CHWY's Autoship Hits 84%: Is Recurring Revenue a Key Catalyst?

Chewy, Inc.’s CHWY Autoship customer sales remain a key driver of its overall performance, demonstrating strong performance in the fourth quarter of fiscal 2025. Autoship customer sales reached more than $2.7 billion in the final quarter. This accounted for 84% of total net sales, highlighting the dominance of recurring revenues. Growth in Autoship sales continued to outpace overall top-line expansion, rising nearly 13% in the quarter and 14% for the full year on a comparable basis. These results reinforce the resilience and scalability of the company’s recurring revenue model.

The strength of this model is reflected in the Net Sales Per Active Customer (NSPAC), which reached $591 in the quarter, a 4% year-over-year increase. Chewy ended the year with 21.3 million active customers. Existing cohorts continue to perform well, reinforcing confidence in the durability and long-term sustainability of this growth strategy.

The company is focused on strengthening customer engagement by transitioning from a search aggregator to a trusted, service-rich pet care platform. A key pillar of this strategy is its advertising model, which converts a significant portion of ad-driven purchases into Autoship orders, reinforcing recurring revenues. By integrating on-site and off-site ad formats through its data ecosystem, the company enhances conversion and repeat purchasing. This approach strengthens supplier incentives and positions the company well, even as Agentic interfaces evolve, due to its close connection to transactions and consistent performance.

Zacks Rundown for CHWY

CHWY shares have lost 21% in the past three months compared with the industry’s 14.9% decline. The company carries a Zacks Rank #3 (Hold) at present.

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From a valuation standpoint, CHWY trades at a forward price-to-earnings ratio of 30.55, higher than the industry’s average of 20.48.

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The Zacks Consensus Estimate for earnings for the current and next fiscal years indicates year-over-year growth of 22.8% and 21.7%, respectively.

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Stocks to Consider

Some better-ranked stocks have been discussed below:

Tapestry, Inc. TPR provides accessories and lifestyle brand products in North America, Greater China, the rest of Asia and internationally. At present, TPR sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for TPR’s current fiscal-year sales and earnings implies growth of 11.2% and 26.5%, respectively, from the year-ago figures. TPR has delivered a trailing four-quarter earnings surprise of 12.8%, on average.

Globe E-Online Ltd. GLBE provides a direct-to-consumer cross-border e-commerce platform in Israel, the United Kingdom, the United States and internationally. At present, GLBE sports a Zacks Rank of 1.

The Zacks Consensus Estimate for GLBE’s current fiscal-year sales and earnings indicates growth of 29.5% and 176.9%, respectively, from the year-ago figures. GLBE delivered a trailing four-quarter earnings surprise of 62.2%, on average.

Five Below, Inc. FIVE operates as a specialty value retailer in the United States. At present, Five Below sports a Zacks Rank of 1.

The Zacks Consensus Estimate for FIVE’s current fiscal-year sales and earnings implies growth of 11.3% and 17.5%, respectively, from the year-ago figures. FIVE delivered a trailing four-quarter earnings surprise of 63.4%, on average.

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