Chewy Fetches Strong Q1, Investors Stay Cautious As E-Retailer Outpaces Pet Market Peers

Chewy Inc. CHWY is best known for delivering pet food and products, but in its latest quarter, the e-retailer delivered something else investors love: a clean beat.

What Happened: The online pet store on Wednesday reported a first-quarter 2025 adjusted earnings of 35 cents per share. That’s up 12.9% year-over-year, beating the consensus of $34 cents and the management guidance of 30-35 cents.

The retailer of pet supplies reported sales of $3.12 billion, up 8.3% year over year. Compare that to the consensus of $3.08 billion and the management guidance of $3.06 billion-$3.09 billion.

For fiscal year 2025, the company expects sales of $12.30 billion-$12.45 billion compared to Wall Street estimate of $12.54 billion. The company expects a 2025 adjusted EBITDA margin of 5.4%-5.7%. Chewy’s fiscal year 2024 adjusted EBITDA margin was 4.8%.

For the second quarter of 2025, Chewy expects sales of $3.06 billion-$3.09 billion compared to the consensus of $3.03 billion.

The company expects second-quarter adjusted earnings of 30-35 cents per share versus a consensus of 31 cents.

What Analysts Say

BofA Securities analyst Curtis Nagle writes, “Results and second-quarter guide suggest robust share gains, and Chewy is tracking towards the high end of its fiscal 2025 revenue target. Combined with our projection for solid FY EBITDA expansion of 90bps, we expect strong earnings growth of 25% for the year, above comps at 11%.”

BofA analyst maintains the price target of $49 and a Buy rating. It sees the potential for significant earnings growth in the next few years as topline trends accelerate.

JPMorgan maintains the Overweight rating, citing Chewy’s continued execution, Active Customer growth, & profitability ramp. The analyst calls the post-earnings pullback “overdone.”

Analyst Doug Anmuth has raised the price target from $36 to $47. The analyst says the company's sales forecast for fiscal 2025 suggests it will gain market share. Its expected growth of 6% to 7%—excluding the impact of an extra week—beats the overall pet industry's projected growth of 3% to 4%.

“We believe CHWY is capturing share from AMZN/WMT supported by hardgoods, product mix shift, consumables, AutoShip, & efficient marketing, while improving industry trends would be a tailwind,” analyst Doug writes.

Wedbush writes Chewy shares trade for around 22x revised 2026 adjusted EBITDA estimate, which it views as a more attractive valuation relative to recent levels.

“We remain constructive on the company’s longer-term opportunity and continue to view Chewy as a category-leading online retailer with a strong record of execution and healthy FCF dynamics,” Wedbush analyst Scott Devitt writes.

Wedbush maintains the Outperform rating and raised the price target from $39 to $45 on Thursday.

On Wednesday, RBC Capital Markets raised the price target from $42 to $44 while maintaining the Outperform rating.

Analyst Steven Shemesh writes, “Reported results (while good) fell short of that bar.” The 2025 margin expansion might be slightly lower than analysts initially anticipated.

Needham analyst maintains the Hold rating on Chewy.

Analyst Bernie Mcternan writes, “CHWY continues to show it is among the best positioned in our e-commerce coverage and is expected to grow HSD in 1H25, but valuation and the uncertain durability of that growth keeps us Hold rated for now.”

Price Action: CHWY stock is up 2.82% at $41.91 at the last check on Thursday.

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