Chewy’s shares fell 9.4% after earnings, indicating investors were disappointed by the still-pressured consumer and pet-market backdrop despite management’s positive framing. Q2 sales landed at the high end of guidance and profitability benefited from timing and discrete items, but the call did not signal a meaningful recovery in demand.
- Q2 net sales increased 7.3% year over year to $3.33 billion, at the high end of guidance; organic sales excluding SmartPak and Modern Animal rose 5.7%.
- Active customers grew 3.8% to 21.7 million, while sales per active customer reached $602. Autoship sales grew 9.3% and represented 84.6% of total sales.
- Adjusted EBITDA margin was 6.8%, with upside driven largely by timing and discrete benefits; management also cited ongoing gains from mix, sponsored ads, automation, and productivity.
- Management said the pressured consumer environment had stabilized but had not meaningfully recovered, a cautious demand backdrop that likely weighed on the stock.
- Chewy highlighted triple-digit revenue growth in its clinic portfolio, triple-digit unit growth in fresh and frozen, and better-than-expected performance from Modern Animal and SmartPak, though these newer initiatives remain part of the longer-term growth case.
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