SFIX earnings name for the interval ending September 30, 2024.
Picture supply: The Motley Idiot.
Sew Repair (SFIX 0.44%)
Q1 2025 Earnings Name
Dec 10, 2024, 5:00 p.m. ET
Contents:
- Ready Remarks
- Questions and Solutions
- Name Members
Ready Remarks:
Operator
Good afternoon, and thanks for standing by. Welcome to the primary quarter fiscal 12 months 2025 Sew Repair earnings name. Presently, all members shall be in a listen-only mode. After the speaker’s presentation, you can be invited to take part in a question-and-answer session.
[Operator instructions] Please be suggested that at this time’s convention is being recorded. And now I might prefer to introduce your host for at this time’s program, Lilly Bindley, investor relations. Please go forward.
Lilly Bindley — Investor Relations
Thanks for becoming a member of us at this time for the Sew Repair first quarter fiscal 2025 earnings name. With me on the decision are Matt Baer, chief government officer; and David Aufderhaar, chief monetary officer. We now have posted full first quarter 2025 monetary ends in a press launch on the quarterly outcomes part of our web site, traders.stitchfix.com. A hyperlink to the webcast of at this time’s convention name will also be discovered on our website.
We want to remind everybody that we’ll be making forward-looking statements on this name, which contain dangers and uncertainties. Precise outcomes might differ materially from these contemplated by our forward-looking statements. Reported outcomes shouldn’t be thought-about as a sign of future efficiency. Please evaluation our filings with the SEC for a dialogue of the elements that would trigger the outcomes to vary, specifically, our press launch issued and filed at this time, in addition to the danger elements part of our annual report on Kind 10-Okay for fiscal 2024 beforehand filed with the SEC.
Additionally, be aware that the forward-looking statements on this name are based mostly on data obtainable to us as of at this time’s date. We disclaim any obligation to replace any forward-looking statements, besides as required by legislation. Throughout this name, we are going to focus on sure non-GAAP monetary measures. Reconciliations to probably the most immediately comparable GAAP monetary measures are offered within the press launch on our Investor Relations web site.
These non-GAAP measures should not meant to be an alternative choice to our GAAP outcomes. Within the first quarter of fiscal 2024, we started to report our U.Okay. enterprise as a discontinued operation. Accordingly, all metrics mentioned on at this time’s name characterize our persevering with operations.
Lastly, this name in its entirety is being webcast on our investor relations web site, and a replay of this name shall be obtainable on the web site shortly. And now let me flip the decision over to Matt.
Matt Baer — Chief Govt Officer
Good afternoon, and thanks for becoming a member of us. We’re off to a powerful begin to the fiscal 12 months. We exceeded our expectations in Q1, delivering internet income of $318.8 million. This can be a 570-basis level enchancment in year-over-year comps from This fall when adjusted for the 53rd week.
We additionally delivered adjusted EBITDA of $13.5 million, and we proceed to enhance our contribution margin, delivering roughly 34% within the quarter. This progress is the results of the continued execution of our transformation technique, which incorporates our work to strengthen the muse of our enterprise and reimagine our consumer expertise. We’re on monitor to efficiently rework our enterprise, and we proceed to anticipate to return to income development by the tip of FY ’26. We’re additionally elevating our annual steerage, and David will share extra on that shortly.
We proceed to embed retail finest practices throughout our enterprise and drive operational efficiencies. The standard, freshness, and total well being of our stock assortment continues to enhance. We’re additionally creating flexibility in our expertise, and we have launched extra customized advertising and engagement techniques to extend consumer visits, drive gross sales throughout each Repair and Freestyle channels, and enhance acquisition economics. Particular to our assortment, the freshness of our stock is driving improved outcomes throughout a number of classes like athleisure, social, and particular events and in each our personal and nationwide manufacturers.
As we shared final quarter, the retail market and our shoppers’ expectations developed over the previous few years, and we didn’t adapt our assortment rapidly sufficient. To handle this, we’ve got been specializing in enhancing our stock by constructing best-in-class methods for purchasing, assortment planning, and allocation. Moreover, enhancements to our proprietary AI stock administration software are serving to to protect our wholesome stock place. In Q1, we infused extra newness and seasonally related types into our providing.
Whereas we nonetheless have work to do, the penetration of newness in our stock elevated greater than 40% within the quarter, and our shoppers are responding positively, driving AUR up 6% 12 months over 12 months. For example, we’ve got launched a bigger number of silhouettes in denim that our ladies shoppers are embracing. Gross sales of wide-leg and boot-cut types are up 250% from final 12 months. This improve in demand highlights simply how keen our shoppers are for contemporary type selections, and we are going to proceed leaning in to ship rising developments extra rapidly.
Our two latest private-label manufacturers, The Commons and Montgomery Publish, have delivered encouraging early outcomes. The Commons has been fashionable in our males’s enterprise, rapidly turning into a prime 10 model for shoppers below the age of 40. The Commons’ sweater polos have been a giant winner for our males consumer this quarter. In ladies’s, new workwear types from Montgomery Publish are resonating, with silhouettes like cowl necks performing properly.
A lot of our nationwide manufacturers delivered constructive comps for the quarter, together with manufacturers corresponding to Vuori, Marine Layer, Rhone, Winery Vines, Public Rec, Verity, and Pistola. We proceed to deepen relationships with these and different manufacturers as valued companions in our transformation, and we’re additional increasing our assortment with the upcoming launch of latest nationwide manufacturers. Along with enhancing our assortment, we’re persevering with to construct flexibility into the Sew Repair expertise. Final quarter, we shared how we have been starting to increase past our conventional 5 gadgets in a Repair.
Shoppers now have the chance to obtain as much as eight gadgets of their Repair, permitting them to higher discover present developments and replace their wardrobes for main life occasions. This flexibility permits us to offer extra worth and seize larger pockets share with our most engaged shoppers. Whereas nonetheless early days, shoppers who select this selection are requesting practically 40% extra gadgets in a Repair on common and driving roughly 50% larger AOVs than conventional five-item fixes. Sew Repair was constructed on personalization, and as we proceed to tailor our styling expertise to every consumer, we’re additionally participating out all our consumer segments by a brand new customized strategy to advertising.
Our technique isn’t just about driving quantity, it is about participating our shoppers in very focused methods. And during the last 12 months, we’ve got constructed promotional capabilities from the bottom as much as assist us obtain that. We’re being methodical about particular use circumstances to make sure our promotions drive elevated lifetime worth whereas nonetheless sustaining total profitability as demonstrated by our very wholesome contribution margin. These new promotional capabilities are additionally enabling us to extra successfully insert Sew Repair into the consideration set in the course of the vacation season.
Now, along with including a wide range of seasonal types, we’re additionally rotating by a spread of vacation promotions and gives. This permits us to higher serve shoppers with a customized styling expertise for vacation dressing. In Q1, we noticed greater engagement in each Freestyle and Repair channels. In Freestyle, we had improved year-over-year comps in furtherance of our technique to seize a larger share of pockets.
In our Repair enterprise, for the primary time in additional than three years, we achieved a sequential improve in shoppers who’ve enabled recurring shipments. As we highlighted in our final name, we launched a refreshed model identification, the primary important replace to our model in additional than a decade. Alongside our rebrand, we launched a brand new advertising marketing campaign referred to as Retail Remedy, a content material collection that explores a few of the largest procuring, match, and elegance challenges individuals face and the way Sew Repair because the trade chief in customized styling is uniquely positioned to unravel them. Because of this, we’re seeing decrease price per acquisition and better conversion in TV and associated channels.
Model consciousness amongst our goal demographics has additionally improved throughout our ladies’s and males’s companies, reaching the best ranges in two years for ladies’s. As a part of our broader effort to reinforce our consumer expertise, we not too long ago launched StyleFile, a customized useful resource that describes every consumer’s distinctive type character, and our shoppers inform us they like it. We’re additionally placing a larger highlight on our stylists and their work by the latest introduction of stylist profiles, a brand new characteristic that allows shoppers to get to know their stylists higher. These profiles are custom-made by the stylists themselves and embody their background data, in addition to vogue style and preferences.
We’re inspired by the early engagement we’re seeing. I am happy with our sturdy begin to the fiscal 12 months and imagine our progress this quarter additional demonstrates we’ve got the suitable technique in place to return to development. We’re investing and innovating in our consumer expertise, leveraging our AI and information science management, in addition to our group of skilled stylists to offer extra causes for shoppers to come back again to Sew Repair as their go-to for all attire and equipment wants. Now I will flip the decision over to David to share extra particulars of our monetary outcomes and future outlook.
David Aufderhaar — Chief Monetary Officer
Thanks, Matt. As Matt mentioned, Q1 was a powerful begin to this fiscal 12 months, and we proceed to anticipate to return to income development by the tip of FY ’26. As we proceed our transformation, we’re centered on driving long-term development whereas sustaining the stable basis we have labored so onerous to strengthen. The constructive outcomes we’re seeing, together with more healthy consumer engagement, enhancing top-line efficiency, and continued leverage throughout the P&L are all indicators that this strategy is working, and provides us confidence to proceed making focused investments towards sustainable worthwhile development.
Now let’s dive into the outcomes. Q1 internet income got here in at $318.8 million, down 13% 12 months over 12 months and flat quarter over quarter. Income was above our steerage vary on account of our centered efforts in driving fastened AOV, up 6% 12 months over 12 months and 11% quarter over quarter. This AOV work consists of three major elements: our methodical efforts to seize the upside from an earlier-than-expected shift into fall product, the growth of Repair flexibility, and our ongoing optimization of our pricing structure.
Web lively shoppers ended the quarter at 2.4 million shoppers, representing our lowest sequential decline in lively consumer depend in two years, down 19% 12 months over 12 months and down 3% quarter over quarter. Income per lively consumer for the quarter was $531, up 5% 12 months over 12 months and comparatively flat quarter over quarter. Gross margin for the quarter got here in at 45.4%, up 180 foundation factors 12 months over 12 months and up 80 foundation factors quarter over quarter. Each year-over-year and quarter-over-quarter enhancements have been pushed by improved product margins and transportation leverage.
With a contribution margin of roughly 34%, Q1 was our third consecutive quarter delivering a contribution margin above our historic vary of 25% to 30%. This was pushed by the wholesome gross margins highlighted above, in addition to sustainable leverage in our warehouse and styling organizations. Value per order in warehouse ops was down 23% 12 months over 12 months, and styling price per Repair was down 21% 12 months over 12 months. Promoting got here in barely above our estimated vary at 9.4% of income in Q1, up 120 foundation factors 12 months over 12 months and up 40 foundation factors quarter over quarter as we leaned into alternatives to drive favorable returns on advert spend.
We noticed power in reactivations this quarter, and we proceed to make investments in our rebrand efforts and the Retail Remedy marketing campaign that Matt talked about. We ended Q1 with internet stock of $119.1 million, down 26% 12 months over 12 months and up 22% quarter over quarter as a result of timing of receipts forward of the autumn/winter seasons, in addition to our continued funding in newness to extra carefully align our providing with the wants of our shoppers. Q1 adjusted EBITDA was $13.5 million or roughly 4.2% margin, up 180 foundation factors 12 months over 12 months and up 120 foundation factors quarter over quarter. We generated $9.9 million of free money circulation in Q1 and ended the quarter with $253 million in money, money equivalents and investments, and no debt.
Turning to our outlook. Because of the power we noticed this quarter, we’re updating our annual income and EBITDA steerage. For the total 12 months FY ’25, we anticipate whole income to be between $1.14 billion and $1.18 billion. We anticipate whole adjusted EBITDA for the 12 months to be between $25 million and $36 million.
This steerage nonetheless assumes we shall be free money circulation constructive for the total 12 months, however we do anticipate Q2 to be destructive as a result of timing of working capital necessities associated to stock purchases. For Q2, we anticipate whole income to be between $290 million and $300 million. We anticipate Q2 adjusted EBITDA to be between $8 million and $13 million. We anticipate each Q2 and full 12 months gross margin to be roughly 44% to 45%, and we now anticipate full 12 months promoting to be on the excessive finish of the 8% to 9% vary we offered final quarter, reflecting our ongoing give attention to opportunistically reinvesting our EBITDA upside again into the enterprise after we see the suitable ROIs.
This outlook displays the methodical strategy we’ve got taken to drive leverage in our enterprise whereas investing in focused areas to return to development. As we progress by our transformation, we’re assured within the strategy we have been taking and our capacity to proceed delivering effectivity and reinvesting. With that, I will flip it again over to Matt to shut us out.
Matt Baer — Chief Govt Officer
Thanks, David. To reiterate, our outcomes for Q1 present our technique is working. We exceeded our steerage vary for each income and EBITDA, and we have elevated our full 12 months outlook for each metrics. We’re delivering on our imaginative and prescient to be probably the most client-centric and customized procuring expertise.
We proceed to make nice progress towards our return to development, and I sit up for sharing extra with all of you subsequent quarter. I additionally need to take a second to deal with our Sew Repair staff. Thanks for the good work you all do every day. Our continued enhancements are a testomony to your dedication to our mission and the client-centricity which you might have infused into all features of our enterprise.
I will now flip the decision over to the operator for questions.
Questions & Solutions:
Operator
Thanks. [Operator instructions] We ask that you just restrict your self to 1 query and one follow-up and to chorus from multi-part questions till everybody within the queue has had an opportunity to take part. If time permits, we are going to come again to reply any remaining questions. And our first query for at this time comes from the road of Maria Ripps from Canaccord.
Your query please.
Maria Ripps — Analyst
Nice. Thanks a lot for taking my questions and congrats on the sturdy quarter. Are you able to perhaps speak about form of key contributors to stronger-than-expected spend per consumer this quarter? I believe you talked about Repair flexibility and value form of structure, however was there anything that is form of value highlighting right here? After which so that you raised your full 12 months steerage, which is nice to see. However perhaps extra broadly, how sustainable do you assume this form of dynamics are going ahead?
Matt Baer — Chief Govt Officer
Hey, Maria, it is Matt. I admire the query and the type phrases. The primary query by way of the contributors for the spend per consumer, I’d reference again plenty of what we shared within the ready remarks, and completely satisfied to share just a little bit extra data as properly. One of many issues that was a extremely sturdy driver for us by way of our share per consumer was the continued enhancements that we’re making in our stock and in our assortment.
We have continued to extend the penetration of newness to make sure that we’re on pattern and in type for our shoppers, in addition to having the suitable seasonal stock obtainable on the proper instances. We noticed plenty of power beginning in the midst of September by way of our fall and winter items. We noticed actually sturdy gross sales efficiency from sweaters, jackets, and different seasonally acceptable stock that basically helped drive spend per consumer. As well as, creating extra flexibility within the Repair, as you famous, helps us improve our common order worth fairly significantly for these shoppers which have taken benefit of this optionality that we have created for them.
And as you famous too, the work that we’re doing by way of pricing structure. We recognized and spoke to this work a number of calls in the past, the place we had this nice alternative to actually return and take a holistic look and perceive the elasticity of our opening value factors for our stock throughout the board, recognizing that net-net, we had a chance to seize extra worth by way of our preliminary pricing. And that is helped us drive up each AUR and finally, AOV. Along with these, one thing else that we have been actually centered on is creating extra moments for engagement with our shoppers.
How can we have interaction them in between their fixes? How can we be sure that we’re capturing as a lot pockets share as potential, actually utilizing our Freestyle channel to enhance the Repair enterprise that we’re doing with our shoppers, in order that we’re growing the frequency at which we’re offering clothes and attire to our shoppers. And all of these have actually helped to contribute to the rise in spend per consumer. And I believe by way of how sustainable these are, we’ll share just a little bit and likewise, I will let David present some further colour, however we really feel actually good about the place we’re at at this time. Our focus on growing the penetration of newness in our assortment, whereas we’re proud of our ends in Q1, we additionally, as famous within the ready remarks, nonetheless have work to do.
As we shared on our final name, we’re trying to triple the quantity of newness inside our assortment over the course of the fiscal 12 months, and good for us to be up 40% from a penetration standpoint, however we’ll proceed to see our stock accredited by the steadiness of the fiscal 12 months as we get to make as we work to make sure we’ve got the suitable product for the suitable consumer on the proper time going ahead. We really feel actually good concerning the flex Repair penetration that we’ve got at this time, and the main target there may be simply guaranteeing that we’re client-right with that optionality for them. After which from a pricing perspective, we’ll proceed to lean in to seize the demand the place we see it. We additionally acknowledge that over the course of our present quarter, we’ll be anniversarying the initiation of that work.
So, whereas there may be, whereas it’d pull again just a little bit, we nonetheless really feel actually good concerning the functionality that we have constructed and the long-term affect that, that can have for us.
David Aufderhaar — Chief Monetary Officer
And Maria, it is David. I will simply add simply a few numbers round that. Particular to Q1, I believe you noticed in our remarks that Repair AOV was up 6% 12 months over 12 months, and that is actually one of many major causes we beat the excessive finish of our expectations. And inside that have been a few issues that we noticed that I believe Matt referred to as out.
The primary, we noticed AUR upside, and that was actually pushed by that earlier-than-normal seasonal transition into fall/winter items, and our merch groups did a extremely nice job of being ready for that with contemporary, new stock to actually be capable of seize the upside that we noticed there. And the second is what Matt referred to as out round that new flex Repair providing is we have been in a position to launch and ramp flex Repair sooner than anticipated within the quarter. And so, these have been two of the primary drivers of the quarter. After which to your level across the full 12 months information, there have been a few issues that occurred that do play ahead, and that is why we up to date the total 12 months information the way in which that we did.
The very first thing is that we did have a small beat to our expectations round lively shoppers, the place I believe final quarter, we had mentioned we anticipated to be down just a little greater than 3%, and we got here in proper at 3%, and we’re taking part in a few of that upside ahead. After which to Matt’s level, there have been different form of AOV drivers that we noticed along with form of the Q1 drivers that we anticipate to play ahead for the 12 months as properly. After which all of that’s included into the brand new full 12 months information.
Maria Ripps — Analyst
Nice, that is very useful. Thanks each and I will get again within the queue.
David Aufderhaar — Chief Monetary Officer
Thanks, Maria.
Operator
Thanks. And our subsequent query comes from the road of Jay Sole from UBS. Your query, please.
Jay Sole — Analyst
Nice, thanks a lot. Matt, are you able to elaborate just a little bit on the affect that personal manufacturers have had within the enterprise? You touched on within the ready remarks, however are you able to simply inform us perhaps just a little bit about what share of gross sales these manufacturers are proper now, how that is pushed larger AOV? And simply in case you can elaborate, that may be useful. Thanks.
Matt Baer — Chief Govt Officer
Jay, yeah, completely satisfied to elaborate. And the place I will begin is simply by way of the goal that we’ve got for the proportion of personal and nationwide manufacturers, that is going to proceed to ebb and circulation. And that can ebb and circulation relying on what are our shoppers wants, what our shoppers need and what are we studying from them daily, week to week, month to month. And as I discussed on a previous name, I believe the power of Sew Repair is a strong providing of nationwide and personal manufacturers.
It is one of many ways in which we will finest serve our shoppers by that portfolio that we’ve got. And given our wholesome contribution margin that we spoke to within the ready remarks, I do imagine that we’re working from a place of power that permits us to regulate the portfolio profitably to finest meet our shoppers’ wants, and we’ll proceed to make use of a data-driven strategy to the decision-making and utilizing these consumer insights to information the place we’re shopping for into and what that total penetration is. As we have shared traditionally and on prior calls, our personal model composition is round 40% to 50% of our whole market of our whole portfolio. And the maintain charge and the margins in these proceed to have an outperformance over our market manufacturers, however our market manufacturers additionally proceed to actually resonate with our shoppers, and we’re seeing plenty of power there as we shared within the ready remarks.
So, we’re simply going to proceed to be sure that on the finish of the day, we’ve got the client-right assortment and really feel actually assured in our capacity to serve our shoppers extraordinarily properly and get them the product that they are on the lookout for.
Jay Sole — Analyst
Received it. If I can sneak yet one more in earlier than I am going again in queue, are you able to simply speak just a little bit extra concerning the progress you are making with the lively consumer file? Are you able to simply speak about issues perhaps that incrementally which have been profitable and perhaps belongings you’re trying to do going ahead to proceed to maneuver that in the suitable path?
Matt Baer — Chief Govt Officer
Yeah, so completely satisfied to talk to each the place we’re at from a progress of lively shoppers, in addition to the place we see this transferring ahead. And David, please leap in with any further context. For us, and as we have spoken about beforehand, it’s actually vital to work to drive up our lively consumer base, however the major focus is guaranteeing that our shoppers are wholesome shoppers. That is each by way of which shoppers we’re buying upfront, after which as soon as we have acquired a consumer, how are we driving engagement, guaranteeing that we’re assembly their wants as a way to improve our income per lively consumer and improve our LTV over time? So, I really feel actually good at this time by way of the work that we have completed each inside our advertising and our product expertise to proceed to enhance and improve the onboarding that we’ve got for brand new consumer acquisition.
I really feel actually good concerning the work that we have been doing to reengage our prior shoppers and the power that we have been seeing by way of reengagement. And likewise, as I famous in response to Maria’s query, too, I really feel actually good about how we’re participating our present shoppers as a way to drive extra frequent visits and extra frequent transactions with them. So, I really feel fairly good about our lively consumer depend total, and this shall be one thing that we’re perpetually centered on, each working to extend that quantity, in addition to improve that engagement to proceed to drive up our RPAC and LTV metrics.
David Aufderhaar — Chief Monetary Officer
And I believe, Jay, I’d simply add that I believe to Matt’s level, we’re undoubtedly more than happy with the place we’re this quarter, barely beating our expectations. And for Q2, we anticipate to see continued enchancment by way of sequential development. I believe we had referred to as out just a little bit greater than 3% down final quarter. This quarter, roughly, I believe we anticipate to be down someplace between 2% and three% from a quarter-over-quarter standpoint.
And I believe again to Matt’s level, that is about being methodical about ensuring that we’re bringing in the suitable shoppers and definitely seeing that in a few of the 90-day LTV numbers that we’re seeing which can be form of the best we have seen in nearly three years. And all of that offers us confidence to form of reiterate what we mentioned final quarter the place we anticipate to see a quarter-over-quarter improve in lively shoppers throughout FY ’26.
Jay Sole — Analyst
Received it. OK. That is useful. Thanks a lot.
David Aufderhaar — Chief Monetary Officer
Thanks.
Operator
Thanks. And our subsequent query comes from the road of Dylan Carden from William Blair. Your query, please.
Dylan Carden — Analyst
Thanks rather a lot, and good progress right here. So, in case you’re seeing this enhance ROAS, as I am curious if there’s something that you just’re doing on form of the deep information units that it’s a must to leverage engagement. It seems like proper now, AI is getting used extra on the stock facet, however is there something you are doing so far as leveraging form of the view of buyer that you’ve got from a retention or engagement standpoint?
Matt Baer — Chief Govt Officer
Hey, Dylan, completely satisfied to reply the query. Are you able to simply repeat it rapidly?
Dylan Carden — Analyst
Positive. I am simply curious, I imply the wanting it’s, are you utilizing AI in any capability by your information units to do a greater job participating or for buyer retention or retaining?
Matt Baer — Chief Govt Officer
Yeah. Glad to reply the query, and I admire the remark relating to the sturdy progress that we have been making. So, I believe what’s vital is only a continued reference level is only for us, at Sew Repair, AI is built-in into each side of our enterprise. It has been from day one.
It isn’t a brand new funding space for us. It is in our DNA, and it is a core a part of our worth proposition. And we’re completely utilizing our AI and information science capabilities as a way to each methodically and affordably drive engagement and reengagement with our totally different consumer bases and our totally different consumer segmentations. It is a key part of what is been in a position us to unlock plenty of the power that we have seen in our promotional capabilities, such that we’re in a position to make use of these promotional capabilities to drive up AOV as a way to improve engagement and for a wide range of different use circumstances, all whereas delivering the best contribution margins that we have had as a public firm.
So, it is one thing that we’ll proceed to lean on, and it is going to proceed to be an space of aggressive power for us.
Dylan Carden — Analyst
Glorious. After which it sounds such as you rattled off a handful of manufacturers there within the ready remarks. It seems like a few of these are incremental to you, and I am curious if that is true and in case you’re discovering form of higher relevance or higher entry to manufacturers and what your pitch is there to form of get these in.
Matt Baer — Chief Govt Officer
Yeah. I admire the query. So, by way of how we’re figuring out which market manufacturers we’ll go after and combine into our expertise, as I discussed earlier than, plenty of that has to do with simply being client-led and understanding what’s trending out there, what manufacturers are our shoppers on the lookout for, and likewise as with the info units that we’ve got, what do we predict are the manufacturers which can be going to finest meet the wants of our shoppers? We now have a powerful personal model portfolio, and we additionally acknowledge that, in plenty of cases, the needs or wants of our shoppers are both very brand-specific or there are particular white areas that we have to fill in with market manufacturers that we do not have protection inside our present personal model portfolio. I believe we’ve got a extremely compelling worth proposition for market manufacturers.
We now have a really extremely engaged consumer base. We do a terrific job of assembly our shoppers’ wants in a really differentiated and distinctive service. It is a service that creates unparalleled comfort and consumer satisfaction that turns into a extremely good alternative for market manufacturers as a way to get in entrance of shoppers and to introduce their manufacturers to this consumer base and to a brand new consumer base, probably, that is outdoors the attain of both their present direct-to-consumer attain or the attain of the bodily community that they in any other case have entry to. So, we discovered actually good reception as we exit to market to each deepen {our relationships} with the market manufacturers we work with at this time, in addition to to draw new market manufacturers to deliver into our assortment tomorrow.
Dylan Carden — Analyst
Actually admire it. Thanks.
Operator
Thanks. [Operator instructions] Our subsequent query comes from the road of Simeon Siegel from BMO Capital Markets. Your query, please.
Unknown speaker — BMO Capital Markets — Analyst
That is Dan on for Simeon. Thanks for taking our query and congrats on the great enchancment. So, you talked concerning the alternative round reactivation prior to now. After which earlier than you touched on it with Jay’s query, we simply wished to see how reactivations are trending versus your expectations and the way you view this chance going ahead.
Thanks.
Matt Baer — Chief Govt Officer
Yeah. Hey Dan, good to listen to from you once more. I admire the remarks. So, we proceed to see power within the works that we’re doing as a way to drive reengagement.
David, be happy so as to add some further colour if you would like. However that is been a giant focus of ours. We now have a extremely massive and lively consumer base, in addition to a big base of shoppers which have beforehand been Sew Repair shoppers, and as we proceed to enhance our assortment, proceed to enhance our expertise, proceed to enhance our AI-driven engagement and concentrating on capabilities, we have seen a terrific alternative and nice outcomes going again to that section of former shoppers and giving them a extremely sturdy worth proposition to come back again to us. They’re properly conscious of the comfort that we provide and the good service that we provide in terms of type and match, and we have seen some actually nice outcomes once they’re experiencing the enhancements that we have made to each reimagine the consumer expertise and enhance our assortment total.
David Aufderhaar — Chief Monetary Officer
And Dan, simply to offer a few numbers round that. We’re undoubtedly, to Matt’s level, actually inspired round reengagements. And that is one of many major causes we did barely beat our expectations from an lively consumer standpoint this quarter, as a result of reengagements have been up 17% 12 months over 12 months, and it was a second quarter of year-over-year development in a row. And so, to Matt’s level, simply actually inspired by the work the groups are doing to actually lean in right here, and we’re seeing some good outcomes.
Unknown speaker — BMO Capital Markets — Analyst
I admire it. Thanks for the colour. Glad holidays.
David Aufderhaar — Chief Monetary Officer
Thanks.
Operator
Thanks. And this does conclude the question-and-answer session. [Operator signoff]
Length: 0 minutes
Name members:
Lilly Bindley — Investor Relations
Matt Baer — Chief Govt Officer
David Aufderhaar — Chief Monetary Officer
Maria Ripps — Analyst
Jay Sole — Analyst
Dylan Carden — Analyst
Unknown speaker — BMO Capital Markets — Analyst
