Chewy, Inc. (CHWY) saw its stock decline on December 4, 2024, closing at $33.47, down 0.45% from the previous day's close of $33.62. The stock opened at $30.81 and experienced significant volatility, reaching a low of $29.90 before recovering slightly. The trading volume was notably high at 16,993,786 shares, nearly three times the average daily volume, indicating heightened investor activity. The decline was primarily driven by the company's third-quarter financial results, which revealed a profit miss and a decrease in active customers. Despite a 4.8% y/y increase in net sales to $2.88 billion, Chewy's EPS of $0.20 fell short of the consensus estimate of $0.23, raising concerns about its profitability trajectory. The market's reaction was negative, overshadowing the company's positive full-year guidance and recent upgrades from major financial institutions.
The earnings report highlighted a decline in active customers, which, coupled with the profit miss, contributed to the stock's downward pressure. Although Chewy added about 200,000 net new customers, reaching a total of 20.2 million, the overall sentiment was dampened by the earnings shortfall. The company's inclusion in the S&P MidCap 400 Index and recent analyst upgrades failed to offset the negative impact of the earnings miss.