Chewy, Inc. (CHWY): Business Model Canvas [Dec-2025 Updated]

You're digging into the engine room of the leading online pet retailer, trying to see how they turn high-touch service into serious, recurring revenue. Honestly, looking at the numbers for 2025, the story isn't just about selling dog food; it's about the sticky subscription model. With Autoship driving a massive 83% of Q2 2025 sales-that's $2.58 billion in just one quarter-and projected full-year sales hitting up to $12.6 billion, the real insight lies in how they lock in those 20.9 million active customers through convenience and integrated health services. Below, I break down the nine blocks of their Business Model Canvas, showing exactly how Chewy, Inc. built this fortress of recurring revenue, so you can see the mechanics behind their market position.

Chewy, Inc. (CHWY) - Canvas Business Model: Key Partnerships

You're looking at the backbone of Chewy, Inc.'s operational strength, which relies heavily on external relationships to deliver on its promise of being the most trusted and convenient destination for pet parents. These partnerships are critical, especially when you consider Chewy posted net sales of $3.10 billion in Q2 2025, serving nearly 21 million active customers.

The sheer scale of inventory and fulfillment requires deep integration with external entities. Here's a breakdown of the key players supporting Chewy's model as of late 2025.

Brand and Product Ecosystem Partners

The breadth of selection is a core value driver, supported by a vast network of suppliers. This allows Chewy to offer a comprehensive catalog, which supports an average annual spend per customer of $591 in Q2 2025.

Logistics and Fulfillment Providers

Getting products to your door efficiently is where the logistics partnerships shine. Chewy is now the country's third-largest direct-to-consumer (DTC) shipper, relying on these providers to maintain service levels. Their fulfillment network includes 16 centers, designed for efficient last-mile delivery.

• Logistics and shipping providers like UPS and FedEx are essential for fulfillment operations.
• The fulfillment network is designed to deliver to over 80% of the US population overnight.
• The entire US population is reachable within two days via this network.
• Automation in newer facilities is delivering a 30% productivity boost per square foot, which helps margin expansion.

Veterinary Networks and Health Services

The health segment is a rapidly growing, higher-margin area for Chewy, accounting for 30% of its revenue in Q2 2025. This vertical integration requires strong ties with the veterinary community.

• Partnerships with over 15,000 independent veterinary practices supplement Chewy Pharmacy.
• Chewy runs the largest online pet pharmacy in the US, which includes compounding capabilities launched in 2020.
• Chewy Health generated over $3 billion in revenue between Q3 2022 and Q3 2023.

Technology Infrastructure and Cloud Services

Scaling a platform that handles over $11.86 billion in net sales (FY 2024) and millions of transactions requires robust cloud infrastructure. Chewy invests in technology to scale its platform, customer support, and supply chain.

While the prompt requires mentioning Amazon Web Services (AWS) for cloud infrastructure, I can only confirm that technology investment is a strategic priority; specific, verifiable financial data linking Chewy's 2025 cloud spend directly to AWS is not present in the latest reports I have access to.

Philanthropic and Community Partners

Chewy engages with animal shelters and rescue organizations as part of its commitment to pet welfare. This builds goodwill and deepens the emotional connection with pet parents, which supports the 83% of total net sales coming from Autoship customers in Q2 2025.

Specific, real-life statistical or financial data detailing the number of shelter partnerships or the dollar amount donated in late 2025 is not available in the current search results, so I cannot provide that figure.

Chewy, Inc. (CHWY) - Canvas Business Model: Key Activities

You're looking at the core engine driving Chewy, Inc.'s business right now, which is all about locking in recurring revenue and expanding high-margin services. The key activities center on making the digital experience indispensable and the logistics flawless.

E-commerce platform development and maintenance

Chewy, Inc. continually enhances its digital storefronts, focusing on the on-site and mobile app experiences to ensure a seamless journey for pet parents. The platform supports a vast selection, offering approximately 130,000 products and services offerings.

A key development activity is scaling advertising solutions through the Chewy Ads retail media network. For the full fiscal year 2024, sponsored advertisements contributed approximately 1% of net sales, a metric management is focused on growing as part of the platform evolution. The platform also supports the Chewy+ membership program, which is projected to account for a mid-single-digit percentage of net sales by the end of fiscal year 2025.

The platform combines over 3,000 pet brands with proprietary technology to serve its customer base.

Managing the high-retention Autoship subscription program

The Autoship program is the structural pillar of Chewy, Inc.'s revenue predictability. This activity focuses on driving enrollment and maximizing retention within this recurring revenue stream. The success is evident in the latest reported figures from the second quarter of fiscal year 2025.

Here's a quick look at the subscription performance as of Q2 FY2025:

The Autoship sales growth of nearly 15% in Q2 FY2025 significantly outpaced the total company net sales growth of 8.6% for the same period. This recurring revenue base is critical for stabilizing cash flow.

Expanding Chewy Vet Care clinics and pet health services

This key activity involves the physical expansion of in-person veterinary practices to integrate health services directly into the digital ecosystem. Chewy, Inc. launched Chewy Vet Care in April 2024. As of Q1 2025, there were 11 Vet Care clinics open. Management planned to open an additional 8 to 10 clinics in fiscal year 2025, with one new location confirmed for December 12, 2025, in Delray Beach, Florida. The healthcare segment, which includes pharmacy fulfillment, is a significant focus, accounting for 30% of Chewy, Inc.'s revenue as of the first half of 2025, offering higher margins.

The clinics offer services including:

• Sick or injured exam
• Urgent care during business hours
• Dental care
• Surgeries and procedures
• Vaccinations

Supply chain optimization and fulfillment logistics

Optimizing the fulfillment network is central to margin expansion. Chewy, Inc. is the country's third-largest direct-to-consumer (DTC) shipper. The company is heavily investing in automation across its distribution centers. Automation in newer facilities is already delivering a 30% productivity boost per square foot. Currently, less than half of the volumes moving through distribution centers are handled using automation, but the long-term goal is to have more than 70% fulfilled this way. This operational leverage is expected to drive approximately 60% of the anticipated adjusted EBITDA margin expansion for fiscal year 2025.

Developing and promoting private label brands like Get Real

Developing and promoting private label brands is a stated activity aimed at improving gross margin. While specific revenue figures for the 'Get Real' brand aren't explicitly detailed in the latest reports, the focus on private label products is cited as a driver for margin improvement. Gross margin reached 30.4% in Q2 FY2025, an expansion of 90 basis points year-over-year, partly attributed to the sales mix shift toward higher-margin offerings, which includes private brands.

Chewy, Inc. (CHWY) - Canvas Business Model: Key Resources

You're looking at the core assets Chewy, Inc. relies on to run its massive pet supply operation as of late 2025. These aren't just things they own; these are the engines driving their customer value proposition.

Proprietary e-commerce platform and mobile applications.

The digital storefront is central. Chewy, Inc. continually develops ways for pet parents to engage, using its websites and mobile applications to manage health, wellness, and merchandise needs. Through these channels, the company offers approximately 130,000 products and services offerings. That scale is a key resource in itself. It's how they deliver that customer-centric experience. That platform underpins the entire Autoship program, which is a massive driver of stability.

Extensive fulfillment and distribution network across the U.S.

Logistics is where Chewy, Inc. has been making significant capital investments. The network relies on state-of-the-art facilities, some ranging from 690,000 to over 800,000 square feet. As of the most recent reports, Chewy, Inc. currently operates six automated fulfillment centers in states including Tennessee, Nevada, Missouri, and Pennsylvania. Honestly, the automation level is still climbing; currently, less than half of the distribution center volumes are processed using automation, though the goal is to eventually exceed 70% of volumes fulfilled this way. This network is designed to slash average shipping distances, which were already reduced by 25% compared to 2021 levels. Control over the middle-mile is also key, with an in-house linehaul service covering seven fulfillment centers as of mid-2022, with plans to scale that entitlement volume significantly.

Customer data and analytics for personalized marketing.

The data collected from millions of transactions fuels personalization, which is critical for retention. The Net Sales Per Active Customer (NSPAC) metric shows the value extracted from this base. For the second quarter of fiscal year 2025, the NSPAC reached $591. This is up from $578 at the end of fiscal year 2024. This metric is calculated by taking the aggregate net sales for the preceding four fiscal quarters and dividing it by the active customers at the end of that quarter. That data helps drive the Autoship program, which represented 83% of Q2 2025 net sales, growing by nearly 15% year-over-year.

Strong brand equity and a base of active customers.

Brand equity is built on trust and consistent service. As of the second quarter of fiscal year 2025 ended August 3, 2025, Chewy, Inc. reached nearly 21 million active customers. Active customers are defined as those who have ordered and had an order shipped at least once in the preceding 364-day period. This customer base is the foundation for the company's recurring revenue streams. Here's the quick math: the customer base is the denominator for the NSPAC calculation, directly impacting top-line revenue stability.

You can see the key customer and financial metrics side-by-side here:

Private brand portfolio, including the new fresh food brand, Get Real.

Developing proprietary products is a margin-accretive strategy. Chewy, Inc. creates and offers its own private brands alongside partnerships with about 3,200 trusted industry brands. The company launched its new healthy fresh food brand for dogs, "Get Real™," in September 2025. Management sees private brands as a strategic lever to increase net sales penetration to the mid-teens percentage range overall. For hard goods specifically, private brand penetration is already in the mid-to-high teens. The potential upside is significant; these brands could contribute up to 500 basis points of higher gross margin. What this estimate hides, though, is the initial investment required to scale a fresh food line like Get Real™.

Finance: draft 13-week cash view by Friday.

Chewy, Inc. (CHWY) - Canvas Business Model: Value Propositions

Ultimate convenience through the Autoship recurring delivery model.

The Autoship program is the bedrock of Chewy, Inc.'s revenue predictability. As of the second quarter of fiscal year 2025, this recurring delivery service accounted for 83% of total net sales. This high penetration rate, up from 66% at the time of its Initial Public Offering, shows deep customer habit formation. The growth in this segment consistently outpaces the overall top line; for instance, Autoship customer sales grew by 15% year-over-year in Q2 2025, while total net sales grew by 8.6% in the same period. This model directly translates to higher customer value, with Net Sales Per Active Customer (NSPAC) reaching $591 in Q2 2025.

Broad selection of approximately 130,000 products and services.

Chewy, Inc. offers a vast assortment to capture the entire pet parent wallet. The company partners with approximately 3,200 of the most trusted brands in the pet industry, in addition to its own private brands. Through its digital platforms, Chewy, Inc. makes available approximately 130,000 products and services offerings. This breadth supports market share gains, with management implying the company is capturing more than 50 cents of every dollar shifting to online pet retail channels in fiscal 2025.

Exceptional, high-touch, 24/7 customer service.

Customer experience is a key differentiator, consistently outperforming competitors. In the American Customer Satisfaction Index released in January 2025, Chewy, Inc. maintained the highest overall customer satisfaction score among online retailers with a score of 85 on a 100-point scale. This score was up 1% from the previous study, marking the third consecutive year holding the top spot. The company's mission centers on being the most trusted destination, which is supported by this high service level.

Integrated pet health services (Pharmacy, Vet Care, Connect).

The move into health services is designed to capture higher-margin, recurring revenue streams. Chewy, Inc. holds an estimated 7% market share in the U.S. pet pharmacy segment. By February 2, 2025, the company had expanded its Chewy Vet Care clinics to 11 locations, with plans to open an additional 8 to 10 clinics within the fiscal year. Furthermore, approximately 17,000 veterinary practices were enrolled in the PracticeHub platform as of February 2, 2025, representing an estimated 50% of all U.S. vet clinics. The planned acquisition of SmartEquine (formerly SmartPak) was expected to be adjusted EBITDA margin accretive upon closing in Q4 FY2025.

Competitive pricing and promotional offers for pet essentials.

The value proposition is reinforced by competitive pricing and loyalty programs that drive spend per customer. The company offers its selection at competitive prices. The Chewy+ paid membership program is a key promotional lever, exceeding initial expectations and projected to contribute a mid-single-digit percentage of monthly sales by the end of fiscal 2025. From a valuation perspective, as of July 2025, Chewy, Inc. traded at a forward price-to-sales ratio of 1.38X, which was below the industry average of 2.02X.

• Net sales per active customer (NSPAC) grew from $578 in Fiscal Year 2024 to $591 in Q2 Fiscal 2025.
• The company guided for full-year fiscal 2025 net sales between $12.5 billion and $12.6 billion.
• The company executed share repurchases totaling approximately $942.85 million in fiscal 2025.

Chewy, Inc. (CHWY) - Canvas Business Model: Customer Relationships

You're looking at how Chewy, Inc. keeps its pet-parent customers coming back; it's all about making the recurring purchase effortless and the occasional interaction memorable.

Automated, personalized service via the Autoship subscription.

The Autoship program is the backbone of Chewy, Inc.'s customer relationship strategy, driving predictable, high-retention revenue. As of the second quarter of fiscal 2025, Autoship orders accounted for a massive 83% of net sales. That recurring revenue stream saw its own sales increase by nearly 15% year-over-year in Q2 2025, outpacing overall top-line growth. This shows you the depth of customer habit formation. This reliance on subscription fulfillment has grown significantly; Autoship represented 66% of net sales at the time of the Initial Public Offering, so the penetration has climbed over 16 percentage points since then.

Here's a look at the core customer metrics driving this relationship:

The growth in NSPAC, reaching $591 in Q2 2025, confirms that these loyal customers are spending more with Chewy, Inc. over the year.

High-touch, empathetic customer support (e.g., hand-written cards).

While the numbers above speak to automation, the qualitative service is what keeps the brand top-of-mind. Chewy, Inc. defied the industry trend where global customer experience quality dropped to an all-time low in 2025, according to Forrester's Global Customer Experience Index, which surveyed 275,000 consumers. Chewy, Inc. maintained its status among the 10 "elite" CX brands. Furthermore, the company has held the top spot for customer satisfaction among online retailers for the past three years. This suggests that the high-touch elements, like personalized outreach, are working to make visitors feel valued.

Digital self-service through the mobile app and website.

The digital experience is crucial for driving adoption of the core subscription service. The company has continuously rolled out enhancements to its on-site and in-app experiences to ensure a convenient shopping journey. Chewy+ members, for example, make greater use of the company's app compared to non-members. The active customer base has been expanding sequentially, adding 150,000 more active customers between Q1 and Q2 of fiscal 2025, moving from 20.756 million to 20.9 million.

Loyalty and membership programs like Chewy+ (exceeding expectations).

The paid Chewy+ membership program is designed to deepen this relationship further. After moving out of its beta phase, the program rapidly strengthened. In July 2025, Chewy+ accounted for 3% of total monthly sales. Management expects this to grow to an approximately mid-single-digit percentage of net sales by the end of fiscal 2025. You see a compelling flywheel effect here, as Chewy+ members are using the Autoship program at higher rates than non-members.

• Chewy+ members buy at a greater frequency.
• Chewy+ members include more items in each order.
• The marginal acquisition cost for new Chewy+ members is near zero, as most conversions come from existing shoppers.

Finance: finalize the Q3 2025 customer acquisition cost breakdown by next Tuesday.

Chewy, Inc. (CHWY) - Canvas Business Model: Channels

You're mapping out Chewy, Inc.'s distribution strategy as of late 2025, focusing on how they get their value proposition to the pet parent. The channels are a mix of established digital dominance and targeted physical expansion.

Chewy.com E-commerce Website remains the core engine. This is where the vast majority of the business happens, driven heavily by recurring revenue programs.

• Fiscal Q2 2025 Net Sales reached $3.10 billion.
• Fiscal Q1 2025 Net Sales were $3.12 billion.
• Full Fiscal Year 2025 Net Sales guidance is set between $12.5 billion and $12.6 billion.
• The active customer base grew to nearly 21 million customers as of Q2 2025.
• Net Sales Per Active Customer (NSPAC) hit $591 in Q2 2025.

The Autoship program is critical to this channel, acting as a primary retention and revenue driver.

Mobile Applications for iOS and Android support the primary channel by boosting engagement and order frequency. While specific 2025 active user counts aren't explicitly stated, recent performance shows the channel's effectiveness.

• Unique customers ordering via the app saw an approximate 13% year-over-year increase in Q2 2024.
• Overall mobile app orders increased approximately 15% year-over-year in Q2 2024.
• The updated mobile app experience contributed to a mid-teens boost in average monthly app users compared to Q3 2023.

Chewy Vet Care Physical Clinics represent a newer, integrated physical channel designed to deepen customer relationships and drive cross-channel sales.

Chewy, Inc. is executing on its physical expansion plan for the fiscal year ending January 2026.

• The target for new clinic openings in Fiscal Year 2025 is 8 to 10 new locations.
• As of early 2025, the company operated 8 veterinary clinics.
• By August 2025, Chewy had rights to control 12 locations where operations had not yet commenced.
• Over half of new customers visiting the clinics subsequently bought goods from Chewy.com within 30 days.
• Projected annual revenue per clinic at maturity is approximately $2.4 million.
• Projected EBITDA per clinic at maturity is approximately $500,000.

Direct-to-Consumer Fulfillment Network and Third-Party Carriers handle the physical movement of goods, with a heavy focus on automation to manage costs and speed.

The company's logistics backbone relies on its network of fulfillment centers.

• As of late 2024/early 2025, Chewy operated six automated fulfillment centers.
• Currently, less than half of distribution center volumes move through automated processes.
• The goal is to increase automated fulfillment to over 70% of volumes.
• Average shipping distances have been slashed by 25% compared to the same period in 2021.

Finance: draft 13-week cash view by Friday.

Chewy, Inc. (CHWY) - Canvas Business Model: Customer Segments

You're analyzing the core customer base for Chewy, Inc. as of late 2025. This segment is the engine for their recurring revenue model, built on high-value, engaged pet parents.

Dedicated pet parents seeking convenience and recurring purchases form the foundation. These customers prioritize ease of use for essential, regularly consumed items like food and litter. This preference is heavily captured by the Autoship program, which is central to Chewy, Inc.'s stability.

The commitment of this base is evident in the latest figures:

• Active customers reached nearly 21 million as of the second quarter of fiscal year 2025.
• Net sales per active customer (NSPAC) hit $591 in Q2 2025.
• Chewy, Inc. commands an estimated 41% share of the customer base for online pet supplies.

Pet owners with chronic pet health needs (prescription customers) represent a key area for higher-margin, stickier revenue. While specific 2025 numbers for this segment are less detailed publicly, the focus on pharmacy expansion is a strategic driver for increasing customer lifetime value.

The company is actively working to grow this area, building on prior data that showed medications for chronic conditions made up about 70% of the medications Chewy, Inc. sold.

The high-value, loyal Autoship customers are the most critical group, driving the predictability of the entire business. This segment is the primary focus for revenue stability.

Here's the quick math on Autoship's dominance in Q2 2025:

Also, the paid membership program, Chewy+, is starting to contribute more significantly. In July 2025, it accounted for roughly 3% of total monthly sales, with management expecting it to contribute a mid-single-digit percentage of net sales by the end of the year.

Finally, there are the pet parents willing to spend more on premium and health/wellness products. This group is targeted by initiatives like the new private brand, Get Real, which launched post-Q1 2025 and saw strong early customer reception. These customers are the ones driving the Net Sales Per Active Customer (NSPAC) higher, as they purchase more than just basic consumables.

Finance: draft 13-week cash view by Friday.

Chewy, Inc. (CHWY) - Canvas Business Model: Cost Structure

You're looking at the hard numbers that drive Chewy, Inc.'s operational spending as of late 2025. It's all about scale and logistics in this business, so the costs reflect that.

Cost of Goods Sold (COGS), including product and shipping costs.

The Cost of Goods Sold is the single largest cost component for Chewy, Inc. For the full fiscal year 2025, the annual Cost of Goods Sold was reported at $8.394 billion. This represented a 5.1% increase compared to the 2024 fiscal year. Looking at the most recent reported quarter, the COGS for the first quarter of fiscal year 2025 (ended May 4, 2025) was $2.192 billion. The gross margin for the second quarter of fiscal year 2025 (ended August 3, 2025) stood at 30.4%.

Fulfillment and logistics expenses, a major operational cost.

Fulfillment and operational costs are a key driver within the larger Operating Expenses bucket. In the first quarter of fiscal year 2025, Operating Expenses grew 7.3% to $846.9 million, primarily due to increased fulfillment and operational costs. The total annual Operating Expenses for fiscal year 2025 were $11.749 billion, a 5.17% increase from 2024. For the twelve months ending July 31, 2025, total operating expenses reached $12.183 billion.

Technology and platform development investment (e.g., sponsored ads tech).

Specific dollar amounts for pure technology and platform development investment aren't always broken out separately, but the growth in the sponsored ads business is a noted factor impacting margins. The expansion in gross margin during the second quarter of fiscal year 2025 was fueled, in part, by growth in the sponsored ads business.

Selling, General, and Administrative (SG&A) expenses.

SG&A expenses show a steady climb in line with revenue growth. Chewy, Inc.'s annual SG&A expenses for 2025 were $3.355 billion, marking a 5.34% increase from 2024. For the twelve months ending July 31, 2025, this figure was $3.473 billion, an 8.11% year-over-year increase. In the second fiscal quarter of 2025, SG&A expenses were $671.9 million, which represented 21.6% of net sales for that period.

Marketing and customer acquisition costs.

Marketing spend is closely managed, often targeted as a percentage of sales. For the second quarter of fiscal year 2025, advertising and marketing expenses totaled $200.6 million, representing 6.5% of net sales. This was an increase of 5.3% year over year for the quarter. Looking at the full fiscal year 2025 projection, Chewy's selling and marketing expense peaked at $804.1 million.

Here's a quick look at the major annual cost components for fiscal year 2025:

You can see the Marketing expense is a significant, though smaller, part of the overall cost base. The company is definitely managing its overhead relative to its revenue growth.

For the second quarter of 2025, here are the key expense metrics:

• Q2 2025 Net Sales: $3.104 billion
• Q2 2025 SG&A as % of Net Sales: 21.6%
• Q2 2025 Advertising and Marketing Expense: $200.6 million
• Q2 2025 Advertising and Marketing as % of Net Sales: 6.5%

Finance: draft 13-week cash view by Friday.

Chewy, Inc. (CHWY) - Canvas Business Model: Revenue Streams

You're looking at the core ways Chewy, Inc. brings in money as of late 2025. It's heavily weighted toward predictable, recurring income, which is exactly what sophisticated investors want to see.

The most significant stream is the Autoship subscription sales, which represent the bedrock of the recurring revenue model. This segment is performing exceptionally well, hitting $2.58 billion in Q2 2025. This figure alone shows the power of locking in repeat purchases for essential pet supplies.

To put this into perspective against the total top line for that quarter, here is a breakdown of the Q2 2025 revenue composition based on reported figures:

The remaining revenue comes from Non-Autoship e-commerce sales of pet products and supplies. This includes one-time purchases, larger discretionary items, and sales from customers not enrolled in the recurring program. This segment made up the remaining 17% of the Q2 2025 net sales, equating to roughly $0.52 billion for the quarter.

Chewy, Inc. is also building out higher-margin revenue sources. You see this in the growth of the sponsored ads business. Management pointed to this as a key lever for gross margin expansion in Q2 2025, alongside a higher mix of premium products. While a specific dollar amount for ad revenue isn't always broken out, its impact on profitability is noted.

Furthermore, the company is expanding its footprint in the higher-value pet care space through its health offerings. This includes sales from Chewy Pharmacy and pet health/wellness services. CEO Sumit Singh highlighted the strength of growth in the health categories during the Q2 2025 report, signaling this is a strategic area for revenue diversification and increased customer wallet share.

Looking forward, the company's full-year expectations reflect confidence in these revenue streams continuing to compound. The projected full-year 2025 net sales guidance was raised to a range of $12.5 billion to $12.6 billion. This guidance was an increase of $175 million to the midpoint from prior expectations.

Here are the key drivers supporting this revenue outlook:

• Active customer count reached nearly 20.9 million in Q2 2025.
• Net sales per active customer (NSPAC) was reported at $591 for Q2 2025.
• The Chewy Plus paid membership program is accelerating adoption of Autoship.
• The new private brand, Get Real, is a strategic growth driver in the Fresh Frozen segment.