Chewy stock soared 25% in extended trading: explore why

Chewy Inc stock (NYSE: CHWY) soared more than 25% in extended trading on Wednesday after the pet products retailer reported a surprise profit for its fiscal Q1 and offered solid full-year guidance.

Chewy Q1 earnings snapshot

• Net income printed at $18.5 million versus the year-ago figure of $38.7 million.
• Per-share earnings of 4 cents were significantly lower than last year’s 9 cents.
• Revenue jumped 14% YoY to $2.43 billion, as per the earnings press release.
• FactSet consensus was for 11 cents of per-share loss on $2.41 billion in revenue.
• Gross margin was down 10 bps to 27.5% in the recent financial quarter.

The stock is still down nearly 50% for the year. In the earnings press release, CEO Sumit Singh said:

Chewy guidance for the future

Chewy now forecasts $10.2 billion to $10.4 billion in revenue this year, including up to $2.46 billion it expects in the fiscal second quarter.

In comparison, analysts had called for $2.44 billion in revenue for Q2 and $10.26 billion for the full financial year. Chewy said in the letter to shareholders: