Chewy posted strong quarterly results as the online pet food company rode a wave of increased demand from pet owners sheltering in place due to the coronavirus pandemic.
For the first quarter, Chewy reported that sales jumped 46% to $1.62 billion from a year ago, reflecting the addition of a record 1.6 million net active customers — more than double the average quarterly rate of customer growth in 2019.
The company had an adjusted loss of 12 cents per share. Analysts had expected a loss of 18 cents per share on revenue of $1.53 billion.
The first-quarter results “reflect the significant change that occurred in consumers’ shopping behavior as the pandemic spread,” the company said in a letter to shareholders, noting that absolute sales growth was the strongest in its history.
Chewy’s shares rose 5.6% to $51.51 in trading Tuesday as the company also expressed optimism that the first-quarter results would not be a “one-off event.”
“We believe the increased demand levels we are experiencing are here to stay and reflect an acceleration of e-commerce adoption that is not likely to return to pre-pandemic levels,” Chewy’s said.
The company, which was spun off from Pet Smart last year, is forecasting revenue for the current quarter to be in the range of $1.62 billion to $1.64 billion, an increase of 40% to 42%. Analysts predicted sales of $1.56 billion.
As Investor’s Business Daily reports, Chewy stock “has climbed sharply since March on hopes the shift to online consumption incited by the pandemic will accelerate the top-line growth. It has yet to show a profit but is growing at double-digit rates.”
Chewy also saw a 6.6% first-quarter increase in net sales per active customer, to $357, while its Autoship subscription program topped $1 billion in sales for the first time.
Initial orders from customers acquired since the COVID-19 outbreak were up to 11% larger in average value than those from pre-COVID-19 customers and the value of repeat orders in the first four weeks after the initial purchase was as much as 5% higher, the company said.