Chewy (company)

2011–2019: Founding, acquisition and pre-IPO

Chewy was founded with the name "Mr. Chewy" in June 2011 by Ryan Cohen[3] and Michael Day.[4] In March 2012, the company estimated a total yearly revenue of $26 million, despite losing money in its first half year.[4][5] By 2017, the company had revenue of approximately $2 billion and 51% of online pet food sales in the US.[6][7] At that time, CEO Ryan Cohen prepared to take Chewy public as both Petco and PetSmart approached with merger offers.[8] Petco's offer would be paid for in part using stock, whereas PetSmart offered an all-cash bid that would also allow Chewy to remain a completely separate business.[9] In 2017, Chewy was purchased by PetSmart, a retail entity backed by private equity firm BC Partners,[10] for $3.35 billion, which at the time was the largest ever acquisition of an e-commerce business.[9]

Following the acquisition, Cohen remained CEO and operated the business largely as an independent unit of PetSmart.[11] Between 2017 and 2018, Chewy's sales increased from $2.1 billion to $3.5 billion,[12] with 66% of sales coming from customers signed up for automatic recurring shipments.[9] Sumit Singh succeeded Ryan Cohen as CEO of Chewy in March 2018.[13]

2019–present: Post-IPO

In 2019, Chewy filed an S-1 for an initial public offering, intending to trade under the ticker symbol CHWY. In its filing, Chewy reported a net loss of $268 million on total sales of $3.5 billion for its 2018 fiscal year.[14] In the 2019 fiscal year, Chewy earned net sales of $4.85 billion, a 40 percent year-over-year increase on a 52-week basis. The company saw increased demand from millions of existing and new customers as the business sustained growth throughout the economic disruption of the COVID-19 era.[15][16]

Chewy launched a free tele-triage service called Connect With a Vet in October 2020.[17] In November 2020, Chewy announced that it would produce and fulfill orders of customized prescription medications, commonly referred to as compounding, for instances where commercial alternatives are absent.[18] In 2020, it was announced that Chewy and PetSmart would split to operate as separate companies.[19]

In March 2021, Chewy reported revenue of $2.04 billion for Q4 of 2020, making it Chewy's first quarter of net profitability, and net sales of $7.15 billion for the fiscal year.[20] In March 2022, Chewy reported net sales of $8.89 billion for the 2021 fiscal year.[21]

In August 2022, Chewy announced the introduction of the CarePlus program, which provides pet insurance and wellness plans. This initiative marked Chewy's entry into the health insurance sector for pets.[22]

In the 2022 fiscal year, Chewy's net sales grew 13.6% since 2021, to $10.1 billion.[23] Following this, in December 2023, Chewy expanded its healthcare services by launching Chewy Vet Care. This service includes the establishment of veterinary practices that offer routine check-ups, urgent care, and surgical procedures.[24]

In fiscal year 2023, Chewy reported net sales of $11.15 billion representing 10.2% year-over-year growth primarily driven by increased spending from both new and existing customers, strength of Chewy's Autoship subscription program and growth of Chewy's pet healthcare business.[25]

In April 2024, Chewy launched Chewy Vet Care, which offers in-person veterinary practices.[26]

In fiscal year 2024, Chewy reported net sales of $11.86 billion, which reflects a 6.4% year-over-year growth.[27] The company's gross margin improved to 29.2%,[27] up from 28.4% in 2023,[28] driven in part by growth in sponsored advertisements that reached approximately 1% of net sales for the full year.[27]