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Shares of Chewy (CHWY) rose in Wednesday’s premarket trading after the online pet-products retailer reported fourth-quarter results that exceeded Wall Street expectations and issued upbeat guidance for fiscal 2026. The stock was up as much as 11.3% and traded around $24.98 in early premarket, up roughly 6.5%.
Chewy reported adjusted earnings of $0.27 per share for the quarter ended February 1, compared with the Street consensus of $0.09. The company’s adjusted earnings beat by $0.18.
Quarterly revenue totaled $3.26 billion, up 0.5% on an as-reported basis versus the prior year. The year-over-year comparison was affected by different quarter lengths, with last year’s period spanning 14 weeks versus 13 weeks this year. On a normalized 13-week basis, revenue increased 8.1%.
Chewy’s profitability improved during the quarter. Gross margin expanded by 90 basis points to 29.4%, while the adjusted EBITDA margin increased by 120 basis points to 5.0%. Adjusted EBITDA for the quarter was $162.3 million, up $37.8 million from the year-ago period.
Net income for the quarter was $39.2 million, or 9 cents per diluted share. This compares with net income of $22.8 million, or 5 cents per share, in the prior-year quarter.
For the full fiscal year 2025, Chewy reported net sales of $12.60 billion, an 8.3% increase on a normalized 52-week basis. Adjusted EBITDA totaled $719.2 million, up $148.7 million year over year, with margin expansion of 90 basis points to 5.7%.
The company generated a record $562 million in free cash flow during the year.
Customer metrics also improved. Active customer count rose 4% to 21.3 million in the fourth quarter, while net sales per active customer increased 2.2% to $591.
Chewy forecast full-year fiscal 2026 net sales of $13.6 billion to $13.75 billion. Analysts had expected $13.58 billion, placing the guidance midpoint slightly above consensus.
For the first quarter, Chewy projected adjusted earnings per share of $0.40 to $0.45 on net sales of $3.33 billion to $3.36 billion. Analyst estimates were centered around $0.41 per share on revenue of $3.36 billion. The revenue midpoint was marginally below consensus, while EPS guidance aligned with expectations.
CEO Sumit Singh described the results as coming from a “position of real strength,” citing sales expansion, EBITDA growth, and “unprecedented cash generation.” He said the company expects “continued profitable growth, expanding margins, and strong cash generation in 2026 and beyond.”
Premium gym chains are entering a “golden era” that is ending or already in decline, as rising operating costs collide with shifting consumer preferences toward more flexible, community-based ways to exercise. Long-term memberships are shrinking, margins are pressured by higher rents and facility expenses, and competition from smaller, more personalized…
