Wed, Jun 11, 11:29 AM (12 days ago)
**Chewy, Inc. (CHWY) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** Chewy's net sales increased by 8.3% to $3.12 billion for the quarter ended May 4, 2025, up from $2.88 billion in the same period last year. This growth was driven by a 3.8% increase in active customers and a 3.7% increase in net sales per active customer. - **Profit Margins:** Gross profit increased by 8.2% to $923.8 million, with a gross margin of 29.6%, down slightly from 29.7% in the previous year. Operating expenses rose by 7.3%, leading to a 19% increase in income from operations to $76.9 million. Net income decreased by 6.7% to $62.4 million, resulting in a net margin of 2.0%, down from 2.3%. - **Cash Flow:** Net cash provided by operating activities was $86.4 million, up from $81.9 million. Free cash flow decreased by 7.4% to $48.7 million due to higher capital expenditures. **Key Metrics and Trends:** - **Active Customers:** Increased by 3.8% to 20.76 million, indicating strong customer acquisition and retention. - **Autoship Sales:** Autoship customer sales grew by 14.8% to $2.56 billion, accounting for 82.2% of net sales, up from 77.6%. - **Operational Efficiency:** Advertising and marketing expenses increased by 3.7%, while selling, general, and administrative expenses rose by 8.4%, reflecting investments in growth and operational expansion. **Future Operations and Uncertainties:** - **Growth Initiatives:** Chewy is expanding its fulfillment centers, pharmacy network, and customer service infrastructure to support business growth. - **Economic Factors:** Macroeconomic conditions, including inflation and interest rates, may impact consumer spending and operational costs. - **Share Repurchase:** Chewy repurchased $23.2 million worth of Class A common stock during the quarter, with $383.5 million remaining under the repurchase program. **Conclusion:** Chewy demonstrated solid revenue growth and operational efficiency improvements in Q1 2025. However, net income and free cash flow faced challenges due to increased expenses and capital investments. The company continues to invest in growth initiatives while navigating macroeconomic uncertainties.