Petco Health and Wellness Company, Inc.
WOOF Consumer Cyclical Q1 2026
Petco Health and Wellness Company, Inc. (Nasdaq: WOOF) reported its first-quarter financial results for 2025. The company generated net sales of $1.5 billion, a decrease of 2.3% year over year. Comparable sales also fell by 1.3% from the previous year. Gross profit margin improved by approximately 30 basis points to 38.2% of net sales.
Despite the revenue decline, operating income improved by $33.1 million to $16.4 million. The GAAP net loss narrowed by $34.8 million to $11.7 million compared to the same quarter last year. Adjusted EBITDA increased by $13.8 million to $89.4 million.
Petco reaffirmed its fiscal 2025 net sales and earnings outlook, which anticipates a low single-digit decline in net sales for the year. The adjusted EBITDA for full-year 2025 is projected to be between $375 million and $390 million. For the second quarter of 2025, net sales are expected to decline in line with the annual guidance, while adjusted EBITDA is anticipated to be between $92 million and $94 million.
The company’s net loss per Class A and B-1 common share was $0.04, a 76% improvement from the previous year’s net loss of $0.17. Weighted average shares used in computing net loss per share increased by 3% to 277,548.
Total current assets were reported at $920.4 million, decreasing from $973.6 million at the end of the previous quarter. Cash and cash equivalents amounted to $133.3 million, down from $165.8 million. The total liabilities stood at $4.0 billion, a slight decline from $4.1 billion at the end of the last reported quarter.
The company’s adjusted EBITDA margin for Q1 2025 was 6.0%, compared to 4.9% in the same quarter of 2024. The net margin was reported at -0.8%, an improvement from -3.0% year over year.
Cash flows from operating activities reported a net outflow of $15.5 million for Q1 2025, compared to a cash outflow of $8.4 million in the same period of 2024. Petco’s free cash flow, calculated as net cash used in operating activities minus cash paid for fixed assets, was -$43.9 million, compared to -$41.1 million in Q1 2024.