Chewy Shares Slide After Reporting Earnings and a Weak Outlook

Pet supply retailer Chewy saw its shares tumble this week after reporting its earnings and releasing a dismal forecast.

company traded down more than 11% at one point in extended trading on Wednesday.

Chewy CEO Sumit Singh told CNBC he remains “really bullish” about the business however.

For the second quarter the company reported that revenue rose nearly 27% on a year-over-year basis to $2.16 billion. Analysts were expecting sales of $2.20 billion, according to Refinitiv. The company also lost 4 cents per share, compared with estimates of a loss of 2 cents per share, according to Refinitiv.

Looking ahead towards the third quarter, the company has forecast sales guidance of $2.20 billion to $2.22 billion. This was slightly lower than expectations as analysts had projected $2.23 billion in sales for the quarter, per StreetAccount.

In an interview Wednesday on CNBC’s “Closing Bell,” Chewy CEO Sumit Singh said he wasn’t worried about the company’s shares falling.

Singh said it was expected that the company’s growth rate would moderate as the economy reopened and consumer spending shifted back toward activities like travel.

In Q2, Chewy’s posted a 47% year-over-year jump in sales, compared with the most-recent quarter’s roughly 27% increase.

Singh said other important metrics for the company are stronger than ever.

“Customer spending on our platform is at an all-time high,” Singh said. In the second quarter, Chewy’s net sales per active customer was $404, up 13.5% compared with the same period last year.

Active customers of 20.1 million in the second quarter was 21.1% higher than in the second quarter in 2020.

“So what does that tell you? More customers. They’re spending more. They’re staying with us longer, and we continue to deliver very strong comps,” Singh added. “Overall, we’re very pleased with the performance of the business and the way that the teams are operating amidst this difficult environment.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.