Chewy, Inc.
For the period ended May 3, 2026. Filed Jun 10, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
May 3, 2026 · Filed Jun 10, 2026
CHWY$22.56-1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-11-02; filed 2025-12-10.
0001766502-25-000059
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-05-03; filed 2026-06-10.
0001628280-26-042060
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 112 previous paragraphs and 90 current paragraphs.
52 unchanged; 26 reworded; 11 added; 33 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Macroeconomic conditions, including inflationary pressures, elevated interest rates, and broader economic uncertainty, have influenced consumer spending patterns and may continue to affect demand across our categories. We monitor these conditions closely and adjust elements of our logistics, transportation, supply chain, and merchandising strategies as appropriate. Changes in consumer behavior may impact product mix, purchasing frequency, and promotional intensity, and we manage our operations with a focus on maintaining value, service levels, and operational discipline in varying economic environments.
Current report
We derive net sales primarily from sales of both third-party brand and private brand pet food, pet products, pet health and specialty products, and related shipping fees. Consumable products include retail pet food and veterinary diet products. Hard goods products include non-perishable pet supplies. Pet health and specialty products include prescription medications, non-prescription pet health care products and certain specialty animal products for categories such as equine, birds, fish, and other non-traditional pets. Other net sales include private brand sales and certain pet-related services including telehealth services, pet insurance-related offerings, loyalty program memberships, and veterinary clinic services. Revenues from these service-based offerings are not a significant component of net sales and are managed as part of the Company’s integrated platform rather than as standalone service offerings.
Current report
To supplement our GAAP results, we present certain non-GAAP financial measures that management uses to evaluate operating performance, assess liquidity, and inform capital allocation decisions. These measures include Adjusted EBITDA and Adjusted EBITDA margin, Adjusted net income and Adjusted earnings per share, and Free cash flow.
Current report
Free cash flow represents net cash provided by operating activities less capital expenditures.
Current report
We believe these measures provide additional insight into the underlying trends in our business and facilitate comparisons across reporting periods. Reconciliations to the most directly comparable GAAP measures are provided below.
Current report
These non-GAAP measures have limitations and should not be considered in isolation or as a substitute for GAAP results. For example, Adjusted EBITDA does not reflect capital expenditures, working capital requirements, interest income (expense), income taxes, or share-based compensation, which remains a recurring component of our compensation structure. In addition, other companies may calculate non-GAAP measures differently, which may limit their comparability. Accordingly, these measures should be considered together with our GAAP financial statements and related disclosures.
Current report
Free cash flow may vary period to period based on the timing and level of capital expenditures, including investments in fulfillment capacity, pharmacy facilities, veterinary clinics, technology infrastructure, and other operational initiatives. Free cash flow may also be affected by changes in working capital, including fluctuations in inventory levels, vendor payment terms, and other components of the cash conversion cycle.
Current report
Results of Consolidated Operations
Current report
Other expense, net, was nil for the thirteen weeks ended May 3, 2026 compared to other expense, net, of $2.2 million in the thirteen weeks ended May 4, 2025.
Current report
Net cash used in investing activities was $228.6 million for the thirteen weeks ended May 3, 2026, primarily consisting of $174.8 million for acquisition of SmartPak, and $37.7 million for capital expenditures related to expanding operations at our fulfillment centers, veterinary clinics, and future pharmacy facility capabilities.
Current report
Net cash used in financing activities was $254.8 million for the thirteen weeks ended May 3, 2026 primarily consisting of $200.0 million for repurchases of common stock, and $53.3 million for tax withholdings related to vesting of share-based compensation awards.
Removed paragraphs (33)
Previous report
Evolving macroeconomic conditions, including inflation levels, tariffs, and high interest rates, have affected, and continue to affect, our business and consumer shopping behavior. We continue to monitor conditions closely and adapt aspects of our logistics, transportation, supply chain, and purchasing processes accordingly to meet the needs of our growing community of pets, pet parents and partners. As our customers react to these economic conditions, we will adapt our business accordingly to meet their evolving needs.
Previous report
To provide investors with additional information regarding our financial results, we have disclosed here and elsewhere in this 10-Q Report the following non-GAAP financial measures:
Previous report
•Adjusted basic and diluted earnings per share: defined as adjusted net income attributable to common stockholders divided by the weighted-average shares outstanding during the period, as compared to basic and diluted earnings per share (the most directly comparable GAAP financial measures) defined as net income attributable to common stockholders divided by the weighted average shares outstanding during the period.
Previous report
•Free cash flow: defined as net cash provided by operating activities (the most comparable GAAP financial measure) less capital expenditures (which consist of purchases of property and equipment, capitalization of labor related to our websites, mobile applications, software development, and leasehold improvements).
Previous report
We have included these non-GAAP metrics in this 10-Q Report because each is a key measure used by our management and board of directors to evaluate our operating performance, generate future operating plans, assess liquidity and the amount of cash we generate, and make strategic decisions regarding the allocation of capital. Accordingly, we believe these non-GAAP metrics provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.
Previous report
We believe it is useful to exclude: i) non-cash depreciation and amortization, income tax provision (benefit), interest income (expense), net, transaction related costs, and litigation matters and other items from our adjusted EBITDA, ii) releases of valuation allowances associated with deferred tax assets from our adjusted net income, and iii) changes in the fair value of equity warrants, share-based compensation and related taxes, and severance and exit costs from our adjusted EBITDA and adjusted net income as these exclusions may represent temporary initiatives to realign resources and enhance operational efficiency, and/or are not components of, and may not directly correlate to, the underlying performance of our core business operations.
Previous report
All of these non-GAAP measures have limitations as financial measures and you should not consider these in isolation or as a substitute for analysis of our results as reported under GAAP. Specifically, some of these limitations are:
Previous report
•although depreciation and amortization are non-cash charges excluded from Adjusted EBITDA, the assets being depreciated and amortized may have to be replaced in the future and adjusted EBITDA does not reflect capital expenditure requirements for such replacements or for new capital expenditures;
Previous report
•adjusted EBITDA does not reflect interest income (expense), net; or changes in, or cash requirements for, our working capital;
Previous report
•adjusted EBITDA does not reflect transaction related costs, litigation matters, integration consulting fees, internal salaries and wages (to the extent the individuals are assigned full-time to integration and transformation activities), certain costs related to integrating and converging IT systems, and other items;
Previous report
•adjusted EBITDA and adjusted net income do not reflect share-based compensation and related taxes. Share-based compensation has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation strategy; and
Previous report
•adjusted EBITDA and adjusted net income do not reflect changes in the fair value of equity warrants, and severance and exit costs, as all of these exclusions are either not representative of our underlying operations or are incremental costs that result from an actual or planned transaction or initiative.
Previous report
Additionally, other companies, including companies in our industry, may calculate these non-GAAP measures differently, which reduces their usefulness as comparative measures. Because of these limitations, you should consider these measures alongside GAAP financial performance measures, including net income, net margin, basic and diluted earnings per share, various cash flow metrics including net cash provided by operating activities and capital expenditures, and our other GAAP results.
Previous report
Free cash flow may be affected in the near to medium term by the timing of capital investments (such as the launch of new fulfillment centers, pharmacy facilities, veterinary clinics, customer service infrastructure, and corporate offices and purchases of IT and other equipment), fluctuations in our growth and the effect of such fluctuations on working capital, and changes in our cash conversion cycle due to increases or decreases of vendor payment terms as well as inventory turnover.
Previous report
Results of Condensed Consolidated Operations
Previous report
Net sales for the thirty-nine weeks ended November 2, 2025 increased by $722.9 million, or 8.4%, to $9.3 billion compared to $8.6 billion for the thirty-nine weeks ended October 27, 2024. This increase was primarily driven by growth in autoship customer sales, which improved by 14.4%, to $7.8 billion, higher net sales per active customer, which increased $28 or 4.9% to $595, and growth in active customers, which improved by 4.9%, to 21.2 million in the thirty-nine weeks ended November 2, 2025 compared to the thirty-nine weeks ended October 27, 2024. This increase was attributable to growth across our hardgoods, specialty, and healthcare businesses.
Previous report
Cost of goods sold for the thirty-nine weeks ended November 2, 2025 increased by $470.4 million, or 7.7%, to $6.5 billion compared to $6.1 billion in the thirty-nine weeks ended October 27, 2024. This increase was primarily due to higher sales coupled with increased outbound freight and shipping supply costs.
Previous report
Gross profit for the thirty-nine weeks ended November 2, 2025 increased by $252.5 million, or 9.9%, to $2.8 billion compared to $2.5 billion in the thirty-nine weeks ended October 27, 2024. This increase was primarily due to the year-over-year increase in net sales as described above. Gross margin for the thirty-nine weeks ended November 2, 2025 was 29.9%, an increase of 40 basis points compared to 29.5% for the thirty-nine weeks ended October 27, 2024, and is driven by growth in sponsored ads, autoship customer sales as a percentage of net sales increasing 430 basis points to 83.0%, and margin growth across our consumables and healthcare businesses.
Previous report
Selling, general and administrative expenses as a percentage of net sales decreased 20 basis points to 21.3% for the thirty-nine weeks ended November 2, 2025, compared to 21.5% for the thirty-nine weeks ended October 27, 2024. Selling, general and administrative expenses for the thirty-nine weeks ended November 2, 2025 increased by $139.8 million, or 7.6%, to $2.0 billion compared to $1.9 billion in the thirty-nine weeks ended October 27, 2024. The majority of the increase is associated with network-wide fulfillment costs, including modest increases in depreciation and amortization, which were collectively incurred to support the overall growth of the business, our pharmacy fulfillment network, and veterinary clinics. This also included modest increases in other selling, general, and administrative expenses primarily associated with expanded hosting and software infrastructure requirements.
Previous report
We commenced a project in fiscal year 2024 to modernize our finance information technology architecture. At the conclusion of this project, we aim to have, among other things, (i) the ability to produce financial information across different segments of the Company, which supports scalability for future growth, (ii) expanded visibility and analytical capabilities with respect to our data, and (iii) an infrastructure that enables the use of artificial intelligence and other system advancements that will create further efficiencies for our team members. While we have made progress on this project, we also identified additional system automations that expanded our original scope. As a result, we expect that this project will go live towards the end of fiscal year 2026. The project will not require meaningful capital investment.
Previous report
Interest income for the thirty-nine weeks ended November 2, 2025 decreased by $20.7 million, to $10.6 million compared to interest income of $31.3 million in the thirty-nine weeks ended October 27, 2024. This decrease was primarily due to a decrease in interest income generated from cash and cash equivalents and a decrease in interest income generated from marketable securities, primarily due to maturities of marketable securities during the thirty-nine weeks ended October 27, 2024.
Previous report
Other income for the thirteen weeks ended November 2, 2025 increased by $0.6 million, to $0.6 million compared to no other income (expense), net for the thirteen weeks ended October 27, 2024. This increase was primarily due to the termination of equity warrants, partially offset by decreases in the fair value of equity investments.
Previous report
Other expense for the thirty-nine weeks ended November 2, 2025 increased by $2.0 million, to $1.2 million compared to other income of $0.8 million in the thirty-nine weeks ended October 27, 2024. This increase was primarily due to the termination of equity warrants and decreases in the fair value of equity investments partially offset by a decrease in foreign currency losses.
Previous report
Income tax provision for the thirty-nine weeks ended November 2, 2025 increased by $253.1 million, to $37.6 million compared to income tax benefit of $215.5 million in the thirty-nine weeks ended October 27, 2024. The increase was primarily due to the release of the valuation allowance on the Company’s U.S. federal and certain state deferred tax assets during the thirty-nine weeks ended October 27, 2024.
Previous report
Net cash provided by investing activities was $445.5 million for the thirty-nine weeks ended October 27, 2024, primarily consisting of $538.4 million for the maturities and sales of marketable securities, partially offset by $92.9 million for capital expenditures related to the launch of new and future pharmacy facilities, veterinary clinics, and fulfillment centers as well as additional investments in IT hardware and software.
Previous report
Net cash used in financing activities was $221.0 million for the thirty-nine weeks ended November 2, 2025, primarily consisting of $207.5 million for repurchases of common stock and payments for secondary offering costs, as well as $9.1 million for net payments for the parent reorganization transaction.
Previous report
Share Repurchases
Previous report
On June 26, 2024, the Company entered into an agreement with Buddy Chester Sub LLC (the “Seller”) to repurchase an aggregate of 17,550,000 shares of Class A common stock at a price per share of $28.49, resulting in an aggregate repurchase price of $500 million (the “June 2024 Stock Repurchase”).
Previous report
On September 18, 2024, the Company entered into an agreement with the Seller to repurchase $300 million of shares of Class A common stock from the Seller at a price per share of $29.40, resulting in the repurchase of an aggregate of 10,204,081 shares of Class A common stock (the “September 2024 Concurrent Stock Repurchase”).
Previous report
On June 20, 2025, the Company entered into an agreement with the Seller to repurchase $100 million of shares of Class A common stock from the Seller at a price per share of $41.75, resulting in the repurchase of an aggregate of 2,395,210 shares of Class A common stock (the “June 2025 Concurrent Stock Repurchase”).
Previous report
As of February 2, 2025, the total unpaid cost of share repurchases was $5.6 million, which included $5.1 million for excise taxes. During the thirty-nine weeks ended November 2, 2025, the Company paid $5.7 million for excise taxes, accrued repurchases, and commissions.
Previous report
Future Acquisition
Previous report
We expect to use approximately 25 percent of our cash and cash equivalents as of November 2, 2025 to fund the SmartPak acquisition.
Reworded paragraphs (26)
Previous wording
We are the largest pet e-tailer in the United States, offering virtually every product a pet needs. We launched Chewy in 2011 to bring the best of the neighborhood pet store shopping experience to a larger audience, enhanced by the depth and wide selection of products and services, as well as the around-the-clock convenience, that only e-commerce can offer. We believe that we are the preeminent destination for pet parents as a result of our broad selection of high-quality products and expanded menu of service offerings, which we offer at great prices and deliver with an exceptional level of care and a personal touch. We are the trusted source for pet parents and partners and continually develop innovative ways for our customers to engage with us. We partner with approximately 3,200 of the best and most trusted brands in the pet industry, and we create and offer our own outstanding private brands. Through our websites and mobile applications, we offer our customers approximately 130,000 products, compelling merchandising, an easy and enjoyable shopping experience, and exceptional customer service.
Current wording
We are the largest pet e-tailer in the United States, offering virtually every product a pet needs. We launched Chewy in 2011 to bring the best of the neighborhood pet store shopping experience to a larger audience, enhanced by the depth and wide selection of products and services, as well as the around-the-clock convenience, that only e-commerce can offer. We believe that we are the preeminent destination for pet parents as a result of our broad selection of high-quality products and expanded menu of service offerings, which we offer at great prices and deliver with an exceptional level of care and a personal touch. We are the trusted source for pet parents and partners and continually develop innovative ways for our customers to engage with us. We partner with approximately 4,000 of the best and most trusted brands in the pet industry, and we create and offer our own outstanding private brands. Through our websites and mobile applications, we offer our customers approximately 190,000 products, compelling merchandising, an easy and enjoyable shopping experience, and exceptional customer service.
Previous wording
We have a 52- or 53-week fiscal year ending each year on the Sunday that is closest to January 31 of that year. Our 2025 fiscal year ends on February 1, 2026 and is a 52-week year. Our 2024 fiscal year ended February 2, 2025 and was a 53-week year.
Current wording
We have a 52- or 53-week fiscal year ending each year on the Sunday that is closest to January 31 of that year. Our 2026 fiscal year ends on January 31, 2027 and is a 52-week year. Our 2025 fiscal year ended February 1, 2026 and was a 52-week year.
Previous wording
Components of Results of Condensed Consolidated Operations
Current wording
Components of Results of Consolidated Operations
Previous wording
We derive net sales primarily from sales of both third-party brand and private brand pet food, pet products, pet medications and other pet health products, and related shipping fees. Sales of third-party brand and private brand pet food, pet products and shipping revenues are recorded when products are shipped, net of promotional discounts and refunds and allowances. Taxes collected from customers are excluded from net sales. Net sales is primarily driven by growth of new customers and active customers, and the frequency with which customers purchase and subscribe to our Autoship subscription program.
Current wording
Sales of third-party brand and private brand pet food, pet products, pet health and specialty products, and shipping revenues are recorded when products are shipped, net of promotional discounts and refunds and allowances. Taxes collected from customers are excluded from net sales. Net sales is primarily driven by growth of new customers and active customers, and the frequency with which customers purchase and subscribe to our Autoship subscription program.
Previous wording
We generate interest income from our cash and cash equivalents and marketable securities. We incur interest expense in relation to our borrowing facilities, finance leases, and uncertain tax positions.
Current wording
We generate interest income from our cash and cash equivalents and marketable securities. We incur interest expense in relation to our borrowing facilities, finance leases, and unrecognized tax benefits.
Previous wording
Our other income (expense), net consists of changes in the fair value of equity warrants, equity investments, tax indemnification receivables, foreign currency transaction gains and losses, and allowances for credit losses.
Current wording
Our other income (expense), net consists of changes in the fair value of equity warrants, equity investments, tax indemnification receivables, foreign currency transaction gains and losses, and allowances for credit losses on marketable securities.
Previous wording
•Adjusted EBITDA: defined as net income (the most comparable GAAP financial measure) excluding depreciation and amortization; share-based compensation expense and related taxes; income tax provision (benefit); interest income (expense), net; transaction related costs; changes in the fair value of equity warrants; severance and exit costs; and litigation matters and other items that we do not consider representative of our underlying operations.
Current wording
Adjusted EBITDA excludes depreciation and amortization, share-based compensation and related taxes, income tax provision (benefit), interest income (expense), transaction-related costs, changes in the fair value of equity warrants, severance and exit costs, and other items not considered indicative of our core operations. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of net sales.
Previous wording
•Adjusted net income: defined as net income (the most comparable GAAP financial measure) excluding share-based compensation expense and related taxes, releases of valuation allowances associated with deferred tax assets, changes in the fair value of equity warrants, and severance and exit costs.
Current wording
Adjusted net income and Adjusted earnings per share exclude certain non-cash and non-recurring items, including share-based compensation and related taxes, releases of valuation allowances associated with deferred tax assets, transaction-related costs, changes in the fair value of equity warrants, and severance and exit costs. Beginning in the first quarter of 2026, Adjusted net income excludes transaction-related costs prospectively.
Previous wording
•Adjusted EBITDA margin: defined as adjusted EBITDA divided by net sales, as compared to net margin (the most directly comparable GAAP financial measure) defined as net income divided by net sales.
Current wording
We define net margin as net income divided by net sales and adjusted EBITDA margin as adjusted EBITDA divided by net sales.
Previous wording
Net sales for the thirteen weeks ended November 2, 2025 increased by $239.0 million, or 8.3%, to $3.1 billion compared to $2.9 billion for the thirteen weeks ended October 27, 2024. This increase was primarily driven by growth in autoship customer sales, which improved by 13.6%, to $2.6 billion, higher net sales per active customer, which increased $28 or 4.9% to $595, and growth in active customers, which improved by 4.9%, to 21.2 million in the thirteen weeks ended November 2, 2025 compared to the thirteen weeks ended October 27, 2024. This increase was attributable to growth across our hardgoods, specialty, and healthcare businesses.
Current wording
Net sales for the thirteen weeks ended May 3, 2026 increased by $241.2 million, or 7.7%, to $3.4 billion compared to $3.1 billion for the thirteen weeks ended May 4, 2025. This increase was primarily driven by growth in active customers, which improved by 3.6%, to 21.5 million, and higher net sales per active customer, which increased $14, to $597 in the thirteen weeks ended May 3, 2026 compared to the thirteen weeks ended May 4, 2025, driven by growth across our consumables, pet health and specialty products, and hardgoods businesses. On February 2, 2026, the Company completed the acquisition of SmartPak whose net sales were not material for the thirteen weeks ended May 3, 2026 and are included within pet health and specialty products.
Previous wording
Cost of goods sold for the thirteen weeks ended November 2, 2025 increased by $154.7 million, or 7.6%, to $2.2 billion compared to $2.0 billion in the thirteen weeks ended October 27, 2024. This increase was primarily due to higher sales coupled with increased outbound freight and shipping supply costs.
Current wording
Cost of goods sold for the thirteen weeks ended May 3, 2026 increased by $153.6 million, or 7.0%, to $2.3 billion compared to $2.2 billion in the thirteen weeks ended May 4, 2025. This increase was primarily due to higher sales coupled with increased outbound freight and shipping supply costs.
Previous wording
Gross profit for the thirteen weeks ended November 2, 2025 increased by $84.3 million, or 10.0%, to $928.2 million compared to $843.9 million in the thirteen weeks ended October 27, 2024. This increase was primarily due to the year-over-year increase in net sales as described above. Gross margin for the thirteen weeks ended November 2, 2025 was 29.8%, an increase of 50 basis points compared to 29.3% for the thirteen weeks ended October 27, 2024, and is driven by growth in sponsored ads, autoship customer sales as a percentage of net sales increasing 390 basis points to 83.9%, and margin growth across our consumables and healthcare businesses.
Current wording
Gross profit for the thirteen weeks ended May 3, 2026 increased by $87.6 million, or 9.5%, to $1,011.4 million compared to $923.8 million in the thirteen weeks ended May 4, 2025. This increase was primarily due to the year-over-year increase in net sales as described above. Gross margin for the thirteen weeks ended May 3, 2026 was 30.1%, an increase of 50 basis points compared to 29.6% for the thirteen weeks ended May 4, 2025, and is driven by growth in sponsored ads and margin growth across our consumables business.
Previous wording
Selling, general and administrative expenses as a percentage of net sales decreased 50 basis points to 21.3% for the thirteen weeks ended November 2, 2025, compared to 21.8% for the thirteen weeks ended October 27, 2024. Selling, general and administrative expenses for the thirteen weeks ended November 2, 2025 increased by $38.6 million, or 6.2%, to $665.1 million compared to $626.5 million in the thirteen weeks ended October 27, 2024. The majority of the increase is associated with network-wide fulfillment costs, which were collectively incurred to support the overall growth of the business, our pharmacy fulfillment network, and veterinary clinics. This also included a modest increase in other selling, general, and administrative expenses primarily associated with expanded hosting and software infrastructure requirements.
Current wording
Selling, general and administrative expenses for the thirteen weeks ended May 3, 2026 increased by $23.7 million, or 3.6%, to $676.8 million compared to $653.1 million in the thirteen weeks ended May 4, 2025. The majority of the increase is associated with network-wide fulfillment costs, which were collectively incurred to support the overall growth of the business, our pharmacy fulfillment network, and veterinary clinics. This also included an increase in other selling, general, and administrative expenses of $9.61 million attributable to transaction-related costs with the SmartPak acquisition, as well as a modest increase in expanded hosting and software infrastructure requirements.
Previous wording
Advertising and marketing expenses for the thirteen weeks ended November 2, 2025 increased by $6.1 million, or 3.2%, to $197.9 million compared to $191.8 million in the thirteen weeks ended October 27, 2024. Our marketing expenses increased due to additional investment in our lower and upper funnel marketing channels contributing to new customer acquisition and improved customer retention.
Current wording
Advertising and marketing expenses for the thirteen weeks ended May 3, 2026 increased by $12.3 million, or 6.3%, to $206.1 million compared to $193.8 million in the thirteen weeks ended May 4, 2025. Our marketing expenses increased due to additional investment in our lower and upper funnel marketing channels contributing to new customer acquisition and improved customer retention.
Previous wording
Interest income for the thirteen weeks ended November 2, 2025 decreased by $0.4 million, to $3.5 million compared to interest income of $3.9 million in the thirteen weeks ended October 27, 2024. This decrease was primarily due to a decrease in interest income generated from cash and cash equivalents, partially offset by an increase in interest income generated from marketable securities.
Current wording
Interest income for the thirteen weeks ended May 3, 2026 decreased by $0.4 million, to $2.8 million compared to interest income of $3.2 million in the thirteen weeks ended May 4, 2025. This decrease was due to a decrease in interest income generated from marketable securities, which matured during the thirteen weeks ended May 4, 2025.
Previous wording
Our effective tax rate for the thirty-nine weeks ended November 2, 2025 was lower than the U.S. federal statutory rate, primarily due to federal and state research and development credits and tax benefits from share-based compensation, partially offset by state income taxes.
Current wording
Our effective tax rate for the thirteen weeks ended May 3, 2026 was higher than the U.S. federal statutory rate, primarily due to state income taxes and shortfall from share-base compensation partially offset by federal and state research and development credits.
Previous wording
Income tax provision for the thirteen weeks ended November 2, 2025 decreased by $15.5 million, to $10.1 million compared to income tax provision of $25.6 million in the thirteen weeks ended October 27, 2024, driven primarily by the impact of share-based compensation on pre-tax income.
Current wording
Income tax provision for the thirteen weeks ended May 3, 2026 increased by $21.0 million, to $36.5 million compared to income tax provision of $15.5 million in the thirteen weeks ended May 4, 2025, driven primarily by higher pre-tax income.
Previous wording
We finance our operations and capital expenditures primarily through cash flows generated by operations. Our principal sources of liquidity are expected to be our cash and cash equivalents and our revolving credit facility. Cash and cash equivalents consisted primarily of cash on deposit with banks. Cash and cash equivalents totaled $675.4 million as of November 2, 2025, an increase of $79.6 million from February 2, 2025.
Current wording
We finance our operations and capital expenditures primarily through cash flows generated by operations. Our principal sources of liquidity are expected to be our cash and cash equivalents, marketable securities, and our revolving credit facility. Cash and cash equivalents consisted primarily of cash on deposit with banks. Cash and cash equivalents totaled $485.2 million as of May 3, 2026, a decrease of $374.9 million from February 1, 2026.
Previous wording
We believe that our cash and cash equivalents and availability under our revolving credit facility will be sufficient to fund our working capital, capital expenditure requirements, and contractual obligations for at least the next twelve months. In addition, we may choose to raise additional funds at any time through equity or debt financing arrangements, which may or may not be needed for additional working capital, capital expenditures, share repurchases, or other strategic investments. Our opinions concerning liquidity are based on currently available information. To the extent this information proves to be inaccurate, or if circumstances change, future availability of trade credit or other sources of financing may be reduced and our liquidity could be adversely affected. Our future capital requirements and the adequacy of available funds will depend on many factors, including those described in the section titled “Risk Factors” in Item 1A of our 10-K Report for the fiscal year ended February 2, 2025. Depending on the severity and direct impact of these factors on us, we may be unable to secure additional financing to meet our operating requirements on terms favorable to us, or at all.
Current wording
We believe that our cash and cash equivalents, marketable securities, and availability under our revolving credit facility will be sufficient to fund our working capital, capital expenditure requirements, and contractual obligations for at least the next twelve months. In addition, we may choose to raise additional funds at any time through equity or debt financing arrangements, which may or may not be needed for additional working capital, capital expenditures, share repurchases, or other strategic investments. Our opinions concerning liquidity are based on currently available information. To the extent this information proves to be inaccurate, or if circumstances change, future availability of trade credit or other sources of financing may be reduced and our liquidity could be adversely affected. Our future capital requirements and the adequacy of available funds will depend on many factors, including those described in the section titled “Risk Factors” in Item 1A of our 10-K Report for the fiscal year ended February 1, 2026. Depending on the severity and direct impact of these factors on us, we may be unable to secure additional financing to meet our operating requirements on terms favorable to us, or at all.
Previous wording
Net cash provided by operating activities was $428.2 million for the thirty-nine weeks ended November 2, 2025, which primarily consisted of $183.6 million of net income and $355.2 million of non-cash adjustments, including share-based compensation expense of $225.9 million and depreciation and amortization expense of $94.9 million. These amounts were partially offset by working capital changes of $84.4 million, which were primarily driven by an increase in inventories, accounts receivable, and prepaid expenses and other current assets, as well as a decrease in accrued expenses and other current liabilities. These changes were partially offset by an increase in payables.
Current wording
Net cash provided by operating activities was $108.5 million for the thirteen weeks ended May 3, 2026, which primarily consisted of $94.8 million of net income and $115.9 million of non-cash adjustments, including share-based compensation expense of $66.9 million and depreciation and amortization expense of $37.0 million. These amounts were partially offset by working capital changes of $92.8 million, which were primarily driven by a decrease in accrued expenses and other current liabilities, coupled with an increase in accounts receivable and prepaid expenses and other current assets. These changes were partially offset by a decrease in inventories.
Previous wording
Net cash provided by operating activities was $388.8 million for the thirty-nine weeks ended October 27, 2024, which primarily consisted of $369.9 million of net income, partially offset by $60.9 million of non-cash adjustments such as deferred income tax benefit of $275.7 million, share-based compensation expense of $224.7 million, and depreciation and amortization expense of $85.4 million, and a cash decrease of $23.8 million from working capital. Cash decreases from working capital were primarily driven by an increase in inventories, receivables, and other current assets, partially offset by an increase in payables and other current liabilities.
Current wording
Net cash provided by operating activities was $86.4 million for the thirteen weeks ended May 4, 2025, which primarily consisted of $62.4 million of net income, $120.4 million of non-cash adjustments, such as share-based compensation expense of $74.5 million and depreciation and amortization expense of $30.0 million, partially offset by a cash decrease of $88.8 million from working capital. Cash decreases from working capital were primarily driven by a decrease in other current liabilities and an increase in inventories, receivables, and other current assets, partially offset by an increase in payables.
Previous wording
Net cash used in investing activities was $127.9 million for the thirty-nine weeks ended November 2, 2025, primarily consisting of $97.8 million for capital expenditures related to expanding operations at our Houston, Texas fulfillment center, veterinary clinics, future pharmacy facility capabilities, and investments in our fresh and frozen infrastructure.
Current wording
Net cash used in investing activities was $41.2 million for the thirteen weeks ended May 4, 2025, primarily consisting of $37.7 million for capital expenditures related to expanding operations at our Houston, Texas fulfillment center, veterinary clinics, and future pharmacy facility capabilities.
Previous wording
Net cash used in financing activities was $929.7 million for the thirty-nine weeks ended October 27, 2024, primarily consisting of $875.2 million for repurchases of common stock, $53.7 million for income taxes paid for, net of proceeds from, the parent reorganization transaction, principal repayments of finance lease obligations, and payments for secondary offering costs.
Current wording
Net cash used in financing activities was $25.0 million for the thirteen weeks ended May 4, 2025, primarily consisting of $23.1 million for repurchases of common stock, as well as payments for secondary offering costs, and principal repayments of finance lease obligations.
Previous wording
We have a senior secured asset-based credit facility (the “ABL Credit Facility”), which matures on April 1, 2030 following an amendment entered into on April 1, 2025, and provides for non-amortizing revolving loans in the aggregate principal amount of up to $800 million, subject to a borrowing base comprised of, among other things, inventory and sales receivables (subject to certain reserves). The ABL Credit Facility provides the right to request incremental commitments and add incremental asset-based revolving loan facilities of (i) $250 million, (ii) the amount of permanent reductions of commitments thereunder and (iii) if greater than zero, the amount by which the borrowing base as of the date of incurrence exceeds the commitments thereunder, subject to customary conditions. Borrowings under the ABL Credit Facility bear interest at a rate per annum equal to either a base rate or a term Secured Overnight Financing Rate (“SOFR”) (with no credit spread adjustment) at the Company’s option, plus a margin determined based on the Company's average excess availability, which is either (i) 0.25%, 0.50%, or 0.75% for borrowings at the base rate, or (ii) 1.25%, 1.50%, or 1.75% for SOFR borrowings. We are required to pay a 0.25% per annum commitment fee with respect to the undrawn portion of the commitments, which is generally based on average daily usage of the facility. Based on our borrowing base as of November 2, 2025, which is reduced by standby letters of credit, we had $783.1 million of borrowing capacity under the ABL Credit Facility. As of November 2, 2025 and February 2, 2025, we did not have any outstanding borrowings under the ABL Credit Facility, respectively.
Current wording
We have a senior secured asset-based credit facility (the “ABL Credit Facility”), which matures on April 1, 2030 following an amendment entered into on April 1, 2025, and provides for non-amortizing revolving loans in the aggregate principal amount of up to $800 million, subject to a borrowing base comprised of, among other things, inventory and sales receivables (subject to certain reserves). Based on our borrowing base as of May 3, 2026, which is reduced by standby letters of credit, we had $783.1 million of borrowing capacity under the ABL Credit Facility. As of May 3, 2026 and February 1, 2026, we did not have any outstanding borrowings under the ABL Credit Facility, respectively.
Previous wording
On May 24, 2024, our Board of Directors authorized the Company to repurchase up to $500 million of its Class A common stock, par value $0.01 per share (the “Class A common stock”), and/or Class B common stock, par value $0.01 per share (the “Class B common stock” and together with the Class A common stock, the “common stock”), pursuant to a share repurchase program (the “Repurchase Program”). The actual timing and amount of any share repurchases remains subject to a variety of factors, including stock price, trading volume, market conditions, compliance with applicable legal requirements, and other general business considerations. We are not required to repurchase any specific dollar amount or to acquire any specific number of shares of common stock. The Repurchase Program has no expiration date and may be modified, suspended, or terminated at any time.
Current wording
On April 7, 2026, the Board of Directors approved an increase of $500 million to the Repurchase Program. The actual timing and amount of any share repurchases remains subject to a variety of factors, including stock price, trading volume, market conditions, compliance with applicable legal requirements, and other general business considerations. We are not required to repurchase any specific dollar amount or to acquire any specific number of shares of common stock. The Repurchase Program has no expiration date and may be modified, suspended, or terminated at any time.
Previous wording
During the thirty-nine weeks ended November 2, 2025, 2,767,453 and 2,395,210 shares of Class A common stock were repurchased and subsequently cancelled and retired pursuant to the Repurchase Program and June 2025 Concurrent Stock Repurchase, for a total cost of $101.8 million and $100 million, respectively, excluding the cost of commissions and excise taxes. The authorized value of shares available to be repurchased under the Repurchase Program excludes the cost of commissions and excise taxes and as of November 2, 2025, the remaining value of shares of common stock that were authorized to be repurchased under the Repurchase Program was $304.9 million.
Current wording
During the thirteen weeks ended May 3, 2026, 7,599,226 shares of Class A common stock were repurchased and subsequently cancelled and retired pursuant to the Repurchase Program for a total cost of $200.0 million, excluding the cost of commissions and excise taxes. The authorized value of shares available to be repurchased under the Repurchase Program excludes the cost of commissions and excise taxes and as of May 3, 2026, the remaining value of shares of common stock that were authorized to be repurchased under the Repurchase Program was $550.0 million. As of May 3, 2026, the total unpaid cost of share repurchases was $1.4 million for excise taxes.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
On May 24, 2024, our Board of Directors authorized the Company to repurchase up to $500 million of its Class A common stock, par value $0.01 per share (the “Class A common stock”), and/or Class B common stock, par value $0.01 per share (the “Class B common stock” and together with the Class A common stock, the “common stock”), pursuant to a share repurchase program (the “Repurchase Program”).
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Advertising and marketing expenses for the thirty-nine weeks ended November 2, 2025 increased by $23.2 million, or 4.1%, to $592.3 million compared to $569.1 million in the thirty-nine weeks ended October 27, 2024. Our marketing expenses increased due to additional investment in our lower and upper funnel marketing channels contributing to new customer acquisition and improved customer retention.