Chewy Reports 8.3% Revenue Growth and Significant Net Income Increase in Q3 Fiscal 2025

Chewy, Inc. reported significant financial results for the third quarter of fiscal 2025, ending November 2, 2025, with net sales reaching $3.12 billion, an increase of 8.3% from $2.88 billion in the same period last year. The company's net income surged to $59.2 million, compared to just $3.9 million in the prior year, marking a substantial improvement in profitability. This growth in revenue was primarily driven by a 13.6% increase in Autoship customer sales, which totaled $2.61 billion, and a 4.9% rise in active customers, bringing the total to 21.16 million.

In terms of operational metrics, Chewy's gross profit for the quarter was $928.2 million, reflecting a gross margin of 29.8%, up from 29.3% a year earlier. The increase in gross margin was attributed to higher sales from sponsored ads and a greater proportion of sales from Autoship customers. However, the company experienced a 6.2% rise in selling, general, and administrative expenses, totaling $665.1 million, primarily due to increased fulfillment costs associated with its expanding operations, including its pharmacy fulfillment network and veterinary clinics.

Strategically, Chewy announced its acquisition of SmartPak Equine, LLC, a leading provider of equine health and nutrition products, which is expected to enhance its product offerings in the equine segment. This acquisition is anticipated to close in fiscal year 2025, pending regulatory approvals. Additionally, Chewy's cash and cash equivalents increased to $675.4 million, up from $595.8 million at the beginning of the fiscal year, providing a solid liquidity position to support ongoing operations and strategic initiatives.

The company also reported a decrease in interest income, which fell to $3.5 million for the quarter, down from $3.9 million a year ago, primarily due to lower interest rates on cash and cash equivalents. Chewy's total liabilities increased to $2.83 billion, up from $2.75 billion, driven by higher trade accounts payable and accrued expenses. The company continues to maintain a strong balance sheet, with a total stockholders' equity of $469.4 million, significantly improved from $261.5 million at the end of the previous fiscal year.

Looking ahead, Chewy remains optimistic about its growth trajectory, emphasizing its commitment to enhancing customer experience and expanding its product offerings. The company plans to leverage its strong cash position and operational efficiencies to navigate the evolving macroeconomic landscape, which includes challenges such as inflation and changing consumer behavior. Chewy's management is focused on sustaining growth rates and effectively managing costs while continuing to innovate in the pet products and services market.