Stitch Fix Inc (SFIX) shares skyrocketed more than 26 percent on Friday after the company announced strong financial results for the third quarter, as more people subscribed to its personalized online clothing service.
The San Francisco, California-based company said subscriptions jumped 30 percent in the latest quarter and it now has more than 2.7 million active customers.
Stitch Fix plans to launch Stitch Fix Kids, a personalized platform for kids’ apparel. Chief Executive Officer, Katrina Lake said the company is excited to style everyone in the family and to make it easy for parents to buy for themselves and their children. The company’s plan is to offer unique, affordable children clothing in a variety of styles, providing kids the liberty to express themselves in outfits they love.
The online subscription and personal shopping service posted earnings of $9.5 million, or 9 cents a share for the quarter ended April 28, as compared to a loss of $9.6 million, or 38 cents a share in the same period last year. Analysts surveyed by Thomson Reuters were looking for a profit of 3 cents a share.
Revenue for the quarter came in at $316.7 million, up 29 percent from the comparable period last year, and above consensus forecast of $306.4 million.
Stitch Fix is competing in the market against Trunk Club, Boon + Gable and e-commerce giant Amazon, which is spending more in clothing. Stitch Fix has been trying to grow its market to better compete with rivals. As a part of those efforts, it launched a plus-size offering last year with third-party labels, beside its own brand. It also rolled out a mobile and Web-based game, named Style Shuffle, which enables participants to vote on a variety of merchandise, offering it a clear picture about the fashion preferences of its clients.
