SFIX Q1 Loss Meet, Revenues Beat on Robust Client Engagement

Core Insights - Stitch Fix, Inc. (SFIX) reported first-quarter fiscal 2026 results with the bottom line matching the Zacks Consensus Estimate and the top line exceeding expectations, showing a year-over-year increase [1][2] Financial Performance - The company reported an adjusted loss of $0.05 per share, consistent with the Zacks Consensus Estimate, and net revenues of $342.1 million, surpassing the consensus estimate of $336 million, reflecting a 7.3% increase from the previous year [2][9] - Gross profit rose 3.1% to $149.3 million, while gross margin decreased by 180 basis points to 43.6% [7] - Selling, general and administrative expenses (SG&A) increased by 2.7% to $157.9 million, with SG&A as a percentage of net revenues decreasing to 46.2% [8] Client Engagement and Growth Metrics - Active clients totaled 2,307,000, down 5.2% year-over-year, but average net revenues per active client (RPAC) increased by 5.3% to $559, marking the seventh consecutive quarter of growth in this metric [3] - Average order value (AOV) increased by approximately 10% year-over-year, continuing a trend of nine consecutive quarters of growth [4] Product Category Performance - The company experienced significant growth in women's and men's categories, with women's seasonal categories rising 19% and sneakers increasing by 63% year-over-year [5][6] - Seasonal categories, including fleece and outerwear, grew by 57% collectively, while denim and sneakers rose by 30% and 24%, respectively [6] Strategic Initiatives - Stitch Fix is leveraging generative AI technology and human stylist expertise to enhance client engagement and personalize shopping experiences, reinforcing its competitive position [4] - The company is expanding into non-apparel categories, which is expected to contribute approximately $1 billion in incremental revenues [6] Guidance and Future Outlook - For fiscal 2026, the company raised its revenue guidance to a range of $1.32-$1.35 billion, projecting growth of 4.2-6.5% from the previous fiscal year [12] - For Q2, total revenues are expected to be between $335-$340 million, indicating year-over-year growth of 7.3-8.9% [13]