Earnings Release (stitch fix announces fourth quarter and full fiscal year 2025)

Q4 2025 Net Revenue Decreased 2.6% YoY, Increased 4.4% YoY on a 13-Week Adjusted Basis
Q4 2025 Net Revenue Per Active Client Grew 3.0% YoY to $549
FY 2025 Gross Margin Expanded YoY to 44.4%

SAN FRANCISCO, Sept. 24, 2025 (GLOBE NEWSWIRE) -- Stitch Fix, Inc. (NASDAQ: SFIX), the leading online personal styling service, today announced its financial results for the fourth quarter and full fiscal year 2025, ended August 2, 2025. Please note that fiscal 2024 was a 53-week year due to an extra week in the fourth quarter. As such, the adjusted revenue growth rates referenced in these results remove the impact of that extra week to provide a comparison that the Company believes more accurately reflects its performance.

"Fiscal 2025 was a milestone year for Stitch Fix. We finished the year with our second consecutive quarter of year-over-year revenue growth on an adjusted basis, and once again gained share in the US apparel market," said Matt Baer, CEO, Stitch Fix. "Our positive momentum was driven by the successful execution of our transformation strategy, including the improvements to our client experience and assortment. Looking ahead, we will continue to fuel growth by harnessing the power of AI, our assortment of leading brands, and the human connection of our Stylists, to deliver the most client-centric and personalized shopping experience."

Fourth Quarter Fiscal 2025 Key Metrics and Financial Highlights

• Net revenue of $311.2 million, a decrease of 2.6% year-over-year. Adjusting for the impact of the extra week in the fourth quarter of fiscal 2024 of $21.6 million, net revenue increased 4.4% year-over-year.
• Active clients of 2.309 million, a decrease of 1.9% quarter-over-quarter and a decrease of 7.9% year-over-year.
• Net revenue per active client ("RPAC") of $549, an increase of 3.0% year-over-year.
• Gross margin of 43.6%, a decrease of 100 basis points year-over-year, driven primarily by transportation deleverage and lower product margins.
• Net loss of $8.6 million and net loss margin of 2.8%; diluted loss per share of $0.07.
• Adjusted EBITDA of $8.7 million and Adjusted EBITDA margin of 2.8%, which reflect continued cost management discipline.
• Net cash provided by operating activities of $7.0 million and free cash flow of $2.8 million.
• We ended the quarter with $242.7 million of cash, cash equivalents, and investments; and no debt.

Full Fiscal 2025 Key Metrics and Financial Highlights

• Net revenue of $1.27 billion, a decrease of 5.3% year-over-year. Adjusting for the impact of the extra week in fiscal 2024 of $21.6 million, net revenue decreased 3.7% year-over-year.
• Gross margin of 44.4%, an increase of 10 basis points year-over-year, which reflects improved transportation leverage.
• Net loss of $28.8 million and net loss margin of 2.3%; diluted loss per share of $0.22.
• Adjusted EBITDA of $49.1 million and Adjusted EBITDA margin of 3.9%, which reflect continued cost management discipline.
• Net cash provided by operating activities of $25.6 million and free cash flow of $9.3 million.

Financial Outlook

Stitch Fix's financial outlook for the first quarter of fiscal 2026, ending November 1, 2025, is as follows:

The Company's fiscal year is a 52-week or 53-week period ending on the Saturday closest to July 31. The fiscal years 2025 and 2026 are 52-week years.

Stitch Fix's financial outlook for fiscal year 2026 is as follows:

The Company expects full fiscal year 2026 gross margin to be between 43% and 44%. It expects full fiscal year 2026 advertising expense as a percentage of revenue to be between 9% and 10%. It also expects to be free cash flow positive for the full year.

Stitch Fix has not reconciled its Adjusted EBITDA outlook to GAAP net income (loss) or free cash flow outlook to net cash flows used in operating activities from continuing operations because it does not provide an outlook for GAAP net income (loss) or net cash flows used in operating activities from continuing operations due to the uncertainty and potential variability of restructuring and other one-time costs, net other income (expense), provision for income taxes, stock-based compensation expense, or net cash flows used in operating activities from continuing operations, which are reconciling items between the non-GAAP financial measure and the corresponding GAAP measure. Because Stitch Fix cannot reasonably predict such items, a reconciliation of the non-GAAP financial measure outlooks to the corresponding GAAP measures are not available without unreasonable effort. We caution, however, that such items could have a significant impact on the calculation of GAAP net income (loss) and free cash flow. For more information regarding the non-GAAP financial measures discussed in this release, please see "Non-GAAP Financial Measures" below.

Discontinued Operations

During the first quarter of fiscal 2024, Stitch Fix ceased operations of its UK business and met the accounting requirements for reporting the UK business as a discontinued operation. Accordingly, its unaudited condensed consolidated financial statements reflect the results of the UK business as a discontinued operation for all periods presented. Unless otherwise noted, amounts and disclosures relate to its continuing operations.

Conference Call and Webcast Information

Matt Baer, Chief Executive Officer of Stitch Fix, and David Aufderhaar, Chief Financial Officer of Stitch Fix, will host a conference call at 2:00 p.m. Pacific Time today to discuss the Company's financial results and outlook. A live webcast of the call will be accessible on the investor relations section of the Stitch Fix website at https://investors.stitchfix.com.

To access the call by phone, please register at the following link:

Dial-In Registration: https://register-conf.media-server.com/register/BI725d4564b3654e229ca663ca2a1f4060

Upon registration, telephone participants will receive the dial-in number along with a unique PIN number that can be used to access the call. A replay of the webcast will also be available for a limited time at https://investors.stitchfix.com.

About Stitch Fix, Inc.

Stitch Fix (NASDAQ: SFIX) is the leading online personal styling service that helps people discover the styles they will love that fit perfectly so they always look - and feel - their best. Few things are more personal than getting dressed, but finding clothing that fits and looks great can be a challenge. Stitch Fix solves that problem. By pairing expert stylists with best-in-class AI and recommendation algorithms, the company leverages its assortment of exclusive and national brands to meet each client's individual tastes and needs, making it convenient for clients to express their personal style without having to spend hours in stores or sifting through endless choices online. Stitch Fix, which was founded in 2011, is headquartered in San Francisco. For more information, please visit https://www.stitchfix.com.

Forward-Looking Statements

This press release and the related conference call and webcast, contain forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact could be deemed forward looking, including but not limited to statements regarding our expectations for future financial performance, including our profitability and long-term targets; guidance on financial results and metrics for the first quarter and full fiscal year of 2026; our ability to achieve full-year revenue growth in fiscal 2026; the impact of our transformation strategy and the continuation of certain positive trends in our financial results and metrics; that the execution of our strategy and priorities will enable us to achieve long-term, sustainable, and profitable growth and positive free cash flow; our expectations for a quarter of sequential active client growth in fiscal 2026; that the changes we have made to our client experience will help us acquire, retain, and reactivate highly engaged clients over time and better serve our clients; that our expanded and more flexible Fix options, including larger Fixes or family accounts, will become an important driver of long-term engagement; that our investments to deepen client-Stylist relationships, leverage generative AI in our client experience and design process, and strengthen our product assortment will lead to improved client engagement and retention; our expectations with respect to the impact of tariffs on client prices or margins; our assessment of how tariffs and the macroeconomic environment may impact our future performance; that we will continue to build a stronger operational foundation that will enable us to scale and move toward growth; that we will continue to grow faster than the overall U.S. apparel market; and our expectations regarding future costs and metrics, including transportation costs, gross margin, average order value, inventory levels, compensation mix, and advertising spend. These statements involve substantial risks and uncertainties, including risks and uncertainties related to the current macroeconomic environment; our ability to generate sufficient net revenue to offset our costs; changing consumer behavior; the effect of changes in and uncertainty regarding tariffs or trade policies and our ability to mitigate tariff-related risks; our ability to acquire, engage, and retain clients; our ability to provide offerings and services that achieve market acceptance; our data science and technology, Stylists, operations, marketing initiatives, and other key strategic areas, including the implementation of our transformation strategy; risks related to our inventory levels and management; risks related to our supply chain, sourcing of materials and shipping of merchandise; our ability to forecast our future operating results; and other risks described in the filings we make with the SEC. Further information on these and other factors that could cause our financial results, performance, and achievements to differ materially from any results, performance, or achievements anticipated, expressed, or implied by these forward-looking statements is included in filings we make with the SEC from time to time, including in the section titled "Risk Factors" in our Quarterly Report on Form 10-Q for the fiscal quarter ended May 3, 2025. These documents are available on the SEC Filings section of the investor relations section of our website at: https://investors.stitchfix.com. We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law. The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties, and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management's beliefs and assumptions only as of the date such statements are made.

Non-GAAP Financial Measures

We report our financial results in accordance with generally accepted accounting principles in the United States ("GAAP"). However, management believes that certain non-GAAP financial measures provide users of our financial information with additional useful information in evaluating our performance. We believe that Adjusted EBITDA from continuing operations ("Adjusted EBITDA") and Adjusted EBITDA margin, which is defined as Adjusted EBITDA divided by net revenue for the period, are frequently used by investors and securities analysts in their evaluations of companies, and that this supplemental measure facilitates comparisons between continuing operations of companies. We believe free cash flow from continuing operations ("Free Cash Flow") is an important metric because it represents a measure of how much cash from continuing operations we have available for discretionary and non-discretionary items after the deduction of capital expenditures. These non-GAAP financial measures may be different than similarly titled measures used by other companies.

Our non-GAAP financial measures should not be considered in isolation from, or as substitutes for, financial information prepared in accordance with GAAP. There are several limitations related to the use of our non-GAAP financial measures as compared to the closest comparable GAAP measures. Some of these limitations include:

• Adjusted EBITDA excludes interest income and other (income) expense, net as these items are not components of our core business;
• Adjusted EBITDA does not reflect our provision for income taxes, which may increase or decrease cash available to us;
• Adjusted EBITDA excludes the recurring, non-cash expenses of depreciation and amortization of property and equipment and, although these are non-cash expenses, the assets being depreciated and amortized may have to be replaced in the future;
• Adjusted EBITDA excludes the non-cash expense of stock-based compensation, which has been, and will continue to be for the foreseeable future, an important part of how we attract and retain our employees and a significant recurring expense in our business;
• Adjusted EBITDA excludes costs incurred related to discrete restructuring plans and other one-time costs attributable to our continuing operations that are fundamentally different in strategic nature and frequency from ongoing initiatives. We believe exclusion of these items facilitates a more consistent comparison of operating performance over time, however these costs do include cash outflows;
• Adjusted EBITDA excludes non-ordinary course legal fees for specific proceedings that we have determined arise outside of the ordinary course of business and are nonrecurring, infrequent, or unusual; and
• Free Cash Flow does not represent the total residual cash flow available for discretionary purposes and does not reflect our future contractual commitments.

Adjusted EBITDA

We define Adjusted EBITDA as net loss from continuing operations excluding interest income, other (income) expense, net, provision for income taxes, depreciation and amortization, stock-based compensation expense, restructuring and other one-time costs, and non-ordinary course legal fees related to our continuing operations. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net revenue for the period. The following table presents a reconciliation of net loss from continuing operations, the most comparable GAAP financial measure, to Adjusted EBITDA, and net loss margin, the most comparable GAAP financial measure, to Adjusted EBITDA margin, for each of the periods presented:

_{⁽¹⁾ For the three and twelve months ended August 3, 2024, "Depreciation and amortization" excluded $2.9 million and $12.1 million, respectively, that was reflected in "Restructuring and other one-time costs".
⁽²⁾ For the three and twelve months ended August 2, 2025, restructuring charges were nil and $1.2 million, respectively, primarily in severance and employee-related benefits and other restructuring costs; and other one-time costs were $0.1 million and $2.0 million, respectively, in one-time bonuses for certain continuing employees. For the three and twelve months ended August 3, 2024, restructuring charges were $22.7 million and $43.8 million, respectively. This included a $19.3 million impairment charge related to a portion of our corporate office space, recorded in selling, general, and administrative expenses in the consolidated statements of operations and comprehensive loss. For the three and twelve months ended August 3, 2024, other one-time costs were comprised of $3.7 million and $6.7 million in one-time professional services fees.
⁽³⁾ Non-ordinary course legal fees for the three and twelve months ended August 2, 2025, include costs related to a specific class action lawsuit. We estimate we will incur approximately $4.2 million in non-ordinary course legal fees in fiscal 2026 related to said class action lawsuit.}

Free Cash Flow

We define Free Cash Flow as net cash flows used in operating activities from continuing operations, reduced by purchases of property and equipment that are included in cash flows from investing activities from continuing operations. The following table presents a reconciliation of net cash flows used in operating activities from continuing operations, the most comparable GAAP financial measure, to Free Cash Flow for each of the periods presented:

Operating Metrics

Active Clients

We define an active client as a client who checked out a Fix or was shipped an item via Freestyle in the preceding 52 weeks, measured as of the last day of that period. Clients check out a Fix when they indicate what items they are keeping through our mobile application or on our website. We consider each Women's, Men's, or Kids account as a client, even if they share the same household.

Net Revenue per Active Client

We calculate net revenue per active client based on net revenue over the preceding four fiscal quarters divided by the number of active clients measured as of the last day of the period.

Source: Stitch Fix, Inc.