Chewy, Inc

Chewy delivered a solid result and managed an all-around beat in the last quarter, producing mid-teens growth that exceeded expectations as well as strong profitability. Chewy achieved $2.78 billion in net sales in Q2, an increase of 14% and an adjusted EBITDA margin of 3%. The number of active customers was almost steady sequentially, but the net sales per active customer, or NSPAC, rose by 15% to $530. Net sales growth was boosted by active customer participation, highlighting the steadily growing strength of the Chewy ecosystem. The Q2 advertising and marketing spend was $185.5 million, or 6.7% of net sales, in line with the company’s 6% to 7% target. Furthermore, they are effectively promoting the discovery of their Chewy Health platform. Their automation initiatives have also continued to create margin improvement as well as provide room for further growth. Their fifth automated site is anticipated to open in early 2024, and two of their four automated facilities are still ramping up.