Chewy’s CHWY Autoship subscription program remained a cornerstone of the business model in the first quarter of fiscal 2025, reinforcing its role as a key driver of customer loyalty and growth. Autoship sales reached $2.56 billion during the quarter, rising 14.8% year over year and significantly outpacing overall revenue growth of 8.3%. This performance pushed Autoship’s share of total net sales to 82.2%, the highest level in the company’s history and a clear sign of the increasing importance.
The strong momentum was fueled by higher enrollment in Autoship and stronger retention of existing subscribers. Chewy’s focus on a broad product assortment, reliable in-stock availability and a seamless, personalized digital experience has made Autoship an appealing choice for customers looking for convenience and value.
The company added customers and reactivated past ones while improving gross churn, reflecting healthier customer retention overall. Chewy ended the quarter with 20.8 million active customers, a 3.8% increase year over year. Many of these customers enrolled in Autoship soon after joining, drawn by its ease of use, reliability and tailored service.
Over the years, Autoship has steadily grown from 66% of net sales at the time of the IPO to more than 82% today. This indicates both better conversion of new customers into the program and stronger long-term engagement.
By deepening customer relationships and delivering recurring, predictable revenues, Autoship has become a critical growth engine. Chewy’s fiscal 2025 sales outlook of $12.3 billion to $12.45 billion, projecting 6% to 7% growth, assumes continued strength in Autoship adoption and retention.
How Do CENT & WOOF Stack Up Against CHWY’s Sales Growth
Chewy's net sales have outperformed those of its key competitors, including Central Garden & Pet Company CENT and Petco Health and Wellness Company, Inc. WOOF.
Central Garden & Pet reported second-quarter fiscal 2025 net sales of $833.5 million, down 7.4% year over year, impacted by weather delays and the loss of two product lines. Despite this, Central Garden & Pet saw strong performance in its Wild Bird and e-commerce businesses, helping offset broader sales softness.
Petco Health and Wellness reported first-quarter fiscal 2025 net sales of $1.49 billion, down 2.3% year over year due to store closures. Assuming stable tariff levels, Petco Health and Wellness expects 2025 net sales to decline in the low single digits and adjusted EBITDA between $375 million and $390 million.
CHWY’s Price Performance, Valuation & Estimates
Shares of Chewy have gained 13.4% year to date compared with the industry’s growth of 7.6%.
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From a valuation standpoint, CHWY trades at a forward price-to-sales ratio of 1.22X, below the industry’s average of 2.17X. It has a Value Score of B.
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The Zacks Consensus Estimate for CHWY’s fiscal 2025 earnings implies year-over-year growth of 23.1%, whereas the same for fiscal 2026 indicates an uptick of 19.5%. Estimates for fiscal 2025 have been revised upward by 1 cent, while estimates for fiscal 2026 have remained unchanged over the past 30 days.
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CHWY currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Download Atomic Opportunity: Nuclear Energy's Comeback free today.Central Garden & Pet Company (CENT) : Free Stock Analysis Report
Petco Health and Wellness Company, Inc. (WOOF) : Free Stock Analysis Report
Chewy (CHWY) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
