Stocks

Headlines

Chewy's Q4 2024: Strong Growth and Profitability Trends

Chewy reports impressive Q4 results with 15% net sales growth, signaling a robust performance trend. The company anticipates continued active customer growth into 2025, showcasing confidence in its market positioning.

Date: 
AI Rating:   8

Analysis of Chewy's Financial Performance

Chewy has successfully demonstrated strong financial results in Q4 2024, highlighted by a net sales increase of approximately 15% year over year, which amounts to $3.25 billion. This growth indicates effective operations and an impressive product offering that resonates well with its customer base.

**Earnings Per Share (EPS)**: For Q4 2024, Chewy reported an adjusted diluted earnings per share of $0.28 and an adjusted diluted earnings per share of $1.04 for the full year, showcasing significant profitability. The results reflect the company's strong market position and operational efficiency.

**Revenue Growth**: The net sales for the entire fiscal year of 2024 reached $11.86 billion, representing a year-over-year growth of approximately 6%. The growth in net sales was substantially supported by the expansion of the active customer base, which grew to 20.5 million for the first time in eight quarters, a notable achievement in a competitive marketplace.

**Profit Margins**: Chewy's adjusted EBITDA margin reached 4.8% for the fiscal year 2024, with a margin improvement of 150 basis points year-over-year. This margin expansion is indicative of better operating leverage and robust sales, driven largely by the company’s Autoship program, which constituted 80.6% of Q4 net sales.

**Free Cash Flow (FCF)**: The company generated a record high of $452.5 million in free cash flow for fiscal year 2024, with approximately 80% of adjusted EBITDA converted to free cash flow. This significant amount of free cash flow allows Chewy not only to reinvest in strategic initiatives but also return capital to shareholders through share repurchases.

Overall, Chewy's remarkable performance in 2024 paints a positive outlook for investors. The growth in active customers, sales, and improved margins positions the company favorably as it heads into 2025.

Stocks:  CHWY