Chewy, Inc.’s CHWY Autoship program has evolved into an important structural pillar with its subscription model now deeply embedded in the company’s ecosystem. CHWY’s second-quarter fiscal 2025 results reflect the impressive strength of the program. We note that Autoship generated $2.58 billion in sales, which increased about 15% year over year, and now accounts for 83% of total net sales.
The program showed particular strength in high-value categories such as consumables and health, suggesting that core customer spending is increasingly committed to Chewy's platform.Impressively, Autoship’s sales performance outpaced the company’s overall net sales growth of 8.6%. Management believes that guiding customers into Autoship and other programs like Chewy Plus improves retention and deepens engagement.
With more predictable volume and higher frequency, the network operates more efficiently, contributing to the gross margin expansion. Chewy’s gross margin reached 30.4%, an increase of nearly 80 basis points sequentially and 90 basis points year over year.
Chewy+ members are showing stronger Autoship participation and higher mobile app engagement than non-members. This behavior is translating into robust NSPAC (Net Sales Per Active Customer) trajectories for Chewy+ customers, ultimately providing a meaningful lift to the company’s overall net sales. NSPAC jumped 4.6% year over year to $591 in the second quarter, with active customers reaching 20.9 million.
As the company looks to widen its market share, the Autoship platform remains the primary lever. Looking ahead, management plans to continue investing to expand programs such as Autoship and Chewy Plus.
The Zacks Rundown for CHWY
CHWY’s shares have gained 2.1% year to date compared with the industry’s rise of 6.1%. CHWY carries a Zacks Rank #3 (Hold).
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From a valuation standpoint, CHWY trades at a forward price-to-earnings ratio of 48.3, higher than the industry’s average of 23.3.
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The Zacks Consensus Estimate for CHWY’s fiscal 2026 and 2027 earnings implies a year-over-year rise of 22.1% and 20.7%, respectively. CHWY delivered a trailing four-quarter earnings surprise of 5.8%, on average.
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Stocks to Consider
Some better-ranked stocks have been discussed below:
American Eagle Outfitters, Inc. AEO operates as a multi-brand specialty retailer in the United States and internationally. At present, American Eagle holds a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for AEO’s current fiscal-year sales and earnings implies a decline of 0.1% and 35.6%, respectively, from the year-ago figures. AEO delivered a trailing four-quarter earnings surprise of 30.3%, on average.
Boot Barn Holdings, Inc. BOOT operates specialty retail stores in the United States and internationally. At present, Boot Barn holds a Zacks Rank of 2.
The Zacks Consensus Estimate for Boot Barn’s current fiscal-year sales and earnings implies growth of 16.2% and 20.5%, respectively, from the year-ago figures. BOOT delivered a trailing four-quarter earnings surprise of 5.4%, on average.
Amazon.com, Inc. AMZN engages in the retail sale of consumer products, advertising, and subscription services through online and physical stores in North America and internationally. At present, Amazon holds a Zacks Rank of 2.
The Zacks Consensus Estimate for Amazon’s current fiscal-year sales and earnings implies growth of 11.9% and 29.7%, respectively, from the year-ago figures. AMZN delivered a trailing four-quarter earnings surprise of 22.5%, on average.
Zacks' Research Chief Names "Stock Most Likely to Double"
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Free: See Our Top Stock And 4 Runners UpAmazon.com, Inc. (AMZN) : Free Stock Analysis Report
American Eagle Outfitters, Inc. (AEO) : Free Stock Analysis Report
Boot Barn Holdings, Inc. (BOOT) : 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.
