What Happened?

Shares of personalized clothing company Stitch Fix (NASDAQ: SFIX) fell 5.7% in the afternoon session after the company reported underwhelming first quarter 2025 (fiscal Q3) results: Sales were flat, and it continued to lose customers. In addition, margins stayed weak and in the red. 

On the other hand, Stitch Fix blew past analysts' revenue, EPS, and EBITDA expectations, suggesting expectations were modest heading into the prints. Zooming out, we think this was a weak quarter.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Stitch Fix? Access our full analysis report here, it’s free.

What The Market Is Telling Us

Stitch Fix’s shares are extremely volatile and have had 57 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 15 days ago when the stock gained 5.8% on the news that the major indices rebounded (Nasdaq +2.0%, S&P 500 +1.5%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025. Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.

Stitch Fix is up 4.7% since the beginning of the year, but at $4.57 per share, it is still trading 31.1% below its 52-week high of $6.64 from December 2024. Investors who bought $1,000 worth of Stitch Fix’s shares 5 years ago would now be looking at an investment worth $200.65.

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