Stitch Fix Inc is cutting around 15% of salaried positions as part of a plan to return to profitability.
Shares of the online personalized styling service firm plunged 16% after hours.
Revenue in the April-ended quarter fell 8% from a year earlier.
The company forecasted net revenue between $485 million and $495 million for the fourth quarter, compared with estimates of $495.1 million, according to Refinitiv data.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
The layoffs account for nearly 4% of the company’s overall workforce, or around 330 positions in total.
The majority of the jobs are in non-technology corporate and styling leadership roles, according to Chief Executive Officer Elizabeth Spaulding.
ONLINE INFLATION CONTINUES TO SLOW IN MAY, ADOBE SAYS
“[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.
|SFIX||STITCH FIX INC.||6.34||-2.07||-24.61%|
The job cuts and other changes are expected to save $40 million to $60 million in costs in fiscal 2023. The company will also incur charges of around $15 million to $20 million in the fourth quarter.
CLICK HERE TO READ MORE ON FOX BUSINESS
The company lost $78 million in its fiscal third quarter. On a per-share basis, the San Francisco-based company said it had a loss of 72 cents, which was larger than the expected loss of 57 cents per share.
Reuters contributed to this report.