Petco Health and Wellness Co Inc (NASDAQ:WOOF) shares are climbing Wednesday after the company posted stronger‑than‑expected third‑quarter results and lifted its full‑year outlook.
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What Happened: Petco posted third‑quarter earnings of 3 cents per share, topping expectations for breakeven earnings, according to Benzinga Pro. The bottom-line number marks a turnaround from a 2‑cent loss a year ago.
Quarterly revenue came in at $1.464 billion, just shy of the $1.472 billion consensus, and down 3.1% from last year's $1.511 billion reported.
Net sales fell 3.1% year-over-year, in line with guidance, while comparable sales slipped 2.2%. Even with the revenue decline, margins improved as gross profit rose about 75 basis points to 38.9% of net sales.
“Once again, we delivered on Petco’s profitability goals as we continue to execute on our multi-phased transformation,” said Joel Anderson, Petco’s CEO. “Rebuilding the base of our economic model has been a priority in 2025. This strengthened base sets the foundation for a return to growth during fiscal 2026.”
Petco narrowed its full‑year sales outlook and raised its 2025 earnings guidance, lifting the midpoint of its adjusted EBITDA forecast by $6 million.
For fiscal 2025, the company expects net sales to fall 2.5% to 2.8%, with adjusted EBITDA between $395 million and $397 million. Net interest expense is projected at about $125 million, while capital spending is planned at $125 million to $130 million. Petco also plans to close around 20 stores during the year.
Looking to the fourth-quarter, Petco anticipates net sales will decline in the low-single digits from last year, with adjusted EBITDA in the range of $93 million to $95 million.
Following the company’s quarterly results, Evercore ISI Group maintained an In-Line rating and raised its price target on the stock from $3 to $4.
WOOF Price Action: Petco shares were up 15.17% at $3.42 at the time of publication on Wednesday, according to Benzinga Pro.
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