Chewy Q4 Earnings Preview: Analyst Says 'Consumer Spending Headwinds' Could Overshadow Growth, Limit Upside

Pet care e-commerce company Chewy Inc CHWY could highlight its subscription growth when the company reports fourth-quarter financial results before market open Wednesday.

Earnings Estimates: Analysts expect Chewy to report fourth-quarter revenue of $3.20 billion, up from $2.83 billion in last year's fourth quarter, according to data from Benzinga Pro.

The company missed analyst estimates for revenue in two straight quarters, while beating estimates in six of the last 10 quarters overall.

Analysts expect the company to report earnings per share of five cents in the fourth quarter, down from 18 cents per share in last year's fourth quarter. The company has beaten analyst estimates for earnings per share in more than 10 straight quarters.

Chewy's guidance calls for fourth-quarter revenue to be in a range of $3.18 billion to $3.20 billion.

What Analysts Are Saying: Consumer spending and macroeconomic concerns could put a damper on Chewy's growth and financial results, Citizens analyst Nicholas Jones said in a recent investor note.

The analyst reiterated a Market Outperform rating on Chewy with a $37 price target.

"Industry trends have remained durable and upper-funnel growth accelerated sequentially in F4Q, suggesting a favorable setup," Jones said.

The analyst said macro concerns remain an overhang and could limit the upside for the stock.

"Consumer spending headwinds persist and consumer confidence remains challenged, likely limiting growth in discretionary items on the platform."

Jones said investors will focus on active buyer trends, Chewy Health trends, profit margins, commentary on vet clinics and the company's recent expansion into Canada.

Data trends show visit growth in the fourth quarter along with higher monthly active users year-over-year. Jones said estimates for positive sequential net adds are reasonable.

The analyst said Chewy's recurring revenue from its Autoship business and strong EBITDA growth are two of the larger highlights for the company and when compared to peers.

"In our view, CHWY is approaching the high end of its fair valuation range but is likely to maintain a high valuation on improving industry conditions and conservative expectations for bottom-line performance."

Key Items to Watch: Autoship will be one of the most watched items in Chewy's financials. The company reported Autoship customer sales of $2.3 billion in the third quarter, up 8.7%.

Net sales per customer will also be a key metric. This figure was up 4.2% to $567 in the third quarter, which comes with Chewy offering more products and services. Jones suggestion of the macroeconomic concerns and lower consumer spending could see a drop in the sales per active customer.

With this being the fourth quarter, all eyes will quickly turn to guidance from the company for the first quarter and next fiscal year. Guidance will likely determine which way shares trade on Wednesday.

CHWY Price Action: Chewy stock is down 1.09% to $33.67 on Tuesday versus a 52-week trading range of $14.69 to $40.09. Chewy stock is slightly up year-to-date in 2025, while shares are up 117% over the last year.

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