Dive Brief:
- Chewy’s Autoship subscription, paid membership program Chewy+, and vet care offerings are creating a symbiotic ecosystem, driving new customer acquisition and increased retention, Chewy CEO Sumit Singh told investors on a Q3 2025 earnings call Wednesday.
- The pet retailer ended the third quarter with 21.2 million active customers, up nearly 5% year over year, according to Singh. It saw improvements across every part of the active customer funnel.
- “We are attracting high-quality customers and are quickly converting them into Autoship, Chewy+ and health programs, which deepens loyalty and increases lifetime value,” Will Billings, chief accounting officer and interim principal financial officer at Chewy, said on the call.
Dive Insight:
Chewy has long pursued “customer-centric growth,” but its flywheel-like operating model is also aimed at delivering consistent, durable revenue growth, Singh said.
Singh described to investors three flywheels — the Autoship, Chewy+ paid membership program, and Chewy Vet Care — built onto a closed-loop mobile app.
“As you envision that, these are separate programs that essentially compound [net sales per active customer] curves, increase retention, cohort retention, reduce churn, and drive both top line as well as greater efficiency in the way that we deliver profitability,” Singh said.
The strategy paid off again in the third quarter. Chewy delivered 8% year-over-year net sales growth, reaching $3.1 billion, according to an earnings report. Autoship customer sales accounted for $2.6 billion, with its 13.6% year-over-year growth outpacing total company growth.
Meanwhile, app customers and app orders grew about 15% year over year, Singh said on the call.
Customer satisfaction remains strong, too. In a USA Today and Plant-A Insights Group survey of more than 32,000 consumers, Chewy is a leader among 750 companies for delivering the best customer service in the U.S.
Autoship provides predictable revenue, allowing operational planning to reduce cost and grow margin and in turn, providing Chewy unique structural competitive advantages, Singh said.
Since it was launched in the summer of 2024, Chewy+ has outperformed the company’s expectations and has driven higher order frequency, broader category engagement, higher mobile app adoption, and stronger Autoship participation, according to Singh. That continued even as Chewy raised the price of the membership at the end of October from $49 a year to $79.
The pet retailer added two Chewy Vet Care locations in the quarter and is slated to open two more in the near future, on track to open eight to 10 locations in fiscal year 2025.
The service is “driving strong utilization, supporting ecosystem engagement, and strengthening customer loyalty through recurring high-margin services,” Singh said.
About 40% of Chewy Vet Care customers are new to Chewy, and half then expand their connection to Chewy, according to Singh. Vet care has a customer satisfaction score of 4.8 on a 5-point scale.
Despite the strong report, Chewy issued a cautious forecast for 2026, predicting the industry to grow at low single digit and net household formation to remain largely flat.
