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 Individuals
Ready Remarks:
Operator
Good afternoon, and thanks for standing by. Welcome to the primary quarter fiscal 12 months 2025 Sew Repair earnings name. At the moment, all members will likely 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 right now’s convention is being recorded. And now I would prefer to introduce your host for right now’s program, Lilly Bindley, investor relations. Please go forward.
Lilly Bindley — Investor Relations
Thanks for becoming a member of us right now for the Sew Repair first quarter fiscal 2025 earnings name. With me on the decision are Matt Baer, chief govt officer; and David Aufderhaar, chief monetary officer. We now have posted full first quarter 2025 monetary leads to a press launch on the quarterly outcomes part of our web site, traders.stitchfix.com. A hyperlink to the webcast of right now’s convention name can be discovered on our website.
We wish to remind everybody that we are going to 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 of as a sign of future efficiency. Please assessment our filings with the SEC for a dialogue of the elements that might trigger the outcomes to vary, particularly, our press launch issued and filed right now, in addition to the chance elements part of our annual report on Type 10-Okay for fiscal 2024 beforehand filed with the SEC.
Additionally, notice that the forward-looking statements on this name are primarily based on info out there to us as of right now’s date. We disclaim any obligation to replace any forward-looking statements, besides as required by regulation. Throughout this name, we’ll focus on sure non-GAAP monetary measures. Reconciliations to probably the most straight comparable GAAP monetary measures are offered within the press launch on our Investor Relations web site.
These non-GAAP measures usually are not meant to be an alternative 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 right now’s name signify 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 will likely be out there 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. It is a 570-basis level enchancment in year-over-year comps from This autumn 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 shopper expertise. We’re on observe to efficiently remodel our enterprise, and we proceed to count on to return to income development by the top of FY ’26. We’re additionally elevating our annual steerage, and David will share extra on that shortly.
We proceed to embed retail greatest 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 personalised advertising and marketing and engagement techniques to extend shopper 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 purchasers’ expectations advanced over the previous few years, and we didn’t adapt our assortment rapidly sufficient. To handle this, we’ve 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 device are serving to to protect our wholesome stock place. In Q1, we infused extra newness and seasonally related kinds 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 purchasers are responding positively, driving AUR up 6% 12 months over 12 months. For example, we’ve launched a bigger number of silhouettes in denim that our ladies purchasers are embracing. Gross sales of wide-leg and boot-cut kinds are up 250% from final 12 months. This improve in demand highlights simply how keen our purchasers are for recent model decisions, and we’ll proceed leaning in to ship rising traits extra rapidly.
Our two latest private-label manufacturers, The Commons and Montgomery Submit, have delivered encouraging early outcomes. The Commons has been fashionable in our males’s enterprise, rapidly turning into a high 10 model for purchasers below the age of 40. The Commons’ sweater polos have been an enormous winner for our males shopper this quarter. In ladies’s, new workwear kinds from Montgomery Submit are resonating, with silhouettes like cowl necks performing nicely.
Lots 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 develop past our conventional 5 objects in a Repair.
Purchasers now have the chance to obtain as much as eight objects of their Repair, permitting them to higher discover present traits and replace their wardrobes for main life occasions. This flexibility allows us to offer extra worth and seize better pockets share with our most engaged purchasers. Whereas nonetheless early days, purchasers who select this selection are requesting almost 40% extra objects in a Repair on common and driving roughly 50% better AOVs than conventional five-item fixes. Sew Repair was constructed on personalization, and as we proceed to tailor our styling expertise to every shopper, we’re additionally partaking out all our shopper segments by means of a brand new personalised strategy to advertising and marketing.
Our technique isn’t just about driving quantity, it is about partaking our purchasers in very focused methods. And over the past 12 months, we’ve 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 through the vacation season.
Now, along with including quite a lot of seasonal kinds, we’re additionally rotating by means of a spread of vacation promotions and gives. This permits us to higher serve purchasers with a personalised styling expertise for vacation dressing. In Q1, we noticed increased engagement in each Freestyle and Repair channels. In Freestyle, we had improved year-over-year comps in furtherance of our technique to seize a better share of pockets.
In our Repair enterprise, for the primary time in additional than three years, we achieved a sequential improve in purchasers who’ve enabled recurring shipments. As we highlighted in our final name, we launched a refreshed model id, the primary vital replace to our model in additional than a decade. Alongside our rebrand, we launched a brand new advertising and marketing marketing campaign known as Retail Remedy, a content material collection that explores a few of the greatest purchasing, match, and magnificence challenges individuals face and the way Sew Repair because the business chief in personalised 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 very best ranges in two years for girls’s. As a part of our broader effort to boost our shopper expertise, we not too long ago launched StyleFile, a personalised useful resource that describes every shopper’s distinctive model persona, and our purchasers inform us they adore it. We’re additionally placing a better highlight on our stylists and their work by means of the latest introduction of stylist profiles, a brand new characteristic that permits purchasers to get to know their stylists higher. These profiles are custom-made by the stylists themselves and embrace their background info, 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 the suitable technique in place to return to development. We’re investing and innovating in our shopper expertise, leveraging our AI and information science management, in addition to our crew of skilled stylists to offer extra causes for purchasers to come back again to Sew Repair as their go-to for all attire and equipment wants. Now I am going to 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 count on to return to income development by the top 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 exhausting to strengthen. The constructive outcomes we’re seeing, together with more healthy shopper 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 resulting from our centered efforts in driving mounted AOV, up 6% 12 months over 12 months and 11% quarter over quarter. This AOV work consists of three fundamental 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.
Internet lively purchasers ended the quarter at 2.4 million purchasers, representing our lowest sequential decline in lively shopper rely in two years, down 19% 12 months over 12 months and down 3% quarter over quarter. Income per lively shopper 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 because of the timing of receipts forward of the autumn/winter seasons, in addition to our continued funding in newness to extra intently align our providing with the wants of our purchasers. 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 stream in Q1 and ended the quarter with $253 million in money, money equivalents and investments, and no debt.
Turning to our outlook. On account of the power we noticed this quarter, we’re updating our annual income and EBITDA steerage. For the complete 12 months FY ’25, we count on complete income to be between $1.14 billion and $1.18 billion. We count on complete adjusted EBITDA for the 12 months to be between $25 million and $36 million.
This steerage nonetheless assumes we will likely be free money stream constructive for the complete 12 months, however we do count on Q2 to be unfavourable because of the timing of working capital necessities associated to stock purchases. For Q2, we count on complete income to be between $290 million and $300 million. We count on Q2 adjusted EBITDA to be between $8 million and $13 million. We count on each Q2 and full 12 months gross margin to be roughly 44% to 45%, and we now count on full 12 months promoting to be on the excessive finish of the 8% to 9% vary we offered final quarter, reflecting our ongoing deal with opportunistically reinvesting our EBITDA upside again into the enterprise once we see the suitable ROIs.
This outlook displays the methodical strategy we’ve taken to drive leverage in our enterprise whereas investing in focused areas to return to development. As we progress by means of our transformation, we’re assured within the strategy we have been taking and our capacity to proceed delivering effectivity and reinvesting. With that, I am going to 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 personalised purchasing 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 workers. Thanks for the nice 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 am going to 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’ll come again to reply any remaining questions. And our first query for right now 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 possibly discuss kind of key contributors to stronger-than-expected spend per shopper this quarter? I feel you talked about Repair flexibility and value kind of structure, however was there the rest that is kind of value highlighting right here? After which so that you raised your full 12 months steerage, which is nice to see. However possibly extra broadly, how sustainable do you assume this kind 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 shopper, I’d reference again lots of what we shared within the ready remarks, and completely happy to share a bit of bit extra info as nicely. One of many issues that was a very sturdy driver for us by way of our share per shopper 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 model for our purchasers, in addition to having the suitable seasonal stock out there on the proper occasions. We noticed lots of power beginning in the course 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 shopper. As well as, creating extra flexibility within the Repair, as you famous, helps us improve our common order worth fairly significantly for these purchasers 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 just a few 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 purchasers.
How can we interact them in between their fixes? How can we ensure that we’re capturing as a lot pockets share as attainable, actually utilizing our Freestyle channel to enrich the Repair enterprise that we’re doing with our purchasers, in order that we’re growing the frequency at which we’re offering clothes and attire to our purchasers. And all of these have actually helped to contribute to the rise in spend per shopper. And I feel by way of how sustainable these are, we’ll share a bit of bit and in addition, I am going to let David present some further colour, however we really feel actually good about the place we’re at right now. Our focus on growing the penetration of newness in our assortment, whereas we’re proud of our leads to Q1, we additionally, as famous within the ready remarks, nonetheless have work to do.
As we shared on our final name, we’re seeking 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 accepted by means of the stability of the fiscal 12 months as we get to make as we work to make sure we’ve the suitable product for the suitable shopper on the proper time going ahead. We really feel actually good concerning the flex Repair penetration that we’ve right now, and the main target there’s simply making certain 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 is likely to be, whereas it would pull again a bit of bit, we nonetheless really feel actually good concerning the functionality that we have constructed and the long-term impression that, that may have for us.
David Aufderhaar — Chief Monetary Officer
And Maria, it is David. I am going to simply add simply a few numbers round that. Particular to Q1, I feel 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 feel Matt known 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 very nice job of being ready for that with recent, new stock to actually have the ability to seize the upside that we noticed there. And the second is what Matt known as out round that new flex Repair providing is we have been capable of launch and ramp flex Repair sooner than anticipated within the quarter. And so, these have been two of the principle 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 complete 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 purchasers, the place I feel final quarter, we had mentioned we anticipated to be down a bit of greater than 3%, and we got here in proper at 3%, and we’re enjoying a few of that upside ahead. After which to Matt’s level, there have been different kind of AOV drivers that we noticed along with kind of the Q1 drivers that we count on to play ahead for the 12 months as nicely. After which all of that’s integrated into the brand new full 12 months information.
Maria Ripps — Analyst
Nice, that is very useful. Thanks each and I am going to 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 a bit of bit on the impression that non-public manufacturers have had within the enterprise? You touched on within the ready remarks, however are you able to simply inform us possibly a bit of bit about what share of gross sales these manufacturers are proper now, how that is pushed better AOV? And simply in case you can elaborate, that will be useful. Thanks.
Matt Baer — Chief Govt Officer
Jay, yeah, completely happy to elaborate. And the place I am going to begin is simply by way of the goal that we’ve for the share of personal and nationwide manufacturers, that is going to proceed to ebb and stream. And that may ebb and stream relying on what are our purchasers wants, what our purchasers need and what are we studying from them each day, week to week, month to month. And as I discussed on a previous name, I feel the power of Sew Repair is a strong providing of nationwide and personal manufacturers.
It is one of many ways in which we will greatest serve our purchasers by means of that portfolio that we’ve. 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 greatest meet our purchasers’ wants, and we’ll proceed to make use of a data-driven strategy to the decision-making and utilizing these shopper 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 complete market of our complete portfolio. And the preserve price 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 purchasers, and we’re seeing lots of power there as we shared within the ready remarks.
So, we’re simply going to proceed to ensure that on the finish of the day, we’ve the client-right assortment and really feel actually assured in our capacity to serve our purchasers extraordinarily nicely and get them the product that they are searching for.
Jay Sole — Analyst
Obtained it. If I can sneak another in earlier than I’m going again in queue, are you able to simply discuss a bit of bit extra concerning the progress you are making with the lively shopper file? Are you able to simply discuss issues possibly that incrementally which were profitable and possibly belongings you’re seeking to do going ahead to proceed to maneuver that in the suitable course?
Matt Baer — Chief Govt Officer
Yeah, so completely happy to talk to each the place we’re at from a progress of lively purchasers, in addition to the place we see this transferring ahead. And David, please soar 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 shopper base, however the major focus is making certain that our purchasers are wholesome purchasers. That is each by way of which purchasers we’re buying upfront, after which as soon as we have acquired a shopper, how are we driving engagement, making certain that we’re assembly their wants with the intention to improve our income per lively shopper and improve our LTV over time? So, I really feel actually good right now by way of the work that we have performed each inside our advertising and marketing and our product expertise to proceed to enhance and improve the onboarding that we’ve for brand spanking new shopper acquisition.
I really feel actually good concerning the work that we have been doing to reengage our prior purchasers 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 partaking our present purchasers with the intention to drive extra frequent visits and extra frequent transactions with them. So, I really feel fairly good about our lively shopper rely total, and this will likely 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 feel, Jay, I’d simply add that I feel to Matt’s level, we’re positively very happy with the place we’re this quarter, barely beating our expectations. And for Q2, we count on to see continued enchancment by way of sequential development. I feel we had known as out a bit of bit greater than 3% down final quarter. This quarter, roughly, I feel we count on to be down someplace between 2% and three% from a quarter-over-quarter standpoint.
And I feel again to Matt’s level, that is about being methodical about ensuring that we’re bringing in the suitable purchasers and positively seeing that in a few of the 90-day LTV numbers that we’re seeing which are kind of the very best we have seen in virtually three years. And all of that provides us confidence to kind of reiterate what we mentioned final quarter the place we count on to see a quarter-over-quarter improve in lively purchasers throughout FY ’26.
Jay Sole — Analyst
Obtained 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 so much, 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 kind of the deep information units that you must leverage engagement. It appears like proper now, AI is getting used extra on the stock aspect, however is there something you are doing so far as leveraging kind of the view of buyer that you’ve from a retention or engagement standpoint?
Matt Baer — Chief Govt Officer
Hey, Dylan, completely happy 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 means of your information units to do a greater job partaking or for buyer retention or retaining?
Matt Baer — Chief Govt Officer
Yeah. Joyful to reply the query, and I admire the remark relating to the sturdy progress that we have been making. So, I feel what’s vital is only a continued reference level is only for us, at Sew Repair, AI is built-in into each facet of our enterprise. It has been from day one.
It is not 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 with the intention to each methodically and affordably drive engagement and reengagement with our completely different shopper bases and our completely different shopper segmentations. It is a key element of what is been in a position us to unlock lots 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 with the intention to improve engagement and for quite a lot of different use circumstances, all whereas delivering the very 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 will proceed to be an space of aggressive power for us.
Dylan Carden — Analyst
Wonderful. After which it sounds such as you rattled off a handful of manufacturers there within the ready remarks. It appears like a few of these are incremental to you, and I am curious if that is true and in case you’re discovering kind of higher relevance or higher entry to manufacturers and what your pitch is there to type 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, lots of that has to do with simply being client-led and understanding what’s trending available in the market, what manufacturers are our purchasers searching for, and in addition as with the info units that we’ve, what do we predict are the manufacturers which are going to greatest meet the wants of our purchasers? We now have a powerful personal model portfolio, and we additionally acknowledge that, in lots of situations, the needs or wants of our purchasers are both very brand-specific or there are specific white areas that we have to fill in with market manufacturers that we do not have protection inside our present personal model portfolio. I feel we’ve a very compelling worth proposition for market manufacturers.
We now have a really extremely engaged shopper base. We do an ideal job of assembly our purchasers’ wants in a really differentiated and distinctive service. It is a service that creates unparalleled comfort and shopper satisfaction that turns into a very good alternative for market manufacturers with the intention to get in entrance of purchasers and to introduce their manufacturers to this shopper base and to a brand new shopper base, doubtlessly, that is exterior 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 right now, in addition to to draw new market manufacturers to carry 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 up to now. After which earlier than you touched on it with Jay’s query, we simply needed 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 with the intention to drive reengagement.
David, be happy so as to add some further colour if you would like. However that is been an enormous focus of ours. We now have a very massive and lively shopper base, in addition to a big base of purchasers which have beforehand been Sew Repair customers, and as we proceed to enhance our assortment, proceed to enhance our expertise, proceed to enhance our AI-driven engagement and focusing on capabilities, we have seen an ideal alternative and nice outcomes going again to that phase of former purchasers and giving them a very sturdy worth proposition to come back again to us. They’re nicely conscious of the comfort that we provide and the nice service that we provide in terms of model and match, and we have seen some actually nice outcomes after they’re experiencing the enhancements that we have made to each reimagine the shopper expertise and enhance our assortment total.
David Aufderhaar — Chief Monetary Officer
And Dan, simply to offer a few numbers round that. We’re positively, to Matt’s level, actually inspired round reengagements. And that is one of many fundamental causes we did barely beat our expectations from an lively shopper 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. Joyful holidays.
David Aufderhaar — Chief Monetary Officer
Thanks.
Operator
Thanks. And this does conclude the question-and-answer session. [Operator signoff]
Period: 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
