Free Subscription

  • Access 15 free news articles each month

Professional

Try one month for $5
  • Unlimited access to news,insights and opinions
  • Quarterly and weekly magazines
  • Independent research reports and forecasts
  • Quarterly webinars with industry experts
  • Q&A with retail leaders
  • Career advice
  • Exclusive Masterclass access. Part of Retail Week 2021

Stitch Fix to cut salaried workforce by 15 per cent

(Source: Stitch Fix Facebook )

Stitch Fix says it is reducing its workforce by around 15 per cent of salaried positions, as the online personalised styling service firm aims to return to profitability.

Decades-high inflation and the impact of the war in Ukraine have pressured Corporate America to consider laying off people or impose a freeze on hiring.

The layoff at Stitch Fix accounts for nearly 4 per cent of the roles, or around 330 positions, with most of them in its non-technology corporate and styling leadership roles, CEO Elizabeth Spaulding said.

“(The decision) was one we needed to make to position ourselves for profitable growth … There will be tough choices along the way, and this is one of those,” Spaulding wrote in a message to Stitch Fix employees.

Stitch Fix expects to save $40 million to $60 million in costs in fiscal 2023 from the job cuts and other changes while incurring charges of around $15 million to $20 million in the fourth quarter.

Shares, which closed more than 10 per cent lower on Thursday, were down nearly 6 per cent in extended trading after Stitch Fix reported revenue for the third quarter below expectations.

Stitch Fix also forecast net revenue between US$485 million and $495 million for the fourth quarter, compared with estimates of $495.1 million, according to Refinitiv data.

  • Reporting by Praveen Paramasivam in Bengaluru; Editing by Krishna Chandra Eluri, of Reuters.

You have 7 free articles.