Chewy Reports Strong Growth in Fourth Quarter and Fiscal Year 2024: Positive Results Amid Margin Challenges

Chewy Inc. (NYSE: CHWY) today released its financial results for the fourth quarter and full fiscal year 2024, ending on February 2, 2025. The company delivered impressive performance, reporting quarterly sales growth of 14.9%, totaling approximately $3.25 billion, and an annual increase of 6.4%, bringing yearly sales to $11.86 billion.

Gross margin for the fourth quarter expanded to 28.5%, an increase of 30 basis points compared to the same period last year. For the full year, gross margins improved even more significantly, expanding by 80 basis points to 29.2%.

However, despite the strong sales growth, quarterly net margin narrowed to 0.7%, declining by 40 basis points compared to the prior year. Net income for the quarter amounted to $22.8 million, down from $31.9 million in the corresponding quarter last year, primarily due to increased share-based compensation expenses and related taxes totaling $99.7 million.

On the other hand, adjusted metrics such as Adjusted EBITDA demonstrated strong performance, rising 44% in the fourth quarter to $124.5 million, with adjusted EBITDA margins expanding to 3.8%. Adjusted net income increased to $120 million for the quarter, representing a 49.5% improvement year-over-year.

For the full fiscal year, results were even more positive, with net income surging dramatically to $392.7 million from $39.6 million the previous year. Adjusted net income reached $446.8 million, an increase of 50.8% compared to the prior year.

Operational metrics revealed additional strengths, including a 2.1% increase in active customers to 20.5 million, with average annual sales per active customer rising by 4.1% to $578. Additionally, the company’s Autoship subscription program continues to serve as a significant growth engine, contributing 79.2% of annual sales, up from 76.2% last year.

Chewy continues to focus on constantly enhancing customer experience and developing innovative, advanced services. The company offers a wide variety of high-quality products and unique services through its digital platforms, including its website and mobile applications. Chewy collaborates with approximately 3,200 leading brands in the industry, offering around 130,000 different products, including high-quality private-label brands developed in-house. Its emphasis on personalized and convenient customer service significantly boosts customer loyalty and repeat purchases.

CEO Sumit Singh emphasized that Chewy maintains strong momentum heading into 2025, focusing on innovation and growth in the pet products and services market segment. Investors will closely monitor how the company addresses short-term profitability challenges while sustaining robust top-line growth.