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• The online styling service reported a net loss of $30.9 million in the quarter
• Revenue for the quarter increased to $516.7 million from $504.1 million a year earlier
Stitch Fix (NYSE: SFIX) shares fell more than 18% at an all-time intraday low of $8.82 on Wednesday after the online styling service reported disappointing outlook for fiscal third quarter and slashed its forecast for full year on Tuesday evening.
The company said it faced challenges in creating new clients and Stitch Fix Chief Elizabeth Spaulding said the active client count is not where she wants it to be.
Active clients of the company are a little more than 4 million, an increase of 4% from the last year, the company said.
In the quarter ended January 29, the company reported a net loss of $30.9 million, or 28 cents per share as expected by analysts.
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Revenue for the quarter increased to $516.7 million from $504.1 million a year earlier, topping estimates of $514.8 million.
Revenue forecast
Stitch Fix expects net revenue to be between $485 million and $500 million for the third quarter, a decrease of 10% to 7% from the previous year.
The company forecasts revenue to be flat to slightly down for full year, considering the number of active clients in the period.
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Freestyle launch
Stitch Fix recently launched a direct-buy option, known as Freestyle, where shoppers are offered the option of buying single items from its website, without a subscription.
Analysts and investors have been worried as the newly launched feature is not performing as expected.
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