Stitch Fix (SFIX) Q4 2026 Earnings Report

The call was predominantly positive: fiscal 2026 delivered 6.4% revenue growth, six consecutive quarters of positive revenue comps, record revenue per active client, improved margins, positive free cash flow and a strong balance sheet. Management also highlighted progress in retention, assortment expansion, AI and Vision. The primary challenges were declining active clients, higher acquisition costs, a difficult consumer environment and more modest fiscal 2027 revenue and EBITDA guidance, with Q1 additionally affected by temporary fix-volume issues. Management remained confident in returning to active client growth and sustaining long-term profitable growth.

For FY '27, Stitch Fix expects total revenue to be between $1.31 billion and $1.36 billion, total adjusted EBITDA to be between $27 million and $42 million, full year gross margin to remain between 43% to 44%, and to generate stronger positive free cash flow for FY '27 compared to last year; for Q1, it expects total revenue to be between $323 million and $328 million and adjusted EBITDA to be between $3 million and $6 million, with lower expected fix volume from two temporary factors affecting only Q1. The company is probably going to be spending a little bit more in the 10% to 11% range on marketing versus the 9% to 10% range in FY '26, with Q1 and Q3 tending to be stronger acquisition quarters, and if excluding additional advertising and incremental AI investments, the EBITDA margin guide would have been much more consistent with last year's margin at the 4% range.