Group 1 - The article does not provide any specific content or data regarding companies or industries [1]

Market Overview - Markets paused after a strong run following the Fed's decision to lower interest rates by 25 basis points, leading to record highs in major market indexes [1] - The Dow decreased by 171 points (+0.37%), S&P 500 fell by 18 points, and Nasdaq dropped by 75 points (-0.73%), with the Russell 2000 down the most at 22 points (-0.92%) [2] - Bond yields remained steady, with the 10-year yield at 4.15% and the 2-year yield at 3.61% [2] KB Home Performance - KB Home reported Q3 earnings of $1.61 per share, exceeding expectations of $1.50, with revenues of $1.62 billion slightly above the forecast of $1.60 billion [3] - The company announced a stock repurchase of $188.5 million [3] - However, revenue guidance for the fiscal year was lowered to $6.10-6.20 billion from the previous estimate of $6.4 billion, contributing to a decline in share price by 0.50% [4] - The Average Selling Price per home increased to $475,700 [4] StitchFix Performance - StitchFix reported a fiscal Q4 loss of -$0.07 per share, better than the estimated -$0.13 and the -$0.12 from the previous year [5] - Revenues reached $311.2 million, surpassing the $301.3 million forecast, with a year-over-year decline of only -2.6% [5] - Shares rose by 10% following the earnings report, adding to a year-to-date gain of +30.8% [5] New Home Sales Data - New home sales surged to 800,000 in August, a 20.5% increase year-over-year, exceeding the revised estimate of 665,000 [6] - The Northeast region experienced the highest gains at +72.2%, followed by the South at +24.7%, the Midwest at +12.7%, and the West at +5.6% [7] - The median sales price rose by 7% month-over-month to $413,500 [7]

Financial Data and Key Metrics Changes - For fiscal year 2025, net revenue was $1.27 billion, with an adjusted revenue decline of 3.7% year over year, but revenue for the second half of the year grew by 2.5% [20][21] - Q4 net revenue was $311.2 million, representing a 4.4% year-over-year increase on an adjusted basis, although it was down 4.2% quarter over quarter [21][22] - Adjusted EBITDA for the year was $49.1 million, or a 3.9% margin, up 170 basis points compared to fiscal year 2024 [21][26] - Gross margin for Q4 was 43.6%, down 100 basis points year over year, primarily due to higher transportation costs [23][26] Business Line Data and Key Metrics Changes - Both women's and men's business lines accelerated revenue growth in Q4, with men's business achieving double-digit growth [7][32] - Average order value (AOV) grew by 12% year over year, marking the eighth consecutive quarter of AOV growth [6][21] - Revenue per active client increased by 3% year over year to $549, demonstrating high engagement from retained clients [23] Market Data and Key Metrics Changes - The company gained market share in the U.S. apparel market during Q4, outperforming the overall market growth [5][37] - Active clients totaled 2.3 million, down 7.9% year over year, but the year-over-year comparison improved for the fifth consecutive quarter [22][23] Company Strategy and Development Direction - The company is focused on enhancing client experience through investments in generative AI and new features like AI style assistant and Stylist Connect [9][10][12] - Plans for fiscal year 2026 include a return to full-year revenue growth and continued improvement in active client growth rates [15][25] - The company aims to deepen client-stylist relationships and strengthen its assortment by adding new styles and brands [9][13][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current macro environment while seizing strategic opportunities for growth [27][45] - The company is optimistic about the upcoming holiday season, leveraging new features and improved assortment to drive sales [40][41] - Management highlighted the importance of maintaining a disciplined approach to growth investments amidst a dynamic environment [15][25] Other Important Information - The company achieved its highest contribution margin in the last decade and completed the year with positive free cash flow and no debt [9][21] - The company has removed nearly $500 million in SG&A expenses over the last three years, improving operational efficiency [19][21] Q&A Session Summary Question: Where is the most growth coming from, and how are tariffs impacting AOV? - Management noted that growth is driven by both women's and men's business lines, particularly in non-apparel categories and established brands, with no impact from tariffs on AOV [30][32][33] Question: Where do you see you're taking share from, and how do you plan for the holiday? - Management indicated that they are gaining market share from retailers that fail to deliver personalized experiences, and they are well-positioned for the holiday season with new features and improved assortment [36][37][40] Question: Additional context on active clients and revenue growth? - Management highlighted the methodical approach to rebuilding the client base, with expectations for quarter-over-quarter increases in active clients [42][43]

Financial Data and Key Metrics Changes - For fiscal year 2025, net revenue was $1.27 billion, down 3.7% year over year, but revenue for the second half of the year grew 2.5% [20][21] - Q4 net revenue was $311.2 million, representing a 4.4% year-over-year increase on an adjusted basis [21] - Adjusted EBITDA for the year was $49.1 million, or a 3.9% margin, up 170 basis points compared to fiscal year 2024 [21] - Gross margin for fiscal year 2025 was 44.4%, the highest since fiscal year 2021, driven by transportation leverage and operational efficiencies [20][21] Business Line Data and Key Metrics Changes - Both women's and men's business lines accelerated revenue growth in Q4, with men's business achieving double-digit growth [7][31] - Average order value (AOV) grew 12% year over year, marking the eighth consecutive quarter of AOV growth [6][21] - Revenue per active client increased by 3% year over year to $549, demonstrating high engagement from retained clients [23] Market Data and Key Metrics Changes - The company gained market share in the U.S. apparel market during Q4, outperforming the overall market growth [5][37] - Active clients totaled 2.3 million, down 7.9% year over year, but the year-over-year comp improved for the fifth consecutive quarter [22][23] Company Strategy and Development Direction - The company is focused on enhancing client experience through investments in generative AI and new features like AI style assistant and Stylist Connect [10][12] - Plans for fiscal year 2026 include creating more dynamic client engagement, deepening client-stylist relationships, and strengthening the product assortment [9][15] - The company aims to return to full-year revenue growth and improve active client growth rates while maintaining disciplined growth investments [15][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current macro environment and seize strategic opportunities for growth [27][48] - The company anticipates total revenue for fiscal year 2026 to be between $1.28 billion and $1.33 billion, with adjusted EBITDA expected between $30 million and $45 million [25][26] - Management highlighted the importance of personalized service in gaining market share from competitors who fail to meet consumer expectations [37][47] Other Important Information - The company achieved its highest contribution margin in the last decade and completed the year with positive free cash flow and no debt [9][21] - The company has added over 50 new brands since the start of fiscal year 2025, enhancing its product assortment [15] Q&A Session Summary Question: Where is the most growth coming from, and how are tariffs impacting AOV? - Management noted that growth is driven by both women's and men's business lines, particularly in non-apparel categories and established brands, with no impact from tariffs on AOV [31][33] Question: How is the company planning for the holiday season? - Management emphasized a focus on flexibility and improved assortment to drive promotions and gifting opportunities during the holiday season [39][40]

Financial Data and Key Metrics Changes - For FY 2025, net revenue was $1.27 billion, down 3.7% year-over-year, but revenue for the second half of the year grew 2.5% [19] - Q4 net revenue was $311.2 million, up 4.4% year-over-year on an adjusted basis [20] - Adjusted EBITDA for FY 2025 was $49.1 million, or a 3.9% margin, up 170 basis points compared to FY 2024 [20] - Gross margin for FY 2025 was 44.4%, the highest annual gross margin since FY 2021 [19] - Q4 gross margin was 43.6%, down 100 basis points year-over-year [22] Business Line Data and Key Metrics Changes - Both women's and men's lines accelerated revenue growth in Q4, with men's business delivering double-digit revenue growth [7][30] - Average order value (AOV) grew 12% year-over-year, marking the eighth consecutive quarter of AOV growth [6][22] - Revenue per active client was up 3% year-over-year to $549, demonstrating high engagement from retained clients [22] Market Data and Key Metrics Changes - The company gained market share in the U.S. apparel market during Q4, outperforming the overall market [5][36] - Active clients totaled 2.3 million, down 7.9% year-over-year, but the year-over-year comp improved for the fifth consecutive quarter [21][22] Company Strategy and Development Direction - The company is focused on enhancing client experience through investments in generative AI and improving client-stylist relationships [9][10] - Plans for FY 2026 include creating more dynamic engagement methods, increasing Fix flexibility, and strengthening the product assortment [9][14] - The introduction of family accounts and new features like Stylist Connect and Vision aims to enhance client engagement and convenience [12][13][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a challenging macro environment while focusing on sustainable, profitable growth [26][45] - The company anticipates a return to full-year revenue growth in FY 2026, with guidance for total revenue between $1.28 billion and $1.33 billion [24] - Management highlighted the importance of maintaining a disciplined approach to growth investments while adapting to market dynamics [14][25] Other Important Information - The company achieved its highest contribution margin in the last decade and completed FY 2025 with positive free cash flow and no debt [9][20] - The company has added over 50 new brands since the start of FY 2025, enhancing its product assortment [14] Q&A Session Summary Question: Where is the most growth coming from, and how are tariffs impacting AOV? - Management noted that growth is driven by expansion into non-apparel categories and increased demand for footwear and denim, with no impact from tariffs on AOV [30][32] Question: Where do you see you're taking market share from, and how do you plan for the holiday season? - Management indicated that they are gaining market share from retailers that fail to deliver personalized experiences, and they are well-positioned for the holiday season with improved flexibility and assortment [36][39]

Financial Data and Key Metrics Changes - For Fiscal Year 2025, net revenue was $1.27 billion, down 3.7% year over year, but revenue for the second half of the year grew 2.5% [19] - Q4 net revenue was $311.2 million, representing a 4.4% year-over-year increase on an adjusted basis [20] - Adjusted EBITDA for FY25 was $49.1 million, or a 3.9% margin, up 170 basis points compared to FY24 [20] - Gross margin for FY25 was 44.4%, the highest annual gross margin since FY21, driven by transportation leverage and operational efficiencies [19][20] - Active clients at the end of Q4 were 2.3 million, down 7.9% year over year [20] Business Line Data and Key Metrics Changes - Both women's and men's lines accelerated revenue growth in Q4, with men's business delivering double-digit revenue growth [6][29] - Average order value (AOV) grew 12% year over year, marking the eighth consecutive quarter of AOV growth [6][20] - The average revenue per active client increased by 3% year over year to $549, indicating higher engagement from retained clients [21] Market Data and Key Metrics Changes - The company gained market share in the U.S. apparel market during Q4, outperforming the overall market growth [5][32] - Demand for footwear in the women's business grew over 35%, with strong performance in denim and athleisure categories [29] Company Strategy and Development Direction - The company is focused on enhancing client experience through investments in generative AI and new features like AI style assistant and Stylist Connect [10][12] - Plans for FY26 include a return to full-year revenue growth and continued improvement in active client growth rates [14][24] - The company aims to deepen client-stylist relationships and strengthen its assortment by adding new brands and leveraging AI in private brand development [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current macro environment while focusing on sustainable, profitable growth [26] - The company anticipates a challenging holiday season but believes its differentiated business model will allow it to gain market share [32][35] - Management highlighted the importance of client-centric service as a competitive advantage in the retail space [16][41] Other Important Information - The company achieved its highest contribution margin in the last decade and completed FY25 with positive free cash flow and no debt [9][20] - Advertising expenses were 9.5% of revenue in Q4, reflecting a disciplined approach to marketing investments [23] Q&A Session Summary Question: Where is the most growth coming from, and how are tariffs impacting AOV? - Management noted that both women's and men's businesses saw accelerated revenue growth, driven by expansion into non-apparel categories and established brands [28] - Tariffs did not impact the improvement in AUR or AOV, thanks to proactive measures taken by the company [30] Question: How does the company plan for the holiday season amidst a volatile outlook? - The company plans to build on last year's holiday success by enhancing flexibility in its offerings and improving its assortment [34] - Management is confident in its ability to gain market share during the holiday season due to its differentiated business model [35]

Core Insights - Stitch Fix, Inc. reported better-than-expected fourth-quarter results, leading to a rise in share price [1] - The company provided fiscal 2026 guidance that exceeded analyst estimates [4] Financial Performance - Quarterly losses were reported at seven cents per share, beating the consensus estimate of ten cents [1] - Quarterly revenue reached $311.22 million, surpassing the Street estimate of $305.83 million [2] - Net revenue decreased by 2.6% year-over-year, but adjusted for an extra week in the previous fiscal year, it increased by 4.4% [5] - Active clients totaled 2.309 million, reflecting a decrease of 1.9% quarter-over-quarter and 7.9% year-over-year [5] - Revenue per active client (RPAC) was $549, marking a 3% increase year-over-year [5] - Gross margin stood at 43.6%, down 100 basis points year-over-year due to transportation deleverage and lower product margins [5] Future Outlook - For the first quarter, Stitch Fix anticipates revenue between $333 million and $338 million, compared to the analyst estimate of $293.12 million [4] - The company expects fiscal 2026 revenue to be in the range of $1.28 billion to $1.33 billion, exceeding the $1.26 billion estimate [4]

[Financial Results Overview](index=1&type=section&id=Financial%20Results%20Overview) Stitch Fix reported mixed Q4 and full fiscal year 2025 results, with revenue decreases but improved gross margin and Adjusted EBITDA, driven by strategic execution and client experience enhancements [Q4 and Full Fiscal Year 2025 Highlights](index=1&type=section&id=Q4%20and%20Full%20Fiscal%20Year%202025%20Highlights) Stitch Fix reported mixed results for Q4 and full fiscal year 2025, with Q4 net revenue decreasing 2.6% YoY but increasing 4.4% YoY on a 13-week adjusted basis, while full fiscal year 2025 net revenue decreased 5.3% YoY, or 3.7% YoY adjusted, with gross margin expanding for the full year to 44.4% and improved Adjusted EBITDA despite net losses | Metric | Q4 FY25 (Actual) | Q4 FY25 (Adjusted YoY Change) | FY25 (Actual) | FY25 (Adjusted YoY Change) | FY24 (Actual) | | :-------------------------------- | :--------------- | :---------------------------- | :------------ | :--------------------------- | :------------ | | Net Revenue | $311.2 million | +4.4% | $1.27 billion | -3.7% | $1.34 billion | | Gross Margin | 43.6% | -100 bps YoY | 44.4% | +10 bps YoY | 44.3% | | Net Loss | $8.6 million | N/A | $28.8 million | N/A | $128.8 million | | Diluted Loss Per Share | $0.07 | N/A | $0.22 | N/A | $1.07 | | Adjusted EBITDA | $8.7 million | N/A | $49.1 million | N/A | $29.3 million | | Adjusted EBITDA Margin | 2.8% | N/A | 3.9% | N/A | 2.2% | | Active Clients | 2.309 million | -7.9% YoY | N/A | N/A | 2.508 million | | Net Revenue Per Active Client (RPAC) | $549 | +3.0% YoY | N/A | N/A | $533 | [CEO Commentary and Strategic Direction](index=1&type=section&id=CEO%20Commentary%20and%20Strategic%20Direction) CEO Matt Baer highlighted fiscal 2025 as a milestone year, driven by successful execution of the transformation strategy, leading to improved client experience and assortment, achieving the second consecutive quarter of adjusted year-over-year revenue growth and market share gains in the US apparel market, with future growth fueled by AI, leading brands, and human stylists for personalized shopping experiences - Fiscal 2025 was a milestone year, achieving the **second consecutive quarter of year-over-year revenue growth** on an adjusted basis and gaining share in the US apparel market[3](index=3&type=chunk) - Positive momentum was driven by the successful execution of the transformation strategy, including improvements to client experience and assortment[3](index=3&type=chunk) - Future growth will be fueled by harnessing AI, assortment of leading brands, and the human connection of Stylists to deliver client-centric and personalized shopping experiences[3](index=3&type=chunk) [Financial Outlook](index=1&type=section&id=Financial%20Outlook) Stitch Fix provides positive revenue and Adjusted EBITDA guidance for Q1 and full fiscal year 2026, anticipating continued growth and free cash flow positivity [Q1 Fiscal Year 2026 Outlook](index=1&type=section&id=Q1%20Fiscal%20Year%202026%20Outlook) Stitch Fix provided guidance for the first quarter of fiscal year 2026, projecting net revenue between $333 million and $338 million, representing 4.4% to 6.0% year-over-year growth, with Adjusted EBITDA expected to be between $8 million and $11 million, at a margin of 2.4% to 3.3% | Metric | Q1 2026 Guidance | YoY Change | | :---------------- | :----------------------- | :--------- | | Net Revenue | $333 million - $338 million | 4.4% - 6.0% | | Adjusted EBITDA | $8 million - $11 million | 2.4% - 3.3% margin | [Full Fiscal Year 2026 Outlook](index=3&type=section&id=Full%20Fiscal%20Year%202026%20Outlook) For the full fiscal year 2026, Stitch Fix anticipates net revenue between $1.28 billion and $1.33 billion, a 1.0% to 5.0% year-over-year increase, with Adjusted EBITDA projected to be $30 million to $45 million, at a margin of 2.3% to 3.4%, alongside expectations for gross margin between 43% and 44%, advertising expense between 9% and 10% of revenue, and positive free cash flow | Metric | FY 2026 Guidance | YoY Change | | :---------------- | :----------------------- | :--------- | | Net Revenue | $1.28 billion - $1.33 billion | 1.0% - 5.0% | | Adjusted EBITDA | $30 million - $45 million | 2.3% - 3.4% margin | - Full fiscal year 2026 gross margin is expected to be between **43% and 44%**[8](index=8&type=chunk) - Full fiscal year 2026 advertising expense as a percentage of revenue is expected to be between **9% and 10%**[8](index=8&type=chunk) - The company expects to be **free cash flow positive** for the full fiscal year 2026[8](index=8&type=chunk) [Discontinued Operations](index=3&type=section&id=Discontinued%20Operations) Stitch Fix ceased its UK business operations in Q1 fiscal 2024, now reported as a discontinued operation [UK Business Cessation](index=3&type=section&id=UK%20Business%20Cessation) During the first quarter of fiscal 2024, Stitch Fix ceased operations of its UK business, which is now reported as a discontinued operation in its unaudited condensed consolidated financial statements for all periods presented - Stitch Fix ceased operations of its UK business in **Q1 fiscal 2024**, reporting it as a discontinued operation[10](index=10&type=chunk) [Company Information](index=3&type=section&id=Company%20Information) This section provides an overview of Stitch Fix as a personal styling service, outlines forward-looking statements and associated risks, and details investor communication channels [About Stitch Fix, Inc.](index=3&type=section&id=About%20Stitch%20Fix%2C%20Inc.) Stitch Fix is a leading online personal styling service founded in 2011, headquartered in San Francisco, combining expert stylists with AI and recommendation algorithms to offer personalized clothing selections from exclusive and national brands, aiming to simplify style discovery for clients - Stitch Fix is a leading online personal styling service that helps clients discover styles that fit perfectly[12](index=12&type=chunk) - The service pairs expert stylists with best-in-class AI and recommendation algorithms, leveraging an assortment of exclusive and national brands[12](index=12&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding future financial performance, strategic initiatives, and market expectations, which involve substantial risks and uncertainties, including macroeconomic conditions, consumer behavior, ability to acquire and retain clients, supply chain issues, and the impact of tariffs, cautioning readers not to rely on these statements as predictions of future events - Forward-looking statements cover expectations for future financial performance, profitability, long-term targets, and guidance for Q1 and full fiscal year 2026[13](index=13&type=chunk) - Key strategic areas include the impact of the transformation strategy, client experience improvements, expanded Fix options, investments in client-Stylist relationships, generative AI, and product assortment[13](index=13&type=chunk)[15](index=15&type=chunk) - Statements involve substantial risks and uncertainties, such as macroeconomic environment, ability to generate sufficient revenue, changing consumer behavior, tariffs, client acquisition/retention, and supply chain risks[15](index=15&type=chunk) [Conference Call and Webcast Information](index=3&type=section&id=Conference%20Call%20and%20Webcast%20Information) Stitch Fix's CEO and CFO hosted a conference call on September 24, 2025, at 2:00 p.m. Pacific Time to discuss financial results and outlook, with a live webcast and replay made available on the investor relations section of the company's website - A conference call was held on **September 24, 2025, at 2:00 p.m. Pacific Time** to discuss financial results and outlook[11](index=11&type=chunk) - A live webcast and replay are accessible on the investor relations section of the Stitch Fix website[11](index=11&type=chunk) [Investor and Public Relations Contacts](index=11&type=section&id=IR%20Contact) Contact information for investor relations and public relations inquiries is provided - IR Contact: **ir@stitchfix.com**[28](index=28&type=chunk) - PR Contact: **media@stitchfix.com**[28](index=28&type=chunk) [Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Consolidated%20Financial%20Statements%20(Unaudited)) Unaudited consolidated financial statements present the company's balance sheets, statements of operations, and cash flows for fiscal years 2024 and 2025, highlighting key financial positions and performance [Consolidated Balance Sheets](index=6&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) As of August 2, 2025, Stitch Fix reported total assets of $480.6 million, a slight decrease from $486.9 million in the prior year, with cash and cash equivalents decreasing while short-term investments and inventory increased, and total liabilities also decreased, leading to an increase in total stockholders' equity | Metric (in thousands) | August 2, 2025 | August 3, 2024 | Change (YoY) | | :-------------------------------- | :------------- | :------------- | :----------- | | Cash and cash equivalents | $113,952 | $162,862 | -$48,910 | | Short-term investments | $120,901 | $84,106 | +$36,795 | | Inventory, net | $118,370 | $97,903 | +$20,467 | | Total current assets | $373,872 | $366,710 | +$7,162 | | Total assets | $480,622 | $486,864 | -$6,242 | | Total current liabilities | $206,227 | $203,551 | +$2,676 | | Total liabilities | $277,644 | $299,842 | -$22,198 | | Total stockholders' equity | $202,978 | $187,022 | +$15,956 | [Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20LOSS) For Q4 FY25, net revenue was $311.2 million, a decrease from $319.6 million in Q4 FY24, with gross margin decreasing to 43.6% from 44.6%, and the company reported a net loss of $8.6 million, a significant improvement from $36.5 million in Q4 FY24, while for the full fiscal year 2025, net revenue was $1.27 billion, down from $1.34 billion, but net loss improved substantially to $28.7 million from $128.8 million in FY24 | Metric (in thousands) | Q4 FY25 | Q4 FY24 | FY25 | FY24 | | :-------------------------------- | :------ | :------ | :----- | :------- | | Revenue, net | $311,227 | $319,550 | $1,267,171 | $1,337,468 | | Cost of goods sold | $175,512 | $177,073 | $704,232 | $745,430 | | Gross profit | $135,715 | $142,477 | $562,939 | $592,038 | | Gross margin | 43.6% | 44.6% | 44.4% | 44.3% | | Operating loss | $(11,206) | $(41,888) | $(38,905) | $(133,427) | | Net loss from continuing operations | $(8,577) | $(35,741) | $(28,844) | $(118,885) | | Net loss | $(8,576) | $(36,498) | $(28,739) | $(128,840) | | Diluted loss per share | $(0.07) | $(0.30) | $(0.22) | $(1.07) | [Consolidated Statements of Cash Flow](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOW) For fiscal year 2025, net cash provided by operating activities from continuing operations was $25.6 million, a decrease from $28.2 million in FY24, while net cash used in investing activities from continuing operations decreased to $59.1 million from $78.7 million, primarily due to changes in securities, and net cash used in financing activities remained stable at $15.0 million, with the company ending the year with $114.0 million in cash and cash equivalents | Metric (in thousands) | FY25 | FY24 | | :-------------------------------------------------- | :----- | :----- | | Net cash provided by operating activities from continuing operations | $25,575 | $28,207 | | Net cash used in investing activities from continuing operations | $(59,121) | $(78,742) | | Net cash used in financing activities from continuing operations | $(14,967) | $(15,493) | | Net decrease in cash and cash equivalents | $(48,910) | $(76,575) | | Cash and cash equivalents at end of period | $113,952 | $162,862 | [Non-GAAP Financial Measures](index=9&type=section&id=Non-GAAP%20Financial%20Measures) This section reconciles non-GAAP financial measures, Adjusted EBITDA and Free Cash Flow, to their most directly comparable GAAP measures, illustrating core operational performance [Adjusted EBITDA Reconciliation](index=9&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA is defined as net loss from continuing operations excluding interest income, other income/expense, income taxes, depreciation and amortization, stock-based compensation, restructuring and other one-time costs, and non-ordinary course legal fees, with Q4 FY25 Adjusted EBITDA at $8.7 million (2.8% margin) and FY25 at $49.1 million (3.9% margin), showing significant improvement from FY24 - Adjusted EBITDA is a non-GAAP measure excluding specific non-core or non-recurring items from net loss from continuing operations to provide a clearer view of core business performance[21](index=21&type=chunk)[23](index=23&type=chunk) | Metric (in thousands) | Q4 FY25 | Q4 FY24 | FY25 | FY24 | | :-------------------------------- | :------ | :------ | :----- | :----- | | Net loss from continuing operations | $(8,577) | $(35,741) | $(28,844) | $(118,885) | | Stock-based compensation expense | $13,069 | $16,845 | $56,727 | $76,756 | | Restructuring and other one-time costs | $121 | $26,356 | $3,228 | $50,463 | | Adjusted EBITDA | $8,713 | $9,523 | $49,139 | $29,281 | | Adjusted EBITDA margin | 2.8% | 3.0% | 3.9% | 2.2% | [Free Cash Flow Reconciliation](index=10&type=section&id=Free%20Cash%20Flow) Free Cash Flow is defined as net cash flows from operating activities from continuing operations minus purchases of property and equipment, and for fiscal year 2025, it was $9.3 million, a decrease from $14.2 million in FY24 - Free Cash Flow is a non-GAAP measure representing cash available after operating activities and capital expenditures[21](index=21&type=chunk)[24](index=24&type=chunk) | Metric (in thousands) | Q4 FY25 | Q4 FY24 | FY25 | FY24 | | :-------------------------------------------------- | :------ | :------ | :----- | :----- | | Net cash provided by operating activities from continuing operations | $7,003 | $8,200 | $25,575 | $28,207 | | Purchases of property and equipment | $(4,228) | $(3,706) | $(16,293) | $(13,965) | | Free Cash Flow | $2,775 | $4,494 | $9,282 | $14,242 | [Operating Metrics](index=11&type=section&id=Operating%20Metrics) Key operating metrics, including active clients and net revenue per active client, are presented to show client engagement and revenue efficiency trends [Active Clients](index=11&type=section&id=Active%20Clients) Active clients are defined as those who checked out a Fix or were shipped an item via Freestyle in the preceding 52 weeks, and as of August 2, 2025, active clients decreased to 2.309 million, a 1.9% QoQ decrease and 7.9% YoY decrease - An active client is defined as a client who checked out a Fix or was shipped an item via Freestyle in the preceding 52 weeks[26](index=26&type=chunk) | Date | Active Clients (in thousands) | QoQ Change | YoY Change | | :----------------- | :---------------------------- | :--------- | :--------- | | August 2, 2025 | 2,309 | -1.9% | -7.9% | | May 3, 2025 | 2,353 | -0.76% | N/A | | February 1, 2025 | 2,371 | -2.59% | N/A | | November 2, 2024 | 2,434 | -2.9% | N/A | | August 3, 2024 | 2,508 | N/A | N/A | [Net Revenue per Active Client (RPAC)](index=11&type=section&id=Net%20Revenue%20per%20Active%20Client) Net revenue per active client (RPAC) is calculated based on net revenue over the preceding four fiscal quarters divided by active clients, and RPAC increased 3.0% year-over-year to $549 as of August 2, 2025 - Net revenue per active client (RPAC) is calculated based on net revenue over the preceding four fiscal quarters divided by the number of active clients[27](index=27&type=chunk) | Date | Net Revenue per Active Client | YoY Change | | :----------------- | :---------------------------- | :--------- | | August 2, 2025 | $549 | +3.0% | | May 3, 2025 | $542 | N/A | | February 1, 2025 | $537 | N/A | | November 2, 2024 | $531 | N/A | | August 3, 2024 | $533 | N/A |

Stitch Fix Inc. is getting a little of its old mojo back on the top line — and Matt Baer, who’s spent two years turning around the business as chief executive officer, is feeling validated. “We worked really hard to get here,” Baer told WWD as the company capped its fiscal year with its second-consecutive quarter of sales growth after a long drought. “We’re obviously going to continue to work really hard, but what continues to strengthen my confidence is the validation that we have the right strategy, we’ ...

Financial Performance - Q4 2025 net revenue decreased by 2.6% year-over-year to $311.2 million, but increased by 4.4% year-over-year on a 13-week adjusted basis [6][1] - Net revenue per active client grew by 3.0% year-over-year to $549 [6][1] - FY 2025 gross margin expanded year-over-year to 44.4% [6][1] - The company reported a net loss of $8.6 million for Q4 2025, with a diluted loss per share of $0.07 [6][1] Key Metrics - Active clients totaled 2.309 million, a decrease of 1.9% quarter-over-quarter and 7.9% year-over-year [6][1] - Adjusted EBITDA for Q4 2025 was $8.7 million, with an adjusted EBITDA margin of 2.8% [6][1] - For FY 2025, net revenue was $1.27 billion, a decrease of 5.3% year-over-year [6][1] Future Outlook - The financial outlook for Q1 2026 anticipates net revenue between $333 million and $338 million, representing a year-over-year growth of 4.4% to 6.0% [5][7] - For FY 2026, net revenue is expected to be between $1.28 billion and $1.33 billion, indicating a growth of 1.0% to 5.0% year-over-year [7][5] - The company expects to be free cash flow positive for the full year of 2026 [7][5] Strategic Initiatives - The CEO highlighted that FY 2025 was a milestone year, with successful execution of the transformation strategy and improvements in client experience [2][1] - The company plans to leverage AI and enhance the human connection through stylists to deliver a personalized shopping experience [2][1]