What Happened?
Shares of e-commerce pet food and supplies retailer Chewy (NYSE: CHWY) jumped 5.5% in the afternoon session after the company announced it is expanding its use of artificial intelligence (AI) and automation across its business to improve operational efficiency.
Chewy is applying these technologies to customer service, pharmacy operations, fulfillment, and marketing workflows as part of its long-term growth strategy. The company built the required infrastructure in the first quarter of fiscal 2026 to deploy AI at a larger scale. Chewy expects these initiatives to generate efficiency benefits in the low tens of millions of dollars during fiscal 2026, with a more significant contribution anticipated in 2027 and beyond.
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What Is The Market Telling Us
Chewy’s shares are somewhat volatile and have had 14 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 4.9% on the news that signs of renewed diplomatic talks between the U.S. and Iran boosted investor sentiment.
The broader market saw a significant uplift, as the S&P 500 attempted to break a five-day losing streak after a rare losing week. The Dow Jones Industrial Average and the tech-heavy Nasdaq composite also posted gains. This widespread optimism often creates a 'risk-on' environment, where investors are more willing to buy stocks across various sectors, including technology and media. Big Tech stocks were noted as leaders in the recovery, as renewed confidence in the market's stability encouraged buying activity.
Chewy is down 37.9% since the beginning of the year, and at $20.79 per share, it is trading 50.9% below its 52-week high of $42.33 from September 2025. Investors who bought $1,000 worth of Chewy’s shares 5 years ago would now be looking at only $257.75.
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