Stitch Fix profits devastated by stunted U.S. retail spend
Stitch Fix Inc. announced on Tuesday sales for the fiscal year 2022 dipped by 1.4% to $2.1 billion, on the back of a double-digit sales plunge in the fourth quarter, hurt by a drop in active customers.
The San Francisco-based company said net revenues for the fourth quarter ending July 30 decreased 16% year-over-year to $481.9 million, while active client numbers fell 9% to 3.8 million. However, net revenue per active client came in at $546, an increase of 8% on last year. After a posting net income of $21.6 million in the prior-year quarter, Stitch Fix swung to a quarterly net loss of $96.3 million and diluted loss per share of $0.89 this year.
For the full year, losses widened to $207.1 million, compared to a loss of $8.9 million last year.
“This year marked an important moment in Stitch Fix’s history. We launched 'Freestyle', which combined with our original Fix offering, broadens our ecosystem and expands our total addressable market," said Stitch Fix CEO, Elizabeth Spaulding.
“Today’s macroeconomic environment and its impact on retail spending has been a challenge to navigate, but we remain committed to working through our transformation and returning to profitability."
Looking ahead, Stitch Fix said it expects net revenue to be between $1.76 billion and $1.86 billion for fiscal year ending July 29, 2023, with adjusted EBITDA to be between a loss of $45 million and a loss of $25 million.
"We are also capitalizing on every customer touchpoint to build long-term relationships and reignite net active client growth," added Spaulding.
"Even in retail’s dynamism, our core differentiators — fit, discovery, and human relationships — remain as relevant as ever, and will further cement our place as the global destination for personalized online shopping and styling.”
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