Description

Chewy’s 84.4% Autoship Machine: A Recurring Revenue Powerhouse In A Weak Consumer Market?

Chewy, Inc. reported its first quarter results for fiscal year 2026, showing moderate revenue growth amid a challenging consumer environment. Net sales increased 7.7% year-over-year to about $3.36 billion, supported by the addition of nearly 200,000 net active customers, bringing the total to 21.5 million—a 3.6% increase year-over-year. Net sales per active customer (NSPAC) improved to $597, driven by recurring purchases through the Autoship program, which accounted for 84.4% of net sales and grew over 10% year-over-year. The company highlighted its strong value proposition based on convenience, pricing, trusted service, and deep product assortment, enabling continued market share gains despite softer consumer spending trends. Profitability metrics improved notably, with adjusted EBITDA margin expanding by approximately 130 basis points year-over-year to 7.5%, fueled by operational efficiencies including enhanced sponsored advertising, category mix shifts favoring higher-margin health and wellness products, supply chain improvements, marketing productivity, and cost discipline.