How does CHWY's Q4 2025 performance compare to previous quarters?

Chewy's Q4 2025 performance shows significant improvements over previous quarters:

1. Revenue Growth: The revenue in Q4 2025 was $3.25 billion, which is a 14.9% increase year-over-year. This marks a strong growth compared to the previous quarter's revenue of $2.88 billion on the same date last year.

CHWY Total Revenue YoY, Total Revenue

2. Net Income Improvement: The net income in Q4 2025 was $299.12 million, which is a substantial increase from the previous quarter's net income of $66.9 million on the same date last year. This indicates a strong profitability period for the company.

CHWY Net Income YoY, Net Income

3. Gross Margin Expansion: The gross margin expanded to 28.5% in Q4 2025, which is a 30 basis point improvement from the previous year. This suggests improved operational efficiency and pricing power in the market.
4. EBITDA and Free Cash Flow Increase: The adjusted EBITDA increased to $124.5 million, which is a $38.1 million rise year-over-year. Free cash flow also improved significantly by 133.2% to $156.6 million, reflecting enhanced operational efficiency.
5. Customer Growth: The number of active customers increased to 20.5 million, marking the first year-over-year growth since FY23. This indicates a strong customer base and loyalty, particularly from Autoship customers whose sales grew by 21.2% to $2.62 billion.
6. Margin Improvements: The adjusted EBITDA margin improved to 4.8% for fiscal year 2024, reflecting better profitability on sales. Gross margin also expanded to 29.2% for the full year 2024, with an 80 basis point improvement.

In conclusion, Chewy's Q4 2025 performance demonstrates robust growth in revenue, net income, and gross margin, along with significant improvements in EBITDA and free cash flow. The company's strategic focus on customer growth, particularly through the Autoship program, has been instrumental in sustaining its performance amid economic challenges.