Stitch Fix Inc. is getting a little of its old mojo back on the top line — and Matt Baer, who’s spent two years turning around the business as chief executive officer, is feeling validated.
“We worked really hard to get here,” Baer told WWD as the company capped its fiscal year with its second-consecutive quarter of sales growth after a long drought. “We’re obviously going to continue to work really hard, but what continues to strengthen my confidence is the validation that we have the right strategy, we’ve got the right team and we’re executing at a high level.”
Stitch Fix’s fourth-quarter revenues grew 4.4 percent to $311 million, excluding an extra week in fiscal 2024. Revenue per active client rose 3 percent to $549.
The styling service — which offers shoppers AI and human help crafting a box of looks to try on at home — has made progress with its customer base, but has more to do. Stitch Fix’s active client count fell 7.9 percent to 2.3 million from a year earlier, but is down just 1.9 percent from the preceding quarter.
Adjusted earnings before interest, taxes, depreciation and amortization tallied $8.7 million, but net losses hit $8.6 million.
Baer said he was first attracted to Stitch Fix by “the core value propositions of our service.”
“The fact that we know our clients so well before their very first transaction and we’re able to express that and build on that in new and meaningful ways has continued to enhance our performance quarter-over-quarter,” the CEO said. “We’ve seen the metrics moving in the right direction nearly across the board. We’re very methodical and judicious in terms of who we target to acquire and bring into this service.”
For the full year, Stitch Fix posted adjusted EBITDA of $49.1 million. And while that is expected to slip to $30 million to $45 million in the year ahead, the company continues to dedicate 9 percent to 10 percent of revenues to advertising expense.
There’s bringing in customers and then there’s keeping them — and Stitch Fix has been busy on both fronts.
“The new features that we’ve added, the flexibility in the business model that we’ve created, the improvements to our private brand portfolio and how we’ve added emerging and national brands to our assortment to compliment those private brands have all very clearly strongly resonated with our current clients,” Baer said.
“As we enter fiscal 2026, we’re confident that we’ll get back to active client growth within the third quarter from a quarter-over-quarter perspective, and that will compound the results that we’re seeing as we’re improving the order economics and the engagement,” the CEO said.
The pressure is always on for public companies, but Stitch Fix still has room to keep figuring out its future with $242.7 million of cash on its books and no debt.
