Sew Repair (SFIX) Q2 2021 earnings estimates

Katrina Lake, CEO of Stitch Fix

Adam Jeffery | CNBC

Stitch Fix reported a less-than-expected loss for the last quarter on Monday, but the company fell short of analysts’ expectations for sales and outlook as shipping delays and lower customer spending weighed on sales.

The stock fell 21% in extended trading.

The styling service lowered its sales forecast for the current quarter and fiscal year, citing ongoing uncertainty due to the coronavirus pandemic and longer purchase cycles due to delivery issues.

The company reported for the quarter ended Jan. 30, relative to Wall Street expectations, based on an analyst survey conducted by Refinitiv:

• Loss per share: 20 cents compared to 22 cents expected
• Revenue: $ 504.1 million versus $ 512.2 million expected

Stitch Fix posted a net loss of $ 21 million, or 20 cents per share, for the second quarter, compared to earnings of $ 11.4 million, or 11 cents per share, a year earlier. Analysts surveyed by Refinitiv expected a loss per share of 22 cents.

Net sales rose 12% to $ 504.1 million, below expectations of $ 512.2 million. Shipping delays during the holiday season resulted in the company being forced to run a backlog and unable to post revenue for all of the boxes shipped during the quarter. Stitch Fix records revenue when customers check out items, not when the company ships the order.

The company also said its overall Christmas sales were weaker than expected as consumers stopped just spending money on themselves, but buying gifts for others as well. However, it was the strongest January in existence.

For the third quarter of fiscal year, Stitch Fix expects net sales of $ 505 to 515 million, representing growth of 36 to 39 percent, and adjusted loss before interest, taxes, depreciation and amortization of $ 5 to 9 million. Executives said February shipping and processing delays so far have been a “mixed bag” and they expect the trend to continue as the third fiscal quarter progresses.

For the full fiscal year 2021, the company now expects sales growth of 18% to 20% compared to the previous outlook of 20% to 25%. Wall Street forecast sales growth of 22.6% for the fiscal year.

The company added 110,000 new active customers in the quarter, bringing the total to nearly 3.9 million. Stitch Fix reported that it added more active customers in the first half of fiscal year 2021 than in the entire previous fiscal year.

However, customers spend less on average. Active customers spent an average of $ 467, down 7% from the same period last year.

Stitch Fix defines active customers as those who have purchased an item directly from its website in the past 52 weeks from the last day of the quarter.

Read the full letter to shareholders here.