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Stitch Fix shares jump over 30% in after-hours trading following earnings beat

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Stitch Fix reported Q1 earnings that topped the Street’s expectations. The online retailer posted $490.4M in net revenue, outperforming consensus estimates of $481M in revenue. As COVID-19 continues to push more consumers to online retailers, Stitch Fix’s active clients have increased by 3.8M, up 10%. Yahoo Finance’s Jared Blikre breaks down the details.

Video Transcript

JARED BLIKRE: Stitch Fix here-- shares are up 37% in after-hours trading here. And let's go over some of the numbers. They did manage a slightly positive EBITDA profit. So shares could be rising on that. But let's go over to the top line numbers first. First quarter net revenue came in at $490.4 million. Estimate was for a bit lower at $481 million. And their first quarter EPS coming on in at $0.09.

Active clients-- now this is a key metric-- active clients, ordinarily 3.8 million, and they're also announcing rotation of their CFO. So they have Dan Jedda. He is a new CFO. He's joining from Amazon. That could also be adding to some of the excitement here. That new clients number that I was talking to you about, active clients, up nearly 3.8 million. This is up 10%. This is more than the Street was expecting. They also gave some guidance for the next quarter. They're holding off on full year growth estimates right now, but they are going to give these second quarter net revenue estimates of $506 to $515 million. Estimate was somewhere in the middle for $509 million.

Second quarter-- they're looking for an EBITDA loss of $3 to $6 million, instead of an estimated profit of $31.1 million, slight negative there. And on that guidance, they are holding off on providing full year 2021 adjusted EBITDA guidance right now. But the stock flying high here, 35% after-hours trading.

Let's take a look at some charts here over a slightly longer time period. Here's over the last two months. And you see they've fallen off, but likely to get a big boost as we open tomorrow. Guys.

- Hey, Jared, when you look at this view, I'm just curious, just at the reaction in the stock. Because you can see investors are excited about this new CFO appointment. That's why shares here are getting a bit of a boost. But when you talk about, I guess, what this could mean for Stitch Fix going forward, how big of a game-changer do you think this new CFO appointment is?

JARED BLIKRE: Well, he comes from Amazon in the digital strategies department. And it has all the right buzzwords. So I'm not familiar with the individual myself, but you get one of these high profile coups when you get them on your team. That can definitely lead to some excitement here. But the numbers are pretty solid as well. This isn't-- I mean, this is a stock that is up 136% max. That's over its entire lifetime, going back to its IPO a few years ago. It's up 40% year to date, which is really nice. That's outpacing the market. But it's not like a Zoom, it's not a Tesla. And so expectations are maybe a little bit tempered here, not expecting 300% revenue growth, which is just about impossible to sustain. So nice win for Stitch Fix here. Have to see what happens tomorrow when we open for real in the trading hours.