Chewy tops guidance with 8.6% Q2 sales growth

American online pet retailer Chewy reported an 8.6% year-over-year (YoY) increase in net sales to $3.1 billion (€2.9B) for the second quarter of FY2025, which ended 3 August, up from $2.8 billion (€2.6B) in Q2 FY2024.

The gain was driven by autoship customer sales, which rose 15% and accounted for 83% of total net sales.

According to Chewy, this growth in net sales exceeded the high end of its guidance range for the quarter.

“Chewy’s differentiated value proposition was once again on display, with both active customers and share of wallet (net sales per active user) growing 4.5% year over year to reach nearly 21 million customers and $591 (€505.74), respectively,” says Sumit Singh, CEO of Chewy.

Performance

Gross profit for the period reached $942.2 million (€866.8M), up 11.6% from $843.8 million (€776.3M) in Q2 2024. Gross margin also increased 90 basis points YoY to 30.4%.

However, net income dropped to $62 million (€57M) from $299.1 million (€275.2M) a year earlier. This translates to basic earnings per share of $0.15 (€0.14) and diluted earnings per share of $0.14 (€0.13), compared with $0.70 (€0.64) and $0.68 (€0.63), respectively, in Q2 2024. 

The decline was attributed to a share-based compensation expense and related taxes of $79.1 million (€72.8M).

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose $38.4 million (€35.3M) YoY to $183.3 million (€168.6M), while the adjusted EBITDA margin increased 80 basis points.

Meanwhile, adjusted net income rose $36.4 million (€33.5M) to $141.1 million (€129.8M), and adjusted diluted earnings per share grew by $0.09 (€0.08) to $0.33 (€0.30) YoY.

For the first half of FY2025, net sales rose 8.4% to $6.2 billion (€5.7B), compared to 

$5.7 billion (€5.3B) in the first half of 2024. Net income, however, fell 66% to $124.4 million (€114.4M) from $366 million (€336.7M) a year earlier.

Guidance for the fiscal year

The company raised its full-year sales guidance to $12.5 billion (€10.6B) to $12.6 billion (€10.7B), up from the previous $12.3 billion (€10.5B) to $12.45 billion (€10.6B) presented last quarter. For the third quarter, the company’s net sales guidance is $3.07 billion (€2.6B) to $3.1 billion (€2.7B).

“Overall, we see the second half of 2025 as an opportunity to further accelerate market share gains in the US and position Chewy for even greater long-term success,” the CEO says.

According to Singh, Chewy is in the “process of scaling to a national footprint” by leveraging its “existing fulfillment center topology”. The goal is to deliver fresh food within a one-day transit time by the end of 2025. He also sees “evolving macro” as a driver of dynamics for the second half of the year, citing the advantage of mitigating tariff-related costs by passing them onto customers.