MW Stitch Fix's stock rallies after styling service boosts full-year sales forecast

By Bill Peters

CEO says 'investments in stronger client-stylist relationships' are paying off, even as sales fall

Shares of Stitch Fix Inc. rallied after hours on Tuesday, after the online clothing and styling service nudged its full-year sales forecast higher and said its turnaround efforts were working, even as sales continued to fall.

Stitch Fix (SFIX) said it expects total fiscal-year sales of $1.225 billion to $1.240 billion, representing a year-over-year drop.

However, that forecast is up from expectations given in December for $1.14 billion to $1.18 billion. And Tuesday's forecast was above FactSet analyst estimates for $1.18 billion. The company's fiscal 2025 runs through July.

"Our clients are responding to the improvements we've made to our experience, including the increased newness in our assortment, expanded Fix flexibility, and investments in stronger client-stylist relationships," Chief Executive Matt Baer said in a statement.

Shares jumped 18.6% after hours on Tuesday. As of the day's close, the stock was up 82% over the past 12 months.

As higher costs of living continue to weigh on clothing demand, Stitch Fix has spent months trying to deepen the relationships between shoppers and the company's stylists who help them pick out clothing. But the broader economic backdrop has made analysts cautious on the company.

During Stitch Fix's fiscal second quarter, sales and active clients fell, but those results still came in above estimates.

Sales slipped 5.5% year over year to $312.1 million, but that was above FactSet forecasts for $298.1 million. The company lost 5 cents a share, narrower than a year ago and better than estimates for a loss of 11 cents a share.

Active clients slid 15.5% year over year to around 2.37 million. Wall Street expected around 2.36 million.

-Bill Peters

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March 11, 2025 17:05 ET (21:05 GMT)

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