Chewy Delivers Strong Q2 Earnings, Outpaces Broader Pet Market
Chewy, a leading online retailer of pet products and services, reported strong second-quarter earnings for fiscal year 2026, continuing to gain share and expand profitability. The company's performance underscores the strength of its business model and disciplined execution.
In a call with investors, Chewy's CEO Sumit Singh highlighted the company's ability to outperform the broader pet category by roughly 2 to 3 times. Despite a more pressured consumer backdrop for the pet market, Chewy did not see further deterioration in sales during the second quarter. The environment has broadly stabilized to the trends observed exiting the first quarter.
Chewy's earnings algorithm provides the capacity to continue investing for long-term growth, while its expanding ecosystem and growing contribution from Chewy Health drive structural wallet share gains. The company's recurring revenue base supports durable sales, making it well-positioned to outperform in the current environment.
The company's various business segments also delivered strong results. Chewy Vet Care continues to scale, with total clinic portfolio delivering triple-digit revenue growth in the second quarter. Meanwhile, the fresh and frozen portfolio is meaningfully outpacing the broader category, delivering triple-digit unit growth. Equine, farm, and exotics business also delivered its seventh consecutive quarter of mid-double-digit year-over-year sales growth.
Chewy reported Q2 total enterprise net sales at the high end of its guidance range of $3.33 billion, representing 7.3% year-over-year growth. Excluding the impact of SmartPak and Modern Animal, Q2 organic net sales increased 5.7% year-over-year, driven by active customer growth, NSPAC expansion, and ongoing market share gains.
The company ended the quarter with 21.7 million active customers, up 3.8% year-over-year, while net sales per active customer increased to $602. Autoship customer sales once again outpaced overall company growth, increasing 9.3% and representing 84.6% of total net sales in the quarter.
Chewy's ability to maintain strong sales despite a challenging market environment is a testament to its solid business model and disciplined execution. The company's continued investment in new growth platforms, such as Chewy Vet Care and fresh and frozen products, also positions it for long-term success.
