Chewy, Inc. (CHWY) Stock Analysis

Chewy’s primary competitive advantage is its customer-centric business model, anchored by a high-touch service culture and a robust subscription platform. Over 80% of revenue is generated by Autoship, a recurring delivery program that locks in customer loyalty and provides revenue visibility. This subscription penetration is materially higher than at Petco or PetSmart, and even Amazon’s Subscribe & Save is less tailored to pet-specific needs.

Chewy’s product assortment is broad—offering approximately 130,000 SKUs from 3,200 brands—enabling it to serve as a one-stop shop for pet owners. The company’s focus on nondiscretionary categories (food, healthcare, and supplies) accounts for roughly 85% of sales, insulating it from economic downturns more than rivals with heavier exposure to discretionary goods.

Operationally, Chewy’s fulfillment network enables overnight or two-day delivery to nearly all U.S. households, matching Amazon’s logistics reach in pet products. Its digital platform, including a top-rated mobile app, drives high engagement: app monthly active users grew in the mid-teens year-over-year in Q3 2024.

Customer satisfaction is a core differentiator. Chewy consistently leads the category in Net Promoter Score and customer retention, with Net Sales Per Active Customer rising from $330 pre-IPO to $583 in 2025. While Amazon and Walmart offer scale, Chewy’s specialized service, tailored experience, and high repeat purchase rates underpin its durable edge.