Stitch Fix Inc. reported its second straight quarter of revenue growth in fiscal Q2 as the company works to stabilize its business after several years of declining sales.
Net revenue totaled $341.3 million in the fiscal second quarter ended Jan. 31, up 9.4% from $312.1 million a year earlier.
The gains came even as the broader U.S. apparel, footwear and accessories market contracted 0.5% during the same period, according to Circana data cited by the company.
Stitch Fix ranks No. 76 in the Top 2000 Database. That’s Digital Commerce 360’s ranking of the largest online retailers in North America by their annual ecommerce sales. Digital Commerce 360 categorizes Stitch Fix as an Apparel & Accessories retailer.
What drove Stitch Fix revenue growth in Q2?
Matt Baer, Stitch Fix’s CEO, said improvements to the retailer’s assortment, client experience and new artificial intelligence (AI)-powered tools are driving higher engagement and revenue growth.
“As a result, we are solidifying our position in the market and our role as our clients’ retailer of choice for apparel, footwear and accessories,” Baer said during the company’s earnings call.
Several operating metrics improved during the holiday period.
Both the company’s women’s and men’s Fix businesses grew at double-digit rates in Q2, Baer noted.
Average order value for Fixes — the company’s curated clothing shipments — rose nearly 10% year over year. That marked the 10th consecutive quarter of growth for the metric, he said.
Increased Stitch Fix revenue per active client
Revenue per active client also reached Stitch Fix record of $577 during the latest quarter.
Baer attributed some of the gains to changes in the service itself.
“Adoption of our larger Fixes, which offer up to eight items in a Fix versus the original five, continues to grow,” he said. “We are also seeing high resonance with other newer formats, such as themed Fixes and Fixes built around a Freestyle item of a client’s choosing.”
The company is also refining its brand mix, pairing well-known national labels with its private brands designed using client data, Baer said.
Several product categories also posted strong gains. Activewear and athleisure sales rose 37% year over year combined, while special-occasion and night-out styles increased 46%. Footwear revenue climbed 33%, and accessories rose 51%, Baer said.
Baer added that expanding Stitch Fix’s presence in categories such as activewear, footwear and accessories could unlock a significant “wallet share” opportunity. Within the company’s existing client base, that could represent roughly $1 billion in incremental revenue, he said.
Client totals, however, continued to decline. Active clients totaled 2.288 million during the quarter, down 0.8% sequentially and 3.5% year over year.
David Aufderhaar, chief financial officer at Stitch Fix, said rebuilding the client base remains a priority. The company expects to return to year-over-year active client growth in fiscal 2027, he said.
As both average order value and client totals improve, the company believes the model can support longer-term compounding growth, he assessed.
Overall, the company reported its fourth consecutive period of revenue growth on a 52-week basis, which adjusts for the extra week in the fourth quarter of fiscal 2024.
AI tools reshape styling experience
Baer said Stitch Fix’s proprietary data and algorithms provide a competitive advantage in delivering personalized styling recommendations.
The company is drawing on billions of data points about client preferences — including fit, budget and style choices — to power new AI-driven tools.
One example is the company’s AI Style Assistant. The conversational tool engages clients in a dialogue and offers AI-generated outfit ideas to help them articulate their preferences.
The company is also expanding Stitch Fix Vision, an AI-powered styling platform that allows shoppers to preview how they might look in curated head-to-toe outfits.
Baer said engagement has been strong. 75% of users return to the tool in subsequent months. Those users generated more than a 100% increase in spending on Freestyle — Stitch Fix’s on-demand shop — over a 90-day period, he said.
Executives also pointed to emerging demand tied to GLP-1 weight-loss medications, including Ozempic and Wegovy.
As some clients experience body changes while taking those medications, they are turning to Stitch Fix stylists for help updating their wardrobes, Baer said. Mentions of weight loss in Fix request notes have tripled over the past two years, including a 75% year-over-year increase in the most recent quarter, he noted.
Stitch Fix forecasts modest growth
Aufderhaar cautioned that the strong holiday quarter may not fully carry through the rest of the fiscal year. He cited broader economic pressures – including weaker consumer sentiment and rising gas prices – that could weigh on discretionary spending.
For the third quarter of fiscal 2026, Stitch Fix expects net revenue between $330 million and $335 million, representing year-over-year growth of roughly 1.5% to 3.1%.
For the full fiscal year, the company forecasts net revenue of $1.33 billion to $1.35 billion. This would represent growth of approximately 5% to 6.5% year over year.
Baer said the company believes its styling model positions it well, even if consumers become more cautious with spending.
“Our clients and stylists have a very deep and enduring relationship that allows them to have a real conversation around how budget might be shifting month to month, week to week, quarter to quarter,” Baer said. “That is what gives us so much confidence that, wherever the overall market goes, we will continue to be a market share gainer.”
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