Stitch Fix (SFIX) Q3 2026 earnings summary

Executive summary

• Revenue for Q3 2026 was $340.3 million, up 4.7% year-over-year, marking the fifth consecutive quarter of revenue growth and surpassing expectations.

• Active clients reached 2.309 million, up sequentially but down 1.9% year-over-year, with both women's and men's segments contributing to growth.

• Net revenue per active client (RPAC) hit a record $578, up 6.6% year-over-year, reflecting higher engagement and spend.

• Adjusted EBITDA was $13.2 million (3.9% margin), with net loss narrowing to $1.5 million and positive free cash flow.

• Continued focus on operational efficiency, innovation, AI-driven personalization, and transformation strategy to drive client engagement and profitability.

Financial highlights

• Gross margin was 43.7% for Q3 2026, down 50 basis points year-over-year but above the midpoint of FY26 guidance.

• Adjusted EBITDA for Q3 2026 was $13.2 million, margin 3.9%; free cash flow was $6.5 million.

• SG&A spend decreased by over 220 basis points year-over-year, reflecting disciplined expense management.

• Cash, cash equivalents, and investments totaled $229.4 million at quarter end; no debt.

• Inventory increased 15.6% year-over-year to $132.2 million, supporting demand for larger Fixes.

Outlook and guidance

• Q4 FY26 revenue expected between $322 million and $327 million; adjusted EBITDA between $7 million and $10 million.

• FY26 revenue guidance raised to $1.346 billion–$1.351 billion; adjusted EBITDA to $49 million–$52 million.

• Full-year gross margin expected at 43%-44%; advertising costs at 9%-10% of revenue.

• Free cash flow positive for the full year; continued investment in client experience and innovation.

• Management expects macroeconomic uncertainty to continue impacting consumer discretionary spending.