Petco bets on wellness and cats to drive growth in FY20
The US pet retailer hit $1.5 billion in Q1 revenue, supported by services as product sales remained under pressure.
Petco reported revenue of $1.5 billion (€1.3B) for the first quarter (Q1) of fiscal year (FY) 2026, ending 2 May 2026. The figure represents a modest 0.2% year-over-year (YoY) growth, while comparable sales increased 0.7% in the period.
According to the US pet retailer, revenue exceeded expectations by approximately $10 million (€8.5M).
Accounting for 82% of total net sales, the product segment’s revenue fell 1.1% YoY. The services segment, while representing 18% of net sales, increased revenue by 6.8% in the period, raising its share by 1.1 percentage points (p.p.).
Petco ended the quarter with 1,378 stores following 4 net store closures.
Wider net loss
Gross profit rose 0.7% YoY to $574.4 million (€488.2M), while the gross margin increased 21 basis points to 38.4%.
On the other hand, the American pet retailer reported a net loss of $15.1 million (€12.8M), up 29% from Q1 FY2025.
Q2 pipeline
CEO Joel Anderson says the company will focus on emerging customer trends throughout Q2 and the rest of the fiscal year, including high-protein diets and new treats for dogs and cats.
This follows the launch of several new supplement categories, including hip and joint care, liver health and a holistic care line, as pet owners increasingly focus on health and longevity.
“We anticipated the recent spike in demand for cat products. As a result, we invested to make Petco the destination for cat parents. It was a key contributor to the improved sequential trends we saw in consumables overall,” he says.
The retailer will expand its offerings of furniture, beds, bowls and cat trees in the next quarter. In supplies, it is introducing new products across grooming, toys, collars and leashes, following the relaunch of its proprietary Well & Good brand.
Guidance reaffirmed
Petco reaffirmed its FY2026 guidance, expecting net sales to range from flat to up 1.5% YoY and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $415 million (€352.8M) to $430 million (€365.5M).
Capital expenditures are expected to reach $140 million (€119M), while the company plans to close 15 to 20 net stores, primarily in the second half of the year.
According to CFO Sabrina Simmons, the guidance assumes fuel prices remain at approximately current levels for the remainder of the year and includes the benefit of a tariff refund received in May.
“Our full-year guidance assumes no additional tariff refunds beyond what we’ve received to date. Our outlook also assumes that the current tariff policies remain for the balance of the year,” she says.
For the second quarter of FY2026, Petco expects net sales growth of approximately 0.3% YoY and adjusted EBITDA of $110 million (€93.5M) to $112 million (€95.2M).
Fonte: globalpetindustry.com
