Chewy (CHWY) stock jumps on better-than-anticipated Q4 top and bottom line
Chewy Inc. (NYSE: CHWY) shares jumped more than 6% in after-hours trading Wednesday after the company reported better-than-expected results for the fiscal Q4.
The online pet food retailer posted earnings per share (EPS) of $0.19, topping the $0.03 loss per share estimated by analysts. Revenue reached $2.83 billion, beating the consensus projection of $2.8 billion.
Year over year, Chewy's gross margin improved by 10 basis points to 28.2 percent, while its net margin expanded by 80 basis points to 1.1 percent.
“I am proud of the performance the team delivered to close out a strong fourth quarter and full year. In 2023, we gained market share while simultaneously expanding margins and accelerating free cash flow generation,” said Sumit Singh, CEO of Chewy.
“As we embark on 2024, we remain committed to further expanding our margins and generating meaningful free cash flow for our shareholders.”
Looking forward, Chewy expects its pet category to grow at a weaker rate than the historical average in 2024. Unit growth is also anticipated to be muted "due to pet household formation trends that remain below historical levels," the company said.
In terms of profitability, the retailer expects to continue delivering adjusted EBITDA margin growth this year. Moreover, the company's automation efforts and operating expenses discipline are anticipated "to positively offset our investments, delivering SG&A leverage in full year 2024 relative to full year 2023."
By Vahid Karaahmetovic