Chewy Reports Strong Adjusted FY25 Profitability, Acquires SmartPak Equine for $175M, and Repurchases $257M in Shares

summarizeSummary

Chewy reported strong adjusted financial results for fiscal year 2025, including significant growth in adjusted EBITDA and free cash flow, alongside a $175 million acquisition and $256.8 million in share repurchases. GAAP net income decreased due to tax adjustments.

check_boxKey Events

• Fiscal Year 2025 Financial Performance

  Net sales increased by 6.2% to $12.6 billion (or 8.3% excluding the 53rd week in FY24). Adjusted EBITDA grew 26.1% to $719.2 million, and Adjusted Net Income rose 21.0% to $540.5 million. Free cash flow increased 24.3% to $562.4 million. However, GAAP net income decreased 43.3% to $222.8 million, primarily due to a significant income tax provision in FY25 compared to a benefit in FY24.

• Strategic Acquisition Completed

  On February 2, 2026, Chewy acquired SmartPak Equine, LLC, a leading provider of equine health and nutrition products, for $175 million in cash, strengthening its position in the equine category and expanding into higher-margin health and wellness verticals.

• Significant Share Repurchases

  The company repurchased $256.8 million of Class A common stock in fiscal year 2025. As of February 1, 2026, $249.9 million remains authorized under the existing $500 million share repurchase program.

• New Chief Financial Officer Appointed

  Christopher S. Deppe was appointed Chief Financial Officer, effective February 23, 2026. His compensation package includes a $450,000 annual base salary, a 100% target annual short-term incentive, and an annual equity grant valued at 800% of his base salary, plus a one-time equity grant of $8.78 million in RSUs.

auto_awesomeAnalysis

Chewy's annual report reveals a mixed but generally positive financial performance for fiscal year 2025. While GAAP net income decreased significantly due to a shift from an income tax benefit to a provision, the company demonstrated robust growth in adjusted profitability metrics, including a 26.1% increase in Adjusted EBITDA and a 21.0% rise in Adjusted Net Income. Free cash flow also saw substantial growth, indicating strong operational health. Strategically, the company completed a notable $175 million acquisition of SmartPak Equine, expanding its presence in the equine health market. Additionally, Chewy executed significant share repurchases totaling $256.8 million, with a substantial amount remaining under authorization, signaling confidence in its valuation. The appointment of a new CFO and associated equity grants, alongside pre-planned insider stock sales, provide further insights into executive leadership and compensation strategies.