Chewy reported second-quarter fiscal 2026 net sales of $3.33 billion, up 7.3% year over year, with results reaching the high end of the company’s guidance as recurring revenue growth, customer activity, and operating execution supported performance.
Excluding contributions from SmartPak and Modern Animal, Chewy said net sales increased 5.7% year over year, indicating that the company’s core business continued to grow even before accounting for acquired operations.
The company’s gross margin remained stable at 30.4%, as Chewy balanced sales growth with continued investments across its pet retail and services platform.
Profitability improved meaningfully during the quarter. Net income increased to $80.5 million from $62 million in the prior-year period, while net margin expanded by 40 basis points to 2.4%.
Diluted earnings per share increased to $0.20 from $0.14, reflecting the benefit of higher net income and improved operating performance.
On an adjusted basis, Chewy delivered another strong quarter. Adjusted EBITDA increased by $43.4 million to $226.7 million, while adjusted EBITDA margin expanded by 90 basis points to 6.8%.
Adjusted net income increased to $148.8 million, and adjusted diluted EPS rose to $0.36 from $0.33 a year earlier.
Chewy also generated $92 million in operating income during the quarter, compared with $69.7 million in the same period last year, highlighting continued progress in converting revenue growth into stronger operating earnings.
For the first six months of fiscal 2026, Chewy reported net income of $175.3 million, up from $124.4 million in the comparable prior-year period.
The company said its recurring revenue model remains an important contributor to business stability, particularly as customers continue to use Chewy for repeat purchases of food, medications, supplies, and other everyday pet products.
Management also pointed to continued customer growth and operating execution as factors supporting its outlook for the remainder of the fiscal year.
Based on the company’s performance through the first half of fiscal 2026, Chewy said it has raised its full-year revenue and profitability outlook.
The revised outlook reflects management’s confidence in the durability of demand across the company’s core categories, continued customer engagement, and its ability to improve profitability as the business scales.
Chewy’s business extends beyond traditional e-commerce pet retail. The company operates an online platform spanning pet products, supplies, prescriptions, pharmacy services, and other pet-related offerings.
Its assortment includes approximately 190,000 products and service offerings from around 4,000 pet-industry brands, along with Chewy’s own private-label brands.
The company’s recurring purchase model gives it exposure to categories such as food, treats, medications, and other consumables that customers typically purchase on a regular basis, providing a more predictable revenue base than many discretionary e-commerce categories.
Chewy has also continued expanding its broader pet-care ecosystem, including healthcare and services, as it works to deepen relationships with existing customers and increase the number of products and services used across each household.
The combination of 7.3% revenue growth, higher net income, expanding adjusted EBITDA margins, and an increased full-year outlook suggests Chewy entered the second half of fiscal 2026 with improving earnings momentum.
With net sales reaching $3.33 billion in the quarter and adjusted EBITDA margin rising to 6.8%, the company is continuing to demonstrate improved operating leverage while expanding its customer and recurring revenue base.
KEY QUOTE:
“Chewy delivered a strong second quarter, with growth of 7.3% to $3.33 billion of net sales at the high end of our guidance, and a 6.8% Adj. EBITDA margin, exceeding our expectations. The durability of our recurring revenue base, continued customer growth, and disciplined execution give us confidence to raise our full-year revenue and profitability outlook, while continuing to invest in compelling opportunities that deepen customer engagement and create long-term shareholder value.”
Sumit Singh, Chief Executive Officer of Chewy
