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Chewy Guidance Cut Reflects Tougher Consumer Environment, UBS Says

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Chewy (CHWY) Q1 results showed continued market share gains and margin expansion, but also highlighted growing pressure from a weaker consumer environment, UBS said in a note emailed Thursday.

"The company's model is not fully immune from the macro," UBS said, adding that Chewy appears to be prioritizing profitability over growth by reducing some lower return promotions.

The company lowered its fiscal 2026 sales guidance to $13.40 billion to $13.55 billion from $13.60 billion to $13.75 billion, while maintaining its adjusted earnings before interest, taxes, depreciation, and amortization margin outlook of 6.6% to 6.8%, the firm noted.

UBS said the revised forecast reflects a more cautious view of consumer spending and pet industry demand.

UBS maintained its neutral rating on Chewy and cut its price target to $24 from $32.

Price: $18.85, Change: $-1.13, Percent Change: -5.66%

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