What happened Shares of Stitch Fix (NASDAQ: SFIX) gained 12.3% in value last month, according to data provided by S&P Global Market Intelligence. The online apparel seller and styling service delivered a larger-than-expected loss when it reported its fiscal first-quarter results on Sept. 22. However, investors were more focused on positive developments such as growth in the number of the company's active clients and the growing adoption of its direct buy service. The stock was already rebounding to start the month as investors have been optimistic about the company's ability to gain market share with more consumers going online to shop for apparel. Image source: Stitch Fix. So what Direct buy has proven a hit with Stitch Fix clients. Sales of women's activewear grew by 350% year over year during the quarter, driven by strength across regular Fixes and direct buy. Stitch Fix recently launched its Trending For You service for direct buy clients; in the first two weeks after that debuted, the company experienced a 30% year-over-year increase in weekly direct buy orders. Stitch Fix's revenue grew 11% year over year for the quarter, and active clients grew 9% to reach 3.5 million. Overall, then, it's performing better than average in the retail clothing industry, where many incumbents have reported revenue declines. Now what "As traditional retailers close their doors, consumers are shifting to Stitch Fix as evidenced by our increased demand and growth, validating that we're taking share," said President Elizabeth Spaulding during the earnings conference call. So far, a relatively small number of clients are using direct buy, which leaves a lot of room for continued growth as more clients adopt it. It's also encouraging that two-thirds of customers who have tried direct buy have returned to make another purchase. Management believes direct buy offers a "step change" in the company's growth trajectory; that potential is largely why investors remain bullish on Stitch Fix's future. 10 stocks we like better than Stitch FixWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Stitch Fix wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of September 24, 2020 John Ballard owns shares of Stitch Fix. The Motley Fool owns shares of and recommends Stitch Fix. The Motley Fool has a disclosure policy.Source