URBN’s 7-year-old clothing rental platform Nuuly reached a milestone, with revenue surpassing $500 million in the year ending January 31, 2026. URBN now expects Nuuly to become a billion-dollar brand in the next few years, according to Nuuly CEO David Hayne.
But key to Nuuly’s success hasn’t been taking existing market share away from other rental platforms. Instead, nearly 70% of all Nuuly subscribers have never rented from any platform before, according to Nuuly’s customer research. That means Nuuly has succeeded in expanding the addressable market and creating a new cohort of renters.
That’s a good sign for the business model, which surged in the 2010s, faced headwinds in the Covid era as occasions to rent ground to a halt and is now seeing a resurgence.
“It’s not a finite market that we’re stealing share from,” Hayne told Glossy. “We’re broadening the audience of the rental concept. It’s partly that we’ve put a lot of work into building the brand, and partly that the model itself is naturally appealing to many women. Our innovation was to make rental more approachable, a little more everyday, and to reach a broader audience.”
Rental companies across the board have seen their subscriber counts grow in recent months. Nuuly had over 420,000 subscribers as of February, accounting for 64% of the country’s rental market share. Meanwhile, 17-year-old Rent the Runway has nearly 150,000 active subscribers, a 12% increase from the previous year, and 185,000 total subscribers, a 6% increase from the previous year.
Price sensitivity from younger consumers feeling economic pressure is one factor leading to rental’s resurgence. Investors are also interested, with newer rental startups like Vivrelle and Pickle both raising tens of millions of dollars in capital in the last year.
Both Nuuly and Rent the Runway have also made efforts to be more flexible and transparent about subscriptions and cancellations. Rent the Runway recently updated its add-on option, which lets customers pay extra for additional items, to better communicate that pricing is prorated based on the time left in the month. CEO Jennifer Hyman said this small change in transparency led to a 17% year-over-year increase in the subscription add-on rate in the last quarter of 2025. Rent the Runway’s revenue last quarter was $87 million, a 15% increase from the previous year.
“Add-on pricing transparency and one-off shipments to drive incremental revenue for subscribers, creating more visibility around pricing and the value she is getting by adding on to her order, has significantly boosted add-on revenue,” Hyman said on an earnings call in December.
Hayne has a similar philosophy around Nuuly, which makes pausing, canceling and restarting a subscription as simple as a few clicks.
“Trying to cancel a gym membership or a phone plan — nobody likes that,” Hayne said. “We’ve intentionally built Nuuly to let customers be very fluid and active. They can pause, skip a month or reactivate very easily, because it’s not high-commitment. It’s easy to dip in and out, which makes it easier for customers to give it a try.”
