Stitch Fix (SFIX) shares fell 17% in extended trading after the online styling service lowered its forward guidance for the full year as it struggles to grow its subscriber base.
In its latest quarter, the company said it experienced challenges with onboarding new customers and converting clients. Looking ahead, the company is being cautious about its prospects for future growth.
The company reported a net loss of $30.9 million U.S., or $0.28 U.S. per share, compared with a loss of $21 million U.S., or $0.20 U.S. a year earlier. That was exactly in line with analysts’ estimates for the quarter.
Revenue grew to $516.7 million U.S. from $504.1 million U.S. a year earlier, beating Wall Street estimates of $514.8 million U.S. The company counted active clients of a little more than four million, an increase of 4% from a year-ago. Revenue per client came in $549 U.S. during the period.
For the current quarter, Stitch Fix expects net revenue to be between $485 million U.S. and $500 million U.S., which would represent a decline of 10% to 7% from the previous year. Analysts had been looking for sales of $560.5 million U.S.
For its fiscal year, which ends July 30, Stitch Fix forecasts revenue flat to slightly down year over year, assuming that the number of active clients is flat through the end of the 12-month period. Analysts had expected revenue to be up 8.1% for the year.
Stitch Fix stock has already fallen 41% this year as of yesterday’s market close (March 8), and stood at $11.01 U.S. per share in New York trading.