Stitch Fix (NASDAQ: SFIX) shares soared after hours on Monday as the personalized styling service smashed estimates in its fiscal 2021 first-quarter report .
Revenue grew 10.3% to $490.4 million, ahead of expectations at $481.2 million, and growth was driven almost entirely by new customers as active clients rose 10.2% to 3.8 million. On the bottom line, adjusted EBITDA , the company's preferred profitability metric, slipped from $17.3 million to $6.9 million as a hiring spree on tech talent led to higher costs. On a generally accepted accounting principles ( GAAP ) basis, the company posted earnings per share of $0.09, which compared to the consensus estimate of a loss of $0.20 per share. However, excluding a special tax benefit, the company would have had a per-share loss of around $0.15.
Stitch Fix, like much of the apparel industry, has struggled during the pandemic, but the quarter showed the company putting the challenges of the public health crisis behind it as it had earlier been forced to shutter warehouses and suffered from lagging demand. Its business is now back on track and it's returned to its prior growth strategy.
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3 Reasons Investors Loved Stitch Fix's Earnings Report