容方法，第五，對我們的儲備租賃業務進行再投資。雖然我們預計行銷可能需要幾個季度才能加強。我們的目標是重新激活租金、跑道品牌的動態特性，我們將透過有機成長和流量來衡量我們的業績。在整個2024 年，我們的客戶將看到和聽到更多我們的消息，因為我們計劃透過合作夥伴、公關影響者、名人，以及最重要的是，將我們自己的客戶和女性賦權使命帶回中心的內容，在現實生活中啟動我們的品牌故事。

As a small example of what I mean in March, we launched a campaign aligned with International Women's month that encourage women to show off their own professional accomplishments or those of their peers on linked in the campaign went viral receiving over 630 million impressions, I believe due to its authenticity, over 310,000 people engaged with an unlinked did and thousands of women use the LinkedIn platform to tell inspirational stories of female career success. We also relaunched the real runway, which uses our own aspirational customers, self-defined women who are leaders in their fields and Avid and authentic users of Rent the Runway to inspire our community. These women create social first content that showcases how to read the runway. Subscription has been an unlock for them in their own lives. This month, we partnered with celebrity stylists, may Riley to create styling content that will inspire our customers on how to dress for work and all of their spring events Maeve is joining us for a series of in real life events and top-ups in New York City, where we're inviting many of our highest LTV and VIP. win-back customers we're excited to bring the magic and growth back to our brand, and we'll be sure to update you on progress as we go.

作為我在三月的意思的一個小例子，我們發起了一項與國際婦女月相一致的活動，鼓勵女性展示自己或同齡人的職業成就，我相信該活動的鏈接像病毒一樣傳播，收到了超過6.3 億次展示由於其真實性，超過 310,000 人與未關聯的人進行了互動，並有數千名女性使用 LinkedIn 平台講述女性職業成功的勵志故事。我們也重新推出了真正的跑道，它利用我們自己的理想客戶、各自領域的領導者、自我定義的女性以及 Rent the Runway 的狂熱和真實用戶來激勵我們的社群。這些女性創作的內容以社群為先，展示如何解讀時裝秀。訂閱對他們來說是開啟自己人生的一把鑰匙。本月，我們與名人造型師 May Riley 合作，創作造型內容，啟發我們的客戶如何在工作和所有春季活動中穿著 Maeve 將與我們一起參加一系列現實生活中的活動和 New 充值活動約克市，我們邀請了許多最高LTV 和VIP 人士。為了贏回客戶，我們很高興能夠為我們的品牌帶來魔力和成長，並且我們一定會隨時向您通報最新進展。

Our second area of focus this year will be in continuing the digital product innovation we started in 2023 to drive increases in conversion and loyalty. In 2023, we made major strides on site performance and speed across all of our surfaces, and we made it easier for users to find inventory. They love the enhanced discovery features like rental, look, AI, search, new filtering and upgraded photography and styling this year. Our product work is focused in three main buckets. One innovations, an app and site merchandising to streamline product UX and design to simplify conversion flows and three focus on styling and customer review content that teaches our customers, how to wear our items, giving her even more confidence to rent. If you go to our site or app today, you can already see some of this work in action. Earlier this quarter, we transformed our site merchandising to center around use case based shopping hubs that show her how to get dressed for work parties, weddings, travel and weekends. Within the within each hub, we focus on key trends, must-have items and styling advice, visually inspiring potential customers that are limitless closet has everything they could possibly need. The insight is this people don't come to our site to buy a subscription to fashion. They come to Rent the Runway because they need solutions. They're trying to solve functional problems, like how do I get dressed for work, special occasions, vacation every day. And they're also trying to solve emotional problems, like how do I express myself through fashion and feel amazing with these hubs and boutiques, we're delivering on the promise of actually helping her get dressed with a limitless closet and an expert fashion point of view as the closing resale and rental market continues to expand, I feel confident in Rent the Runway positioning as the premium offering in the marketplace and the most widely known solutions. Our elevated customer experience is unparalleled with offerings like at-home pickup, speedy shipping, one-on-one styling, personalized Curations and the most flexible subscription programs. We're continuously iterating to improve the experience. We have strong momentum coming out of fiscal year 2023. Our margins and cost structure are in a great place. The team is fully aligned behind growth, and I'm excited for us to take advantage of this tremendous market, though there continues to be enormous market skepticism in our business. I'm fired up to prove this wrong once and for all the way to do this will be to drive profitability and growth.

我們今年的第二個重點領域是繼續我們於 2023 年開始的數位產品創新，以推動轉換率和忠誠度的提高。 2023 年，我們在所有平台上的網站效能和速度方面取得了重大進步，並且讓用戶更輕鬆地找到庫存。他們喜歡今年增強的發現功能，如租賃、外觀、人工智慧、搜尋、新的過濾以及升級的攝影和造型。我們的產品工作主要集中在三個主要方面。其中一項創新是應用程式和網站行銷，以簡化產品用戶體驗和設計，以簡化轉換流程，三項重點關注造型和客戶評論內容，教導我們的客戶如何穿著我們的物品，讓她更有信心租賃。如果您今天訪問我們的網站或應用程序，您已經可以看到其中的一些工作正在實施。本季度早些時候，我們對網站行銷進行了轉變，以基於用例的購物中心為中心，向她展示如何在工作聚會、婚禮、旅行和週末著裝。在每個中心內，我們專注於主要趨勢、必備單品和造型建議，從視覺上激發潛在客戶的無限衣櫃裡擁有他們可能需要的一切。我們的見解是，人們來到我們的網站並不是為了購買時尚訂閱。他們來到 Rent the Runway 是因為他們需要解決方案。他們試圖解決功能性問題，例如我如何穿著工作、特殊場合、每天度假。他們也試圖解決情感問題，例如我如何透過時尚來表達自己，並在這些中心和精品店中感到驚奇，我們正在兌現承諾，用無限的衣櫃和專業的時尚點來幫助她著裝鑑於轉售和租賃市場的不斷擴大，我對Rent the Runway 定位為市場上的優質產品和最廣為人知的解決方案充滿信心。我們提升的客戶體驗是無與倫比的，包括上門取貨、快速運輸、一對一造型、個人化策劃和最靈活的訂閱方案等服務。我們不斷迭代以改善體驗。 2023 財年我們的發展勢頭強勁。我們的利潤率和成本結構都處於良好狀態。團隊完全一致支持成長，我很高興我們能夠利用這個巨大的市場，儘管我們的業務仍然存在巨大的市場懷疑。我很想一勞永逸地證明這是錯誤的，而做到這一點的方法將是推動盈利和成長。

With that, I'll turn it over to Sid.

這樣，我就把它交給 Sid。

Thanks, Jenn, and thank you, everyone, for joining us. We believe fiscal year 2024 will be transformational for at the runway. First, we expect restaurant we expect revenue growth for the year. Second, we expect the business to be free cash flow breakeven this year. Third we expect significant progress in our strategy to improve capital efficiency with almost 50% of new rental product units to be sourced through our share by our TR. platform requiring no or low upfront costs. Indeed, combined with our exclusive design platform, we expect that more than 70% of total new units will be sourced through cost-advantaged channels. We think this combination of revenue growth, along with operating and capital efficiency, reduces business and investment risk considerably. Our increasingly strategic position within the changing retail and apparel industry, combined with the growing market is accelerating our progress towards a capital light model. We found that brand owners are recognizing the customer visibility. We provide them and are more likely to partner with us on a revenue share basis through share buy RTR. The progress we have made validates our belief that for many brands, we are a significant source of new customers who discover these brands on Rent the Runway. Our anticipated lower upfront capital outlays for rental product in fiscal year 2024 reflects this trend.

謝謝 Jenn，也謝謝大家加入我們。我們相信 2024 財年對跑道來說將是一場變革。首先，我們預計餐廳今年的營收將會成長。其次，我們預期該業務今年將實現自由現金流損益兩平。第三，我們預計我們的策略將取得重大進展，以提高資本效率，近 50% 的新租賃產品單位將透過我們的 TR 股份採購。平台無需前期成本或前期成本較低。事實上，結合我們的獨家設計平台，我們預計超過 70% 的新單元將透過具有成本優勢的管道採購。我們認為收入成長以及營運和資本效率的結合可以大大降低業務和投資風險。我們在不斷變化的零售和服裝行業中日益重要的戰略地位，加上不斷增長的市場，正在加速我們向輕資本模式邁進。我們發現品牌所有者正在認識到客戶的知名度。我們提供這些服務，並且更有可能透過股票購買 RTR 在收入分成的基礎上與我們合作。我們所取得的進步證實了我們的信念：對於許多品牌來說，我們是在 Rent the Runway 上發現這些品牌的新客戶的重要來源。我們預期 2024 財年租賃產品的前期資本支出較低，反映了這一趨勢。

Before we turn to results for the year, I want to take a moment to discuss our balance sheet. Our recent debt amendment with zero interest for six quarters reflects our constructive relationship with our lending partner. As John outlined, cash generation is a top priority for the company. We believe the actions we are taking in fiscal '24 position the Company well to not only grow revenue, but to convert that growth into higher free cash flow as we enter fiscal '24, our cost structure is leaner. Our inventory strategy is increasingly capital-light, and our unit economics are sound. We also operate in a growing market and the two sided platform we have created delivers substantial value to both customers and our brand partners. The majority of the company's resources are focused on driving revenue growth in fiscal '24 and beyond.

在我們討論今年的業績之前，我想花點時間討論一下我們的資產負債表。我們最近的六個季度零利率債務修正反映了我們與貸款合作夥伴的建設性關係。正如約翰所概述的，現金生成是公司的首要任務。我們相信，我們在 24 財年採取的行動使公司不僅能夠增加收入，而且在進入 24 財年時將這種增長轉化為更高的自由現金流，我們的成本結構更加精簡。我們的庫存策略越來越輕資本，而且我們的單位經濟效益也很穩健。我們也在不斷成長的市場中經營，我們創建的雙邊平台為客戶和我們的品牌合作夥伴提供了巨大的價值。公司的大部分資源都集中在推動 24 財年及以後的營收成長。

In addition to revenue growth base cash generation, we are laying the foundation for the beginnings of both in advertising and resale business. Initially, advertising is largely comprised of a sampling business that makes the most of the millions of shipments we sent to customers each year. However, there is more we think we can do here resale as you can see by growth in other revenue consists of building a sale and replenishment business here too, we see further potential for sales to both subscribers and non-subscribers. It is too early to go into more detail, but we see considerable cash generation potential at rental runway in these areas. We think that this potential our strong relationship with our lending partner and our strategic position in the industry will allow us to adequately manage our financial position in a timely manner.

除了以收入成長為基礎的現金產生之外，我們還為廣告和轉售業務的起步奠定了基礎。最初，廣告主要由抽樣業務組成，該業務充分利用我們每年向客戶發送的數百萬件貨物。然而，我們認為我們可以在這裡做更多的轉售，因為您可以看到其他收入的成長也包括在這裡建立銷售和補貨業務，我們看到了向訂戶和非訂戶銷售的進一步潛力。現在討論更多細節還為時過早，但我們看到這些地區的租賃跑道具有巨大的創收潛力。我們認為，我們與貸款合作夥伴的牢固關係以及我們在行業中的戰略地位將使我們能夠及時充分管理我們的財務狀況。

Let me now turn to our financial results and path to free cash flow breakeven. We ended Q4 '23 with 125,954 ending active subscribers, down 0.6% year over year. Average active subscribers during the quarter were 128,840 versus 130,476 subscribers in the prior year. A decrease of 1.3%. Ending active subscribers declined from 131,725 subscribers at the end of Q3 2023 due to expected seasonal trends.

現在讓我談談我們的財務表現和實現自由現金流損益平衡的途徑。截至 23 年第 4 季度，我們的活躍訂閱者數量為 125,954 名，年減 0.6%。本季平均活躍訂閱者為 128,840 人，而前一年為 130,476 人。下降1.3%。由於預期的季節性趨勢，最終活躍訂閱者數量較 2023 年第三季末的 131,725 名有所下降。

Total revenue for the quarter was $75.8 million, up $0.4 million or 0.5% year over year and up $3.3 million or 4.6% quarter over quarter. Subscription and reserve rental revenue decreased $3 million year-over-year in Q. three Q4 '23 due to a decline in the reserve business, along with slightly lower average active subscribers. Other revenue increased 48.6% or $3.4 million year over year due to increased focus on our resale business, which drove incremental cash flow and customer loyalty.

該季度總營收為 7,580 萬美元，年增 40 萬美元，成長 0.5%，季增 330 萬美元，成長 4.6%。由於儲備業務下降以及平均活躍訂戶略有下降，2023 年第四季第三季的訂閱和儲備租賃收入比去年同期減少了 300 萬美元。由於我們更加重視轉售業務，其他收入年增 48.6% 或 340 萬美元，從而推動了現金流和客戶忠誠度的增加。

Total revenue for the year was $298.2 million, up $1.8 million year over year or 0.6%. Fulfillment costs were $20.1 million in Q4 '23 versus $22.7 million in Q4 '22 and $21.5 million in Q3 '23. Fulfillment costs as a percentage of revenue were lower year-over-year and quarter-over-quarter at 26.5% of revenue in Q4 '23 compared to 30.1% of revenue in Q4 '22 and 29.7% of revenue in Q3 '23.

全年總收入為 2.982 億美元，年增 180 萬美元，增幅為 0.6%。 23 年第 4 季的履行成本為 2,010 萬美元，而 22 年第 4 季為 2,270 萬美元，23 年第 3 季為 2,150 萬美元。履行成本佔收入的百分比同比和環比均有所下降，23 年第 4 季佔收入的 26.5%，而 22 年第 4 季佔營收的 30.1%，23 年第 3 季佔營收的 29.7%。

Fulfillment costs benefited from a new transportation contract with UPS and continued warehouse efficiencies. Gross margins were 39.4% in Q4 '23 versus 44.2% in Q4 '22. Q4 '23. Gross margins reflect higher rental product costs due to increased investment in rental product year-over-year and higher sales through our resale channel. Increased investment in rental product reflects the depth adjustments to increase inventory in-stock rates in fiscal '23. Q4 '23, gross margins increased quarter over quarter to 39.4% from 34.8% in Q3 '23 due to better fulfillment margins and seasonally lower revenue share expenses associated with new receipts.

履行成本得益於與 UPS 簽訂的新運輸合約以及持續的倉庫效率。 23 年第 4 季的毛利率為 39.4%，而 22 年第 4 季的毛利率為 44.2%。 23 年第 4 季。毛利率反映了由於租賃產品投資逐年增加以及透過我們的轉售管道銷售增加而導致的租賃產品成本上升。租賃產品投資的增加反映了23財年為提高庫存率而進行的深度調整。 23 年第 4 季度，毛利率環比增長，從 23 年第 3 季的 34.8% 增至 39.4%，原因是履約利潤率提高以及與新收入相關的收入分成費用季節性下降。

Operating expenses were about 7% lower year over year, primarily due to the favorable impact of our cost reduction efforts. In January of 2024, we announced a restructuring plan that will reduce our workforce by approximately 10% by the end of Q2 2024 we believe these reductions will support our path to free cash flow profitability, which I will outline shortly.

營運費用較去年同期下降約 7%，主要是由於我們降低成本的努力產生了有利影響。 2024 年1 月，我們宣布了一項重組計劃，到2024 年第二季度末將減少約10% 的員工隊伍，我們相信這些裁員將支持我們實現自由現金流盈利的道路，我將很快概述這一點。

Total operating expenses, which includes technology, marketing and G&A for 55.8% of revenue in Q4 '23 versus 60.2% of revenue in Q4 22% and 60.1% in Q3 '23. Adjusted EBITDA for the quarter was $11.2 million or 14.8% of revenue versus $7.1 million and 9.4% of revenue in the prior year. Adjusted EBITDA for the year was $26.9 million or 9% of revenue versus $6.7 million or 2.3% of revenue in the prior year. Adjusted EBITDA year-over-year reflects the significant progress we have made in reducing fixed costs as well as fulfillment related efficiencies.

總營運支出，其中包括技術、行銷和一般行政費用，佔 23 年第 4 季收入的 55.8%，而 2023 年第 4 季佔收入的 60.2%、22% 和 23 年第 3 季的 60.1%。本季調整後 EBITDA 為 1,120 萬美元，佔營收的 14.8%，而去年同期為 710 萬美元，佔營收的 9.4%。本年度調整後 EBITDA 為 2,690 萬美元，佔營收的 9%，而前一年為 670 萬美元，佔營收的 2.3%。調整後的 EBITDA 年比反映了我們在降低固定成本以及履行相關效率方面取得的重大進展。

Free cash flow for fiscal year 2023 was negative $70.3 million versus negative $92 million in fiscal year 2022.

2023 財年的自由現金流為負 7,030 萬美元，而 2022 財年為負 9,200 萬美元。

I will now discuss guidance for fiscal year 2024. Let me start with a bridge to cash flow breakeven for fiscal year '24. Our debt restructuring in December eliminated all cash interest in fiscal '24, which equates to approximately $5 million in savings on a year-over-year basis on rental product. Our fiscal '24 plan is to acquire between $48 million and $50 million in capital expenditures, which excludes any impact of timing of payments as found in the supplemental cash flow statement and comply with our debt covenants, which we expect to drive approximately $28 million in rental products CapEx savings year over year, while a decrease of approximately $28 million or 37% in rental product CapEx may seem drastic. This reduction largely reflects two things. First, a shift towards procuring more inventory via share of IRTR., which is paid upon performance and not capitalized and to the depth adjustment costs incurred in fiscal '23 to increase rental product in-stock rates on the fixed cost side, we announced the restructuring plan in January, which included a 10% reduction in our corporate headcount by Q2 '24. The restructuring plan, in addition to fixed cost actions we took earlier in fiscal '23 is expected to result in approximately $11 million of cash savings year over year. In fiscal '23, we incurred onetime costs that were related to the restructuring and debt refinancing. These one-time costs, combined with other miscellaneous items such as tax credit, deferred revenue and improved working capital are expected to contribute approximately $10 million in year-over-year. Free cash flow savings outlined above imply approximately $54 million in year-over-year savings, starting with fiscal '23 cash consumption of negative $70 million. These savings reduced cash consumption to negative $16 million. We expect improvements in variable costs and higher revenue to bridge this gap consistent with 2023 weeks. We continue to expect improvements in fulfillment costs as a percentage of sales. And importantly, we believe the strength of our resale business provides a key lever to drive free cash flow breakeven even in scenarios with minimal subscription and reserve revenue growth.

我現在將討論 2024 財年的指導。讓我從通往 24 財年現金流盈虧平衡的橋樑開始。我們 12 月的債務重整消除了 24 財年的所有現金利息，相當於租賃產品比去年同期節省了約 500 萬美元。我們的24 財年計畫是獲得4,800 萬至5,000 萬美元的資本支出，其中不包括補充現金流量表中付款時間的任何影響，並遵守我們的債務契約，我們預計這將推動約2,800 萬美元的資本支出。租賃產品資本支出同比節省，而租賃產品資本支出減少了約 2800 萬美元或 37%，這似乎是巨大的。這種減少主要反映了兩件事。首先，轉向透過 IRTR 份額採購更多庫存，這是根據業績支付而不是資本化，以及 23 財年發生的深度調整成本，以提高固定成本方面的租賃產品庫存率，我們宣布1 月份的重組計劃，其中包括到2024 年第二季將我們的公司員工人數減少10%。除了我們在 23 財年早些時候採取的固定成本行動之外，重組計劃預計將同比節省約 1,100 萬美元的現金。在 23 財年，我們產生了與重整和債務再融資相關的一次性成本。這些一次性成本，加上稅收抵免、遞延收入和改善的營運資金等其他雜項項目，預計將比去年同期貢獻約 1,000 萬美元。上述自由現金流節省意味著年比節省約 5,400 萬美元，從 23 財年現金消耗負 7,000 萬美元開始。這些節省將現金消耗減少至負 1600 萬美元。我們預計變動成本的改善和收入的增加將在 2023 週內彌補這一差距。我們繼續預期履行成本佔銷售額的百分比會有所改善。重要的是，我們相信轉售業務的實力提供了一個關鍵槓桿，可以在認購和儲備收入增長極少的情況下推動自由現金流盈虧平衡。

Let me now outline specific guidance for fiscal 2024, starting with full year guidance. As outlined in the press release, we expect to grow revenue for the year between 1% and 6% versus fiscal 2023 revenue. We also expect fiscal 2024 adjusted EBITDA margin to be between 15% and 16% of revenue. Finally, as we just discussed, we expect free cash flow breakeven for fiscal 2024.

現在讓我概述 2024 財年的具體指導方針，從全年指導方針開始。正如新聞稿中所述，我們預計今年的營收將比 2023 財年的營收成長 1% 至 6%。我們也預期 2024 財年調整後的 EBITDA 利潤率將在營收的 15% 至 16% 之間。最後，正如我們剛剛討論的那樣，我們預計 2024 財年自由現金流將實現損益兩平。

Turning to Q1 '24, we expect revenue to be between $73 million and $75 million. We also expect adjusted EBITDA margins for the quarter to be between 7% and 8% of revenue. As we typically expect, Q1 will see higher upfront revenue share expenses as well as seasonally higher marketing costs. Finally, note that Q1 is also expected to be a quarter with seasonally high rental product receipts driving higher rental product capital expenditures versus the quarterly average run rate.

談到 24 年第一季度，我們預計營收將在 7,300 萬美元至 7,500 萬美元之間。我們也預期本季調整後的 EBITDA 利潤率將在營收的 7% 至 8% 之間。正如我們通常預期的那樣，第一季的前期收入分成費用以及季節性較高的行銷成本將會增加。最後，請注意，預計第一季租賃產品收入季節性較高，將推動租賃產品資本支出相對於季度平均運作率更高。

Let me conclude by reiterating that we expect to grow revenue in fiscal '24 and reach free cash flow breakeven for the full year, we expect rental run rate and fiscal '24 as a stronger and sustainable business.

最後，我要重申，我們預計 24 財年的收入將成長，並在全年實現自由現金流盈虧平衡，我們預計租金運行率和 24 財年將成為一項更強大、可持續的業務。

We will now take your questions.

我們現在將回答您的問題。

Thank you. We will now be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone. Confirmation tone will indicate that your line is in the question queue and you may press star two. If you'd like to remove your question from the queue participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please while we poll for questions.

謝謝。我們現在將進行問答環節。如果您想提問，請按電話上的星號一。確認音將表示您的線路已在問題佇列中，您可以按星號二。如果您想使用揚聲器裝置從佇列參與者中刪除您的問題，則可能需要在按星號鍵之前拿起聽筒。請稍等一下，我們進行投票提問。

Our first question comes from the line of Andrew Boone with JMP Securities. Please proceed with your question.

我們的第一個問題來自 JMP 證券公司的安德魯‧布恩 (Andrew Boone)。請繼續你的問題。

Thanks, much for taking my questions. I wanted to start off with the 2024 guide. Can you just help us understand the acceleration that's implied in guidance in 2024? I understood you called out marketing but is there anything else you can help us bridge the acceleration that you guys are implying?

非常感謝您回答我的問題。我想從 2024 年指南開始。您能否幫助我們理解 2024 年指引中暗示的加速？我知道您呼籲行銷，但是您還有其他什麼可以幫助我們彌合您所暗示的加速嗎？

Sure. I think the as you know, when we I would say that the most important thing to point out here is and the one factor that gives us a very significant amount of confidence in the guidance we've outlined. Obviously, number one, you've seen an improved trajectory from Q3 to Q4. So we are starting to see the benefits of many of the strategies we put in place.

當然。我認為正如您所知，當我們我要說的最重要的事情是，讓我們對我們概述的指導充滿信心的一個因素。顯然，第一，您已經看到從第三季到第四季的軌跡有所改善。因此，我們開始看到我們實施的許多策略的好處。

Second thing that's important to point out is we do as Jenn pointed out, have seen a 10% improvement year over year in churn. That is a very direct impact on the growth and retention that we forecast for the year and third, I think we have started to make and both brand and paid marketing improvements in the business that we expect to bear fruit in the coming years. So I think everything that we're seeing so far in the business gives us some confidence that we're very much on track to meet these numbers.

第二件需要指出的重要事情是，正如 Jenn 指出的那樣，我們的客戶流失率比去年同期提高了 10%。這對我們預測的今年和第三年的成長和保留有非常直接的影響，我認為我們已經開始在業務中進行品牌和付費行銷改進，我們預計將在未來幾年取得成果。因此，我認為迄今為止我們在業務中看到的一切都讓我們有信心，我們非常有能力實現這些數字。

I think that what you see as well is you see that we have developed key levers to drive revenue growth. So the reason why we spoke about our retail business and the success that we saw in 2023 as we really built that out as a lever, we were able to drive not only more customers interacting with buying things they have at home. They're buying more units from us is that high margins?

我認為您所看到的也是我們已經開發出推動營收成長的關鍵槓桿。因此，我們之所以談論我們的零售業務以及我們在 2023 年看到的成功，因為我們確實將其作為槓桿，我們不僅能夠推動更多的客戶與購買他們家中的東西進行互動。他們從我們這裡購買更多單位，利潤率高嗎？

It's itself IROI. on top of the rental revenue we already made from those units. That's a significant lever. We've seen really nice momentum in retention. We are starting to see nice momentum in acquisition across both our subscription business as well as reserve. So we have a lot of confidence in our growth going into this year. And most importantly, when we conducted our restructuring, again, it was not just about cost cutting. It was about a realignment of the resources of this company aligned growth, everyone here is focused on marketing or digital product innovation. And so because we're putting all of our resources into these areas, we're already seeing that momentum. That's what really gives us confidence in the guide.

它本身就是 IROI。除了我們已經從這些單位獲得的租金收入之外。這是一個重要的槓桿。我們看到了保留方面的良好勢頭。我們開始看到我們的訂閱業務和儲備業務的收購勢頭良好。因此，我們對今年的成長充滿信心。最重要的是，當我們進行重組時，這不僅僅是為了削減成本。這是關於公司資源的重新調整，以實現成長，這裡的每個人都專注於行銷或數位產品創新。因此，由於我們將所有資源投入這些領域，我們已經看到了這種勢頭。這才是真正讓我們對指南充滿信心的原因。

And I would say another thing to keep in mind, which I just mentioned, but I think is important to highlight again is we did face throughout fiscal '23 a fairly considerable set of headwinds from a few different decisions we made, right. One was we faced a decline in the reserve business as we pointed out for several quarters now and that business is on a much better trajectory relative to the growth rates of declines in growth that we've seen over the last few quarters. So that's one contributor.

我想說另一件事要記住，我剛才提到了這一點，但我認為再次強調這一點很重要，我們在整個23 財年確實面臨著來自我們做出的一些不同決定的一系列相當大的阻力，對吧。一是我們面臨儲備業務的下降，正如我們在幾個季度中指出的那樣，而且相對於我們過去幾個季度看到的成長下降的成長率，業務的發展軌跡要好得多。這就是貢獻者之一。

The second thing is we obviously embarked on a number of promotional changes throughout fiscal 2023 that we have been transparent about that for acquisitions throughout the course of this year. We'll obviously have anniversaried those. And I think we're seeing nice behavior among repeat customers, which gives us confidence that we're on a good trajectory there.

第二件事是，我們顯然在 2023 財年開始了一系列促銷變革，我們在今年全年的收購方面一直保持透明。我們顯然會慶祝這些週年紀念日。我認為我們在回頭客中看到了良好的行為，這讓我們相信我們正處於良好的軌道上。

Thanks. And then I wanted to ask about the advertising business that you mentioned in the prepared remarks. What are the key hurdles that you guys need to knock down operationally for that to begin to scale and for you guys to grow that business into something more meaningful? Thanks so much, guys.

謝謝。然後我想問一下你在準備好的發言中提到的廣告業務。你們需要在營運上克服哪些關鍵障礙才能開始擴大規模並將業務發展成為更有意義的東西？非常感謝，夥計們。

Sure. Look, I think it's early days, so I'm not going to get into too much detail as I mentioned the first thing, we sent several million shipments to our customers. I think historically what we what we have done is put relatively little effort in trying to maximize the value we can get from a sampling program. What we need to do is make sure that we have a we have a organized outreach program for brands. We highlight the benefits that our customers can provide those brands. And so I think we have got the staff now to start doing some of that. I think we have to it's a process that we need to follow. But but I'm I think it is a real opportunity for us. And frankly, we're at the beginning stages of taking advantage of that opportunity.

當然。聽著，我認為現在還為時過早，所以我不會像我提到的第一件事那樣透露太多細節，我們向客戶發送了數百萬件貨物。我認為從歷史上看，我們所做的只是付出相對較少的努力來試圖最大化我們可以從抽樣計劃中獲得的價值。我們需要做的是確保我們有一個有組織的品牌推廣計劃。我們強調我們的客戶可以為這些品牌提供的好處。所以我認為我們現在已經讓工作人員開始做一些事情了。我認為我們必須遵循這個過程。但我認為這對我們來說是一個真正的機會。坦白說，我們正處於利用這一機會的開始階段。

And I think if you think more broadly, we just shared that nearly 50% of the inventory that we are acquiring in 2024 is going to come via revenue share, meaning we don't really pay for it upfront or we pay very little amounts upfront. And we revenue share with our brand partners, hundreds of them based on the performance of this inventory, the only reason why any brand would interact with us in this way is because they see us as a powerful marketing channel on behalf on behalf of their brand, they know that when Nick psychographic of women, which is highly desirable that we have in our rent, the runway base interacts with their brand, that brand affinity is built and that those experiences drive additional purchases for the for those brands. So we've seen that this platform that we've created is this Retail 2.0 platform. We've brought essentially all the benefits of a retail store into someone's home into their real life where they get to know brands and they develop an affinity and they become customers. So now we are bringing that same prowess of what we've built with fashion brands, and we're bringing that into other industries to enable that level of creative new customer acquisition. So we see this as being a really big opportunity for the business.

我認為，如果你從更廣泛的角度思考，我們剛剛分享了我們在2024 年收購的近50% 的庫存將透過收入分成來獲得，這意味著我們實際上並沒有預先支付費用，或者我們預先支付的金額很少。我們與我們的品牌合作夥伴分享收入，數百個品牌合作夥伴基於庫存的表現，任何品牌都會以這種方式與我們互動的唯一原因是因為他們將我們視為代表他們品牌的強大行銷管道，他們知道，當尼克對女性的心理描寫（這是我們在租金中非常理想的）時，T台基地與他們的品牌互動時，品牌親和力就建立起來，並且這些體驗會推動對這些品牌的額外購買。所以我們已經看到，我們創建的這個平台是零售 2.0 平台。我們基本上將零售店的所有好處帶入了人們的家中，帶入了他們的現實生活，在那裡他們了解品牌並建立親和力並成為客戶。因此，現在我們正在將與時尚品牌相同的實力帶入其他行業，以實現這種水平的創造性新客戶獲取。因此，我們認為這對企業來說是一個非常大的機會。

Thank you.

謝謝。

Our next question comes from the line of Alexandra Steiger with Goldman Sachs. Please proceed with your question.

我們的下一個問題來自高盛的亞歷山德拉·施泰格 (Alexandra Steiger)。請繼續你的問題。

Two questions, if I can. So first on marketing you mentioned that you wanted to incrementally invest into marketing going forward post a few quarters of marketing spending being down. So how should we think about the cadence of marketing investments through the year and the potential impact as we think about customer growth versus driving retention among your existing customers.

有兩個問題，如果可以的話。首先，在行銷方面，您提到，在行銷支出下降了幾個季度後，您希望在未來增加對行銷的投資。因此，當我們考慮客戶成長與提高現有客戶保留率時，我們應該如何考慮全年行銷投資的節奏及其潛在影響。

And then somewhat related with Natalie, having joined us the new CMO how should we think about kind of like the areas like she will be most focused on and going forward?

然後與娜塔莉有些關係，新任首席行銷長加入我們後，我們該如何思考她最關注和未來發展的領域？

So retention at Rent the Runway is focused and retention is driven by our experience. We shared last year that retention drops in the first half of the year because of problems that we had with inventory depth we went in. We fix that problem very quickly. We saw that not only did retention rebound, but it improved significantly year over year, 10%. When you look at Q4 versus Q4, that's not just related to inventory depth. It's related to lots of improvements that we've made to the totality of the customer experience. Of course, there are other things that we're driving within marketing to drive additional retention across all of our customer segments. And that's really a 360 degree lifecycle segment strategy that the marketing team is developing, where we're focusing on our customer segments and coming up with different both communication plans and strategies to service those customer segments differently. The other elements of the marketing plan that we are focused on and what Natalie is going to be focused on is not only lifecycle but increasing traffic, so opening up the funnel of new customers who are considering us. So you'll see us interact with lean more diverse set of marketing channels to drive more traffic to the site. Number one. Number two is reigniting the brand marketing. So our business has grown and continues to actually be very strong as it relates to the organic traffic coming to the site, people come to Rent the Runway directly and investing in our brand activities in authentic ways, rebuilding our relationships with customers so that that customer virality, you know, continues to be a huge source of our acquisition. That's where you'll see us focusing now. So much of the underpinning of this is content and the new creative strategy, a content strategy at this point, fuels organic growth in your lifecycle strategies, it infuses acquisition because the content strategy informs the efficacy of paid advertising so you'll see us innovate our creative strategy and our content strategy, which will actually help all channels.

因此，Rent the Runway 的重點是留住人才，而留住人才是由我們的經驗所驅動的。我們去年曾表示，由於我們的庫存深度存在問題，上半年的留存率有所下降。我們很快就解決了這個問題。我們看到，留存率不僅出現反彈，而且比去年同期顯著提高，達到 10%。當你比較第四季和第四季時，你會發現這不僅僅與庫存深度有關。這與我們對整體客戶體驗所做的許多改進有關。當然，我們也在行銷領域推動其他一些事情，以提高所有客戶群的保留率。這實際上是行銷團隊正在開發的 360 度生命週期細分策略，我們專注於我們的客戶群，並提出不同的溝通計劃和策略，以不同的方式為這些客戶群提供服務。我們關注的行銷計劃的其他要素以及娜塔莉將關注的不僅是生命週期，而且是增加流量，從而打開考慮我們的新客戶的管道。因此，您會看到我們與更多樣化的行銷管道互動，以吸引更多網站流量。第一。第二是重新點燃品牌行銷。因此，我們的業務已經成長，並且實際上仍然非常強勁，因為它與進入網站的有機流量有關，人們直接來租用跑道並以真實的方式投資於我們的品牌活動，重建我們與客戶的關係，以便客戶你知道，病毒式傳播仍然是我們收購的一個巨大來源。這就是我們現在關注的焦點。這一切的基礎是內容和新的創意策略，此時的內容策略會促進生命週期策略的自然增長，它會促進獲取，因為內容策略會告知付費廣告的功效，因此您會看到我們的創新我們的創意策略和內容策略，這實際上會對所有管道都有幫助。

And I would say on the timing of marketing expenditures, I would use fiscal '23 and the timing of the quarterly timing of expenditures as a result of the good die or what we might expect in fiscal '24. As you know, our Q1 and Q3 tend to be heavy subscriber acquisition months quarters for us, and that's when we typically deploy a lot of the marketing expenditure that we have. But fiscal '23 is a good guide for timing.

我想說的是，關於行銷支出的時間安排，我將使用 23 財年和由於良好模具而產生的季度支出時間安排或我們在 24 財年的預期。如您所知，我們的第一季和第三季度往往是我們的大量訂戶獲取月份和季度，我們通常會在此時部署大量行銷支出。但 23 財年是一個很好的時機指南。

Got it.

知道了。

Very helpful. Thank you. And then one follow-up, if I can that you didn't mention the broader consumer environment and some macro volatility in your prepared remarks versus obviously some e-commerce companies and also brands calling out, you know, continued consumer weakness or spending weakness. So just wondering, Mike, what you're seeing across your customer base since the beginning of the year?

很有幫助。謝謝。然後是一個後續行動，如果可以的話，您在準備好的講話中沒有提到更廣泛的消費者環境和一些宏觀波動，而顯然一些電子商務公司和品牌則呼籲，您知道，持續的消費者疲軟或支出疲軟。麥克，我想知道自今年年初以來您在客戶群中看到了什麼？

We're not seeing any macro impacts on the business. We feel strong momentum and feel very good about the guidance that we provided to grow this year.

我們沒有看到對業務的任何宏觀影響。我們感受到了強勁的勢頭，並對我們今年提供的成長指導感到非常滿意。

Thank you.

謝謝。

Thinking coming back, we're seeing in many ways the opposite in the sense that our customer loyalty is up. Customers are willing to buy more items from us. You know, the retail business is growing significantly So we have not --

回想起來，我們在許多方面都看到了相反的情況，因為我們的客戶忠誠度有所提高。顧客願意向我們購買更多商品。你知道，零售業務正在顯著成長，所以我們沒有——

our Net Promoter Score is up 20 points. I mean people are having a better experience that drives an increasingly high customer flywheel for us and higher customer virality. So we're not seeing negative impacts to the macro at all.

我們的淨推薦值上升了 20 分。我的意思是，人們獲得了更好的體驗，這為我們帶來了越來越高的客戶飛輪和更高的客戶病毒式傳播。因此，我們根本沒有看到對宏觀經濟的負面影響。

And I would say that this goes back to some of the things we've talked about in the past, which is we do offer both brands and customers significantly more value at a time when they might be price conscious or we're not, but no signs in our business, right now.

我想說，這可以追溯到我們過去討論過的一些事情，那就是，當品牌和客戶可能對價格敏感或我們不敏感時，我們確實為他們提供了更多的價值，但是現在我們的業務中沒有任何跡象。

I think it also brings up a very important point that we made last year, but it's worth repeating that we had a relatively flat year last year from a revenue standpoint. The reason for that was our own it was that we came into the year with lower inventory depth and we needed. We recognize that that was a problem we solved that problem. We exited the year in a great position related to our inventory. We see that in all of our metrics. So the flatness of our year was self-inflicted but we now actually have spent 2023 and dramatically not only improving the inventory position, but improving so many other aspects of the customer experience that really set us up for a strong 2024.

我認為這也提出了我們去年提出的一個非常重要的觀點，但值得重複的是，從收入的角度來看，去年我們的業績相對持平。原因是我們自己的，因為我們進入這一年的庫存深度較低，而我們需要。我們認識到這是一個問題，我們解決了這個問題。今年結束時，我們在庫存方面處於有利地位。我們在所有指標中都看到了這一點。因此，我們這一年的平淡是我們自己造成的，但我們現在實際上已經度過了2023 年，不僅大幅改善了庫存狀況，還改善了客戶體驗的許多其他方面，這真正為我們在2024 年的強勁表現奠定了基礎。

Thank you.

謝謝。

Our next question comes from the line of Ashley Helgans with Jefferies. Please proceed with your question.

我們的下一個問題來自 Ashley Helgans 和 Jefferies 的對話。請繼續你的問題。

Hi, it's Blake. Thanks for taking our question and nice job on all the progress. I wanted to first ask on subscriber growth. I believe you mentioned you are going to widen the funnel of potential customers was just wondering if you could elaborate on that on. Has there been any update in your target customer you could talk about given some of the high end luxury editions and the pullback in promos, like how would you if we look back over the last year three-plus years, how would you talk about your TAM and target customer now versus maybe a few years ago?

嗨，我是布萊克。感謝您提出我們的問題，並祝您一切順利。我想先詢問用戶成長情況。我相信您提到您將擴大潛在客戶的管道，只是想知道您是否可以詳細說明這一點。鑑於一些高端豪華版和促銷活動的減少，您的目標客戶是否有任何更新，例如，如果我們回顧過去三年多，您會如何談論您的目標客戶？現在的TAM 和目標客戶與幾年前相比？

Well, I think said by opening up the funnel, one of the primaries, primary ways we're going to do that is by diversification of our marketing channels. So really just expanding the channels through which we reach customers. So we, like some other businesses had spend too much of our paid marketing dollars concentrated into the meta platform into the Google platform. And you'll see us dramatically diversify our channel mix to drive additional traffic to the site.

嗯，我認為透過開放漏斗，我們要做到這一點的主要方式之一是行銷管道的多元化。所以其實只是擴大我們接觸客戶的管道。因此，像其他一些企業一樣，我們花了太多的付費行銷資金，集中在Google平台的元平台上。您會看到我們大大多樣化了我們的管道組合，以增加網站的流量。

The other thing that we're focused again on is content and a lot of that content is social first. So really driving, you know, the organic nature of our business in social channels, which is where brands are being built as it relates to the psychographic of our customer which is extremely wide. There are 16 year olds who use Rent the Runway. There are 76 year old to use Rent the Runway. It's about a woman who appreciates designer brands and who also has this busy life who are trying to optimize around for time. We do see our customers using us for work for special events for traveling for weekends. With the TAM, it has never been a problem for us. And so you'll see us focus on this psychographic, which is a more sophisticated customer and leveraging more channels and especially leveraging kind of social first content in order to draw this customer ends. That's really how you want to if you want a specific example, Blake, you know, yes, we know that many of our customers have many agents have careers. And we just this week launched a workwear hub on our site of merchandise content for them for different kinds of office environments. Styling them for everything from a creative office to a bank to a tech firm differently. And we're kind of speaking to the exact customer that we have, which is someone who wants a solution. She doesn't have time to spend shopping. We're able to cater to her via our content. And you'll see us not only activate and what we're doing on the site. But we're also following this up with in real-life pop-ups that are focused on styling for we're inviting her into a retail environment where we partnered with the celebrity stylists to help to style our customers around workwear. So it you've seen 360 degree activations across many different channels to address this really unique psychographic that we cater to.

我們再次關注的另一件事是內容，其中許多內容首先是社交內容。因此，您知道，真正推動了我們在社交管道中業務的有機本質，這是建立品牌的地方，因為它與我們極其廣泛的客戶心理有關。有 16 歲的人使用 Rent the Runway。有76歲的老人使用Rent the Runway。這是關於一位欣賞設計師品牌的女性的故事，她也過著忙碌的生活，試圖優化時間。我們確實看到我們的客戶利用我們來工作、參加特殊活動、週末旅行。有了 TAM，這對我們來說從來都不是問題。因此，您會看到我們專注於這種心理統計，這是一個更複雜的客戶，並利用更多的管道，特別是利用社交優先的內容來吸引這些客戶。如果你想要一個具體的例子，這確實是你想要的，布萊克，你知道，是的，我們知道我們的許多客戶都有許多代理商有職業。本週，我們剛在網站上推出了一個工作服中心，為他們提供適合不同類型辦公環境的商品內容。從創意辦公室到銀行再到科技公司，對它們進行不同的設計。我們正在與我們擁有的確切客戶交談，即想要解決方案的人。她沒有時間去購物。我們能夠透過我們的內容來迎合她。您不僅會看到我們的活動以及我們在網站上所做的事情。但我們也在現實生活中的快閃店中跟進，這些快閃店專注於造型，因為我們邀請她進入零售環境，在那裡我們與名人造型師合作，幫助我們的顧客設計工作服的造型。因此，您已經看到了許多不同管道的 360 度激活，以解決我們所迎合的這種真正獨特的心理特徵。

And that's interesting about the workwear segments you're offering. Would you say that fits under your initiative improving the search tools? Because I know that was a big focus.

你們提供的工作服細分市場很有趣。您認為這符合您改進搜尋工具的倡議嗎？因為我知道這是一個重點。

Exactly. So we have we started a significant focus in 2023 on product discovery, which is really like how do we help people figure out what those 10 items per month that they get from their respiratory subscription, which ones to Beach feedback and our customers want advice and they want advice for the specific use cases that they have going on in their lives. So in April, they might be going on spring break and they're going to be up. So now they can go to clinic use case-based hub that we have on the site that provide real feedback of okay for their travel that they're taking to some sunny destination here. All of the Luxe analysis that we've put together here are the key trends here are the key items that they need, they can go into the workwear hub and get styling advice and suggestions in that way. So this is really about taking the discovery work. We did in 2023 and really taking it to the next level in 2024 based on the learnings that we had in '23.

確切地。因此，我們在 2023 年開始專注於產品發現，這實際上就像我們如何幫助人們找出他們每月從呼吸訂閱中獲得的 10 件商品，哪些是海灘反饋以及我們的客戶需要建議和他們需要針對生活中具體用例的建議。所以到了四月份，他們可能會放春假，然後就起床了。因此，現在他們可以前往我們網站上基於臨床使用案例的中心，該中心為他們前往某個陽光明媚的目的地的旅行提供了真實的反饋。我們在這裡匯總的所有奢侈品分析都是主要趨勢，這裡是他們需要的關鍵單品，他們可以進入工作服中心並以這種方式獲得造型意見和建議。所以這其實是關於進行發現工作。我們在 2023 年做到了，並根據我們在 23 年學到的經驗，在 2024 年真正將其提升到了一個新的水平。

That sounds great. And then the last one was, I know you've given Q1 guide, but any color you can talk about on kind of how the months progressed in Q4 and what you're seeing so far quarter to date?

聽起來不錯。最後一個是，我知道您已經提供了第一季度指南，但是您可以談論第四季度的幾個月進展情況以及到目前為止您所看到的情況嗎？

I would just say we're encouraged with the business we think where the reason we provided this guidance is because we obviously feel good about where the business is and the trends that we're seeing are consistent with the guidance we provided. But there's no color on kind of the monthly trends that we're sharing at this point.

我只想說，我們對我們認為提供此指導的業務感到鼓舞，因為我們顯然對業務狀況感覺良好，我們看到的趨勢與我們提供的指導一致。但我們目前分享的每月趨勢還沒有任何顏色。

Got it. Thank you very much.

知道了。非常感謝。

Thank you.

謝謝。

There are no further questions at this time. I would now like to turn the call back over management for any closing comments.

目前沒有其他問題。我現在想將電話轉回給管理層，以徵求任何結束意見。

Thank you, everyone. I just wanted to reiterate that we do expect fiscal '24 to be a really important year for Rent the Runway. We're making significant progress on revenue on free cash flow and on becoming a significantly capital-light company. We'll see you next cycle.

謝謝大家。我只是想重申，我們確實預計 24 財年對 Rent the Runway 來說將是非常重要的一年。我們在自由現金流收入和成為資本顯著減少的公司方面取得了重大進展。我們下個週期再見。

Thank you.

謝謝。

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

今天的電話會議到此結束。此時您可以斷開線路。感謝您的參與。