Chewy : Third Quarter FY24 Earnings Call Earnings Presentation

CHWY

Q3 2024 Financial Results

December 4, 2024

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Key Recent Highlights

160K

$875M

Sequential Net Active

Capital Returned to

Customer Adds

Shareholders in FY241

Financial Metrics

$567

80.0%

$138M

Net Sales Per

Autoship Customer Sales

Q3 24 Adj. EBITDA

Active Customer2

as a % of Net Sales3

(4.8% Margin)4

the Autoship customer sales in a given reporting period divided by the net sales from all orders in that period.

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(4) Adjusted ("Adj.") EBITDA and adjusted EBITDA margin are non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information on non-GAAP financial measures and a reconciliation to the most comparable GAAP measures.

Net Sales

Full Year

Quarterly

($ Millions)

($ Millions)

$11,148

$11,440

$10,119

$8,967

$2,746

$2,826

$2,878

$2,859

$2,878

FY 21

FY 22

FY 23

LTM1

% YoY Growth2

25.5%

12.8%

10.2%

3.7%

Q3 23

Q4 23

Q1 24

Q2 24

Q3 24

% YoY Growth

8.2%

4.2%

3.1%

2.6%

4.8%

(1)

"LTM" is defined as Last Twelve Months and reflects the preceding 12 month period as of the end of the current quarter (Q3 24).

(2)

Consistent with the Company's Annual Report on Form 10-K for its 2023 Fiscal Year, the Company has provided recasted financial information for historical comparative periods to reflect the operations of Chewy Pharmacy KY, LLC beginning with

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the Company's 2021 Fiscal Year. Any historical comparatives prior to Fiscal Year 2021 are consistent with previously reported financial information.

Autoship Customer Sales1

Full Year

Quarterly

($ Millions)

($ Millions)

$8,935

$8,493

$7,408

$6,324

$2,116

$2,159

$2,233

$2,242

$2,301

FY 21

FY 22

FY 23

LTM2

Q3 23 Q4 23 Q1 24 Q2 24 Q3 24

% YoY Growth3

29.3%

17.1%

14.7%

7.2%

% YoY Growth

13.4%

8.1%

6.4%

5.8%

8.7%

(1)

We define Autoship customers as customers in a given fiscal quarter for whom an order has shipped through our Autoship subscription program during the preceding 364-day period.

(2)

"LTM" is defined as Last Twelve Months and reflects the preceding 12 month period as of the end of the current quarter (Q3 24).

(3)

Consistent with the Company's Annual Report on Form 10-K for its 2023 Fiscal Year, the Company has provided recasted financial information for historical comparative periods to reflect the operations of Chewy Pharmacy KY, LLC beginning

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with the Company's 2021 Fiscal Year. Any historical comparatives prior to Fiscal Year 2021 are consistent with previously reported financial information.

Net Sales Per Active Customer ("NSPAC")1

$555

$544

$567

$496

$434

FY 21

FY 22

FY 23

Q3 23

Q3 24

Active Customers2 (Millions)

20.7

20.4

20.1

20.3

20.2

(1)

We define net sales per active customer ("NSPAC") as the aggregate net sales for the preceding four fiscal quarters, divided by the total number of active customers at the end of that fiscal quarter.

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(2)

We define active customers as the total number of customers who have ordered a product or service, and for whom a product has shipped or for whom a service has been provided, at least once during the preceding 364-day period.

Gross Margin

Full Year

Quarterly

(%)

(%)

29.2%

29.7%

29.5%

29.3%

28.0%

28.4%

28.5%

28.2%

26.6%

FY 21

FY 22

FY 23

LTM1

Gross Profit ($ Millions)

$2,385

$2,834

$3,162

$3,340

Q3 23

Q4 23

Q1 24

Q2 24

Q3 24

Gross Profit ($ Millions)

$782

$798

$854

$844

$844

(1) "LTM" is defined as Last Twelve Months and reflects the preceding 12 month period as of the end of the current quarter (Q3 24).

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Adjusted EBITDA1

Full Year

($ Millions)

$532

$368

$307

$77

FY 21

FY 22

FY 23

LTM2

% Margin1

0.9%

3.0%

3.3%

4.7%

Quarterly

($ Millions)

$163

$145 $138

$83 $86

Q3 23

Q4 23

Q1 24

Q2 24

Q3 24

% Margin1

3.0%

3.1%

5.7%

5.1%

4.8%

(1)

Adjusted ("Adj.") EBITDA and adjusted EBITDA margin are non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information on non-GAAP financial measures and a reconciliation to the most comparable GAAP measures.

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(2)

"LTM" is defined as Last Twelve Months and reflects the preceding 12 month period as of the end of the current quarter (Q3 24).

Free Cash Flow1

Full Year

Quarterly

($ Millions)

($ Millions)

$363

$343

$152

$91

$67

$119

$48

$53

$9

FY 21

FY 22

FY 23

LTM2

Q3 23 Q4 23 Q1 24 Q2 24 Q3 24

Q3 FY24 Cash Balance: $508M3

(2)

"LTM" is defined as Last Twelve Months and reflects the preceding 12 month period as of the end of the current quarter (Q3 24).

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(3)

Reflects total cash and cash equivalents plus marketable securities.

Guidance

Net Sales

Net Sales

Adj. EBITDA Margin1

Fiscal Fourth Quarter 2024

$3.18 billion - $3.20 billion

Approximately 13% YoY growth

Fiscal Year 2024

$11.79 billion - $11.81 billion Approximately 6% YoY growth

4.6% - 4.8%

Our Fiscal Year 2024 and fourth quarter Net Sales guidance ranges reflect the impact of a 53-week fiscal year. Our 53rd week will be fully reflected in the fourth quarter of 2024.

Our guidance is based on certain assumptions, including current expectations regarding the impact of general economic conditions, and is subject to various risks and uncertainties applicable to all forward-looking statements in this presentation. See "Forward-Looking Statements" for more information. We have not reconciled our outlook for adjusted EBITDA margin to net margin because we do not provide an outlook for GAAP net income due to the uncertainty and potential variability of other income, net, and provision for (benefit from) income taxes, which are reconciling items between adjusted EBITDA and GAAP net income. Because such items cannot be reasonably predicted, we are unable to provide a reconciliation of the non-GAAP financial measure outlook to the corresponding GAAP measure. However, such items could have a significant impact on GAAP net income and net margin.

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Disclaimer

Chewy Inc. published this content on December 04, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on December 04, 2024 at 14:20:03.786.