RBC Capital provided its outlook ahead of Chewy, Inc. (NYSE:CHWY) Q3 results, scheduled to be announced tomorrow. The analysts expect revenue of $2.44 billion (vs. Street’s $2.46 billion) and adjusted EBITDA of $31 million (vs. Street’s $34 million).
According to the analysts, demand for consumables (which the company over-indexes to) remains strong, which could result in a modest top-line beat driven by price/net revenue per customer. This, paired with management’s current focus on cost management/profitability will likely result in an EBITDA upside.
The analysts remain of the view that the company’s story will get more interesting over the next 1-3 quarters as churn rates normalize and active customers begin to grow again. The analysts expect active customers of 20.5 million (flat quarter-over-quarter) as Numerator Insights data leads them to believe retention rates among the 2020 and 2021 cohorts are still trending below comparable pre-pandemic levels.