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Poshmark sales top estimates in its first quarterly report as a public company, but outlook disappoints; shares fall

The online seller of secondhand clothing issued a weaker-than-expected sales outlook for the current quarter.

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Poshmark Inc. signage outside the Nasdaq MarketSite during the company’s initial public offering (IPO) in New York, U.S., on Thursday, Jan. 14, 2021.

Michael Nagle | Bloomberg | Getty Images

Poshmark‘s revenue topped analysts’ estimates, in its first financial report since going public in January. But the online seller of secondhand clothing issued a weaker-than-expected sales outlook for the current quarter.

Poshmark’s stock tumbled more than 12% in after-hours trading.

Founder and Chief Executive Manish Chandra said in an interview that demand for apparel is still suppressed in parts of the U.S., where tighter Covid restrictions remain in place.

“Different parts of the country are behaving quite differently,” Chandra said, citing Florida as a strong growth market where customers are searching Poshmark for dresses and bathing suits, whereas New York is still catching up. “So, we are accounting for the state-wide differences.”

For the quarter ended Dec. 31, Poshmark’s loss narrowed to $4.06 million, or 31 cents per share, from a loss of $14.75 million, or $1.20 per share, a year earlier. After adjusting for one-time items, the company earned 5 cents a share during the quarter.

Revenue climbed 27% to $69.32 million from $54.74 million a year earlier. That was higher than the average revenue estimate of $68 million, reported by Refinitiv.

For the first quarter, Poshmark is calling for revenue to fall within a range of $75.5 million to $77.5 million. Analysts had been calling for $79.2 million on average.

“Our platform is super adaptable and flexible,” Chandra said. “That has allowed us to be a growth engine in 2020, compared to a lot of other places that have suffered.”

Poshmark filed to go public in December and opened its first day of trading on the Nasdaq on Jan. 14, at at $97.50 per share. The stock has fallen since, hitting an all-time intraday low of $44.11 last Friday. Shares closed Thursday up nearly 16%, at $59.46.

Founded in 2011, the company’s online marketplace for secondhand clothes, shoes and accessories is akin to eBay and Etsy. Poshmark connects buyers with sellers, who often list items from their own closet. And it makes money by taking a cut of every transaction.

Consumers, especially younger ones, are increasingly turning to these types of internet marketplaces for secondhand goods. A number of players are looking to gain market share, including luxury consignment site TheRealReal, sneaker reseller StockX and virtual thrift store ThredUp. The latter filed for its IPO earlier this month.

Poshmark said its count of active buyers reached 6.5 million in the fourth quarter, up 20% year over year. The company defines active buyers as unique users who have purchased at least one item on the platform in the trailing 12 months, regardless of returns and cancellations.

Cowen & Co. has previously estimated that the resale market in the U.S. is valued at $30 billion to $35 billion.

Find the full earnings press release from Poshmark here.

Source: https://www.cnbc.com/2021/03/11/poshmark-posh-q4-2020-earnings.html

poshmark-sales-top-estimates-in-its-first-quarterly-report-as-a-public-company,-but-outlook-disappoints;-shares-fall

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Source: https://www.cnbc.com/earnings/

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Stitch Fix shares surge as online styling service reports surprise profit

Stitch Fix shares jumped after the online shopping and styling service reported a surprise profit for its fiscal fourth quarter.

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The Stitch Fix application for download in the Apple App Store on a smartphone arranged in Hastings-on-Hudson, New York, U.S., on Saturday, June 5, 2021. Stitch Fix Inc. is scheduled to release earning on June 7.

Tiffany Hagler-Geard | Bloomberg | Getty Images

Stitch Fix shares jumped 14% in extended trading Tuesday after the online shopping and styling service reported a surprise profit for its fiscal fourth quarter.

Sales for the three-month period ended July 31 also came in higher than analysts were expecting, thanks to outsized growth in Stitch Fix’s women’s and kids’ categories. Menswear has been growing more slowly, the company said.

Consumers have been splurging on new outfits in recent months, as many head back to school and return to social gatherings. Some have also citied the need for new clothes after either gaining or losing weight during the Covid pandemic.

Here’s how Stitch Fix did compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: 19 cents vs. a loss of 13 cents expected
  • Revenue: $571.2 million vs. $548 million expected

Net income attributable to shareholders was $28 million, or 19 cents per share, in the latest period. A year ago, it posted a net loss of $44.5 million, or 44 cents a share. Analysts had been looking for the company to book a loss of 13 cents per share.

Revenue grew to $571.2 million from $443.4 million a year earlier. That was better than analysts’ expectations for $548 million.

Stitch Fix reported nearly 4.2 million active clients, up 18% from a year earlier. The company said net revenue per active client was $505, surpassing the $500 threshold for the first time ever. Customers have been purchasing more items to keep at home, Stitch Fix said, as they have more brands and price points to choose from.

Stitch Fix defines active clients as people who either ordered a “Fix” subscription or bought an item directly from its website in the preceding 52 weeks from the final day of the quarter.

The company also said it had its lowest ever churn rate at the end of the period, meaning its customers are sticking around.

Last month, Stitch Fix finally opened up its direct-buy option, which is now known as “Freestyle,” to the public. This allows people to shop Stitch Fix for individual items of clothing, without needing to sign up for a subscription.

CEO Elizabeth Spaulding said this should help Stitch Fix grow its addressable market in the year ahead. The company’s next initiative will be to market and raise broader awareness around the offering, she said. Stitch Fix is preparing to roll out a national advertising campaign on the debut.

Early indications are that “Freestyle” is meaningfully accretive to the company’s revenue per active client metric, Spaulding told analysts on a conference call.

“Clients have agency, flexibility and choice while also experiencing a highly personalized shopping experience,” Spaulding said.

For its fiscal first quarter, Stitch Fix said it sees sales in a range of $560 million to $575 million. That’s below analysts’ expectations for $588 million.

For the upcoming fiscal year, Stitch Fix anticipates sales rising 15% or more from the prior year. Analysts polled by Refinitiv had been looking for an 18% increase.

While the entire retail industry is working through supply chain complications, Stitch Fix said it is seeing a small impact, but nothing that will hurt the business in the fall and winter months. The company said it is less reliant on Vietnam, where manufacturing has largely come to a standstill due to ongoing pandemic lockdowns in the region.

As of Tuesday’s market close, Stitch Fix shares have fallen nearly 39% this year. The company has a market cap of $3.8 billion.

Find the full press release from Stitch Fix here.

Sales for the three-month period ended July 31 also came in higher than analysts were expecting, thanks to outsized growth in Stitch Fix’s women’s and kids’ categories. Menswear has been growing more slowly, the company said.

Source: https://www.cnbc.com/2021/09/21/stitch-fix-sfix-q4-2021-earnings.html

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© 2021 CNBC LLC. All Rights Reserved. A Division of NBCUniversal

Data is a real-time snapshot *Data is delayed at least 15 minutes. Global Business and Financial News, Stock Quotes, and Market Data and Analysis.

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Source: https://www.cnbc.com/earnings/

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