$Chewy, Inc.(CHWY)$ fiscal Q3 2025 earnings report is scheduled to be released before market open on Wednesday, December 10, 2025
Fiscal Q3 2025 Earnings Analysis & Forecast
Analysts are generally expecting a positive year-over-year increase in profitability, but it is important to note that different sources have varying consensus EPS figures, which can indicate volatility based on the metric used (GAAP vs. Adjusted).
Revenue Growth: The key focus will be on whether the company can meet or exceed its revenue guidance, maintaining a healthy single-digit growth rate in a competitive and potentially softer consumer spending environment.
Profitability: The wide range in EPS forecasts ($0.12 vs. $0.30) suggests that investors should pay close attention to the specific profit metric reported (GAAP EPS vs. Adjusted EPS). Meeting the higher $0.30 consensus would indicate strong margin improvement.
Chewy (CHWY) Fiscal Q2 2025 Earnings Summary and Key Lessons
Chewy's fiscal Q2 2025 earnings, reported on September 10, 2025, presented a mixed picture: the company demonstrated strong operational efficiency and beat its own guidance, but the stock fell sharply immediately after the report, illustrating a key lesson for growth stocks.
Q2 2025 Financial Highlights
The results showed continued progress in Chewy's transition from a pure-growth story to a profitable e-commerce leader in the pet space.
The quarter was defined by robust profitability and customer loyalty metrics (Autoship sales, NSPAC, and margin expansion), proving the strength of Chewy's business model.
Post-Earnings Stock Reaction and The Lesson Learned
Despite the solid performance, Chewy's stock fell by nearly 10% in premarket trading following the announcement.
The Lesson Learned: The Market is Forward-Looking, and "Meeting Expectations" is Often Not Enough for High-Growth Stocks.
The key driver for the sell-off was the market's reaction to the company's forward guidance, despite it being raised for the full year:
Full-Year Net Sales Guidance Raised, But Not Aggressively: Chewy raised its full-year fiscal 2025 net sales outlook to $12.5–$12.6 billion (from a previous range of $12.3-$12.5 billion). While a raise, this suggested a conservative outlook for the back half of the year compared to the market's higher expectations for accelerating growth.
Focus Shift from Growth to Profitability: The solid margin results (5.9% Adjusted EBITDA) confirmed Chewy is highly profitable, but the relatively conservative customer growth figures (4.5% increase in Active Customers) and outlook led investors to worry that Chewy's period of rapid top-line growth may be moderating.
The "Whisper Number" Effect: For growth stocks, investors often trade on a "whisper number"—an unstated, higher expectation—rather than the official consensus. When a company meets expectations instead of soundly beating them (the Adjusted EPS was a match), and the forward guidance doesn't signal an acceleration in growth, the stock is penalized as it is deemed to be slowing down.
In essence, the operational performance was excellent, but the forward-looking narrative failed to satisfy investors who demand accelerating growth from stocks with high valuations.
The takeaway for investors is that in a highly-valued sector, guidance is often more important than the beat/miss on the current quarter's EPS. Chewy's guidance confirmed that their focus has shifted to maximizing profitability per customer (seen in the margin expansion and NSPAC growth) over sheer customer acquisition volume.
Key Metrics Investors Should Watch
The story for Chewy is moving from a pure growth narrative to a focus on profitable customer engagement and operational efficiency.
Chewy (CHWY) Price Target
Based on 21 analysts from Tiger Brokers app offering 12 month price targets for Chewy in the last 3 months. The average price target is $44.97 with a high forecast of $52.00 and a low forecast of $34.00. The average price target represents a 29.89% change from the last price of $34.62.
Short-Term Trading Opportunity Post-Earnings
Chewy's stock (CHWY) has historically shown high volatility following earnings, making it a potential event-driven trade:
Historical Volatility: Over the last five years, CHWY has had 19 earnings data points, with only 26% resulting in a positive one-day return, and the median positive return being +11.0% and the median negative return being -8.1%. This suggests a tendency for significant moves in either direction.
Chewy (CHWY) had 30-Day Historical Volatility (Close-to-Close) of 0.3152 for 2025-12-05.
The Key Driver: Given the wide range in EPS forecasts and the focus on margin expansion, the short-term stock movement will likely hinge on the Adjusted EBITDA margin and the full-year guidance.
Opportunity for Longs: A substantial beat on profitability (especially Adjusted EPS/EBITDA margin) coupled with strong forward guidance on Active Customers and NSPAC could lead to a significant short-term rally.
Opportunity for Shorts: A miss on revenue or a clear sign of deceleration in Autoship sales or Active Customer growth, particularly if accompanied by weak forward guidance, could lead to a sharp sell-off, given the stock's historical tendency toward negative post-earnings returns.
Technical Analysis - Exponential Moving Average (EMA)
Looking at how CHWY had fell 10% after its last quarter earnings beat, but with a not so aggressive full-year net sales guidance, so we can see that CHWY have not recovered since the last quarter earnings decline, and it have been trading in the negative RSI momentum and the share price is trading sideways near the 26-EMA period.
This could indicate that investors are still adopting a wait-and-see attitude to gauge whether CHWY is capable to provide a much stronger full-year net sales guidance, we need to understand that for high-growth stock like CHWY, this is what we as investors should be looking out for, earnings beating expectations might not be enough to make a big move on the share price.
Summary
Chewy is set to report its Fiscal Q3 2025 earnings before the market open on Wednesday, December 10, 2025. The market's focus has shifted from top-line growth to profitability and the health of its recurring revenue model.
Key Metrics for Investors:
Investors will closely watch metrics that confirm customer retention and margin expansion:
Autoship Sales: This metric, representing the highly reliable subscription revenue, is the foundation of Chewy's business model. A strong percentage of total sales is critical.
Net Sales Per Active Customer (NSPAC): Growth in NSPAC (forecasted around $596.22) indicates customers are spending more over time, proving success in upselling higher-margin products like Chewy Health.
Adjusted EBITDA Margin: Continued expansion in this margin is essential, as the market is rewarding profitability over sheer customer acquisition volume.
Short-Term Trading Opportunity:
CHWY historically experiences high post-earnings volatility. A significant beat on Adjusted EPS/EBITDA Margin combined with strong full-year guidance could trigger a rally. However, any indication of slowing Active Customer growth or soft forward guidance could lead to a sharp sell-off, following the pattern of its prior-quarter reaction. The market is priced for continued efficiency gains.
Appreciate if you could share your thoughts in the comment section whether you think Chewy would be able to provide a more aggressive full-year net sales guidance.
@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire @MillionaireTiger appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
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