Chewy, Inc. is a leading online retailer in the pet supplies industry, offering a diverse range of products, including food, health and wellness items, and hardgoods. For the first quarter of fiscal year 2025, Chewy reported net sales of $3.12 billion, an increase of 8.3% year-over-year. The company ended the quarter with 20.8 million active customers, reflecting a year-over-year growth of 3.8%, which translates to approximately 240,000 new customers added sequentially.

The company’s Autoship subscription program remained a significant driver of sales, with customer sales generating $2.56 billion in the first quarter, representing 82.2% of total net sales and a year-over-year increase of 14.8%. The average net sales per active customer (NSPAC) increased by 3.7% year-over-year, reaching $583.

Chewy’s gross margin stood at 29.6%, which represents a normalization after accounting for onetime benefits from the previous year, equivalent to an approximately 60 basis point year-over-year improvement. Adjusted EBITDA for the quarter was $192.7 million, resulting in an adjusted EBITDA margin of 6.2%, marking an increase of 50 basis points year-over-year and a year-over-year adjusted net income of $148.9 million, reflecting an increase of 8.6%.

The company reported $62.4 million in net income, equating to a net margin of 2.0%, down from 2.3% the previous year. Free cash flow totaled $48.7 million, supported by $86.4 million provided by operating activities, offset by $37.7 million in capital expenditures. Chewy executed share repurchases valued at $23.2 million during the quarter, maintaining approximately $383.5 million in remaining capacity under its existing share repurchase program.

Looking ahead, Chewy expects second quarter net sales to range between $3.06 billion and $3.09 billion, with full-year 2025 net sales guidance maintained at between $12.3 billion and $12.45 billion. Management anticipates that approximately 80% of adjusted EBITDA will convert into free cash flow for the full year, with an adjusted EBITDA margin of between 5.4% and 5.7%.