Is Hardgoods Chewy's Next Big Growth Engine Beyond Consumables?

Chewy Inc.’s CHWY Hardgoods segment delivered remarkable momentum in first-quarter 2025, highlighting its increasing role in diversifying the company’s sales mix beyond core consumables. Hardgoods revenues rose 12.3% year over year to $342.2 million, well ahead of Chewy’s overall revenue growth of 8.3%, as customers responded favorably to a refreshed assortment and an enhanced shopping experience. 

Over the last two quarters, Chewy added more than 150 new brands and reduced SKU onboarding time by nearly half, enabling a broader selection and twice-as-fast go-to-market execution compared to a year ago.

Management emphasized that growth was broad-based across nearly all hardgoods subcategories. This performance was driven by stronger inventory lifecycle management, personalized merchandising, and improved discoverability on Chewy’s digital platforms. The company’s seamless post-purchase service and high-touch customer care further encouraged engagement with discretionary products, which have historically been more volatile than consumables.

Chewy’s hardgoods success also reflects its deliberate strategy to capture greater wallet share beyond repeatable essentials. Although still a smaller contributor to total sales, the segment demonstrated clear potential to deepen customer relationships and generate incremental revenue. Customers enjoyed a wider, fresher assortment, timely availability, and an intuitive, tailored shopping journey that presented relevant products at the right time.

These gains helped Chewy strengthen its market share and deliver resilient growth. As fiscal 2025 progresses, hardgoods momentum underscores the company’s operational agility and customer-centric innovation, positioning the category as an emerging growth engine. Chewy maintained full-year revenue guidance of $12.3–$12.45 billion, reflecting 6–7% growth adjusted for the prior year’s extra week.

How Do CENT & WOOF Stack Up Against CHWY’s Sales Growth?

Chewy's net sales have outperformed those of its key competitors, including Central Garden & Pet Company CENT and Petco Health and Wellness Company, Inc. WOOF.

Central Garden & Pet reported second-quarter fiscal 2025 net sales of $833.5 million, down 7.4% year over year, impacted by weather delays and the loss of two product lines. Despite this, Central Garden & Pet saw strong performance in its Wild Bird and e-commerce businesses, helping offset broader sales softness.

Petco Health and Wellness reported first-quarter fiscal 2025 net sales of $1.49 billion, down 2.3% year over year due to store closures. Assuming stable tariff levels, Petco Health and Wellness expects 2025 net sales to decline in the low single digits and adjusted EBITDA between $375 million and $390 million.

CHWY’s Price Performance, Valuation & Estimates

Shares of Chewy have gained 17% year to date compared with the industry’s growth of 9.5%.

From a valuation standpoint, CHWY trades at a forward price-to-sales ratio of 1.26X, below the industry’s average of 2.17X. It has a Value Score of C.

The Zacks Consensus Estimate for CHWY’s fiscal 2025 earnings implies year-over-year growth of 23.1%, whereas the same for fiscal 2026 indicates an uptick of 19.5%. Estimates for fiscal 2025 have been revised upward by 5 cents, while estimates for fiscal 2026 have been revised upward by 1 cent over the past 60 days.

CHWY currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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