Stitch Fix has announced its financial results for the second quarter of fiscal year 2023 ended January 28, 2023. The company reported $623.8 million in net revenue, a decrease of 6.6% year-over-year. However, the company's adjusted EBITDA for the quarter was $34.0 million and exceeded their guidance range. They also announced a CFO transition and raised their full-year FY23 adjusted EBITDA guidance.
According to Katrina Lake, Interim Chief Executive Officer, the company is continuing to focus on investing in advanced data science and machine learning capabilities combined with personalized styling expertise to attract long-term clients and drive efficiency. She stated, "I'm excited about our brand and product enhancements, new client engagement programs, and investments in our data science capabilities that are driving stronger personalization."
Stitch Fix also announced $135 million of cost-reduction targets for FY23 and is continuing to focus on a styling-first model to enhance the client experience and maximize return-on-investment in the short term, paving the way for a return to growth.
The company's forward-looking statements regarding their ability to lead the way in personalization, achieve greater impact in years to come, and achieve positive adjusted EBITDA and free cash flow in the near term are subject to risks and uncertainties related to the current macroeconomic environment, market and consumer behavior, and other factors.
Stitch Fix's non-GAAP adjusted EBITDA excludes restructuring and other one-time costs, and their non-GAAP free cash flow is an important metric that represents how much cash from operations the company has available for discretionary and non-discretionary items. However, investors should be mindful that there are limitations to the use of non-GAAP financial measures.
Overall, the company's financial results suggest some positive progress towards profitability and the CEO's comments highlight their continued focus on enhancing the client experience and driving growth. Investors should carefully consider the risks and uncertainties associated with the company's forward-looking statements.