(Updated - June 9, 2022 4:42 PM EDT)

Stitch Fix (NASDAQ: SFIX) reported Q3 EPS of ($0.72), $0.17 worse than the analyst estimate of ($0.55). Revenue for the quarter came in at $494.9 million versus the consensus estimate of $493.26 million.

Organizational Update

In light of Stitch Fix’s recent business momentum and an uncertain macroeconomic environment, the Company undertook a detailed review of its business and what is required to build for the future. As a result, the Company shared the difficult decision to reduce its workforce. This reduction includes approximately 15% of salaried positions, and represents approximately 4% of roles in total. Most of the reductions are in non-technology corporate roles and styling leadership roles.

As a result of this decision and other changes, Stitch Fix expects annual cost savings of $40 million to $60 million in fiscal year 2023. The Company expects to incur restructuring and other one-time charges of approximately $15 million to $20 million to be recognized in the fourth quarter of fiscal 2022.

Financial Outlook:

Stitch Fix sees Q4 revenue of $485 - $495 million vs the consensus of $495 million.

Our financial outlook for the fourth quarter of fiscal 2022, which ends on July 30, 2022 is as follows:

Q4’22 Adjusted EBITDA excludes restructuring and other one-time charges totaling $15 million to $20 million.

For earnings history and earnings-related data on Stitch Fix (SFIX) click here.