Stitch Fix Plummeted After Reporting Second-Quarter Earnings and Weak Outlook
Mar 9, 2022 By MarketDepth
Stitch Fix stock (NASDAQ: SFIX) plummeted to an all-time low after reporting second-quarter earnings along with a weak outlook for its third quarter. Additionally, the company cut its forecast for the full year as it fights to grow its subscriber base.
Higher Than Anticipated Earnings
The online personal styling service reported an earnings loss of USD0.28 per share, in line with the expected loss of USD0.28 a share. Revenue amounted to USD516.7 Million, higher than analysts anticipated USD514.8 Million.
“In Q2, we delivered $517 million in net revenue, reflecting 3% year-over-year growth. Our revenue per active client topped $500 for the third quarter in a row, reaching a record $549, an increase of 18% from the same time last year as a result of higher average order values in our Fix business and the incrementality Freestyle provides to our existing clients. While Freestyle revenue grew 29% year on year in the second quarter, we continue to experience challenges with onboarding and conversion of clients, which are not where we want them to be. We remain confident in our long-term strategy, and are resolutely focused on building and enhancing the overall client experience for Fix and Freestyle with an emphasis on growing active clients.”Elizabeth Spaulding, CEO of Stitch Fix
In its fiscal year, ending July 30, the company predicts revenue will be stagnant or slightly down year over year, if the amount of active consumers is also flat through the period. Meanwhile, analysts had expected revenue to rise 8.1% for the year.