Pick Chewy and Global-E to Counter Headwinds in eCommerce

Why It Matters

These picks illustrate how niche specialization—pet‑care subscriptions and cross‑border tech—can deliver predictable cash flow and margin expansion when broader e‑commerce faces cost pressures. Investors can leverage such defensible models to navigate a sector ranked in the bottom third of Zacks industries.

Key Takeaways

• E‑commerce sales grew 5.3% YoY in Q4 2025, 16.6% of retail
• Global‑e benefits from cross‑border demand amid supply‑chain disruptions
• Chewy’s Autoship drives >80% of sales, ensuring recurring revenue
• Gen‑Z fuels social commerce, pushing brands toward influencer‑driven sales
• AI personalization boosts conversion rates and average order values industry‑wide

Pulse Analysis

The e‑commerce landscape remains a paradox of robust top‑line growth and tightening profitability. While total retail sales rose modestly, online transactions accelerated, reflecting consumers’ appetite for convenience and the seamless blend of digital and physical shopping. This omnichannel shift is especially pronounced among Gen‑Z shoppers, who discover products on TikTok and Instagram before completing purchases on brand sites or through in‑app checkout. Companies that can integrate storefronts, mobile experiences, and rapid fulfillment are better equipped to capture this evolving demand, even as inflation and higher borrowing costs temper discretionary spending.

Chewy and Global‑e exemplify how focused business models can thrive amid sector‑wide headwinds. Chewy’s Autoship subscription, covering more than 80% of its sales, creates a predictable revenue stream and deepens customer loyalty in the pet‑care market—an area that behaves like a consumer staple. Meanwhile, Global‑e’s cross‑border platform removes friction for brands expanding internationally, handling duties, taxes, localization and logistics in a single solution. As trade tensions and tariff volatility increase, merchants increasingly rely on such infrastructure to maintain price transparency and delivery speed, positioning Global‑e for double‑digit growth despite a modest share‑price decline.

Broader industry dynamics reinforce the relevance of these picks. Artificial intelligence is reshaping the shopper journey, from AI‑driven product recommendations to generative‑AI search that lifted retail‑site traffic by over 600% during the 2025 holiday season. Social commerce, powered by influencer content, is shortening the conversion funnel and lowering acquisition costs. Although the Internet‑Commerce sector sits in the bottom 28% of Zacks rankings, its forward P/E of 25.6× suggests a premium valuation relative to the S&P 500, indicating that investors who target high‑margin, technology‑enabled sub‑segments may capture outsized returns.