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Stitch Fix shares soar as company reaches $2 billion in sales for first time

Stitch Fix Inc. said Tuesday it gained more clients and its revenue rose 29% in the fourth quarter, helping propel the company to more than $2 billion in annual sales for the first time.

Stitch Fix SFIX, -2.50% shares surged nearly 18% after hours, after falling 2.5% in the regular session to close at $35.46.

The clothing-subscription company said in a news release that it brought on 643,000 active clients in the quarter, an increase of 18% year over year, to almost 4.2 million.

“These results reflect strong performance across our business, in Women’s, Kids and the U.K.,” Stitch Fix Chief Executive Elizabeth Spaulding said.

The company, which is based in San Francisco, reported fourth-quarter net income of $21.5 million, or 19 cents a share, compared with a loss of $44.5 million, or 44 cents a share, in the year-ago period. Adjusted Ebitda was $55.4 million, adjusted for stock-based compensation and other costs. Revenue rose to $571 million from $443 million in the year-ago quarter.

Analysts surveyed by FactSet had expected a loss of 12 cents a share on revenue of $548 million.

Stitch Fix posted a full-year loss of $8.9 million, or 8 cents a share, on revenue of $2.1 billion, compared with a loss of $67.1 million in the previous year. Analysts had forecast a loss of 41 cents a share on revenue of $2.08 billion.

For the first quarter, the company expects adjusted Ebitda net income of $15 million to $20 million on revenue of $560 million to $575 million, while analysts are forecasting a loss of 14 cents a share on revenue of $591 million.

Stitch Fix stock is down almost 40% year to date, while the S&P 500 Index SPX, -0.08% has risen 16% so far this year.

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