Preheat oven to 350°F and prepare two 8-inch round cake pans with grease, parchment paper, and flour.
Combine flour, sugar, cocoa powder, baking soda, baking powder, and salt in a large bowl.
Whisk dry ingredients thoroughly and create a well in the center.
Add eggs, milk, vegetable oil, and vanilla extract to the dry ingredients.
Beat with an electric mixer for 2 minutes until smooth.
Stir in hot water until the batter becomes thin and pourable.
Divide batter evenly between prepared cake pans.
Tap pans gently to release large air bubbles.
Bake for 30-35 minutes until a toothpick comes out with a few moist crumbs.
Cool cakes in pans for 10 minutes, then transfer to wire racks and cool completely.
Beat softened butter until pale and fluffy.
Add powdered sugar gradually and continue mixing.
Add milk and vanilla extract, then beat until smooth and fluffy.
Divide frosting and color most of it blue using gel food coloring.
Create black frosting using a small amount of buttercream and black gel coloring.
Level the cake layers if necessary and place the first layer on a serving board.
Spread blue buttercream over the first layer and add the second layer on top.
Apply a thin crumb coat and chill for 15 minutes.
Cover the entire cake with a smooth layer of blue buttercream.
Knead and roll out the white fondant until smooth.
Cut fondant pieces to create Stitch's ears, eyes, face, and body details.
Attach fondant pieces to the cake using small amounts of frosting.
Pipe pupils, mouth, and facial outlines with black buttercream.
Add decorative candies and final decorative accents.
Refrigerate the finished cake for at least 1 hour before serving.