Will Chewy’s (CHWY) Earnings Beat and Viking’s Stake Increase Shift Its Profit Narrative?

• In its most recent quarter, Chewy reported US$3.12 billion in revenue, an 8.3% year-on-year increase that modestly exceeded analyst expectations and was accompanied by stronger-than-expected EBITDA performance.
• Shortly after these results, Viking Global Investors lifted its Chewy stake by very large double digits, highlighting strong institutional conviction in the company’s underlying business strength despite earlier pressure on the shares.
• Next, we’ll examine how Viking Global’s larger position in Chewy might influence the company’s investment narrative and perceived long-term profit potential.

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Chewy Investment Narrative Recap

To own Chewy, you need to believe that its subscription driven pet spend, led by Autoship, can stay resilient while profitability steadily improves. The latest quarter’s revenue and EBITDA beat, plus Viking Global’s 147% stake increase, support confidence in the near term, but do not materially change the key catalyst of growing active customers or the biggest current risk around over reliance on Autoship for more than 80% of sales.

The recent Q3 2025 update, with US$3.12 billion in revenue and stronger than expected EBITDA, is the most relevant datapoint here because it speaks directly to Chewy’s progress toward its long term 10% adjusted EBITDA margin ambition and its ability to fund initiatives like Chewy Vet Care Clinics, Chewy+ and the 1P ad platform that are expected to support customer growth and higher margins over time.

Yet investors should be aware that heavy dependence on Autoship still leaves Chewy exposed if…

Read the full narrative on Chewy (it’s free!)

Chewy’s narrative projects $15.1 billion revenue and $467.3 million earnings by 2028. This requires 7.7% yearly revenue growth and about a $79.1 million earnings increase from $388.2 million today.

Uncover how Chewy’s forecasts yield a $44.95 fair value, a 40% upside to its current price.

Exploring Other Perspectives

Seven members of the Simply Wall St Community value Chewy between US$44.41 and US$57.25 per share, showing a wide spread of opinion. You can weigh these views against the company’s reliance on Autoship for more than 80% of sales, which ties Chewy’s performance closely to the stability of this subscription base.

Explore 7 other fair value estimates on Chewy – why the stock might be worth as much as 78% more than the current price!

Build Your Own Chewy Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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