Early Bird
Posts
Stitch Fix "Has Work To Do"

Stitch Fix "Has Work To Do"

June 10, 2022

Today is Friday, June 10, 2022.

New to this newsletter? Sign up here

Stitch Fix "Has Work To Do" After Earnings

Shares of Stitch Fix (Nasdaq: SFIX) dropped 16.32% in after-hours trading on Thursday after the online personal styling service posted negative financial earnings.

Financials: Stitch Fix reported a loss of 72 cents per share and revenue of $492.9 million; both were below estimates.

The Good: Net revenue per active client reached $553, which represents an increase of 15% year-over-year. It’s the sixth consecutive quarter of revenue per active client growth.

The Bad: The number of active clients hit 3.9 million, which represents a 5% decline. On top of that, Stitch Fix confirmed a CNBC report on Thursday that it is laying off 15% of salaried positions in its workforce.

Quote: “While third quarter top-line results, as well as active client counts, were largely within our expectations, we know we still have work to do.” - Stitch Fix CEO Elizabeth Spaulding.

Outlook: The company expects revenue in the current quarter to be between $485 million t0 $495 million, which represents a decline of up to 15%. This is also below estimates.

Numbers: Shares of Stitch Fix are down 59% in 2022 and are down 87% in the past 12 months.

Final Thoughts: Stitch Fix is another example of a company that rose to prominence during the pandemic, crashed back down to earth, and is implementing layoffs or hiring freezes.

Notables

Notable Earnings Today: N/A.

Notable IPOs Today: Forafric Global PLC Ordinary Shares (Nasdaq: AFRI), Acri Capital Acquisition Corporation Unit (Nasdaq: ACACU).

Notable Equity Crowdfunding Campaigns Ending Today: Northstar Technologies Group (Netcapital).

Notable Economic Events Today: Core CPI / CPI (8:30 a.m. ET), Michigan Consumer Expectations / Sentiment (10:00 a.m. ET), WASDE Report (12:00 p.m. ET), Federal Budget Balance (2:00 p.m. ET).

Vail Resorts Jumps On Strong Pass Sales

Photo by Banff Sunshine Village / Unsplash

Shares of Vail Resorts (NYSE: MTN) jumped 6.68% in after-hours trading on Thursday after the mountain resort company posted positive financial earnings.

Financials: Vail Resorts reported earnings of $9.16 per share and revenue of $1.17 billion; both were better than expected.

The Good: Pass product sales jumped 9% in units and 11% in sales dollars during the quarter. Total lift revenue increased 23.7%, ski school revenue increased 50.4%, and lodging segment net revenue increased 54.6%.

The Bad: During the season, the company suffered capacity and staffing constraints due to the pandemic.

Outlook: The company expects its resort reported EBITDA to be between $828 million and $842 million, which is better than expected.

Numbers: Vail Resort’s stock is down 23% in the past 12 months, but is up 1.7% in the past 30 days.

Final Thoughts: While there is always a concern about the impact of the pandemic, Vail Resorts is making a comeback.

Are Tech Stocks Back?

Although the technology-heavy Nasdaq Composite delivered a surprising increase in early June, the tech sector may not be ready for a comeback after a bad start to 2022.

Jobs: Several tech companies, some public and some private, announced a mixture of layoffs and hiring freezes in early June. This is a bad sign for the sector.

Micro Cut: Microsoft (Nasdaq: MSFT) cut its guidance last week, a sign that tech giants might struggle this summer.

Final Thoughts: Keep an eye on the U.S. dollar this summer. If it gets stronger, that could spell trouble for tech stocks.