Stitch Fix on Monday reported net revenue of $445 million, reflecting 21% year-over-year growth, for its first quarter ending on Nov. 2. Net loss was $178,000, compared to income of $10.6 million a year ago in the same quarter, while adjusted EBITDA was $5.1 million, or 1.2% of net revenue, according to a company press release and emailed statement.
The apparel styling service also reported that its active client base reached 3.4 million, an increase of 17% year over year. Stitch Fix grew revenue per active client by 10% year over year, its sixth consecutive quarter of growth, per the release.
The company announced that Elizabeth Spaulding is joining as president from management consulting firm Bain & Company. Additionally, Chief Financial Officer Paul Yee is stepping down from his position and COO Mike Smith will serve in the interim as the company seeks a new CFO.
Stitch Fix continues to illustrate the deep relationship it has between apparel curation and data analysis.
In an earnings call on Monday, founder and CEO Katrina Lake spoke of the company's direct-buy options, including its new Shop Your Looks feature, which is "hyper-curated and algorithmically personalized to every client" and provides a selection of 30 to 40 items based on a shopper's past preferences. Shop Your Looks, which is still in beta, is currently available to about a third of its female clientele. The company expects to expand its reach to all female clients, and begin testing it with men, by the end of the fiscal year.
The feature's tech is boosting sales, with Stitch Fix reporting that those who purchased through the feature interacted with the company multiple times.
Additionally, the new Shop New Colors option allows clients to buy previously purchased items in new colors, prints and sizes. The response has been successful enough that the company plans to introduce the feature to its kids offerings by the end of 2020.
"One of our key strengths is our ability to use data science to match inventory to each of our client's unique preferences," Smith said, echoing the importance of technology in personalizing recommendations.
Executives' confidence in the potential of technology that pinpoints a customer's needs is backed up by research. A study this year by Monetate and WBR Research discovered that 93% of businesses with advanced personalization strategies increased their revenues. Additionally, 77% of businesses that exceeded their revenue goals in 2018 had a documented personalization strategy.
Data has always been at the center of the company's strategy, with Lake stating in the Harvard Business Review that "Data science isn't woven into our culture; it is our culture."