Chewy (CHWY) 10-Q 1 Jun 22 2022 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	May 01, 2022	May 25, 2022
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Period End Date	May 1, 2022
Document Transition Report	false
Entity File Number	001-38936
Entity Registrant Name	CHEWY, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	90-1020167
Entity Address, Address Line One	1855 Griffin Road
Entity Address, Address Line Two	Suite B-428
Entity Address, City or Town	Dania Beach
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33004
City Area Code	786
Local Phone Number	320-7111
Title of 12(b) Security	Class A Common Stock, par value $0.01 per share
Trading Symbol	CHWY
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Emerging Growth Company	false
Entity Shell Company	false
Amendment Flag	false
Fiscal Period Focus	Q1
Fiscal Year Focus	2022
Entity Central Index Key	0001766502
Current Fiscal Year End Date	--01-29
Common Class A
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		109,418,531
Common Class B
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		311,188,356

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	May 01, 2022	Jan. 30, 2022
Current assets:
Cash and cash equivalents	$ 604,761	$ 603,079
Accounts receivable	133,233	123,510
Inventories	598,200	560,430
Prepaid expenses and other current assets	53,185	36,513
Total current assets	1,389,379	1,323,532
Property and equipment, net	403,942	367,166
Operating lease right-of-use assets	371,925	372,693
Other non-current assets	24,798	22,890
Total assets	2,190,044	2,086,281
Current liabilities:
Trade accounts payable	956,994	883,316
Accrued expenses and other current liabilities	740,641	761,563
Total current liabilities	1,697,635	1,644,879
Operating lease liabilities	413,828	410,168
Other long-term liabilities	19,971	16,498
Total liabilities	2,131,434	2,071,545
Commitments and contingencies (Note 4)
Stockholders’ equity:
Preferred stock, $0.01 par value per share, 5,000,000 shares authorized, no shares issued and outstanding as of May 1, 2022 and January 30, 2022	0	0
Additional paid-in capital	2,046,707	2,021,310
Accumulated deficit	(1,992,303)	(2,010,775)
Total stockholders’ equity	58,610	14,736
Total liabilities and stockholders’ equity	2,190,044	2,086,281
Common Class A
Stockholders’ equity:
Common stock, value	1,094	1,089
Common Class B
Stockholders’ equity:
Common stock, value	$ 3,112	$ 3,112

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	May 01, 2022	Jan. 30, 2022
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, authorized (in shares)	5,000,000	5,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common Class A
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	1,500,000,000	1,500,000,000
Common stock, issued (in shares)	109,418,531	108,918,032
Common stock, outstanding (in shares)	109,418,531	108,918,032
Common Class B
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	395,000,000	395,000,000
Common stock, issued (in shares)	311,188,356
Common stock, outstanding (in shares)	311,188,356

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	May 01, 2022	May 02, 2021
Income Statement [Abstract]
Net sales	$ 2,428,327	$ 2,135,178
Cost of goods sold	1,760,507	1,545,402
Gross profit	667,820	589,776
Operating expenses:
Selling, general and administrative	504,283	406,220
Advertising and marketing	144,721	144,435
Total operating expenses	649,004	550,655
Income from operations	18,816	39,121
Interest expense, net	(344)	(402)
Income before income tax provision	18,472	38,719
Income tax provision	0	0
Net income	$ 18,472	$ 38,719
Earnings per share attributable to common Class A and Class B stockholders:
Basic (in dollars per share)	$ 0.04	$ 0.09
Diluted (in dollars per share)	$ 0.04	$ 0.09
Weighted-average common shares used in computing earnings per share:
Basic (in shares)	420,406	415,248
Diluted (in shares)	426,710	427,597

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands	Total	Class A and Class B Common Stock	Additional Paid-in Capital	Accumulated Deficit
Balance at beginning of period (in shares) at Jan. 31, 2021		415,046
Balance at beginning of period at Jan. 31, 2021	$ (2,004)	$ 4,150	$ 1,930,804	$ (1,936,958)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	23,106		23,106
Vesting of share-based compensation awards (in shares)		349
Vesting of share-based compensation awards	0	$ 4	(4)
Tax sharing agreement with related parties	9,201		9,201
Net income	38,719			38,719
Balance at end of period (in shares) at May. 02, 2021		415,395
Balance at end of period at May. 02, 2021	69,022	$ 4,154	1,963,107	(1,898,239)
Balance at beginning of period (in shares) at Jan. 30, 2022		420,106
Balance at beginning of period at Jan. 30, 2022	14,736	$ 4,201	2,021,310	(2,010,775)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	25,794		25,794
Vesting of share-based compensation awards (in shares)		553
Vesting of share-based compensation awards	0	$ 6	(6)
Tax withholdings for share-based compensation awards (in shares)		(53)
Tax withholdings for share-based compensation awards	(2,468)	$ (1)	(2,467)
Tax sharing agreement with related parties	2,076		2,076
Net income	18,472			18,472
Balance at end of period (in shares) at May. 01, 2022		420,606
Balance at end of period at May. 01, 2022	$ 58,610	$ 4,206	$ 2,046,707	$ (1,992,303)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	May 01, 2022	May 02, 2021
Cash flows from operating activities
Net income	$ 18,472	$ 38,719
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	17,340	11,426
Share-based compensation expense	25,794	23,106
Non-cash lease expense	9,109	8,365
Other	234	87
Net change in operating assets and liabilities:
Accounts receivable	(9,723)	(16,866)
Inventories	(37,770)	22,417
Prepaid expenses and other current assets	(14,248)	(27,653)
Other non-current assets	(1,469)	(1,874)
Trade accounts payable	73,678	26,158
Accrued expenses and other current liabilities	2,881	20,535
Operating lease liabilities	(5,338)	(5,223)
Other long-term liabilities	3,473	(831)
Net cash provided by operating activities	82,433	98,366
Cash flows from investing activities
Capital expenditures	(76,021)	(38,882)
Other	(1,400)	0
Net cash used in investing activities	(77,421)	(38,882)
Cash flows from financing activities
Payments for tax withholdings related to vesting of share-based compensation awards	(2,468)	0
(Payments for) proceeds from tax sharing agreement with related parties	(675)	14,968
Principal repayments of finance lease obligations	(187)	(272)
Net cash (used in) provided by financing activities	(3,330)	14,696
Net increase in cash and cash equivalents	1,682	74,180
Cash and cash equivalents, as of beginning of period	603,079	563,345
Cash and cash equivalents, as of end of period	$ 604,761	$ 637,525

Description of Business

Description of Business	3 Months Ended
	May 01, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business	Description of Business Chewy, Inc. and its wholly-owned subsidiaries (collectively “Chewy” or the “Company”) is a pure play e-commerce business geared toward pet products and services for dogs, cats, fish, birds, small pets, horses, and reptiles. Chewy serves its customers through its retail website, www.chewy.com, and its mobile applications and focuses on delivering exceptional customer service, competitive prices, outstanding convenience (including Chewy’s Autoship subscription program, fast shipping, and hassle-free returns), and a large selection of high-quality pet food, treats and supplies, and pet healthcare products. The Company is controlled by a consortium including private investment funds advised by BC Partners and its affiliates, La Caisse de dépôt et placement du Québec, affiliates of GIC Special Investments Pte Ltd, affiliates of StepStone Group LP, and funds advised by Longview Asset Management, LLC (collectively, the “Sponsors”). The Company was controlled by PetSmart LLC (“PetSmart”), a wholly-owned subsidiary of the Sponsors through February 11, 2021.

Basis of Presentation and Signi

Basis of Presentation and Significant Accounting Policies	3 Months Ended
	May 01, 2022
Accounting Policies [Abstract]
Basis of Presentation and Significant Accounting Policies	Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related notes include the accounts of Chewy, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated. The unaudited condensed consolidated financial statements and notes thereto of Chewy, Inc. have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting and, therefore, omit or condense certain footnotes and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) as set forth in the Financial Accounting Standards Board’s (“FASB”) accounting standards codification. In the opinion of management, all adjustments necessary for a fair statement of the financial information, which are of a normal and recurring nature, have been made for the interim periods reported. Results of operations for the quarterly period ended May 1, 2022 are not necessarily indicative of the results for the entire fiscal year. The unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q for the quarterly period ended May 1, 2022 (“10-Q Report”) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 30, 2022 (“10-K Report”). Fiscal Year The Company has a 52- or 53-week fiscal year ending each year on the Sunday that is closest to January 31 of that year. The Company’s 2022 fiscal year ends on January 29, 2023 and is a 52-week year. The Company’s 2021 fiscal year ended January 30, 2022 and was a 52-week year. Significant Accounting Policies Other than policies noted herein, there have been no significant changes from the significant accounting policies disclosed in Note 2 of the “Notes to Consolidated Financial Statements” included in the 10-K Report. Use of Estimates GAAP requires management to make certain estimates, judgments, and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates these estimates and judgments. Actual results could differ from those estimates. Key estimates relate primarily to determining the net realizable value and demand for inventory, useful lives associated with property and equipment and intangible assets, valuation allowances with respect to deferred tax assets, contingencies, self-insurance accruals, evaluation of sales tax positions, and the valuation and assumptions underlying share-based compensation. On an ongoing basis, management evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities. Accrued Expenses and Other Current Liabilities The following table presents the components of accrued expenses and other current liabilities (in thousands): As of May 1, 2022 January 30, 2022 Outbound fulfillment $ 409,550 $ 389,548 Advertising and marketing 86,809 86,285 Payroll liabilities 56,825 70,556 Accrued expenses and other 187,457 215,174 Total accrued expenses and other current liabilities $ 740,641 $ 761,563 Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1-Valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2-Valuations based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3-Valuations based on unobservable inputs reflecting the Company’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. The Company considers all highly liquid investments with an original maturity of 90 days or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value and are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The following is a summary of cash and cash equivalents (in thousands): As of May 1, January 30, Cash $ 452,814 $ 401,119 Level 1 securities: Money market funds 72,000 67,000 Commercial paper 79,947 74,965 U.S. Treasury securities — 59,995 Cash and cash equivalents $ 604,761 $ 603,079 Stockholders’ Equity Conversion of Class B Common Stock On April 12, 2021, Argos Intermediate Holdco I Inc. (“Argos Holdco”), which is controlled by affiliates of BC Partners, converted 6,150,000 shares of the Company’s Class B common stock into Class A common stock and sold such Class A common stock.

Property and Equipment, net

Property and Equipment, net	3 Months Ended
	May 01, 2022
Property, Plant and Equipment [Abstract]
Property and Equipment, net	Property and Equipment, net The following is a summary of property and equipment, net (in thousands): As of May 1, 2022 January 30, 2022 Furniture, fixtures and equipment $ 138,951 $ 132,727 Computer equipment 57,035 55,164 Internal-use software 103,936 95,302 Leasehold improvements 160,748 153,797 Construction in progress 113,961 85,043 574,631 522,033 Less: accumulated depreciation and amortization 170,689 154,867 Property and equipment, net $ 403,942 $ 367,166 Internal-use software includes labor and license costs associated with software development for internal use. As of May 1, 2022 and January 30, 2022, the Company had accumulated amortization related to internal-use software of $39.5 million and $35.1 million, respectively. Construction in progress is stated at cost, which includes the cost of construction and other directly attributable costs. No provision for depreciation is made on construction in progress until the relevant assets are completed and put into use.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	May 01, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Matters Various legal claims arise from time to time in the normal course of business. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. The Company believes that it has adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable. The Company does not believe that the ultimate resolution of any matters to which it is presently a party will have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

Debt

Debt	3 Months Ended
	May 01, 2022
Debt Disclosure [Abstract]
Debt	Debt ABL Credit Facility The Company has a five-year senior secured asset-backed credit facility (the “ABL Credit Facility”) which matures in August 2026 and provides for non-amortizing revolving loans in an aggregate principal amount of up to $500 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 in an aggregate principal amount of up to $300 million, subject to customary conditions. The Company is required to pay a commitment fee of 0.25% with respect to the undrawn portion of the commitments, which is generally based on average daily usage of the facility. Based on the Company’s borrowing base as of May 1, 2022, which is reduced by standby letters of credit, the Company had $450.3 million of borrowing capacity under the ABL Credit Facility. As of May 1, 2022, the Company had no outstanding borrowings under the ABL Credit Facility.

Leases

Leases	3 Months Ended
	May 01, 2022
Leases [Abstract]
Leases	Leases The Company leases all of its fulfillment and customer service centers and corporate offices under non-cancelable operating lease agreements. The terms of the Company’s real estate leases generally range from 5 to 15 years and typically allow for the leases to be renewed for up to three additional five-year terms. Fulfillment and customer service centers and corporate office leases expire at various dates through 2034, excluding renewal options. The Company also leases certain equipment under operating and finance leases. The terms of equipment leases generally range from 3 to 5 years and do not contain renewal options. These leases expire at various dates through 2025. The Company’s finance leases as of May 1, 2022 and January 30, 2022 were not material and were included in property and equipment, net, on the Company’s condensed consolidated balance sheets. The table below presents the operating lease-related assets and liabilities recorded on the condensed consolidated balance sheets (in thousands): As of Leases Balance Sheet Classification May 1, 2022 January 30, 2022 Assets Operating Operating lease right-of-use assets $ 371,925 $ 372,693 Total operating lease assets $ 371,925 $ 372,693 Liabilities Current Operating Accrued expenses and other current liabilities $ 22,189 $ 24,225 Non-current Operating Operating lease liabilities 413,828 410,168 Total operating lease liabilities $ 436,017 $ 434,393 For the thirteen weeks ended May 1, 2022 and May 2, 2021, assets acquired in exchange for new operating lease liabilities were $8.9 million and $46.0 million, respectively. Lease expense primarily relates to operating lease costs. Lease expense for the thirteen weeks ended May 1, 2022 and May 2, 2021 was $21.3 million and $19.0 million, respectively. The aforementioned lease expense was included within selling, general and administrative expenses in the condensed consolidated statements of operations. Cash flows used in operating activities related to operating leases were approximately $18.6 million and $15.3 million for the thirteen weeks ended May 1, 2022 and May 2, 2021, respectively.

Share-Based Compensation

Share-Based Compensation	3 Months Ended
	May 01, 2022
Share-based Payment Arrangement [Abstract]
Share-Based Compensation	Share-Based Compensation 2019 Omnibus Incentive Plan In June 2019, the Company’s board of directors adopted and approved the 2019 Omnibus Incentive Plan (the “2019 Plan”). The 2019 Plan became effective on June 13, 2019 and allows for the issuance of up to 31.9 million shares of Class A common stock. No awards may be granted under the 2019 Plan after June 2029. The 2019 Plan provides for the grant of stock options, including incentive stock options, non-qualified stock options, restricted stock, dividend equivalents, stock payments, restricted stock units, performance shares, other incentive awards, stock appreciation rights, and cash awards (collectively “awards”). The awards may be granted to the Company’s employees, consultants, and directors, and the employees and consultants of the Company’s affiliates and subsidiaries. Service and Performance-Based Awards The Company granted restricted stock units which vested upon satisfaction of both service-based vesting conditions and company performance-based vesting conditions (“PRSUs”), subject to the employee’s continued employment with the Company through the applicable vesting date. The Company recorded share-based compensation expense for PRSUs over the requisite service period and accounted for forfeitures as they occur. Service-Based Awards The Company granted restricted stock units with service-based vesting conditions (“RSUs”) which vested subject to the employee’s continued employment with the Company through the applicable vesting date. The Company recorded share-based compensation expense for RSUs on a straight-line basis over the requisite service period and accounted for forfeitures as they occur. Service and Performance-Based Awards Activity The following table summarizes the activity related to the Company’s PRSUs for the thirteen weeks ended May 1, 2022 (in thousands, except for weighted-average grant date fair value): Number of PRSUs Weighted-Average Grant Date Fair Value Unvested and outstanding as of January 30, 2022 6,573 $ 36.16 Granted 86 $ 43.59 Vested (136) $ 28.99 Forfeited (113) $ 37.87 Unvested and outstanding as of May 1, 2022 6,410 $ 36.38 The total fair value of PRSUs that vested during the thirteen weeks ended May 1, 2022 was $5.7 million. As of May 1, 2022, total unrecognized compensation expense related to unvested PRSUs was $19.3 million and is expected to be recognized over a weighted-average expected performance period of 1.4 years. The fair value for PRSUs with a Company performance-based vesting condition is established based on the market price of the Company’s Class A common stock on the date of grant. Service-Based Awards Activity The following table summarizes the activity related to the Company’s RSUs for the thirteen weeks ended May 1, 2022 (in thousands, except for weighted-average grant date fair value): Number of RSUs Weighted-Average Grant Date Fair Value Unvested and outstanding as of January 30, 2022 3,207 $ 68.96 Granted 5,824 $ 43.59 Vested (417) $ 76.66 Forfeited (256) $ 64.14 Unvested and outstanding as of May 1, 2022 8,358 $ 51.04 The total fair value of RSUs that vested during the thirteen weeks ended May 1, 2022 was $18.8 million. As of May 1, 2022, total unrecognized compensation expense related to unvested RSUs was $392.0 million and is expected to be recognized over a weighted-average expected performance period of 3.3 years. The fair value for RSUs is established based on the market price of the Company’s Class A common stock on the date of grant. As of May 1, 2022, there were 0.8 million additional shares of Class A common stock reserved for future issuance under the 2019 Plan. Share-Based Compensation Expense Share-based compensation expense is included within selling, general and administrative expenses in the condensed consolidated statements of operations. The Company recognized share-based compensation expense as follows (in thousands): 13 Weeks Ended May 1, May 2, PRSUs $ 4,639 $ 14,112 RSUs 21,155 8,994 Total share-based compensation expense $ 25,794 $ 23,106

Income Taxes

Income Taxes	3 Months Ended
	May 01, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Chewy is subject to taxation in the U.S. and various state, local, and foreign jurisdictions. Income taxes as presented in the Company’s condensed consolidated financial statements have been prepared based on Chewy’s separate return method. The Company’s losses and tax attributes were previously included in PetSmart’s consolidated tax return activity at the U.S. federal level and any applicable state and local level. The Company did not have a current or deferred provision for income taxes for any taxing jurisdiction during the thirteen weeks ended May 1, 2022, and May 2, 2021. Additionally, the Company maintained a full valuation allowance on its net deferred tax assets. Concurrent with its initial public offering during the fiscal year ended February 2, 2020, the Company, PetSmart, and Argos Holdco entered into a tax sharing agreement which governs the respective rights, responsibilities, and obligations of the Company, PetSmart, and Argos Holdco with respect to tax matters, including taxes attributable to PetSmart, entitlement to refunds, allocation of tax attributes, preparation of tax returns, certain tax elections, control of tax contests and other tax matters regarding U.S. federal, state, and local income taxes.

Earnings per Share

Earnings per Share	3 Months Ended
	May 01, 2022
Earnings Per Share [Abstract]
Earnings per Share	Earnings per Share Basic and diluted earnings per share attributable to common stockholders are presented using the two-class method required for participating securities. Under the two-class method, net income attributable to common stockholders is determined by allocating undistributed earnings between common stock and participating securities. Undistributed earnings for the periods presented are calculated as net income less distributed earnings. Undistributed earnings are allocated proportionally to common Class A and Class B stockholders as both classes are entitled to share equally, on a per share basis, in dividends and other distributions. Basic and diluted earnings per share are calculated by dividing net income attributable to common stockholders by the weighted-average shares outstanding during the period. The following table sets forth basic and diluted earnings per share attributable to common stockholders for the periods presented (in thousands, except per share data): 13 Weeks Ended May 1, May 2, Basic and diluted earnings per share Numerator Earnings attributable to common Class A and Class B stockholders $ 18,472 $ 38,719 Denominator Weighted-average common shares used in computing earnings per share: Basic 420,406 415,248 Effect of dilutive stock-based awards 6,304 12,349 Diluted 426,710 427,597 Anti-dilutive stock-based awards excluded from diluted common shares 3,110 — Earnings per share attributable to common Class A and Class B stockholders: Basic $ 0.04 $ 0.09 Diluted $ 0.04 $ 0.09

Certain Relationships and Relat

Certain Relationships and Related Party Transactions	3 Months Ended
	May 01, 2022
Related Party Transactions [Abstract]
Certain Relationships and Related Party Transactions	Certain Relationships and Related Party Transactions Certain of the Company’s healthcare operations are conducted through a wholly-owned subsidiary of PetSmart for which the Company and PetSmart entered into a services agreement which provides for the payment of a management fee due from PetSmart. The Company recognized $1.3 million and $10.6 million within net sales in the condensed consolidated statements of operations for the services provided during the thirteen weeks ended May 1, 2022 and May 2, 2021, respectively. As of May 1, 2022 and January 30, 2022, the Company had a net receivable from PetSmart of $3.1 million and $2.5 million, respectively, which was included in prepaid expenses and other current assets on the Company's condensed consolidated balance sheets. PetSmart Guarantees PetSmart previously provided a guarantee of payment with respect to certain equipment and other leases that the Company entered into and served as a guarantor in respect of the Company’s obligations under a credit insurance policy in favor of certain of the Company’s suppliers. As of May 1, 2022, all such guarantees had been released, with the exception of guarantees pertaining to one of the Company’s lease agreements.

Basis of Presentation and Sig_2

Basis of Presentation and Significant Accounting Policies (Policies)	3 Months Ended
	May 01, 2022
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related notes include the accounts of Chewy, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated. The unaudited condensed consolidated financial statements and notes thereto of Chewy, Inc. have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting and, therefore, omit or condense certain footnotes and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) as set forth in the Financial Accounting Standards Board’s (“FASB”) accounting standards codification. In the opinion of management, all adjustments necessary for a fair statement of the financial information, which are of a normal and recurring nature, have been made for the interim periods reported. Results of operations for the quarterly period ended May 1, 2022 are not necessarily indicative of the results for the entire fiscal year. The unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q for the quarterly period ended May 1, 2022 (“10-Q Report”) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 30, 2022 (“10-K Report”).
Fiscal Year	Fiscal Year The Company has a 52- or 53-week fiscal year ending each year on the Sunday that is closest to January 31 of that year. The Company’s 2022 fiscal year ends on January 29, 2023 and is a 52-week year. The Company’s 2021 fiscal year ended January 30, 2022 and was a 52-week year.
Use of Estimates	Use of Estimates GAAP requires management to make certain estimates, judgments, and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates these estimates and judgments. Actual results could differ from those estimates.
Fair Value of Financial Instruments, Policy	Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1-Valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2-Valuations based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3-Valuations based on unobservable inputs reflecting the Company’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

Basis of Presentation and Sig_3

Basis of Presentation and Significant Accounting Policies (Tables)	3 Months Ended
	May 01, 2022
Accounting Policies [Abstract]
Schedule of Accrued Expenses and Other Current Liabilities	The following table presents the components of accrued expenses and other current liabilities (in thousands): As of May 1, 2022 January 30, 2022 Outbound fulfillment $ 409,550 $ 389,548 Advertising and marketing 86,809 86,285 Payroll liabilities 56,825 70,556 Accrued expenses and other 187,457 215,174 Total accrued expenses and other current liabilities $ 740,641 $ 761,563
Schedule of Cash and Cash Equivalents	The following is a summary of cash and cash equivalents (in thousands): As of May 1, January 30, Cash $ 452,814 $ 401,119 Level 1 securities: Money market funds 72,000 67,000 Commercial paper 79,947 74,965 U.S. Treasury securities — 59,995 Cash and cash equivalents $ 604,761 $ 603,079

Property and Equipment, net (Ta

Property and Equipment, net (Tables)	3 Months Ended
	May 01, 2022
Property, Plant and Equipment [Abstract]
Summary of Property and Equipment, net	The following is a summary of property and equipment, net (in thousands): As of May 1, 2022 January 30, 2022 Furniture, fixtures and equipment $ 138,951 $ 132,727 Computer equipment 57,035 55,164 Internal-use software 103,936 95,302 Leasehold improvements 160,748 153,797 Construction in progress 113,961 85,043 574,631 522,033 Less: accumulated depreciation and amortization 170,689 154,867 Property and equipment, net $ 403,942 $ 367,166

Leases (Tables)

Leases (Tables)	3 Months Ended
	May 01, 2022
Leases [Abstract]
Schedule of Operating Lease-related Assets and Liabilities	The table below presents the operating lease-related assets and liabilities recorded on the condensed consolidated balance sheets (in thousands): As of Leases Balance Sheet Classification May 1, 2022 January 30, 2022 Assets Operating Operating lease right-of-use assets $ 371,925 $ 372,693 Total operating lease assets $ 371,925 $ 372,693 Liabilities Current Operating Accrued expenses and other current liabilities $ 22,189 $ 24,225 Non-current Operating Operating lease liabilities 413,828 410,168 Total operating lease liabilities $ 436,017 $ 434,393

Share-Based Compensation (Table

Share-Based Compensation (Tables)	3 Months Ended
	May 01, 2022
Share-based Payment Arrangement [Abstract]
Schedule of Service and Performance Based-Awards Activity	The following table summarizes the activity related to the Company’s PRSUs for the thirteen weeks ended May 1, 2022 (in thousands, except for weighted-average grant date fair value): Number of PRSUs Weighted-Average Grant Date Fair Value Unvested and outstanding as of January 30, 2022 6,573 $ 36.16 Granted 86 $ 43.59 Vested (136) $ 28.99 Forfeited (113) $ 37.87 Unvested and outstanding as of May 1, 2022 6,410 $ 36.38 The following table summarizes the activity related to the Company’s RSUs for the thirteen weeks ended May 1, 2022 (in thousands, except for weighted-average grant date fair value): Number of RSUs Weighted-Average Grant Date Fair Value Unvested and outstanding as of January 30, 2022 3,207 $ 68.96 Granted 5,824 $ 43.59 Vested (417) $ 76.66 Forfeited (256) $ 64.14 Unvested and outstanding as of May 1, 2022 8,358 $ 51.04
Schedule of Share-based Compensation Expense	The Company recognized share-based compensation expense as follows (in thousands): 13 Weeks Ended May 1, May 2, PRSUs $ 4,639 $ 14,112 RSUs 21,155 8,994 Total share-based compensation expense $ 25,794 $ 23,106

Earnings per Share (Tables)

Earnings per Share (Tables)	3 Months Ended
	May 01, 2022
Earnings Per Share [Abstract]
Schedule of Basic and Diluted Net (Loss) Income Per Share	The following table sets forth basic and diluted earnings per share attributable to common stockholders for the periods presented (in thousands, except per share data): 13 Weeks Ended May 1, May 2, Basic and diluted earnings per share Numerator Earnings attributable to common Class A and Class B stockholders $ 18,472 $ 38,719 Denominator Weighted-average common shares used in computing earnings per share: Basic 420,406 415,248 Effect of dilutive stock-based awards 6,304 12,349 Diluted 426,710 427,597 Anti-dilutive stock-based awards excluded from diluted common shares 3,110 — Earnings per share attributable to common Class A and Class B stockholders: Basic $ 0.04 $ 0.09 Diluted $ 0.04 $ 0.09

Basis of Presentation and Sig_4

Basis of Presentation and Significant Accounting Policies - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands	May 01, 2022	Jan. 30, 2022
Accounting Policies [Abstract]
Outbound fulfillment	$ 409,550	$ 389,548
Advertising and marketing	86,809	86,285
Payroll liabilities	56,825	70,556
Accrued expenses and other	187,457	215,174
Accrued expenses and other current liabilities	$ 740,641	$ 761,563

Basis of Presentation and Sig_5

Basis of Presentation and Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	May 01, 2022	Jan. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 604,761	$ 603,079
Cash
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	452,814	401,119
Money market funds | Level 1 securities:
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	72,000	67,000
Commercial paper | Level 1 securities:
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	79,947	74,965
U.S. Treasury securities | Level 1 securities:
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 0	$ 59,995

Summary of Significant Accounti

Summary of Significant Accounting Policies - Narrative (Details) - Argos Holdco	Apr. 12, 2021shares
Common Class B
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Conversion of stock (in shares)	6,150,000
Common Class A
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Conversion of stock (in shares)	6,150,000

Property and Equipment, net - S

Property and Equipment, net - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands	May 01, 2022	Jan. 30, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 574,631	$ 522,033
Less: accumulated depreciation and amortization	170,689	154,867
Property and equipment, net	403,942	367,166
Furniture, fixtures and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	138,951	132,727
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	57,035	55,164
Internal-use software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	103,936	95,302
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	160,748	153,797
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 113,961	$ 85,043

Property and Equipment, net - N

Property and Equipment, net - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	May 01, 2022	May 02, 2021	Jan. 30, 2022
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 12.1	$ 8.6
Internal-use software
Property, Plant and Equipment [Line Items]
Accumulated amortization	39.5		$ 35.1
Amortization expense	$ 4.4	$ 2.8

Commitments and Contingencies (

Commitments and Contingencies (Details) - patent	Apr. 11, 2022	Oct. 08, 2021	May 14, 2021	Apr. 19, 2021	Feb. 15, 2021
Loss Contingencies [Line Items]
Number of patents allegedly infringed		5
Number of patents allegedly infringed, motion to dismiss			3
Number of patents found not infringed	3	1
Pending litigation
Loss Contingencies [Line Items]
Number of patents allegedly infringed				4	4

Debt (Details)

Debt (Details) - Line of Credit - Revolving Credit Facility	3 Months Ended
	May 01, 2022USD ($)
Line of Credit Facility [Line Items]
Debt instrument, term	5 years
Aggregate principal balance	$ 500,000,000
Additional aggregate principal increase limit (up to)	$ 300,000,000
Commitment fee, percentage	0.25%
Current borrowing capacity	$ 450,300,000
Outstanding borrowings	$ 0

Leases - Narrative (Details)

Leases - Narrative (Details) $ in Millions	3 Months Ended
	May 01, 2022USD ($)renewalOption	May 02, 2021USD ($)
Lessee, Lease, Description [Line Items]
Assets acquired in exchange for new operating lease liabilities	$ 8.9	$ 46
Lease expense	21.3	19
Operating lease payments	$ 18.6	$ 15.3
Real Estate
Lessee, Lease, Description [Line Items]
Number of renewal options | renewalOption	3
Renewal term	5 years
Real Estate | Minimum
Lessee, Lease, Description [Line Items]
Lease term	5 years
Real Estate | Maximum
Lessee, Lease, Description [Line Items]
Lease term	15 years
Equipment | Minimum
Lessee, Lease, Description [Line Items]
Lease term	3 years
Equipment | Maximum
Lessee, Lease, Description [Line Items]
Lease term	5 years

Leases - Schedule of Lease Asse

Leases - Schedule of Lease Assets and Liabilities (Details) - USD ($) $ in Thousands	May 01, 2022	Jan. 30, 2022
Assets
Operating	$ 371,925	$ 372,693
Current
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued expenses and other current liabilities	Accrued expenses and other current liabilities
Operating	$ 22,189	$ 24,225
Non-current
Operating	413,828	410,168
Total operating lease liabilities	$ 436,017	$ 434,393

Share-Based Compensation - Narr

Share-Based Compensation - Narrative (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended
	May 01, 2022	Jun. 13, 2019
PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of vested awards	$ 5.7
Cost not yet recognized	$ 19.3
Weighted average performance period	1 year 4 months 24 days
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of vested awards	$ 18.8
Cost not yet recognized	$ 392
Weighted average performance period	3 years 3 months 18 days
Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	0.8
2019 Omnibus Incentive Plan | Common Class A | Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares allowed for issuance (in shares)		31.9

Share-Based Compensation - Sche

Share-Based Compensation - Schedule of Restricted Stock Unit Activity (Details) shares in Thousands	3 Months Ended
	May 01, 2022$ / sharesshares
PRSUs
Number of Shares
Balance at beginning of period (in shares) | shares	6,573
Granted (in shares) | shares	86
Vested (in shares) | shares	(136)
Forfeited (in shares) | shares	(113)
Balance at end of period (in shares) | shares	6,410
Weighted-Average Grant Date Fair Value
Balance at beginning of period (in dollars per share) | $ / shares	$ 36.16
Granted (in dollars per share) | $ / shares	43.59
Vested (in dollars per share) | $ / shares	28.99
Forfeited (in dollars per share) | $ / shares	37.87
Balance at end of period (in dollars per share) | $ / shares	$ 36.38
RSUs
Number of Shares
Balance at beginning of period (in shares) | shares	3,207
Granted (in shares) | shares	5,824
Vested (in shares) | shares	(417)
Forfeited (in shares) | shares	(256)
Balance at end of period (in shares) | shares	8,358
Weighted-Average Grant Date Fair Value
Balance at beginning of period (in dollars per share) | $ / shares	$ 68.96
Granted (in dollars per share) | $ / shares	43.59
Vested (in dollars per share) | $ / shares	76.66
Forfeited (in dollars per share) | $ / shares	64.14
Balance at end of period (in dollars per share) | $ / shares	$ 51.04

Share-Based Compensation - Sc_2

Share-Based Compensation - Schedule of Share-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	May 01, 2022	May 02, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 25,794	$ 23,106
PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	4,639	14,112
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 21,155	$ 8,994

Income Taxes (Details)

Income Taxes (Details) - USD ($)	3 Months Ended
	May 01, 2022	May 02, 2021	Jan. 30, 2022
Related Party Transaction [Line Items]
Current income tax provision	$ 0	$ 0
Deferred income tax provision	0	0
(Payments for) proceeds from tax sharing agreement with related parties	(675,000)	$ 14,968,000
Receivable from related parties	3,100,000		$ 2,500,000
Tax Sharing Agreement
Related Party Transaction [Line Items]
Receivable from related parties	$ 2,300,000		$ 0

Earnings per Share (Details)

Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	May 01, 2022	May 02, 2021
Numerator
Earnings attributable to common Class A and Class B stockholders	$ 18,472	$ 38,719
Weighted-average common shares used in computing earnings per share:
Basic (in shares)	420,406	415,248
Effect of dilutive stock-based awards (in shares)	6,304	12,349
Diluted (in shares)	426,710	427,597
Anti-dilutive stock-based awards excluded from diluted common shares (in shares)	3,110	0
Earnings per share attributable to common Class A and Class B stockholders:
Basic (in dollars per share)	$ 0.04	$ 0.09
Diluted (in dollars per share)	$ 0.04	$ 0.09

Certain Relationships and Rel_2

Certain Relationships and Related Party Transactions (Details) $ in Millions	3 Months Ended
	May 01, 2022USD ($)guarantee	May 02, 2021USD ($)	Jan. 30, 2022USD ($)
Related Party Transaction [Line Items]
Receivable from PetSmart	$ 3.1		$ 2.5
PetSmart
Related Party Transaction [Line Items]
Number of guarantees held | guarantee	1
Affiliated Entity
Related Party Transaction [Line Items]
Net sales from management fee	$ 1.3	$ 10.6