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Chewy Lowers Fiscal 2026 Sales Outlook Despite First-Quarter Revenue Beat

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Chewy Lowers Fiscal 2026 Sales Outlook Despite First-Quarter Revenue Beat

Chewy (CHWY) lowered its full-year sales outlook on Wednesday even though the online pet store company's fiscal first-quarter revenue topped market estimates.

Sales are now expected to come in between $13.4 billion and $13.55 billion for fiscal 2026, the company said in an earnings presentation. It previously projected sales to be in a range of $13.6 billion to $13.75 billion, while the current consensus on FactSet is for $13.65 billion.

Last month, Morgan Stanley said Chewy is likely to lower the top end of its full-year sales outlook amid weakening trends in the pet store industry and increased fuel costs.

Chewy shares fell 1.5% in the most recent premarket activity.

The online pet store firm continues to anticipate an adjusted earnings before interest, taxes, depreciation and amortization margin of 6.6% to 6.8% for the ongoing fiscal year.

For the quarter ended May 3, Chewy's sales improved 7.7% year over year to $3.36 billion, just ahead of the Street's view for $3.35 billion. Adjusted earnings rose to $0.43 a share from $0.36 in the prior-year quarter, in line with the average analyst estimate.

The results came amid a "dynamic consumer backdrop," Chief Executive Sumit Singh said in a statement.

Active customers inclined 3.6% to roughly 21.5 million, while net sales per active customer moved up 2.4%.

"Chewy continues to outperform the pet category while expanding profitability and free cash flow," according to Singh. "We remain confident in our ability to gain market share, deliver profitable growth, and create long-term shareholder value."

For the ongoing three-month period, the company expects adjusted EPS of around $0.36 on a sales range of $3.3 billion to $3.33 billion, it said in the presentation. The Street is looking for non-GAAP EPS of $0.40 and sales of $3.36 billion.

Last week, pet store chain Petco (WOOF) reiterated its fiscal 2026 outlook for sales to be flat to up 1.5%. In the first quarter ended May 2, the company's sales edged up 0.2% to nearly $1.5 billion.

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