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Stitch Fix’s Q4 Earnings: What To Expect

The digital personal styling service is getting to show Wall Street its books, but what can investors expect from the earnings release?

Stitch Fix (NASDAQ: SFIX) has made lots of changes to its business lately and the stock has suffered along the way. Once a Wall Street favorite, the fashion technology firm’s shares are down 35% year-to-date. 

However, the company has been busy extending its audience. Last week, the personal styling service launched Stitch Fix Freestyle. This innovative shopping experience allows fans to buy thoughtfully curated and individualized clothing without needing to subscribe to Stitch Fix. Shipping and returns are still free, and there is no minimum order amount. This is intended to bring its services to a new audience and might help boost subscription numbers in turn. 

Nonetheless, investors are still eagerly waiting to see how the company performs when it reports results for the fourth quarter this week. 

When is Stitch Fix’s earnings date?

Stitch Fix will report its Q4 earnings report on Tuesday, 21 September after the close at 5:00 PM Eastern Time.

How can I listen to Stitch Fix’s earnings call? 

To listen to the earnings call and to access the transcript, simply visit Stitch Fix’s Investor Relations page on its website which you can find in its News & Events section. Alternatively, you can also read it and all of the company’s previous quarterly results in its Quarterly Results section too.

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What to expect from Stitch Fix’s earnings 

Analysts are predicting Stitch Fix to lose $0.13 per share on sales of $548.01 million when it reports results this week. This estimate compares to the year-ago period when Stitch Fix posted a loss of $0.44 per share on revenue of $443.41 million.

Shares of Stitch Fix are down more than 10% over the past month, a downward trend that has continued throughout the year. Investors are falling out of love with the stock for a number of reasons. For one, the online clothing personalization firm has undergone a major switch up in its executive leadership recently. Elizabeth Spaulding has taken the reins from former CEO and founder Katrina Lake. This switch made headlines as the founder leaving the executive position can spell bad news for the company as it might mean the drive and passion for the business dwindles. In addition, it has also reportedly lost a large number of stylists from its team which was also perceived badly by the public. 

Stitch Fix does have many redeemable qualities that make it a good investment though. For example, it is growing sales at a steady pace. In Q3, revenue increased 44% to $535.6 million while sales jumped 12% in Q2. Its gross margin also looks strong, making up 46% of revenue in the third quarter. 

For Stitch Fix to win over shareholders, it will need to report another quarter of solid revenue growth and improved profit margins. As the world digitalizes, the fashion industry is a great choice for disruption meaning there is plenty of long-term potential left for this stock. 

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