Is Chewy's Growing Vet Care Network Its Most Powerful Growth Lever?

Chewy, Inc.’s CHWY expansion into pet health services via the Chewy Vet Care or CVC network represents a strategic move into high-value customer acquisition, driving significant ecosystem benefits. The company emphasized that these clinics are outperforming expectations in both demand generation and broader value creation. Management highlighted that Vet Care customers generate the highest and fastest Net Sales Per Active Customer (NSPAC) curves, further underscoring the network’s growing value.

Chewy pointed out that CVC customers rapidly migrate toward high-value verticals such as premium consumables, supplemental health items, and pharmacy offerings. This dynamic directly feeds the company’s Autoship-driven economics and supports higher gross profit per customer. Its strategic focus is to serve the entire pet care ecosystem by seamlessly connecting food and supplies with comprehensive pet health offerings

This approach creates a layered offering of Chewy’s services, enabling the company to keep customers within its ecosystem while strengthening engagement. By maintaining customers in its funnel, Chewy can build deeper, more consistent relationships and encourage ongoing interaction. This layered model supports sustained customer participation and enhances Chewy’s ability to deliver value across multiple touchpoints.

Chewy is working to expand its Vet Care footprint and remains on track to open 8 to 10 new practices in fiscal 2025. The company expects this expansion to bring its total number of practices to 20 by year-end, reinforcing its commitment to growing its healthcare presence.

Well, Chewy views the vet clinics as pivotal in strengthening its ecosystem economics, with the integration of healthcare services expected to enhance profitability and customer loyalty.

The Zacks Rundown for CHWY

CHWY’s shares have lost 2.1% year to date against the industry’s rise of 8.4%. CHWY carries a Zacks Rank #3 (Hold).

From a valuation standpoint, CHWY trades at a forward price-to-earnings ratio of 47.96, higher than the industry’s average of 24.17.

The Zacks Consensus Estimate for CHWY’s fiscal 2026 and 2027 earnings implies a year-over-year rise of 22.1% and 20.7%, respectively. CHWY delivered a trailing four-quarter earnings surprise of 5.8%, on average.

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Amazon.com, Inc. AMZN engages in the retail sale of consumer products, advertising, and subscription services through online and physical stores in North America and internationally.  At present, Amazon holds a Zacks Rank of 2.

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

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