Stitch Fix Inc (NASDAQ:SFIX) stock plummeted as its fourth-quarter financials disappointed investors and as the "online personal styling" company sought to reset its business.
At Monday's close Stitch Fix had fallen 5.6% to $3.05, now in premarket dealing the stock is down further – losing 6.56% to $2.85.
At $375.8 million, fourth-quarter revenue was 22% lower than the prior year though it was better than Wall Street expectations of $371.2 million.
The company reported a $28.7 million net loss for the three-month period and posted an 89 cents loss per share which far exceeded market expectations of a 21 cent per share loss.
Stitch Fix is now winding down its operations in the UK and chief executive Matt Baer who joined the company in June has conducted a business-wide review.
“I have spent time assessing every aspect of our business, operating model, and organization; getting to know what our clients feel we do well and where we can do better; and identifying opportunities to both optimize in the short term and reimagine for the future,” Baer said.
“Our current business results are not indicative of what I believe this company can deliver, and I am committed to realizing the full potential of Stitch Fix and driving long-term, profitable growth.”
Giving its guidance for its 2024 financial year, the company said it expects to generate $1.3 billion to $1.37 billion in net revenue, for $5 million to $30 million of earnings (adjusted EBITDA), all of which come from the US.
Winding down the UK business is expected to add just $8 million in 2024, accounting for remaining sales to clients and a liquidation of inventory.