The personal styling service and online retailer posted adjusted earnings that exceeded expectations on Wall Street, but revenue and number of active users came up short of expectation.
During the quarter that ended July 28, Stitch Fix posted $18.3 million in net income equal to 18 cents a share, up from estimates by analysts of 4 cents a share.
It reported $318.3 million in net revenue equal to an increase of 23%, but that failed to meet Wall Street expectations of $318.5 million.
The company, which is based in San Francisco, saw its growth in user base increase by 25% year over year ending the quarter at 2.7 million, which disappointed Wall Street that was expecting over 2.8 million.
Stitch Fix’s market cap is approximately $4.4 billion and it also posted its 2018 fiscal year earnings. Stitch Fix net revenue was $1.2 billion during the first year of being a public company. Net income for the year was $44.9 million with $53.6 million in adjusted EBITDA.
Founder of Stitch Fix Katrina Lake went public with the company in November of 2017. The company raised over $120 million during the process, selling over 8 million shares following a decision at the last minute to downsize the offering prior to the first day of trading.
After the release of its first earnings report last December, Stitch Fix shares took a hit of similar proportion falling by 10%.
The company bounces back well and overall stock has climbed since its November 2017 IPO. The company’s best day to date was September 18 when stock reached $52.44 per share, up from its initial opening prices of $15 per share.
Along with its earnings report, the company announced the upcoming launch of its Stitch Fix UK, its first venture into an international market that is expected to launch to the UK consumer before the end of fiscal year 2019.
Following the third quarter earnings report, Stitch Fix announced the hiring of Deirdre Findlay as CMO and the launch of its Stitch Fix Kids.
During the earnings call, Lake said that both services Stitch Fix UK and Stitch Fix Kids would augment the total addressable market of Stitch Fix.