Chewy 2026 Q2 Earnings Sharp Earnings Drop Amid Revenue Growth

Chewy reported Q2 2026 earnings on September 10, 2025, with revenue rising but net income declining sharply. While the company exceeded revenue expectations, it missed on earnings, and did not adjust its guidance.

Revenue
Chewy’s total revenue for Q2 2026 increased by 8.6% year-over-year to $3.10 billion, compared to $2.86 billion in the same period of 2025.

Earnings/Net Income
The company’s earnings significantly declined, with EPS dropping 78.6% to $0.15 in Q2 2026, down from $0.70 a year ago. Net income also fell by 79.3% to $62 million, compared to $299.10 million in Q2 2025, signaling a concerning trend in profitability. This sharp decline in EPS indicates a notable challenge in maintaining earnings momentum.

Price Action
Chewy’s stock continued to face downward pressure in the wake of the earnings report. Over the latest trading day, the stock price fell by 5.39%, and over the past week, it dropped by 13.84%. Month-to-date, the stock has declined by an additional 2.80%, reflecting a broad sell-off.

Post-Earnings Price Action Review
The earnings report appears to have intensified investor concerns, with a steep drop in share price signaling a lack of confidence in the company’s earnings performance. The week-to-date decline of over 13% indicates that the market is reacting strongly to the sharp drop in net income and the mixed earnings message, despite strong revenue growth.

CEO Commentary
CEO Sumit Singh highlighted Q2 2025 performance, noting net sales of $3.1 billion, a 9% year-over-year increase driven by Autoship growth and strong hard goods sales. He emphasized the success of Chewy+ and the company’s expanding customer share of wallet, with NSPAC reaching $591. Gross margin expanded to 30.4%, and adjusted EBITDA reached $183.3 million, reflecting profitability and free cash flow generation. Strategic priorities include expanding the CVC network and investing in Chewy+ and private brands. Singh expressed optimism about leveraging macroeconomic pressures such as tariffs to gain market share and scale high-margin offerings.

Guidance
Chewy expects Q3 2025 net sales of $3.07–$3.1 billion (7–8% year-over-year growth) and full-year 2025 sales of $12.5–$12.6 billion (7–8% year-over-year growth, excluding the impact of a 53rd week). The company maintains a full-year 2025 adjusted EBITDA margin of 5.4–5.7%, with 75 bps expansion at the midpoint and expects to deliver ~15% adjusted EBITDA flow-through. Capital expenditures are expected to be at the low end of the 1.5–2% range of net sales, and $125 million was spent on share repurchases in Q2.

Additional News
On September 10, 2025, Chewy released its Q2 2025 financial results and detailed the report under the “News & Events” section of its investor relations site. The report included links to quarterly results, SEC filings, and governance documents, along with access to stock information, analyst coverage, and investor FAQs. While no major M&A activity or C-level changes were announced, the company emphasized its focus on buyback programs and capital efficiency. Investors were directed to events and presentations for further insight into management's strategy and performance outlook.