sfix-20241102

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 2, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-38291

STITCH FIX, INC.

(Exact name of registrant as specified in its charter)


Delaware									27-5026540
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

1 Montgomery Street, Suite 1500

San Francisco, California 94104

(Address of principal executive offices and zip code)

(415) 882-7765

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Class A common stock, par value $0.00002 per share

SFIX

Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of December 6, 2024, the number of outstanding shares of the registrant’s Class A common stock, par value $0.00002 per share, was 104,524,754, and the number of outstanding shares of the registrant’s Class B common stock, par value $0.00002 per share, was 22,318,035.

STITCH FIX, INC.

TABLE OF CONTENTS


						Page No.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited):						3
Condensed Consolidated Balance Sheets						3
Condensed Consolidated Statements of Operations and Comprehensive Loss						4
Condensed Consolidated Statements of Stockholders’ Equity						5
Condensed Consolidated Statements of Cash Flow						6
Notes to the Condensed Consolidated Financial Statements						7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations						17
Item 3. Quantitative and Qualitative Disclosures About Market Risk						25
Item 4. Controls and Procedures						25

PART II. OTHER INFORMATION						26
Item 1. Legal Proceedings						26
Item 1A. Risk Factors						26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						47
Item 3. Defaults Upon Senior Securities						47
Item 4. Mine Safety Disclosures						47
Item 5. Other Information						47
Item 6. Exhibits						48
Signatures						49

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Stitch Fix, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except share and per share amounts)


	November 2, 2024		August 3, 2024
Assets
Current assets:
Cash and cash equivalents	$	137,153	$	162,862
Short-term investments	116,119		84,106
Inventory, net	119,145		97,903
Prepaid expenses and other current assets	20,099		21,839


Total current assets	392,516		366,710


Property and equipment, net	49,204		51,517
Operating lease right-of-use assets	60,616		63,780
Other long-term assets	4,783		4,857

Total assets	$	507,119	$	486,864
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	114,386	$	87,058
Operating lease liabilities	21,999		21,817
Accrued liabilities	69,352		73,007
Gift card liability	6,296		6,749
Deferred revenue	9,256		9,217
Other current liabilities	5,232		5,201
Current liabilities, discontinued operations	32		502
Total current liabilities	226,553		203,551
Operating lease liabilities, net of current portion	89,465		95,685
Other long-term liabilities	606		606

Total liabilities	316,624		299,842
Commitments and contingencies (Note 6)
Stockholders’ equity:
Class A common stock, $0.00002 par value – 2,000,000,000 shares authorized at November 2, 2024, and August 3, 2024; 106,827,439 and 104,742,401 shares issued at November 2, 2024, and August 3, 2024; and 104,525,298 and 102,440,260 shares outstanding at November 2, 2024, and August 3, 2024, respectively	1		1
Class B common stock, $0.00002 par value – 100,000,000 shares authorized at November 2, 2024, and August 3, 2024; 22,318,035 and 22,318,035 shares issued and outstanding at November 2, 2024, and August 3, 2024, respectively	1		1
Additional paid-in capital	694,339		684,650
Accumulated other comprehensive income (loss)	(295)		(335)
Accumulated deficit	(473,509)		(467,253)
Treasury stock, at cost – 2,302,141 and 2,302,141 shares as of November 2, 2024, and August 3, 2024, respectively	(30,042)		(30,042)
Total stockholders’ equity	190,495		187,022
Total liabilities and stockholders’ equity	$	507,119	$	486,864

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Stitch Fix, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except share and per share amounts)


	For the Three Months Ended
		November 2, 2024		October 28, 2023
Revenue, net		$	318,818	$	364,785
Cost of goods sold		174,013		205,682
Gross profit		144,805		159,103
Selling, general, and administrative expenses		153,771		187,764
Operating loss		(8,966)		(28,661)
Interest income		2,932		2,248
Other income (expense), net		(72)		411
Loss before income taxes		(6,106)		(26,002)
Provision for income taxes		157		169
Net loss from continuing operations		(6,263)		(26,171)
Net income (loss) from discontinued operations, net of income taxes		7		(9,319)
Net loss		(6,256)		(35,490)
Other comprehensive income (loss):
Change in unrealized gains and losses on available-for-sale securities, net of tax		40		121
Foreign currency translation		—		(1,129)
Total other comprehensive income (loss), net of tax		40		(1,008)
Comprehensive loss		$	(6,216)	$	(36,498)
Loss per share from continuing operations, attributable to common stockholders:
Basic		$	(0.05)	$	(0.22)
Diluted		$	(0.05)	$	(0.22)
Loss per share from discontinued operations, attributable to common stockholders:
Basic		$	0.00	$	(0.08)
Diluted		$	0.00	$	(0.08)
Loss per share attributable to common stockholders:
Basic		$	(0.05)	$	(0.30)
Diluted		$	(0.05)	$	(0.30)
Weighted-average shares used to compute loss per share attributable to common stockholders:
Basic		125,972,658		116,645,160
Diluted		125,972,658		116,645,160

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Stitch Fix, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(In thousands, except share amounts)


	For the Three Months Ended November 2, 2024
	Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Treasury Stock			Total Stockholders’ Equity
	Shares	Amount								Shares	Amount
Balance as of August 3, 2024	127,060,436	$	2	$	684,650	$	(335)	$	(467,253)	(2,302,141)	$	(30,042)	$	187,022

Issuance of common stock upon settlement of restricted stock units, net of tax withholdings	2,085,038	—		(3,785)		—		—		—	—		(3,785)
Stock-based compensation	—	—		13,474		—		—		—	—		13,474

Net loss	—	—		—		—		(6,256)		—	—		(6,256)
Other comprehensive income, net of tax	—	—		—		40		—		—	—		40
Balance as of November 2, 2024	129,145,474	$	2	$	694,339	$	(295)	$	(473,509)	(2,302,141)	$	(30,042)	$	190,495

	For the Three Months Ended October 28, 2023
	Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Treasury Stock			Total Stockholders’ Equity
	Shares	Amount								Shares	Amount
Balance as of July 29, 2023	117,924,387	$	2	$	615,236	$	527	$	(338,413)	(2,302,141)	$	(30,042)	$	247,310

Issuance of common stock upon settlement of restricted stock units, net of tax withholdings	2,268,679	—		(4,172)		—		—		—	—		(4,172)
Stock-based compensation	—	—		24,100		—		—		—	—		24,100

Net loss	—	—		—		—		(35,490)		—	—		(35,490)
Other comprehensive loss, net of tax	—	—		—		(1,008)		—		—	—		(1,008)
Balance as of October 28, 2023	120,193,066	$	2	$	635,164	$	(481)	$	(373,903)	(2,302,141)	$	(30,042)	$	230,740

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Stitch Fix, Inc.
Condensed Consolidated Statements of Cash Flow

(Unaudited)

(In thousands)


	For the Three Months Ended
	November 2, 2024		October 28, 2023
Cash Flows from Operating Activities from Continuing Operations
Net loss from continuing operations	$	(6,263)	$	(26,171)
Adjustments to reconcile net loss from continuing operations to net cash provided by operating activities from continuing operations:

Change in inventory reserves	4,970		3,083
Stock-based compensation expense	12,650		19,902
Depreciation, amortization, and accretion	6,859		13,784

Other	34		19
Change in operating assets and liabilities:
Inventory	(26,212)		(33,255)
Prepaid expenses and other assets	1,771		2,800

Operating lease right-of-use assets and liabilities	(2,874)		(1,349)
Accounts payable	27,223		34,709
Accrued liabilities	(3,507)		7,502
Deferred revenue	39		(664)
Gift card liability	(453)		(503)
Other liabilities	31		702
Net cash provided by operating activities from continuing operations	14,268		20,559
Cash Flows from Investing Activities from Continuing Operations
Proceeds from sale of property and equipment	—		21
Purchases of property and equipment	(4,323)		(3,653)
Purchases of securities available-for-sale	(46,074)		—
Sales of securities available-for-sale	2,468

SEC Form 10-Q filed by Stitch Fix Inc.