Chewy reported growth in sales and expenses. Shares fell by 8%

Chewy отчиталась о росте продаж и расходов. Акции подешевели на 8%

Online pet products seller Chewy reports for the third quarter of 2021. The company spoke about the costs in connection with COVID-19, which may persist in the next quarter. After the report, the shares fell by 8%, to 52 $.

Compared to the same quarter last year:

  • revenue - $ 2.2 billion (+24%);
  • net loss unchanged - 32 million;
  • Adjusted EBITDA - 6 million (+10%).

And here are some operating numbers:

  • number of active clients - 20.4 thousand (+15%);
  • revenue per active client - 419 $ (+15%);
  • revenue from auto orders - 1.6 billion (+27%);
  • share of auto orders from revenue - 71%.

Chewy is a growing company, which reduces losses as sales and customer base grows. And in this quarter it was not possible to reduce the loss. The reasons are the same, as the rest: inflation, supply disruptions, persistent labor shortage.

Another negative point is the slowdown in the growth of the client base.. In 2020, in the midst of quarantine, the online store gained an advantage. At the end of the year, the number of active clients increased by 43%. Now, due to the high base effect, growth has slowed to 15%, what investors don't like.

The company itself focuses on its advantages. for example, on the average check. It grows in new, and old clients. The share of auto orders from revenue is also growing. Auto Orders - Subscription Purchases. The client selects the required products, and the company regularly delivers them. This model helps Chewy better predict its future cash flows., and also "tie" clients.

According to Chewy, the shift of shoppers to online stores and the increase in the number of pets will help her to increase revenue. The company expects an increase in revenue for this year by 25%, up to $ 8.9 billion. Adjusted EBITDA due to supply disruptions and other restrictions will remain the same at $ 85 million.

Since the beginning of the year on the news of the easing of quarantine, and also due to the slow growth of the client base, Chewy shares fell by 42%.

Financial performance, million dollars

Revenue Net loss
2019 4847 (+37%) −252
2020 7146 (+47%) −92
9м2021 6502 (+25%) −10

Operating indicators

Number of active clients Revenue per active client
2019 13 459 (+27%) 360 $ (+8%)
2020 19 206 (+43%) 372 $ (+3%)
9м2021 20 407 (+15%) 419 $ (+15%)
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