Chewy, (CHWY) – Get Report the online pet products provider, reported that its fiscal-third-quarter net loss narrowed on 45% higher revenue, with both figures stronger than Wall Street analysts expected.
For the quarter ended Nov. 1 the Dania Beach, Fla., company reported a loss of 8 cents a share compared with a loss of 20 cents in the year-earlier quarter.
Revenue reached $1.78 billion from $1.23 billion.
A survey of analysts by FactSet produced consensus estimates of a net loss of 13 cents a share on revenue of $1.72 billion.
At last check Chewy shares slipped 0.8% at $78.55. They finished regular trading on Tuesday up 5.8% at $79.15.
Operating expenses jumped 31% to $486.9 million from $370.6 million a year earlier.
“Cost headwinds included new fulfillment-center launches, bonuses and incentives for fulfillment-center and customer-service team members, residual covid-19 costs, and increased marketing expenses as a recovering economy and political campaigns drove a surge in digital advertising that increased channel input costs in the quarter,” Chewy said.
Gross-profit margin was 25.5%, up 1.8 percentage points from a year earlier.
In late November MarketWatch columnist Jeff Reeves recommended Chewy shares, saying the company was “capitalizing on the dual megatrends of reliance on online shopping and the never ending upward climb in what Americans will spend on their dogs and cats.”
In mid-November Chewy, in an effort to make medications more affordable, said it would offer compounded medications customized to the needs of specific pets.
In addition to the pharmacy products Chewy carries, pet owners can order customized prescription medications, created to the specifications set out by their veterinarians.
The compounding ingredients the company will use “are sourced from Food and Drug Administration-registered manufacturers and distributors, and all customized medications are prepared by licensed compounding pharmacists,” Chewy said.