We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Stitch Fix (SFIX) Loss Narrows in Q4, Revenues Decline Y/Y
Read MoreHide Full Article
Stitch Fix, Inc. (SFIX - Free Report) posted a narrower-than-expected loss per share and better-than-expected revenues in its fourth-quarter fiscal 2023 results. While the bottom line fared better year over year, the top line deteriorated from the year-earlier quarter figure. Results were hurt by a tough macroeconomic backdrop and a tighter consumer wallet.
Stitch Fix shares declined 5.6% after the trading session on Sep 18.
Q4 Details
Stitch Fix posted a loss of 24 cents per share, which included restructuring costs and other one-time costs. Adjusting for the above-mentioned costs, the company reported an adjusted loss of 19 cents per share, narrower than the Zacks Consensus Estimate of a loss of 22 cents. The metric narrowed from a loss of 65 cents per share reported in the year-ago quarter.
SFIX recorded net revenues of $375.8 million, which outpaced the Zacks Consensus Estimate of $372 million. However, the metric declined 22% from the year-ago quarter figure due to lower net active clients.
For fiscal 2023, Freestyle revenues declined 21% year over year to $1,638.4 million. For the fiscal year, it posted a loss of $1.50 per share, which included restructuring costs and other one-time costs.
Stitch Fix, Inc. Price, Consensus and EPS Surprise
In the fiscal fourth quarter, gross profit declined to $162.7 million from $192.7 million reported in the year-ago period. However, the gross margin expanded 330 basis points (bps) year over year to 43.3% as the company continued its efforts to align its inventory position with the demand environment. We expected the figure to expand by 220 bps to 42.2% for the quarter under review.
The company’s cost of goods sold declined from $289.2 million reported in the year-ago period to $213.1 million in the fiscal fourth quarter. Selling, general and administrative expenses (SG&A) fell from $291.3 million in the prior-year quarter to $194 million in the quarter under review. SG&A expenses, as a percentage of net revenues, were 51.6%, down 880 bps from 60.4% reported in the prior-year quarter. We expected the metric to decline by 1,080 bps to 49.6% for the quarter.
Stitch Fix reported an adjusted EBITDA of $10.4 million for the fiscal quarter under review compared with the adjusted EBITDA loss of $31.8 million posted in the year-ago fiscal quarter.
Other Financial Aspects
The company ended the fiscal fourth quarter with cash and cash equivalents of $239.4 million, short-term investments of $18.2 million, net inventory of $137.2 million and shareholders’ equity of $247.3 million. SFIX generated $21.1 million in cash from operating activities and had a free cash flow of $17.7 million during the fourth quarter of fiscal 2023.
Outlook
For the first quarter of fiscal 2024, management projects net revenues of $355-$365 million, indicating an 18-20% decline from the year-ago fiscal quarter’s reported figure. This is due to challenges related to the tough macroeconomic backdrop. Stitch Fix expects adjusted EBITDA in the band of $2-$7 million, with a margin of 1% to 2%.
Management is persistently navigating the ongoing macroeconomic uncertainties and remains committed to improving gross margins with better product margins, transportation efficiency and inventory efficiency over time. For both first-quarter fiscal 2024 and fiscal 2024, management anticipates a gross margin of 43-44%.
For fiscal 2024, SFIX projects net revenues of $1.30-$1.37 billion, indicating a 14-18% decline from the year-ago fiscal quarter’s reported figure. For the fiscal year, Stitch Fix expects adjusted EBITDA in the range of $5-$30 million with a margin of 0% to 2%.
This Zacks Rank #3 (Hold) stock has lost 18.2% in the past three months against the industry’s growth of 3.5%.
Abercrombie & Fitch is a leading casual apparel retailer. The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and earnings per share (EPS) suggests growth of 10.4% and 1,644%, respectively, from the year-ago reported figures. ANF delivered an earnings surprise of 724.8% in the last reported quarter.
Boot Barn is a fashion retailer of apparel and accessories. The company has a trailing four-quarter earnings surprise of 13.5%, on average. The Zacks Consensus Estimate for Boot Barn’s current financial-year sales suggests growth of 7.8% from the year-ago reported figure.
Brilliant Earth is a designer and seller of precious metals and jewelry in the United States. BRLT has a trailing four-quarter earnings surprise of 83.3%, on average. The Zacks Consensus Estimate for Brilliant Earth’s current financial-year sales suggests growth of 9.2% from the year-ago reported figure.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Stitch Fix (SFIX) Loss Narrows in Q4, Revenues Decline Y/Y
Stitch Fix, Inc. (SFIX - Free Report) posted a narrower-than-expected loss per share and better-than-expected revenues in its fourth-quarter fiscal 2023 results. While the bottom line fared better year over year, the top line deteriorated from the year-earlier quarter figure. Results were hurt by a tough macroeconomic backdrop and a tighter consumer wallet.
Stitch Fix shares declined 5.6% after the trading session on Sep 18.
Q4 Details
Stitch Fix posted a loss of 24 cents per share, which included restructuring costs and other one-time costs. Adjusting for the above-mentioned costs, the company reported an adjusted loss of 19 cents per share, narrower than the Zacks Consensus Estimate of a loss of 22 cents. The metric narrowed from a loss of 65 cents per share reported in the year-ago quarter.
SFIX recorded net revenues of $375.8 million, which outpaced the Zacks Consensus Estimate of $372 million. However, the metric declined 22% from the year-ago quarter figure due to lower net active clients.
For fiscal 2023, Freestyle revenues declined 21% year over year to $1,638.4 million. For the fiscal year, it posted a loss of $1.50 per share, which included restructuring costs and other one-time costs.
Stitch Fix, Inc. Price, Consensus and EPS Surprise
Stitch Fix, Inc. price-consensus-eps-surprise-chart | Stitch Fix, Inc. Quote
Margins & Costs
In the fiscal fourth quarter, gross profit declined to $162.7 million from $192.7 million reported in the year-ago period. However, the gross margin expanded 330 basis points (bps) year over year to 43.3% as the company continued its efforts to align its inventory position with the demand environment. We expected the figure to expand by 220 bps to 42.2% for the quarter under review.
The company’s cost of goods sold declined from $289.2 million reported in the year-ago period to $213.1 million in the fiscal fourth quarter. Selling, general and administrative expenses (SG&A) fell from $291.3 million in the prior-year quarter to $194 million in the quarter under review. SG&A expenses, as a percentage of net revenues, were 51.6%, down 880 bps from 60.4% reported in the prior-year quarter. We expected the metric to decline by 1,080 bps to 49.6% for the quarter.
Stitch Fix reported an adjusted EBITDA of $10.4 million for the fiscal quarter under review compared with the adjusted EBITDA loss of $31.8 million posted in the year-ago fiscal quarter.
Other Financial Aspects
The company ended the fiscal fourth quarter with cash and cash equivalents of $239.4 million, short-term investments of $18.2 million, net inventory of $137.2 million and shareholders’ equity of $247.3 million.
SFIX generated $21.1 million in cash from operating activities and had a free cash flow of $17.7 million during the fourth quarter of fiscal 2023.
Outlook
For the first quarter of fiscal 2024, management projects net revenues of $355-$365 million, indicating an 18-20% decline from the year-ago fiscal quarter’s reported figure. This is due to challenges related to the tough macroeconomic backdrop. Stitch Fix expects adjusted EBITDA in the band of $2-$7 million, with a margin of 1% to 2%.
Management is persistently navigating the ongoing macroeconomic uncertainties and remains committed to improving gross margins with better product margins, transportation efficiency and inventory efficiency over time. For both first-quarter fiscal 2024 and fiscal 2024, management anticipates a gross margin of 43-44%.
For fiscal 2024, SFIX projects net revenues of $1.30-$1.37 billion, indicating a 14-18% decline from the year-ago fiscal quarter’s reported figure. For the fiscal year, Stitch Fix expects adjusted EBITDA in the range of $5-$30 million with a margin of 0% to 2%.
This Zacks Rank #3 (Hold) stock has lost 18.2% in the past three months against the industry’s growth of 3.5%.
Key Picks
Some better-ranked stocks from the same sector are Abercrombie & Fitch (ANF - Free Report) , Boot Barn (BOOT - Free Report) and Brilliant Earth Group, Inc. (BRLT - Free Report) . Abercrombie & Fitch and Boot Barn currently sport a Zacks Rank #1 (Strong Buy), and Brilliant Earth carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Abercrombie & Fitch is a leading casual apparel retailer. The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and earnings per share (EPS) suggests growth of 10.4% and 1,644%, respectively, from the year-ago reported figures. ANF delivered an earnings surprise of 724.8% in the last reported quarter.
Boot Barn is a fashion retailer of apparel and accessories. The company has a trailing four-quarter earnings surprise of 13.5%, on average. The Zacks Consensus Estimate for Boot Barn’s current financial-year sales suggests growth of 7.8% from the year-ago reported figure.
Brilliant Earth is a designer and seller of precious metals and jewelry in the United States. BRLT has a trailing four-quarter earnings surprise of 83.3%, on average. The Zacks Consensus Estimate for Brilliant Earth’s current financial-year sales suggests growth of 9.2% from the year-ago reported figure.