Online personal styling service Stitch Fix announced its financial results for the third quarter of fiscal 2026, ended May 2, 2026, on June 10. The company reported net revenue of $340.3 million, representing a 4.7% year-over-year increase and marking its fifth consecutive quarter of adjusted year-over-year revenue growth.
Summary
- Stitch Fix’s Q3 fiscal 2026 net revenue increased 4.7% year-over-year to $340.3 million
- The company achieved its fifth consecutive quarter of adjusted year-over-year revenue growth
- Active clients reached 2.309 million, up 0.9% quarter-over-quarter
- Net revenue per active client rose 6.6% year-over-year to $578
- Improving customer metrics and profitability suggest continued progress in the company’s turnaround efforts
One of the most notable aspects of the quarter was the return to sequential growth in active clients. Stitch Fix reported 2.309 million active clients, representing a 0.9% increase from the previous quarter. While active clients remained down 1.9% compared to the prior year, the result suggests signs of stabilization after an extended period of customer declines.
In recent years, Stitch Fix has focused on addressing customer attrition and slowing demand. The latest results indicate that initiatives aimed at improving the customer experience and refining product assortment may be beginning to gain traction.
Net revenue per active client reached $578, up 6.6% year-over-year. The increase reflects not only improving customer retention but also higher spending among existing clients, which contributed to overall revenue growth.
Matt Baer, Chief Executive Officer of Stitch Fix, said in a statement: “In Q3, we delivered another strong quarter, reporting our fifth consecutive quarter of year-over-year revenue growth on an adjusted basis, with both revenue and adjusted EBITDA exceeding our expectations,” said Matt Baer, CEO, Stitch Fix. “We also hit a significant milestone with sequential growth in active clients. These results reflect our team’s consistent execution of our strategy and underscore that the improvements we’ve made to our client experience and assortment are resonating.”
On the profitability front, gross margin came in at 43.7%, down 50 basis points from the prior year. However, the company generated adjusted EBITDA of $13.2 million, while net loss narrowed to $1.5 million, reflecting continued progress in profitability.
Stitch Fix also reported $11.8 million in cash provided by operating activities and free cash flow of $6.5 million during the quarter. The company ended the period with $229.4 million in cash, cash equivalents, and investments and reported no outstanding debt.
Looking ahead, Stitch Fix expects full-year fiscal 2026 gross margin to be between 43% and 44% and anticipates remaining free cash flow positive for the year.
Known for combining AI-powered recommendation technology with human stylists, Stitch Fix has spent the past several years adapting to post-pandemic shifts in consumer behavior and demand patterns. The latest quarter not only demonstrated continued revenue growth but also highlighted improving customer metrics, suggesting that the company’s efforts to strengthen its business fundamentals are beginning to show measurable results.
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