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Chewy, Inc. CHWY is likely to register an increase in both top and bottom lines when it reports fourth-quarter fiscal 2024 results on March 26, before the market opens. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.2 billion, which indicates a 13.1% increase from the year-ago period. The consensus mark for fiscal 2024 top line is pegged at $11.81 billion, which indicates an increase of 6.1% from the year-ago level.
The consensus mark for quarterly earnings has increased a penny in the past 30 days and is pegged at 21 cents per share. The figure implies an increase of 16.7% from the prior-year quarter. The consensus mark for fiscal 2024 earnings is pegged at $1.07 per share, implying an increase of 55.1% from the prior year’s reported figure. The company delivered a trailing four-quarter earnings surprise of 30.9%, on average.
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Chewy Price, Consensus and EPS Surprise
Chewy price-consensus-eps-surprise-chart | Chewy Quote
Things to Consider Ahead of CHWY’s Upcoming Results
Chewy’s Autoship program’s continued success is expected to have played a crucial role in driving revenues. As the program grows, its convenience and value are expected to have led to higher customer retention and repeat purchases. With 80% of the third quarter of fiscal 2024 sales coming from Autoship customers, this segment remains a key driver of predictable and recurring revenues.
Chewy’s expansion into the $25 billion pet healthcare market through its vet clinics has been gaining traction. With six clinics already operational and strong cross-category engagement from new customers, this segment could emerge as a significant growth driver. The company's goal of reaching the upper end of its clinic expansion target could indicate strong momentum in this category.
Chewy’s focus on mobile app enhancements and digital engagement is expected to have contributed to increased customer spending. A growing share of purchases now comes from the app, where Autoship adoption and order values tend to be higher. The Chewy+ membership program has been showing early success in boosting customer retention and cross-category purchases. These digital improvements would lead to higher conversion rates and a more seamless shopping experience.
While the aforementioned factors have raised optimism, higher marketing and advertising expenses could weigh on margins in the near-term. In the fiscal fourth quarter, CHWY increased advertising efforts to capitalize on holiday demand, which are likely to have impacted short-term profitability. These investments are expected to have collectively pressured both top and bottom lines in the fiscal fourth quarter.
Moreover, discretionary spending on hard goods remains challenging, despite Chewy’s overall resilience in pet essentials. A cautious consumer environment could weigh on demand for non-essential pet products like toys and accessories. If inflationary trends persist, customers may continue prioritizing essential pet care over discretionary purchases, potentially affecting Chewy’s revenue mix.