NEW YORK, Sept. 01, 2022 (GLOBE NEWSWIRE) — Moore Kuehn, PLLC, a Wall Street-based securities law firm, is investigating whether certain officers and directors of Stitch Fix, Inc. (NASDAQ:SFIX) breached their fiduciary duties to shareholders.

Pursuant to a state securities lawsuit, Stitch Fix insiders caused the company to make false and/or misleading statements and/or failed to disclose the following: (i) the Fix and Freestyle programs were not complementary; (ii) the Freestyle program would be significantly preferred over the Company’s original Fix model; (iii) that the Freestyle program would inevitably cannibalize the Company’s legacy Fix business; and (iv) as a result, the Company’s public statements were, at all relevant times, materially false and misleading.

On December 7, 2021, Stitch Fix admitted for the first time that the company had downplayed the extent of its transition from the subscription-based Fix model to the retail-based Freestyle model. Stitch Fix went on to admit that the company experienced some “short-term cannibalization” of new customers opting for the new Freestyle direct purchase option over the traditional Fix option. Additionally, Stitch Fix announced a loss for the first quarter of 2021 and lowered its full-year revenue guidance. As a result of these disclosures, Stitch Fix stock fell $5.97 per share, or 24%, from $24.97 per share to $19.00 per share.

Then, on March 8, 2022, Stitch Fix offered a weak outlook for the third quarter of 2022 and lowered its full-year revenue guidance. Additionally, Stitch Fix announced self-inflicted friction between the Freestyle program and the Fix program. Specifically, Stitch Fix stated that the company referred customers who visited stitchfix.com – the primary landing page for customers interested in Fix – to the Freestyle experience first, and “therefore, by leading customers to the Freestyle experience first, [it] accidentally created friction”…