Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Jul. 28, 2018	Sep. 27, 2018	Jan. 26, 2018
Document Information [Line Items]
Entity Registrant Name	Stitch Fix, Inc.
Entity Central Index Key	0001576942
Current Fiscal Year End Date	--07-28
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Jul. 28, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 199.1
Class A common stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		38,513,396
Class B common stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		60,619,532

Consolidated Balance Sheets - USD ($)
$ in Thousands

Jul. 28, 2018

Jul. 29, 2017

Current assets:

Cash and cash equivalents

$ 297,516

$ 110,608

Restricted cash

250

Inventory, net

85,092

67,592

Prepaid expenses and other current assets

34,148

19,312

Total current assets

417,006

197,762

Property and equipment, net

34,169

26,733

Deferred tax assets

14,107

19,991

Restricted cash, net of current portion

12,600

9,100

Other long-term assets

3,703

3,619

Total assets

481,585

257,205

Current liabilities:

Accounts payable

79,782

44,238

Accrued liabilities

43,037

46,363

Preferred stock warrant liability

26,679

Gift card liability

6,814

5,190

Deferred revenue

8,870

7,150

Other current liabilities

3,729

4,298

Total current liabilities

142,232

133,918

Deferred rent, net of current portion

15,288

11,781

Other long-term liabilities

8,993

7,423

Total liabilities

166,513

153,122

Commitments and contingencies (Note 7)

Convertible preferred stock, $0.00002 par value – zero and 60,577,280 shares authorized as of July 28, 2018 and July 29, 2017, respectively; zero and 59,511,055 shares issued and outstanding as of July 28, 2018 and July 29, 2017, respectively; aggregate liquidation preference of $42,389 as of July 29, 2017

42,222

Stockholders’ equity:

Preferred stock, $0.00002 par value – 20,000,000 and zero shares authorized as of July 28, 2018 and July 29, 2017, respectively; zero shares issued and outstanding as of July 28, 2018 and July 29, 2017

Additional paid-in capital

235,312

27,002

Retained earnings

79,758

34,858

Total stockholders’ equity

315,072

61,861

Total liabilities, convertible preferred stock and stockholders’ equity

481,585

257,205

Class A common stock

Stockholders’ equity:

Common stock

Class B common stock

Stockholders’ equity:

Common stock

^[1]

$ 1

[1]	Shares authorized, issued and outstanding as of July 29, 2017 includes common stock prior to our initial public offering. See Note 1 for additional details.

Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands

Jul. 28, 2018

Jul. 29, 2017

Convertible preferred stock, par value (in dollars per share)

$ 0.00002

Convertible preferred stock, shares authorized (in shares)

60,577,280

Convertible preferred stock, shares issued (in shares)

59,511,055

Convertible preferred stock, shares outstanding (in shares)

59,511,055

Convertible preferred stock, aggregate liquidation preference

$ 42,389

Preferred stock, par value (in dollars per share)

$ 0.00002

Preferred stock, shares authorized (in shares)

20,000,000

Preferred stock, shares issued (in shares)

Preferred stock, shares outstanding (in shares)

Class A common stock

Common stock, par value (in dollars per share)

$ 0.00002

Common stock, shares authorized (in shares)

2,000,000,000

Common stock, shares issued (in shares)

35,756,628

Common stock, shares outstanding (in shares)

35,756,628

Class B common stock

Common stock, par value (in dollars per share)

^[1]

$ 0.00002

Common stock, shares authorized (in shares)

^[1]

100,000,000

Common stock, shares issued (in shares)

^[1]

63,043,233

26,834,535

Common stock, shares outstanding (in shares)

^[1]

63,043,233

26,834,535

[1]	Shares authorized, issued and outstanding as of July 29, 2017 includes common stock prior to our initial public offering. See Note 1 for additional details.

Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Jul. 28, 2018	Jul. 29, 2017	Jul. 30, 2016
Income Statement [Abstract]
Revenue, net	$ 1,226,505	$ 977,139	$ 730,313
Cost of goods sold	690,483	542,718	407,064
Gross profit	536,022	434,421	323,249
Selling, general and administrative expenses	492,998	402,781	259,021
Operating income	43,024	31,640	64,228
Remeasurement of preferred stock warrant liability	(10,685)	18,881	3,019
Other income, net	(1,004)	(42)	(13)
Income before income taxes	54,713	12,801	61,222
Provision for income taxes	9,813	13,395	28,041
Net income (loss)	44,900	(594)	33,181
Comprehensive income (loss)	44,900	(594)	33,181
Net income (loss) attributable to common stockholders:
Basic	35,541	(594)	8,211
Diluted	$ 27,285	$ (594)	$ 9,496
Earnings (loss) per share attributable to common stockholders:
Basic (in dollars per share)	$ 0.47	$ (0.02)	$ 0.36
Diluted (in dollars per share)	$ 0.34	$ (0.02)	$ 0.34
Weighted-average shares used to compute earnings per share attributable to common stockholders:
Basic (in shares)	75,947,759	24,973,931	22,729,890
Diluted (in shares)	81,288,418	24,973,931	27,882,844

Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings
Convertible preferred stock, beginning balance at Aug. 01, 2015	$ 42,222
Convertible preferred stock, beginning balance (in shares) at Aug. 01, 2015	59,511,055
Convertible preferred stock, ending balance at Jul. 30, 2016	$ 42,222
Convertible preferred stock, ending balance (in shares) at Jul. 30, 2016	59,511,055
Stockholders' equity, beginning balance at Aug. 01, 2015	$ 8,539	$ 0	$ 2,711	$ 5,828
Common stock, beginning balance (in shares) at Aug. 01, 2015		24,933,448
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Compensation expense related to certain stock sales by current and former employees	4,810		4,810
Issuance of common stock upon exercise of stock options, net of early exercised options (in shares)		939,986
Issuance of common stock upon exercise of stock options	351		351
Vesting of early exercised options	1,095		1,095
Stock-based compensation expense	1,908		1,908
Excess tax benefit related to stock-based compensation	63		63
Net income	33,181			33,181
Stockholders' equity, ending balance at Jul. 30, 2016	49,947	$ 0	10,938	39,009
Common stock, ending balance (in shares) at Jul. 30, 2016		25,873,434
Convertible preferred stock, ending balance at Jul. 29, 2017	$ 42,222
Convertible preferred stock, ending balance (in shares) at Jul. 29, 2017	59,511,055
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Compensation expense related to certain stock sales by current and former employees	$ 9,699		9,699
Repurchase of common stock (in shares)		(501,333)
Repurchase of common stock	(3,557)			(3,557)
Issuance of common stock upon exercise of stock options, net of early exercised options (in shares)		1,462,434
Issuance of common stock upon exercise of stock options	1,704		1,704
Vesting of early exercised options	891	$ 1	890
Stock-based compensation expense	3,709		3,709
Excess tax benefit related to stock-based compensation	62		62
Net income	(594)			(594)
Stockholders' equity, ending balance at Jul. 29, 2017	$ 61,861	$ 1	27,002	34,858
Common stock, ending balance (in shares) at Jul. 29, 2017		26,834,535
Increase (Decrease) in Temporary Equity [Roll Forward]
Convertible preferred stock, issuance of Class B common stock upon conversion of convertible preferred stock (in shares)	(59,511,055)
Convertible preferred stock, issuance of Class B common stock upon conversion of convertible preferred stock	$ (42,222)
Convertible preferred stock, ending balance at Jul. 28, 2018	$ 0
Convertible preferred stock, ending balance (in shares) at Jul. 28, 2018	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of Class A common stock upon initial public offering, net of offering costs (in shares)		9,175,557
Issuance of Class A common stock upon initial public offering, net of offering costs	$ 127,033		127,033
Issuance of Class B common stock upon conversion of convertible preferred stock (in shares)		59,511,055
Issuance of Class B common stock upon conversion of convertible preferred stock	42,222	$ 1	42,221
Reclassification of warrant liability to additional paid-in capital upon the initial public offering (in shares)		1,066,225
Reclassification of warrant liability to additional paid-in capital upon the initial public offering	$ 15,994		15,994
Repurchase of common stock (in shares)		(19,479)
Issuance of common stock upon exercise of stock options, net of early exercised options (in shares)	2,194,168	2,192,430
Issuance of common stock upon exercise of stock options	$ 6,384		6,384
Issuance of Class A restricted stock units, net of tax withholdings (in shares)		39,538
Issuance of Class A restricted stock units, net of tax withholdings	(596)		(596)
Vesting of early exercised options	988		988
Stock-based compensation expense	16,286		16,286
Net income	44,900			44,900
Stockholders' equity, ending balance at Jul. 28, 2018	$ 315,072	$ 2	$ 235,312	$ 79,758
Common stock, ending balance (in shares) at Jul. 28, 2018		98,799,861

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Jul. 28, 2018	Jul. 29, 2017	Jul. 30, 2016
Cash Flows from Operating Activities
Net income	$ 44,900	$ (594)	$ 33,181
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes	6,588	(6,728)	(5,869)
Remeasurement of preferred stock warrant liability	(10,685)	18,881	3,019
Inventory reserves	1,916	3,591	5,941
Compensation expense related to certain stock sales by current and former employees	0	9,699	4,810
Stock-based compensation expense	15,403	3,545	1,850
Excess tax benefit related to stock-based compensation expense	0	(62)	(63)
Depreciation and amortization	10,542	7,655	3,544
Loss on disposal of property and equipment	155	0	0
Change in operating assets and liabilities:
Inventory	(19,416)	(26,375)	(26,509)
Prepaid expenses and other assets	(17,307)	(7,596)	(9,504)
Accounts payable	35,502	7,841	10,192
Accrued liabilities	(3,595)	17,748	10,904
Deferred revenue	1,720	2,719	1,574
Gift card liability	1,624	1,993	1,530
Other liabilities	4,831	6,307	10,516
Net cash provided by operating activities	72,178	38,624	45,116
Cash Flows from Investing Activities
Purchase of property and equipment	(16,565)	(17,130)	(15,238)
Net cash used in investing activities	(16,565)	(17,130)	(15,238)
Cash Flows from Financing Activities
Proceeds from initial public offering, net of underwriting discounts paid	129,046	0	0
Proceeds from the exercise of stock options	5,788	2,346	436
Excess tax benefit related to stock-based compensation expense	0	62	63
Repurchase of Class B common stock related to early exercised options	(39)	(3,557)	0
Payment of deferred offering costs	0	(1,879)	0
Net cash provided by (used in) financing activities	134,795	(3,028)	499
Net increase in cash and restricted cash	190,408	18,466	30,377
Cash and restricted cash at beginning of period	119,958	101,492	71,115
Cash and restricted cash at end of period	310,366	119,958	101,492
Components of cash and restricted cash
Total cash and restricted cash	119,958	101,492	71,115
Supplemental Disclosure
Cash paid for income taxes	10,071	28,023	39,387
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Purchases of property and equipment included in accounts payable and accrued liabilities	795	111	2,177
Capitalized stock-based compensation	883	164	58
Leasehold improvements paid by landlord	0	0	249
Vesting of early exercised options	988	891	1,095
Conversion of preferred stock upon initial public offering	42,222	0	0
Reclassification of preferred stock warrant liability upon initial public offering	15,994	0	0
Deferred offering costs included in accrued liabilities	0	508	0
Deferred offering costs paid in prior year	$ 1,879	$ 0	$ 0

Description of Business	12 Months Ended
Description of Business	Jul. 28, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business	Description of Business Stitch Fix, Inc. (“we,” “our,” “us” or “the Company”) delivers one-to-one personalization to our clients through the combination of data science and human judgment. Our stylists hand select items from a broad range of merchandise. Stylists pair their own judgment with our analysis of client and merchandise data to provide a personalized shipment of apparel, shoes and accessories suited to each client’s needs. We call each of these unique shipments a Fix. After receiving a Fix, our clients purchase the items they want to keep and return the other items. We are incorporated in Delaware and have operations in the United States and the United Kingdom. Initial Public Offering On November 16, 2017, we completed an initial public offering, or IPO. In connection with the IPO, we authorized two new classes of common stock: Class A common stock and Class B common stock. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting, conversion and transfer rights. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to ten votes per share. Each share of Class B common stock is convertible at any time at the option of the stockholder into one share of Class A common stock and has no expiration date. The Class B common stock automatically converts to Class A common stock upon transfers or any sale. In the IPO, we issued and sold 8,000,000 shares of our Class A common stock at a public offering price of $15.00 per share. We received $110.4 million in net proceeds after deducting $6.2 million of underwriting discounts and $3.4 million in offering costs. Upon the closing of the IPO, all of the then-outstanding shares of common stock were reclassified into Class B common stock, all of the outstanding shares of convertible preferred stock automatically converted into 59,511,055 shares of Class B common stock and all of the outstanding preferred stock warrants were automatically exercised into 1,066,225 shares of Class B common stock. Subsequent to the closing of the IPO, there were no shares of preferred stock or preferred stock warrants outstanding. In December 2017, we issued an additional 1,175,557 shares of Class A common stock at a price of $15.00 per share following the underwriters’ exercise of their option to purchase additional shares and received $16.7 million in net proceeds after deducting underwriting discounts and expenses.

Significant Accounting Policies

12 Months Ended

Jul. 28, 2018

Accounting Policies [Abstract]

Significant Accounting Policies

Basis of Presentation

The consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The consolidated financial statements include the accounts of Stitch Fix, Inc. and our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Our fiscal year is a 52-week or 53-week period ending on the Saturday closest to July 31. The fiscal years ended July 28, 2018 (“2018”), July 29, 2017 (“2017”), and July 30, 2016, (“2016”) each consisted of 52 weeks.

Segment Information

We have one operating segment and one reportable segment as our chief operating decision maker, who is our Chief Executive Officer, reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. All long-lived assets are located in the United States and all revenue is attributed to the United States.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in our consolidated financial statements and accompanying footnotes. Significant estimates and assumptions are used for inventory, stock-based compensation expense, common stock valuation and remeasurement of preferred stock warrant liability prior to IPO, income taxes and revenue recognition. Actual results could differ from those estimates and such differences may be material to the consolidated financial statements.

Cash and Cash Equivalents

Cash consists of bank deposits and amounts in transit from banks for client credit card and debit card transactions that will process in less than seven days. Cash equivalents consist of investments in short-term, highly liquid money market funds.

Restricted Cash

Restricted cash represents cash balances held in segregated accounts collateralizing letters of credit for our leased properties as of July 28, 2018, and July 29, 2017.

Inventory, net

Inventory consists of finished goods which are recorded at the lower of cost or net realizable value using the specific identification method. The cost of inventory consists of merchandise costs and in-bound freight costs. We establish a reserve for excess and slow-moving inventory we expect to write off based on historical trends. In addition, we estimate and accrue for shrinkage and damage as a percentage of revenue based on historical trends. Inventory shrinkage and damage estimates are made to reduce the inventory value for lost, stolen or damaged items.

The inventory reserve, which reduces inventory in our consolidated balance sheets, was $17.6 million and $15.7 million as of July 28, 2018, and July 29, 2017, respectively.

Property and Equipment, net

Property and equipment, net is recorded at cost less accumulated depreciation and amortization. Depreciation and amortization is recorded on a straight-line basis over the estimated useful lives of the respective assets. Repair and maintenance costs are expensed as incurred.

The estimated useful lives of our assets are as follows:



		Estimated useful life
Computer equipment and capitalized software		3 years
Office furniture and equipment		5 years
Buildings		25 years
Leasehold improvements		Shorter of lease term or estimated useful life

We capitalize eligible costs to develop our proprietary systems, website and mobile app. Capitalization of such costs begins when the preliminary project stage is completed and it is probable that the project will be completed and the software will be used to perform the function intended. A subsequent addition, modification or upgrade to internal-use software is capitalized to the extent that it enhances the software’s functionality or extends its useful life. Costs related to design or maintenance are expensed as incurred.

Deferred Offering Costs

Deferred offering costs, which consist of direct incremental legal, consulting, banking and accounting fees relating to the IPO were capitalized and offset against proceeds upon the consummation of the IPO, which became effective on November 21, 2017.

In December 2017, we issued additional shares of Class A common stock following the underwriters’ exercise of their option to purchase additional shares. The related deferred offering costs were capitalized and offset against proceeds upon issuance of the shares.

Impairment of Long-Lived Assets

We review our long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated from the use of the asset and its eventual disposition. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount exceeds the fair value of the impaired assets. Assets to be disposed of are reported at the lower of their carrying amount or fair value less cost to sell. We have not recorded an impairment of long-lived assets since inception.

Preferred Stock Warrant Liability

We recorded our preferred stock warrants as current liabilities in the consolidated balance sheets at their estimated fair value because the warrants were exercisable at any time by the holders for cash at a purchase price per share equal to the lowest price per share at which we had sold shares of a specific series of our preferred stock or a number of shares of equivalent value as determined by a specified calculation. At initial recognition, we recorded these warrants at their estimated fair value. The liability associated with these warrants was subject to remeasurement at each balance sheet date, with changes in fair value recorded as remeasurement of preferred stock warrant liability in the consolidated statements of operations. In November 2017, in connection with our IPO, the preferred stock warrants were automatically exercised into Class B common stock and the preferred stock warrant liability was reclassified to additional paid-in capital.

Revenue Recognition

We generate revenue from the sale of merchandise in a Fix. Clients create an online account on our website or mobile app, complete a style profile and order a Fix to be delivered on a specified date.

Each Fix represents an offer made by us to the client to purchase merchandise. The client is charged a nonrefundable $20 upfront styling fee before the Fix is shipped. As an alternative to the styling fee, we offer select clients the option to purchase a Style Pass. Style Pass clients pay a $49 nonrefundable annual fee for unlimited Fixes that is credited towards merchandise purchases. If the offer to purchase merchandise is accepted, we charge the client the order amount for the accepted merchandise, net of the upfront styling fee or Style Pass annual fee. For each Fix, acceptance occurs when the client checks out the merchandise on our website or mobile app. We offer a 25% discount to clients that purchase all of the items in the Fix.

Both our styling fee and Style Pass arrangements consist of one unit of account, which is the sale of merchandise. The upfront styling fee is not a separate deliverable as there is no stand-alone value related to the styling activity. Similarly, the right to receive multiple options under Style Pass does not provide the customer with material stand-alone value. Both the upfront styling fee and Style Pass annual fee are included in deferred revenue until all revenue recognition criteria are met.

We recognize revenue when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed or determinable; and (4) collectability is reasonably assured. These criteria are met when the client accepts or rejects the offer to purchase merchandise. Upon acceptance, the total amount of the order, including the upfront styling fee, is recognized as revenue. If none of the items within the Fix are accepted, the upfront styling fee is recognized as revenue at that time. The Style Pass annual fee is recognized at the earlier of the time at which a client accepts and applies the Style Pass fee to an offer to purchase merchandise or upon expiry of the annual period. Under Style Pass arrangements, if a client does not accept any items within the Fix, the annual fee will continue to be deferred until it is applied to a future purchase or upon expiry of the annual period. If a client would like to exchange an item, we recognize revenue at the time the client receives the new item, as that is when all revenue recognition criteria are met.

We deduct discounts, sales tax and estimated refunds to arrive at net revenue. Sales tax collected from clients is not considered revenue and is included in accrued liabilities until remitted to the taxing authorities. Discounts are recorded as a reduction to revenue when the order is accepted. We record a refund reserve based on our historical refund patterns. Our refund reserve, which was included in accrued liabilities in the consolidated balance sheets, was $2.3 million and $1.6 million as of July 28, 2018, and July 29, 2017, respectively.

Deferred revenue related to upfront styling fees and exchanges totaled $7.8 million and $7.2 million as of July 28, 2018, and July 29, 2017, respectively. Deferred revenue related to Style Pass annual fees totaled $1.1 million as of July 28, 2018; the Company did not offer Style Pass prior to fiscal year 2018. Deferred shipping costs related to Fixes shipped at period end but not checked out were $1.4 million and $1.3 million as of July 28, 2018, and July 29, 2017, respectively, and are included within prepaid expenses and other current assets in the consolidated balance sheets.

We sell gift cards to clients and establish a liability based upon the face value of such gift cards. We reduce the liability and recognize revenue upon the redemption of the gift card. If a gift card is not redeemed, we will recognize revenue when the likelihood of its redemption becomes remote. We have not recognized any revenue related to unredeemed gift cards as we are unable to determine whether the likelihood of redemption has become remote.

Cost of Goods Sold

Cost of goods sold consists of the costs of merchandise, expenses for shipping to and from clients and inbound freight, inventory write-offs and changes in our inventory reserve, payment processing fees and packaging material costs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of compensation and benefits costs, including stock-based compensation expense, for our employees including our stylist, fulfillment center operations, data analytics, merchandising, engineering, client experience, marketing and corporate personnel. Selling, general and administrative expenses also include marketing and advertising, third-party logistics costs, facility costs for our fulfillment centers and offices, professional services fees, information technology and depreciation and amortization.

Advertising Expenses

Costs associated with the production of advertising, such as writing, copy, printing and other production costs are expensed as incurred. Costs associated with communicating advertising on television and radio are expensed the first time the advertisement is run. Online advertising costs are expensed as incurred. Advertising costs totaled $102.1 million, $70.5 million and $25.0 million for 2018, 2017 and 2016, respectively, and are included within selling, general and administrative expenses in the consolidated statements of operations.

Marketing Programs

We have a client referral program under which we issue credits for future purchases to clients when the referral results in a new client who has ordered a Fix. We record a liability at the time of issuing the credit and reduce the liability upon application of the credit to a client’s purchase. Our liability for client referral credits amounted to $2.7 million and $2.3 million as of July 28, 2018, and July 29, 2017, respectively. We also have an affiliate program under which we make cash payments to lifestyle or fashion bloggers or others who refer clients in high volumes. Amounts related to both of these programs are included within selling, general and administrative expenses in the consolidated statements of operations.

Leases

We recognize rent expense over the term of the lease, starting when the property is made available for use to us by the landlord. When a lease contains a predetermined fixed rent escalation, we recognize the related rent expense on a straight-line basis and record the difference between the recognized rent expense and the amounts paid under the lease as deferred rent included in other current liabilities and deferred rent, net of current portion, on the consolidated balance sheets. We also receive tenant allowances upon entering into certain leases, which are recorded as a liability and amortized using the straight-line method as a reduction to rent expense over the term of the lease.

Income Taxes

We account for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which they are expected to be realized or settled.

We believe that it is more likely than not that forecasted income and potential income from tax planning strategies, together with future reversals of existing taxable temporary differences and results of recent operations, will be sufficient to fully recover the deferred tax assets. In the event that we determine all or part of the net deferred tax assets are not realizable in the future, we would record a valuation allowance.

We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. We recognize interest and penalties related to unrecognized tax benefits, if any, as income tax expense.

Stock-Based Compensation Expense

We measure stock-based compensation expense associated with option awards made to employees and members of our board of directors based on the estimated fair values of the awards at grant date using the Black-Scholes option-pricing model. For options with service conditions only, stock-based compensation expense is recognized, net of forfeitures, over the requisite service period using the straight-line method such that an expense is only recognized for those awards that we expect to vest. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

We have granted certain option awards that contain both service and performance conditions. The service condition for such awards is satisfied ratably over the 24-month period following the fourth anniversary of the grant date. The performance condition for such awards was satisfied if we consummated an IPO within 12 months of the grant date. Expense related to awards which contain both service and performance conditions is recognized using the accelerated attribution method. Since an IPO is not deemed probable until such event occurs, no compensation cost related to the performance condition was recognized prior to the consummation of our IPO in November 2017. Subsequently, we recorded stock-based compensation expense of $0.5 million related to periods prior to the IPO.

For stock options granted to non-employees, we determined that the estimated fair value of the stock options is more readily measurable than the fair value of the services received. The fair value of stock options granted to non-employees is calculated at each grant date and re-measured at each reporting date using the Black-Scholes option-pricing model and the resulting change in value, if any, is recognized in our consolidated statements of operations for the periods in which the related services are rendered.

Comprehensive Income (Loss)

Comprehensive income (loss) represents net income (loss) for the period plus the results of certain other changes to stockholders’ equity. Our net income (loss) was equal to our comprehensive income (loss) for 2018, 2017 and 2016.

Concentration of Credit Risks

The majority of our cash is held by three financial institutions within the United States. Our cash balances held by these institutions may exceed federally insured limits. The associated risk of concentration for cash is mitigated by banking with credit-worthy institutions. No client accounted for greater than 10% of total revenue, net for 2018, 2017 and 2016.

Recently Adopted Accounting Pronouncements

In July 2015, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2015-11, Inventory: Simplifying the Measurement of Inventory (Topic 330). The new guidance replaces the current inventory measurement requirement of using the lower of cost or market with the lower of cost or net realizable value. We early adopted this standard beginning in 2017, which had no impact on our consolidated financial statements.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash (Topic 230), or ASU 2016-18. ASU 2016-18 requires that the statement of cash flows explain the change during the period in the total cash, cash equivalents and restricted cash. We early adopted this standard beginning in 2017 and have retroactively adjusted the consolidated statements of cash flows for all periods presented.

In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718) or ASU 2016-09, which simplifies the accounting and reporting of share-based payment transactions, including adjustments to how excess tax benefits and payments for tax withholdings should be classified and provides the election to eliminate the estimate for forfeitures. Upon adoption, ASU 2016-09 requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows, rather than being recorded within equity and reflected within financing cash flows. ASU 2016-09 also permits the repurchase of more of an employee’s shares for tax withholding purposes without triggering liability accounting, clarifies that all cash payments made on an employee’s behalf for withheld shares should be presented as a financing activity on the Company’s statement of cash flows, and provides an accounting policy election to account for forfeitures as they occur. We adopted this standard in our first fiscal quarter of 2018. We made an accounting policy election to continue to estimate forfeitures. All excess tax benefits and tax deficiencies related to share-based payment awards are now reflected in the consolidated statement of operations and comprehensive income as a component of the provision for income taxes on a prospective basis, whereas they were recognized in equity under the previous guidance. Additionally, excess tax benefits related to share-based payment awards are now reflected in operating activities, along with other income tax related cash flows, in our consolidated statement of cash flows on a prospective basis. The adoption did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), or ASU 2014-09, which amended the existing FASB Accounting Standards Codification. ASU 2014-09 establishes a principle for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services and also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts. The new guidance may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption (“modified retrospective method”).

We will adopt the standard in the first quarter of fiscal 2019 under the modified retrospective approach. Under the new standard, we will begin to recognize revenue from estimated unredeemed gift cards over the expected customer redemption period rather than waiting until the likelihood of redemption becomes remote. Further, we expect to recognize revenue related to exchanges upon shipment by us, rather than upon receipt by the customer. In the first fiscal quarter of 2019, the Company will record a cumulative catch-up adjustment resulting in an increase to opening retained earnings, net of tax, of approximately $2.5 million, comprised primarily of the impact from the change in revenue recognition related to gift cards.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), or ASU 2016-02, which requires lessees to record most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. ASU 2016-02 states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. We expect to adopt this standard in our first fiscal quarter of 2020. We are currently evaluating the impact that this standard will have on our consolidated financial statements but we expect that it will result in a substantial increase in our long-term assets and liabilities.

In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory (Topic 740), which amends existing guidance on the recognition of current and deferred income tax impacts for intra-entity asset transfers other than inventory. This amendment may be applied on a modified retrospective basis. We expect to adopt this standard in fiscal year 2019 and are currently evaluating the impact that it will have on our consolidated financial statements.

In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, or ASU 2018-07. Under this ASU, the accounting for awards issued to nonemployees will be similar to the accounting for employee awards. This includes allowing for the measurement of awards at the grant date and recognition of awards with performance conditions when those conditions are probable, both of which are earlier than under current guidance for nonemployee awards. We expect to adopt this standard in our first fiscal quarter of 2020. We are currently evaluating the impact that this standard will have on our consolidated financial statements.

Fair Value Measurements

12 Months Ended

Jul. 28, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

We disclose and recognize the fair value of our assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The guidance establishes three levels of the fair value hierarchy as follows:

Level 1: Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2: Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level 3: Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

Our financial instruments consist of cash and cash equivalents, accounts payable, accrued liabilities and the preferred stock warrant liability. At July 28, 2018, we had cash equivalents of $175.2 million which consisted of money market funds with maturities of less than three months. At July 28, 2018, and July 29, 2017, the carrying values of cash and cash equivalents, accounts payable and accrued liabilities approximated fair value due to their short-term maturities. In November 2017, in connection with our IPO, all outstanding preferred stock warrants were automatically exercised into shares of Class B common stock. As a result, we remeasured and reclassified the preferred stock warrant liability to additional paid-in capital upon the closing of the IPO. As of July 28, 2018, the Company did not have any financial instruments measured at fair value.

The following table sets forth our financial instruments that were measured at fair value on a recurring basis based on the fair value hierarchy as of July 29, 2017:



	July 29, 2017
(in thousands)	Level 1		Level 2		Level 3		Total
Financial Liabilities:
Preferred stock warrant liability	—		—		26,679		26,679
Total	$	—	$	—	$	26,679	$	26,679

There were no transfers of financial assets or liabilities into or out of Level 1, Level 2 or Level 3 for 2018 or 2017. The key assumptions used in the Black-Scholes option-pricing model for the valuation of the preferred stock warrant liability upon remeasurement were as follows:



	July 29, 2017
Expected term (in years)	2.0
Fair value of underlying shares	$	25.09
Volatility	43.8		%
Risk free interest rate	1.3		%
Dividend yield	—		%

Generally, increases or decreases in the fair value of the underlying convertible preferred stock would result in a directionally similar impact in the fair value measurement of the associated warrant liability.

The following table sets forth a summary of the changes in the fair value of the preferred stock warrant liability:



(in thousands)	For the Fiscal Year Ended July 28, 2018
Balance at July 29, 2017	$	26,679
Change in fair value	(10,685)
Reclassification of warrant liability to additional paid-in capital upon the initial public offering	(15,994)
Ending balance at July 28, 2018	$	—

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Preferred Stock Warrant Liability	12 Months Ended
Preferred Stock Warrant Liability	Jul. 28, 2018
Equity [Abstract]
Preferred Stock Warrant Liability	Preferred Stock Warrant Liability In 2012 and 2013, in connection with financing arrangements, we issued warrants to purchase shares of our convertible preferred stock. For one of the financing arrangements, we issued warrants to purchase 375,230 shares of Series Seed convertible preferred stock at an exercise price of $0.1066 per share and 66,265 shares of Series A convertible preferred stock at an exercise price of $0.22636 per share. For the second financing arrangement, we issued warrants for the purchase of, at the warrant holder’s option, either (a) 624,730 shares of Series A-1 convertible preferred stock at an exercise price of $0.2401 per share or (b) 308,315 shares of Series B convertible preferred stock at an exercise price of $0.486516 per share. Prior to their automatic exercise in connection with the IPO, the warrants were exercisable for and expired ten years from the date of issuance. In November 2017, in connection with our IPO, the preferred stock warrants were automatically exercised into shares of common stock and the preferred stock warrant liability was reclassified to additional paid-in capital.

Commitments and Contingencies

12 Months Ended

Jul. 28, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Leases

We have entered into various lease arrangements for our corporate offices and fulfillment centers. Such leases generally have original lease terms between five and eight years. We had security deposits totaling $1.3 million and $1.3 million as of July 28, 2018, and July 29, 2017, respectively. We have letters of credit totaling $12.9 million and $9.4 million as of July 28, 2018, and July 29, 2017, respectively, which are collateralized by time deposits.

A schedule of the future minimum rental commitments under our non-cancelable operating lease agreements with an initial or remaining term in excess of one year as of July 28, 2018, is as follows:



(in thousands)	July 28, 2018
2019	$	18,652
2020	19,646
2021	19,024
2022	17,127
2023	14,945
Thereafter	59,159
Total	$	148,553

At one fulfillment center, the Company recognizes contingent rent in excess of its minimum lease payments. Contingent rental amounts are determined based on additional square footage utilized in excess of the Company’s contractual minimum commitments.

Total rent expense classified within selling, general and administrative expenses in the consolidated statements of operations was $18.2 million, $16.6 million and $11.1 million for 2018, 2017 and 2016, respectively.

Future minimum rental commitments as of July 28, 2018 have not been reduced by sublease rentals of $3.0 million due to the Company under non-cancelable subleases through fiscal 2021.

Contingencies

We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also disclose material contingencies when we believe a loss is not probable but reasonably possible. Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. Although we cannot predict with assurance the outcome of any litigation or tax matters, we do not believe there are currently any such actions that, if resolved unfavorably, would have a material impact on our operating results, financial position or cash flows.

Indemnifications

In the ordinary course of business, we may provide indemnifications of varying scope and terms to vendors, directors, officers and other parties with respect to certain matters. We have not incurred any material costs as a result of such indemnifications and have not accrued any liabilities related to such obligations in our consolidated financial statements.

Convertible Preferred Stock

12 Months Ended

Jul. 28, 2018

Temporary Equity Disclosure [Abstract]

Convertible Preferred Stock

Prior to the IPO, the Company’s convertible preferred stock consisted of the following as of July 29, 2017, and July 30, 2016 (in thousands, except share data):



			Net Carrying Value
	Shares Authorized	Shares Outstanding			Liquidation Preference
(in thousands, except share data)	Shares Authorized	Shares Outstanding			Liquidation Preference
Series Seed	7,457,785	7,082,555	$	754	$	754
Series A	11,715,050	11,648,785	2,602		2,637
Series A-1	9,571,715	8,946,985	2,147		2,147
Series B	24,358,445	24,358,445	11,756		11,851
Series C	7,474,285	7,474,285	24,963		25,000
Total	60,577,280	59,511,055	$	42,222	$	42,389

Upon the closing of the IPO, all of the outstanding shares of convertible preferred stock automatically converted into 59,511,055 shares of Class B common stock. As of July 28, 2018, the Company is authorized to issue 20,000,000 shares of preferred stock, with a $0.00002 par value. There are currently no outstanding shares of preferred stock as of July 28, 2018.

Prior to the IPO, the significant provisions of the convertible preferred stock were as follows:

Dividends - The holders of convertible preferred stock were entitled to receive, on a pari passu basis, non-cumulative dividends prior and in preference to any declaration or payment of any dividends to the holders of common stock, when and if declared by the board of directors, at annual rates equal to 6% of original issue price per share for Series Seed, Series A, Series A-1, Series B and Series C convertible preferred stock, as adjusted for stock splits, stock dividends, reclassifications or the like. Holders of convertible preferred stock were also entitled to participate in dividends on the common stock on an as-converted basis. No dividends have been declared by the board of directors or paid since inception.

Conversion - At the option of the holder, each share of convertible preferred stock was convertible into fully paid and non-assessable shares of common stock. As of July 29, 2017, and July 30, 2016, each share of convertible preferred stock was convertible into one share of common stock, subject to adjustment for stock splits, stock dividends and the like. The conversion price of each series of convertible preferred stock was subject to weighted-average adjustment if we issued additional shares of common stock after the applicable original issue date of such series of convertible preferred stock without consideration or for consideration per share less than the conversion price for such series of convertible preferred stock, subject to customary exceptions. Each share of preferred stock automatically converted into the number of shares of common stock into which such shares were convertible at the then-applicable conversion ratio upon (i) the closing of the sale of shares of common stock in a public offering resulting in gross proceeds of at least $30,000,000 and the listing of our common stock on the Nasdaq Global Select Market, or (ii) the consent of the holders of a majority of the outstanding convertible preferred stock, voting as a single class on an as-converted basis.

Liquidation - In the event of any voluntary or involuntary liquidation, dissolution or winding up of Stitch Fix, Inc. (a “liquidation event”), holders of convertible preferred stock were entitled to receive, prior and in preference to holders of common stock, an amount equal to the greater of (i) the applicable original issue price for each series of convertible preferred stock ($0.1066, $0.22636, $0.2401, $0.486516 and $3.344798 per share for Series Seed, Series A, Series A-1, Series B and Series C, respectively, as adjusted for stock splits, stock dividends and the like), plus any declared and unpaid dividends and (ii) the amount per share that would have been payable if all shares of convertible preferred stock were converted into common stock subject to the applicable conversion rights. If upon occurrence of such an event, the assets and funds to be distributed among the holders of convertible preferred stock were insufficient to permit the payment to such holders, our entire assets and funds legally available for distribution would have been distributed ratably among the holders. Upon completion of the distribution to the holders of the convertible preferred stock, all remaining legally available assets would have been distributed ratably to the holders of common stock. A liquidation event would have been deemed to have occurred (unless waived by the holders of the majority of the outstanding shares of convertible preferred stock) upon (i) a consolidation, reorganization or merger of the Company, other than any consolidation, reorganization or merger in which the Company’s stockholders of record as of immediately prior to such transaction would continue to hold a majority of the voting power of the surviving company of such transaction, (ii) a transfer of shares of the Company representing a majority of the voting power of the Company, other than for equity financing purposes or (iii) a sale, lease, exclusive license or other disposition of all or substantially all of the assets of the Company.

Voting - Each share of convertible preferred stock was entitled to the number of votes equal to the number of shares of common stock into which such share could be converted on the record date for the vote or consent of the stockholders, except as otherwise required by law or other provisions of the Company's Certificate of Incorporation, as amended, or Certificate of Incorporation, and generally had voting rights and powers equal to the voting rights and powers of the common stockholders. For so long as at least 3,250,000 shares of Series B convertible preferred stock, as adjusted for stock splits, stock dividends and the like, remained outstanding, the holders of Series B convertible preferred stock, voting as a separate class, were entitled to elect one member of the board of directors. For so long as at least 950,000 shares of Series Seed convertible preferred stock, as adjusted for stock splits, stock dividends and the like, remain outstanding, the holders of Series Seed convertible preferred stock, voting as a separate class, were entitled to elect one member of the board of directors. The holders of Common Stock, voting as a separate class, were entitled to elect two members of the board of directors. The holders of convertible preferred stock and common stock, voting as a single class on an as-converted basis, were entitled to elect all remaining members of the board of directors.

Protective Provisions - For so long as at least 2,000,000 shares of convertible preferred stock, as adjusted for stock splits, stock dividends and the like, remained outstanding, the holders of convertible preferred stock had certain protective provisions whereby the Company could not, without the written consent or affirmative vote of the holders of the majority of outstanding shares of convertible preferred stock, voting together as a single class on an as-converted basis (i) authorize or designate any new class or series of stock or any other securities convertible into equity securities of the Company ranking on a parity with or senior to the convertible preferred stock in respect to redemption rights, liquidation preference, voting or dividend rights, or increase the authorized or designated number of any such class or series; (ii) redeem or repurchase stock, pay or declare dividends or make other distributions in respect of stock, subject to certain exceptions; (iii) consummate a transaction that would have been a liquidation event, or other merger or consolidation or enter into any agreement by the Company or its stockholders regarding a liquidation event or other merger or consolidation; (iv) amend, alter or repeal any provision of the Certificate of Incorporation or the Amended and Restated Bylaws of the Company; (v) increase or decrease the authorized number of members of the board of directors; (vi) increase or decrease the authorized number of shares of common stock or convertible preferred stock or any series thereof; (vii) consummate or enter into any transaction with the Company’s executive officers or their affiliates, subject to certain exceptions; or (viii) create, permit the creation of or hold capital stock in any direct or indirect subsidiary that was not wholly owned by the Company.

The holders of Series A, Series B and Series C convertible preferred stock each had additional protective provisions whereby the Company could not, so long as 1,221,780 shares, 2,435,835 shares and 747,430 shares, respectively, as adjusted for stock splits, stock dividends and the like, remained outstanding, without the written consent or voting approval of the holders of a majority of the then-outstanding shares of the respective series of convertible preferred stock, take any action that: (i) amended, altered or repealed any powers, preferences or rights of such series of convertible preferred stock, so as to affect them adversely and in a manner disproportionate to other series of preferred stock; or (ii) increased or decreased the authorized number of shares of such series of convertible preferred stock.

Other - We classified our convertible preferred stock outside of stockholders’ equity because the shares contained certain liquidation features that were not solely within our control. During 2017 and 2016, we did not adjust the carrying value of the convertible preferred stock to the deemed liquidation value of such shares as a qualifying liquidation event was not probable.

Stockholders' Equity

12 Months Ended

Jul. 28, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stockholders' Equity

Stockholders’ Equity

2011 Equity Incentive Plan

In 2011, we adopted the 2011 Equity Incentive Plan (the “2011 Plan”). The 2011 Plan provided for the granting of stock-based awards to employees, directors and non-employees under terms and provisions established by the board of directors. The number of shares authorized for issuance under the 2011 Plan was 23,223,374 and 20,364,297 as of July 29, 2017, and July 30, 2016, respectively, of which 2,023,424 and 3,101,370 were available for grant, respectively.

The 2011 Plan allowed for the grant of incentive stock options or nonqualified stock options as well as restricted stock units, restricted stock and stock appreciation rights. As of July 28, 2018, we had only granted incentive and nonqualified stock options under the 2011 Plan. Effective upon our IPO, the 2011 Plan was replaced by the 2017 Incentive Plan.

2017 Incentive Plan

In November 2017, our board of directors and stockholders adopted our 2017 Incentive Plan (the “2017 Plan”). The remaining shares available for issuance under the 2011 Plan became reserved for issuance under the 2017 Plan. The 2017 Plan provides for the grant of incentive stock options to employees, including employees of any parent or subsidiary, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards and other forms of stock awards to employees, directors and consultants, including employees and consultants of our subsidiaries. As of July 28, 2018, the number of shares authorized for issuance under the 2017 Plan was 28,423,374,of which 3,743,623 were available for grant.

Employee stock options generally vest 25% on the first anniversary of the grant date with the remaining vesting ratably over the next three years. Options generally expire after 10 years.

Stock option activity under the 2011 Plan and 2017 Plan is as follows:



			Options Outstanding
	Shares Available for Grant		Number of Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value (in thousands)
Balance – July 29, 2017	2,023,424		10,218,912		$	7.12	8.53	$	166,670
Authorized	5,200,000		—
Granted	(4,820,596	)	2,180,789		21.57
Exercised	—		(2,194,168	)	2.33
Cancelled	1,340,795		(1,153,373	)	7.16
Balance – July 28, 2018	3,743,623		9,052,160		$	11.74	8.23	$	160,856
Options vested and exercisable - July 28, 2018			2,361,520		$	4.30	6.65	$	59,539
Options vested and expected to vest - July 28, 2018			8,046,527		$	11.20	8.01	$	147,367

The weighted-average grant date fair value of options granted during 2018, 2017 and 2016 was $8.40, $9.11 and $1.99 per share, respectively. The total grant date fair value of options that vested during 2018, 2017 and 2016 was $8.5 million, $2.6 million and $1.5 million, respectively. The aggregate intrinsic value of options exercised during 2018, 2017 and 2016 was $59.6 million, $17.4 million and $3.5 million, respectively. The aggregate intrinsic value is the difference between the current fair value of the underlying common stock and the exercise price for in-the-money stock options.

Employee restricted stock units are granted under the 2017 Plan and generally vest 25% on the first anniversary of the grant date with the remaining vesting ratably over the next three years.

The following table summarizes the restricted stock unit, or RSU, award activity under the 2017 Plan:



	Unvested RSU's
	Class A Common Stock		Weighted- Average Grant Date Fair Value		Weighted- Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value (in thousands)
Unvested at July 29, 2017	—		—
Granted	2,639,807		$	21.34
Vested	(39,538	)	19.38
Forfeited	(167,943	)	18.28
Unvested at July 28, 2018	2,432,326		$	21.58	3.50	$	71,778
Expected to vest - July 28, 2018	2,018,344		$	21.57	3.50	$	59,561

Stock-Based Compensation Expense

Stock-based compensation expense for options granted to employees was $15.4 million, $3.4 million and $1.6 million for 2018, 2017 and 2016, respectively. Stock-based compensation expense for options granted to non-employees was less than $0.1 million in 2018. Stock-based compensation expense for options granted to non-employees was $0.2 million and $0.3 million for 2017 and 2016, respectively. The income tax benefit related to stock-based compensation was $4.7 million, $1.3 million and $0.6 million for 2018, 2017 and 2016, respectively. Stock-based compensation expense is included in selling, general and administrative expenses in our consolidated statements of operations.

As of July 28, 2018, the total unrecognized compensation expense related to unvested options and RSU's, net of estimated forfeitures, was $97.7 million, which we expect to recognize over an estimated weighted average period of 3.1 years.

In determining the fair value of the stock-based awards, we use the Black-Scholes option-pricing model and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment.

Fair Value of Common Stock - As of July 28, 2018, the fair value of the shares of common stock underlying our stock options has been determined based on market prices. Prior to our IPO on November 16, 2017, the fair value of the shares of common stock underlying our stock options was determined by the board of directors. As there was no public market for our common stock, the board of directors determined the fair value of the common stock on the stock option grant date by considering a number of objective and subjective factors, including third-party valuations of our common stock, sales of our common stock, operating and financial performance, the lack of marketability of our common stock and general macroeconomic conditions.

Expected Term - The expected term represents the period that our stock options are expected to be outstanding and is determined using the simplified method (generally calculated as the mid-point between the vesting date and the end of the contractual term).

Expected Volatility - The expected volatility was estimated based on the average volatility for publicly traded companies that we considered comparable, over a period equal to the expected term of the stock option grants.

Risk-Free Interest Rate - The risk-free interest rate is based on the U.S. Treasury zero coupon notes in effect at the time of grant for periods corresponding with the expected term of the option.

Expected Dividend - We have not paid dividends on our common stock and do not anticipate paying dividends on our common stock; therefore, we use an expected dividend yield of zero.

The fair value of stock options granted to employees was estimated at the grant date using the Black-Scholes option-pricing model with the following assumptions:



	For the Fiscal Year Ended
	July 28, 2018		July 29, 2017		July 30, 2016
Expected term (in years)	5.4 - 6.6		5.1 - 7.7		5.4 - 6.9
Volatility	41.4 - 43.5%		42.6 - 46.0%		44.3 - 47.9%
Risk free interest rate	1.9 - 3.0%		1.3 -2.3%		1.1 -1.9%
Dividend yield	—	%	—	%	—	%

In July 2017, options to purchase an aggregate of 1,097,463 shares of common stock which had both a service-based condition and a liquidity event-related performance condition were granted to certain members of our executive management team. Such options vest ratably over the 24-month period following the fourth anniversary of the grant date, subject to an IPO occurring within 12 months of the grant date and the option holder’s continuous service through each vesting date. The aggregate grant-date fair value of such option awards was $14.0 million. Since an IPO is not deemed probable until such event occurs, no compensation cost related to the performance condition was recognized prior to the consummation of our IPO in November 2017. Subsequently, we recorded stock-based compensation expense of $0.5 million related to periods prior to the IPO.

Early Exercise of Employee Options

We allow certain employees to exercise options granted under the 2011 Plan prior to vesting in exchange for shares of restricted common stock subject to a right of repurchase that lapses according to the original option vesting schedule. The proceeds from the exercise of options are recorded in other current liabilities and other long-term liabilities in our consolidated balance sheets at the time the options are exercised and reclassified to common stock and additional paid-in capital as our repurchase right lapses. Upon termination of employment, any unvested shares are subject to repurchase by us at the original purchase price.

We did not issue any shares upon exercise of unvested stock options during 2018. We issued 111,557 and 42,500 shares of common stock during 2017 and 2016, respectively, upon exercise of unvested stock options. As of July 28, 2018, July 29, 2017, and July 30, 2016 there were 160,417, 702,144 and 1,699,147 shares of common stock, respectively, held by employees subject to repurchase at an aggregate price of $0.2 million, $1.2 million and $1.5 million, respectively.

Sales of Our Stock

In April 2016, an employee sold an aggregate of 268,095 shares of our common stock for a total of $6.0 million to an existing investor. The purchase price was in excess of the fair value of such shares. As a result, during 2016, we recorded the excess of the purchase price above fair value of $4.8 million as compensation expense with a corresponding credit to additional paid-in capital.

In November 2016, we initiated a cash tender offer which was completed in December 2016 for the purchase of our common stock, including shares underlying then-unexercised vested options, at a purchase price of $22.61 per share. To be eligible to participate in the tender offer, employees must have received equity grants with vesting start dates on or before October 31, 2014. Such employees could elect to sell up to 10% of their total vested holdings. The total number of tendered shares was 526,620 for total cash consideration of $11.9 million. The purchase price per share in the tender offer was in excess of the fair value of our common stock at the time of the transaction. As a result, during 2017, we recorded the excess of the purchase price above fair value of $8.3 million as compensation expense.

In January 2017, two of our former employees sold 554,799 shares of our common stock for a total of $12.5 million to existing investors. In addition, an employee sold 85,000 shares of our Series C convertible preferred stock for a total purchase price of $1.9 million to an existing investor. The purchase price was in excess of the fair value of such shares. During 2017, we recorded $13.0 million as compensation expense related to these transactions.

Income Taxes

12 Months Ended

Jul. 28, 2018

Income Tax Disclosure [Abstract]

Income Taxes

The components of income (loss) before income taxes are as follows:



	For the Fiscal Year Ended
(in thousands)	July 28, 2018			July 29, 2017		July 30, 2016
Income (loss) before income taxes
U.S.	$	56,978		$	12,801	$	61,222
Foreign	(2,265		)	—		—
Total	$	54,713		$	12,801	$	61,222

The components of the provision for income tax expense are as follows:



	For the Fiscal Year Ended
(in thousands)	July 28, 2018			July 29, 2017			July 30, 2016
Current:
Federal	$	2,732		$	17,027		$	29,204
State	493			3,096			4,706
Total current	3,225			20,123			33,910
Deferred:
Federal	7,917			(6,009		)	(5,458		)
State	(1,329		)	(719		)	(411		)
Total deferred	6,588			(6,728		)	(5,869		)
Provision for income taxes	$	9,813		$	13,395		$	28,041

The reconciliation of our effective tax rate to the statutory federal rate is as follows:



	For the Fiscal Year Ended
(in thousands, except percentages)	July 28, 2018					July 29, 2017				July 30, 2016
Tax at federal statutory rate	$	14,752		27.0	%	$	4,481	35.0	%	$	21,428	35.0	%
State taxes, net of federal effect	(755		)	(1.4	)%	1,270		9.9	%	2,386		3.9	%
Remeasurement of preferred stock warrant liability	(2,881		)	(5.3	)%	6,608		51.6	%	1,057		1.7	%
Stock-based compensation	(5,454		)	(9.9	)%	229		1.8	%	—		0.0	%
Tax Act impact	6,670			12.2	%	—		0.0	%	—		0.0	%
Research and development credits	(2,146		)	(3.9	)%	—		0.0	%	—		0.0	%
Uncertain tax positions	2,846			5.1	%	23		0.2	%	52		0.1	%
Return to provision	(3,891		)	(7.1	)%	—		0.0	%	45		0.1	%
Nondeductible compensation	—			0.0	%	—		0.0	%	1,684		2.8	%
Other	672			1.2	%	784		6.1	%	1,389		2.2	%
Effective tax rate	$	9,813		17.9	%	$	13,395	104.6	%	$	28,041	45.8	%

The components of net deferred tax assets are as follows:



(in thousands)	July 28, 2018			July 29, 2017			July 30, 2016
Deferred tax assets:
Inventory reserve and uniform capitalization	$	7,504		$	13,378		$	9,262
Deferred rent	202			4,858			3,736
Accruals and reserves	8,274			6,215			3,054
Research and development credits	754			—			—
Stock-based compensation	2,210			308			195
Deferred revenue	739			616			272
Other	404			175			438
Gross deferred tax assets	20,087			25,550			16,957
Deferred tax liabilities:
Depreciation and amortization	(5,860		)	(5,407		)	(3,522		)
Other	(120		)	(152		)	(234		)
Gross deferred tax liabilities	(5,980		)	(5,559		)	(3,756		)
Net deferred tax assets	$	14,107		$	19,991		$	13,201

On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act, or the Tax Act, which significantly changed U.S. tax law. The Tax Act contains several key tax provisions including the reduction of the corporate income tax rate from 35% to 21%, as well as a variety of other changes including the acceleration of expensing of certain business assets and reductions in the amount of executive pay that could qualify as a tax deduction. The federal statutory tax rate reduction was effective January 1, 2018. The Company has a fiscal year end, which subjects us to transitional tax rate rules. Due to the tax rate reduction being effective beginning after December 31, 2017, for the year ended July 28, 2018, we applied a blended U.S. statutory rate of 26.96% due to the tax rate reduction. Additionally, we remeasured our net deferred tax assets, which resulted in an increase in income tax expense of $6.7 million.

On December 22, 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Act, or SAB 118, which provides guidance on accounting for the Tax Act’s impact and allows registrants to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. During the fiscal year ended July 28, 2018, we recorded an amount of $6.7 million due to the remeasurement of our net deferred tax assets for the reduction in U.S. statutory tax rate.

We had a federal net operating loss carryforward of $0.3 million for the year ended July 29, 2017. These losses were fully utilized in the year ended July 28, 2018. We had state net operating loss carryforwards of $0.2 million and $0.5 million as of July 28, 2018, and July 29, 2017, respectively. If not utilized, these losses will begin to expire in 2033. As of July 28, 2018, we had California research and development tax credit carryforwards of $1.5 million which are not subject to expiration.

Uncertain Tax Positions

A reconciliation of our unrecognized tax benefits is as follows:



(in thousands)	July 28, 2018			July 29, 2017			July 30, 2016
Balance at the beginning of the year	$	1,052		$	846		$	481
Increase related to prior period tax positions	2,334			—			—
Decrease related to prior period tax positions	(241		)	(36		)	—
Increase related to current year tax positions	2,358			242			365
Balance at the end of the year	$	5,503		$	1,052		$	846

The amount of unrecognized tax benefits relating to our tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, we anticipate that the balance of the liability for unrecognized tax benefits and related deferred tax assets will decrease by $0.4 million during the next twelve months due to lapses of applicable statutes of limitation. Our liability for uncertain tax positions as of July 28, 2018, includes $4.7 million related to amounts that would impact our current and future tax expense.

We recognize interest related to uncertain tax positions in our provision for income taxes. We file U.S. federal and various state and local income tax returns, including the state of California. We are subject to U.S. federal, state or local income tax examinations for all prior years.

Earnings (Loss) Per Share Attributable to Common Stockholders

12 Months Ended

Jul. 28, 2018

Earnings Per Share [Abstract]

Earnings (Loss) Per Share Attributable to Common Stockholders

Basic and diluted net income (loss) per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. We consider convertible preferred stock and early exercised share options to be participating securities. In connection with the IPO, we established two classes of authorized common stock: Class A common stock and Class B common stock. As a result, all then-outstanding shares of common stock were converted into shares of Class B common stock upon effectiveness of the IPO. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting, conversion and transfer rights. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to ten votes per share. Each share of Class B common stock is convertible at any time at the option of the stockholder into one share of Class A common stock.

Undistributed earnings allocated to participating securities are subtracted from net income (loss) in determining net income (loss) attributable to common stockholders. Basic earnings per share, or EPS, attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. All participating securities are excluded from basic weighted-average common shares outstanding.

For the calculation of diluted earnings per share EPS, net income (loss) attributable to common stockholders for basic EPS is adjusted by the effect of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding, including all potentially dilutive common shares. The undistributed earnings are allocated based on the contractual participation rights of the Class A and Class B common shares as if the earnings for the year have been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. The computation of the diluted net income (loss) per share of Class A common stock assumes the conversion of Class B common stock, while diluted net income (loss) per share of Class B common stock does not assume the conversion of Class A common stock as Class A common stock is not convertible into Class B common stock.

A reconciliation of the numerator and denominator used in the calculation of the basic and diluted EPS attributable to common stockholders is as follows (in thousands except share and per share amounts):

July 28, 2018

July 29, 2017

July 30, 2016

(in thousands except share and per share amounts)

Class A

Class B

Numerator:

Net income (loss)

Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Jul. 29, 2017	Jul. 30, 2016
Statement of Stockholders' Equity [Abstract]
Issuance of common stock upon early exercise of stock options	$ 642	$ 85