Stitch Fix reports fifth consecutive quarter of revenue growth in Q3 2026

US online personal styling service Stitch Fix has reported its financial results for the third quarter of fiscal 2026 ended May 2, 2026, delivering its fifth consecutive quarter of year-over-year revenue growth on an adjusted basis. Both net revenue and adjusted EBITDA exceeded company expectations.

Net revenue for the third quarter increased by 4.7 percent year-over-year to 340.30 million dollars. The company also recorded a sequential increase in active clients, which rose by 0.9 percent quarter-over-quarter to 2.31 million, although this represented a decrease of 1.9 percent compared to the same period last year. Net revenue per active client increased by 6.6 percent year-over-year to 578 dollars.

Stitch Fix chief executive officer Matt Baer said: “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. 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.”

Third quarter financial breakdown

Gross margin for the period was 43.7 percent, representing a decrease of 50 basis points year-over-year. The group reported a net loss of 1.50 million dollars, resulting in a net loss margin of 0.4 percent and a diluted loss per share of 0.01 dollars. Adjusted EBITDA reached 13.20 million dollars, equivalent to an adjusted EBITDA margin of 3.9 percent.

During the first quarter of fiscal 2024, the company ceased operations of its UK business, which met the accounting requirements for discontinued operations. Accordingly, all financial results presented relate strictly to continuing operations.

Updated fiscal year outlook

For the fourth quarter of fiscal 2026 ending August 1, 2026, Stitch Fix projects net revenue to be between 322 million dollars and 327 million dollars, representing year-over-year (YoY) growth of 3.5 percent to 5.1 percent. Adjusted EBITDA is expected to land between seven million dollars and 10 million dollars, representing a margin of 2.2 percent to 3.1 percent.

For the full fiscal year 2026, the company has updated its financial outlook. Full-year net revenue is forecast to be between 1.35 billion dollars and 1.35 billion dollars, representing a YoY growth of 6.2 percent to 6.6 percent. Full-year adjusted EBITDA is expected to be between 49 million dollars and 52 million dollars, with a margin of 3.7 percent to 3.9 percent.

Management expects the full fiscal year 2026 gross margin to be between 43 percent and 44 percent. Advertising expense as a percentage of revenue is anticipated to be between 9% and 10% for the full year, and the company expects to remain free cash flow positive.