TLDR
- Chewy posted Q2 2025 net sales of $3.1 billion, up 8.6% year over year.
- Gross margin expanded 90 basis points to 30.4%.
- Net income reached $62 million, while adjusted EBITDA rose 26.5%.
- Autoship sales increased 15%, representing 83% of total net sales.
- Stock closed at $42.10 on September 9, down 7.45% pre-market at $38.96.
Chewy, Inc. (NYSE: CHWY) reported financial results for the second quarter of fiscal 2025, ended August 3, 2025. At market close on September 9, Chewy stock stood at $42.10, up 1.15%. In pre-market trading, shares dropped 7.45% to $38.96.
The company posted net sales of $3.10 billion, an 8.6% increase from last year. This exceeded the high end of its guidance range.
CEO Sumit Singh highlighted that customer growth and wallet share expansion drove results, with active customers climbing 4.5% to nearly 21 million. Net sales per active customer rose to $591. Autoship sales were a key driver, jumping 15% year over year and accounting for 83% of revenue.
Margins and Profitability
Gross margin improved 90 basis points to 30.4%, supported by better cost management and product mix. Net income was $62 million, though this represented a sharp year-over-year decline due to a $275.7 million tax benefit recorded in the prior year. Net margin narrowed to 2%, down 850 basis points.
Basic earnings per share came in at $0.15, while diluted EPS was $0.14. Both figures fell sharply compared to the prior year, when tax-related benefits boosted profitability. On an adjusted basis, Chewy’s net income improved to $141.1 million, up $36.4 million year over year. Adjusted EPS was $0.33 diluted, a $0.09 gain.
Adjusted Metrics Strength
Adjusted EBITDA totaled $183.3 million, a 26.5% increase. The adjusted EBITDA margin rose 80 basis points to 5.9%. These gains reflected ongoing efficiency improvements and higher sales volumes.
Chewy emphasized that its customer loyalty remains strong, evidenced by the surge in Autoship adoption. The company views Autoship as a cornerstone of long-term revenue stability.
Performance Against Benchmarks
Chewy’s stock performance over different time horizons paints a mixed picture. Year-to-date, shares are up 25.71%, significantly outpacing the S&P 500’s 10.73%. Over the past year, Chewy delivered a 59.59% return, against the S&P 500’s 19.04%. However, three-year returns trail the benchmark, with Chewy up 17.01% compared to 60.12% for the index. Over five years, Chewy stock has remained down 31.54%, while the S&P 500 soared 91.61%.
Chewy’s Q2 2025 report shows strong sales growth, improved adjusted profitability, and expanding customer engagement. While headline net income fell due to prior-year tax benefits, underlying trends remain positive. Investors will be watching whether Autoship momentum and margin improvements can sustain future gains.
