12:48 PM EDT, 06/05/2024 (MT Newswires) -- Stitch Fix ( SFIX ) still has a lot to do to stabilize revenue, despite reporting a fiscal Q3 beat, Wedbush said Wednesday in a note.

"We remain sidelined on [Stitch Fix ( SFIX )] shares following the company's better than expected Q3," the firm said.

Stitch Fix ( SFIX ) reported a net loss of $0.18 per diluted share late Tuesday on revenue of $322.7 million, compared with analyst estimates of a loss of $0.24 per share on revenue of $306.2 million

The company's Q3 revenue declined 16% year over year, excluding UK business discontinuation, "which isn't good in absolute terms," Wedbush said. This was the "least-negative growth quarter in [seven] quarters," but revenue is still "pressured" it added.

Customer count declined 6% sequentially for the second straight quarter, the firm said, adding that in Q4 "active clients are expected to be down -5% QoQ."

It remains to be seen whether the operational improvements such as better client onboarding and stylist connections "can help drive growth in customer counts over time", Wedbush said.

Wedbush maintained a neutral rating and a price target of $3 on the company's stock.

Shares of Stitch Fix ( SFIX ) were up more than 23% in recent Wednesday trading.

Price: 3.30, Change: +0.63, Percent Change: +23.60