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Chewy Targets $50 Million in AI-Driven Cost Savings for Fiscal 2027
Chewy, the online pet‑supplies retailer, said on its September 9, 2026 Q2 2027 earnings call that it expects AI‑related initiatives to generate about $50 million in annual cost savings in the 2027 fiscal year. The company added that the same initiatives produced low‑tens‑of‑millions of dollars in savings during the prior fiscal year.
Chewy’s strategy centers on deploying AI‑enabled tools across customer care, pharmacy services and its Vet Care network. CEO Sumit Singh explained that the company’s AI assistant, Cai, was rolled out to a test group of customers in the second quarter. According to Singh, Cai handled roughly 30 % of self‑service chats about orders, account management and the subscription service Autoship, reducing the need for live agents.
In addition to Cai, Chewy introduced a voice assistant called Callie at several Vet Care locations. Callie assists customers with confirming appointments and scheduling follow‑ups, according to the company’s presentation. The firm also uses AI to automate data extraction in its pharmacy services, helping to streamline prescription processing.
Chewy’s CFO, Chris Deppe, said that the company’s automated facilities are scaling and that it is leveraging fixed‑cost infrastructure embedded in its network while cutting variable costs through automation and AI tools. Deppe noted that the company has spent several quarters building out infrastructure and focusing on data quality, including a multi‑agent orchestration framework that will allow new agentic capabilities to be layered on top of existing systems.
The company’s emphasis on agentic AI aligns with broader industry trends. Gartner reported earlier this year that enterprises are expected to more than double their spending on agentic and generative AI in 2026, with total global AI spend projected to grow by nearly $1 trillion. A Salesforce report showed that the average number of AI agents deployed by organizations nearly tripled from February 2025 to April 2026, and the average time to build and launch an agent fell to just under two days.
Chewy believes its first‑party built AI solutions give it a durable competitive advantage. The company said that competitors would need years to reach the same level of infrastructure or would have to rely on third‑party providers.
Chewy’s AI initiatives are part of a broader push by the company to improve customer experience and drive deeper engagement. The firm’s CEO said that the AI infrastructure will support future agentic capabilities, allowing the retailer to connect existing services more tightly.
The company’s Q2 2027 earnings call also highlighted that AI‑enabled tools are turning customer signals into intelligent insights, which the company uses to refine its operations. Chewy’s focus on clean data and robust infrastructure is intended to prepare the retailer for a future where agentic AI plays a larger role.
In summary, Chewy is investing heavily in AI to reduce variable costs and improve productivity. The company projects $50 million in annualized savings for fiscal 2027, following low‑tens‑of‑millions of savings in the previous year. Chewy’s AI strategy includes customer‑facing assistants, pharmacy automation, and a multi‑agent orchestration framework. The broader industry is experiencing rapid growth in AI spending and deployment, with enterprise adoption accelerating and the time required to launch AI agents shrinking.
The next steps for Chewy will involve scaling the existing AI tools, expanding the use of agentic capabilities, and monitoring the impact on cost savings and customer satisfaction. The company’s progress will be closely watched as it seeks to maintain its competitive edge in a market where AI infrastructure and first‑party solutions are becoming increasingly important.
Chewy’s strategy centers on deploying AI‑enabled tools across customer care, pharmacy services and its Vet Care network. CEO Sumit Singh explained that the company’s AI assistant, Cai, was rolled out to a test group of customers in the second quarter. According to Singh, Cai handled roughly 30 % of self‑service chats about orders, account management and the subscription service Autoship, reducing the need for live agents.
In addition to Cai, Chewy introduced a voice assistant called Callie at several Vet Care locations. Callie assists customers with confirming appointments and scheduling follow‑ups, according to the company’s presentation. The firm also uses AI to automate data extraction in its pharmacy services, helping to streamline prescription processing.
Chewy’s CFO, Chris Deppe, said that the company’s automated facilities are scaling and that it is leveraging fixed‑cost infrastructure embedded in its network while cutting variable costs through automation and AI tools. Deppe noted that the company has spent several quarters building out infrastructure and focusing on data quality, including a multi‑agent orchestration framework that will allow new agentic capabilities to be layered on top of existing systems.
The company’s emphasis on agentic AI aligns with broader industry trends. Gartner reported earlier this year that enterprises are expected to more than double their spending on agentic and generative AI in 2026, with total global AI spend projected to grow by nearly $1 trillion. A Salesforce report showed that the average number of AI agents deployed by organizations nearly tripled from February 2025 to April 2026, and the average time to build and launch an agent fell to just under two days.
Chewy believes its first‑party built AI solutions give it a durable competitive advantage. The company said that competitors would need years to reach the same level of infrastructure or would have to rely on third‑party providers.
Chewy’s AI initiatives are part of a broader push by the company to improve customer experience and drive deeper engagement. The firm’s CEO said that the AI infrastructure will support future agentic capabilities, allowing the retailer to connect existing services more tightly.
The company’s Q2 2027 earnings call also highlighted that AI‑enabled tools are turning customer signals into intelligent insights, which the company uses to refine its operations. Chewy’s focus on clean data and robust infrastructure is intended to prepare the retailer for a future where agentic AI plays a larger role.
In summary, Chewy is investing heavily in AI to reduce variable costs and improve productivity. The company projects $50 million in annualized savings for fiscal 2027, following low‑tens‑of‑millions of savings in the previous year. Chewy’s AI strategy includes customer‑facing assistants, pharmacy automation, and a multi‑agent orchestration framework. The broader industry is experiencing rapid growth in AI spending and deployment, with enterprise adoption accelerating and the time required to launch AI agents shrinking.
The next steps for Chewy will involve scaling the existing AI tools, expanding the use of agentic capabilities, and monitoring the impact on cost savings and customer satisfaction. The company’s progress will be closely watched as it seeks to maintain its competitive edge in a market where AI infrastructure and first‑party solutions are becoming increasingly important.
