The company’s changes also include improvements to inventory strategy, product innovation and connection with core customers, as well as a recapitalization plan that was announced in August, Rent the Runway Co-Founder and CEO Jennifer Hyman said Thursday (Sept. 11) during the company’s quarterly earnings call.

“Significant business transformations typically take place over a long time horizon,” Hyman said. “However, over the last several months, we’ve made swift progress and delivered results quickly.”

Recent product launches that enable personalized recommendations include features based on each customer’s favorite designers, styles and occasions, according to a presentation released Thursday.

Launched in August, these features personalize the customer’s browsing experience with “relevant recommendations based on her preferences and interests to make picking easy,” the presentation said.

The company also plans to leverage AI to surface insights from members’ reviews, making it easier for customers to find the right style and fit, per the presentation.

“Looking forward, product improvements will focus on incorporating more personalized recommendations […] and using AI for review summaries and fit improvements to build a continuously improved product for our customers,” Hyman said during the call.

Hyman also highlighted other components of Rent the Runway’s transformation, including a “historic investment in inventory” that has added 2,200 new styles and 56 new brands to the platform so far this year, giving customers more items to browse and rent; the launch of affiliate emails that enable customers to purchase from brands via links in Rent the Runway’s emails; new social media campaigns that facilitate the company “meeting our customers where they are on Instagram, TikTok and Reddit”; and exclusive, in-person events for subscribers that drew demand that was three times greater than capacity.

During the quarter ended July 31, Rent the Runway saw year-over-year increases of 2.5% in revenue, 13.4% in active subscribers, 5.7% in total subscribers, and 77% in average subscription net promoter score, according to a Thursday earnings release.

Hyman also spotlighted the recapitalization plan that Rent the Runway announced Aug. 21, saying it will strengthen the company’s balance sheet and supply it with fresh capital.

“Since COVID, I believe that our capital structure has been the thing holding us back from making a full comeback, and we’re happy to be moving forward into a new chapter,” Hyman said during the call. “We’re ready to be reacquainted with the investor community and I view this as our IPO 2.0.”

Artificial intelligence giant OpenAI on Thursday announced its nonprofit parent will retain control of the company while also gaining an equity stake worth more than $100 billion.

The move will allow OpenAI to raise new capital while also making its nonprofit parent company “one of the most well-resourced philanthropic organizations in the world,” according to Bret Taylor, chairman of OpenAI’s board.

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“This recapitalization would also enable us to raise the capital required to accomplish our mission — and ensure that as OpenAI’s [public benefit corporation] grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact,” Taylor said in a statement.

OpenAI and Microsoft also said in a joint statement on Thursday that they signed a non-binding memorandum of understanding (MOU) to shape their next phase of partnership and are actively working to finalize a definitive deal. The companies said they are focused on building “the best” artificial intelligence tools that are also safe.

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“OpenAI and Microsoft have signed a non-binding memorandum of understanding (MOU) for the next phase of our partnership,” the two companies said in a joint statement Thursday afternoon. “We are actively working to finalize contractual terms in a definitive agreement. Together, we remain focused on delivering the best AI tools for everyone, grounded in our shared commitment to safety.”

The Microsoft headquarters campus in Redmond, Washington. (iStock / iStock)

Microsoft has reportedly invested around $13 billion in the ChatGPT creator since 2019.

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In May, OpenAI announced it was scuttling its plan to move the company away from a nonprofit structure to becoming a for-profit company. The ChatGPT-maker created a for-profit limited liability company (LLC), which it converted into a public benefit corporation that considers the interests of shareholders as well as OpenAI’s mission. The tech giant announced at the time that OpenAI’s nonprofit would have operational control over the public benefit corporation and would be a large shareholder in it.

Sam Altman, co-founder and CEO of OpenAI, speaks during a panel discussion titled “The Age of AI” at the Technical University of Berlin on February 07, 2025, in Berlin, Germany. (Sean Gallup/Getty Images / Getty Images)

OpenAI CEO Sam Altman, who prompted the company’s exploration of moving to a for-profit structure to make it easier for the company to raise the large amounts of money for investments he thinks will be needed to achieve artificial general intelligence (AGI), sent a letter to employees at the time explaining the decision and what it means for the company.

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“OpenAI was founded as a nonprofit, is today a nonprofit that oversees and controls the for-profit, and going forward will remain a nonprofit that oversees and controls the for-profit. That will not change,” Altman wrote in May.

FOX Business’ Eric Revell contributed to this report.

Microsoft is planning to make “significant investments” in its own AI chip cluster to become “self-sufficient in AI,” Microsoft AI CEO Mustafa Suleyman said during an all-employee town hall meeting on Thursday.

Microsoft’s AI strategy has so far largely relied on a partnership with OpenAI, although the companies appear to be drifting apart lately and they’re locked in tense contract renegotiations right now.

Suleyman’s comments suggest Microsoft wants to forge its own path in AI, while still supporting OpenAI with cloud-computing services.

“It’s critical that a company of our size, with the diversity of businesses that we have, that we are, you know, able to be self sufficient in AI, if we choose to,” Suleyman said.

Instead of relying solely on OpenAI, Microsoft is using open-source models, partnering with other AI developers, and building its own models, Suleyman said.

The software giant unveiled MAI-1-preview in late August. This is Microsoft AI’s first foundation model trained end-to-end by the company, and offers a glimpse of future offerings inside its Copilot service. This model ranks 24th among text models on LMArena, a widely followed leaderboard, so Microsoft has a lot of work to do still.

“We should have the capacity to build world class frontier models in-house of all sizes, but we should be very pragmatic and use other models where we need to,” Suleyman said.

Microsoft plans to make “significant” investments in its own AI chip cluster to help the company build its own models, he added.

Suleyman noted that MAI-1-preview was only trained on 15,000 Nvidia H100s, which he said was a “tiny cluster” in the grand scheme of things. Competing models from Google, Meta, and xAI were all trained on clusters that were six to 10 times larger in size, Suleyman said.

Microsoft has significantly benefited from its arrangement to access OpenAI’s intellectual property, both by selling it to customers through the Azure OpenAI service and creating its own products using OpenAI’s technology, like its AI assistant Copilot. Those terms are under renegotiation now that OpenAI needs Microsoft’s blessing for a corporate restructuring.

Microsoft CEO Satya Nadella during the town hall reassured employees that the company still benefits from the partnership.

“We have a very good partnership with OpenAI. We’re very excited to continue to work with them, support them. Remember, OpenAI supplies to us. We supply to them. So they’re each other’s customers. We have a commercial partnership. We are investors,” Nadella said. “And at the same time, we were very clear that we also want to build our own capabilities.”

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