Patterson Companies Inc: Mixed Q2 2025 Results Amid Challenging End Market

Patterson Companies Inc (PDCO) reported mixed fiscal 2025 second quarter results, reflecting a challenging end market environment. The dental supply maker announced earnings and net sales growth, but also revised its guidance and announced an exploration of strategic alternatives, including a potential sale or merger.

Second quarter reported net sales increased 1.3 percent year-over-year to $1.67 billion, while internal sales, adjusted for currency translation and other factors, increased 0.6 percent. However, reported net income attributable to Patterson Companies, Inc. decreased to $26.8 million, or $0.30 per diluted share, compared to $40.0 million, or $0.42 per diluted share, in the second quarter of fiscal 2024. Adjusted net income of $41.8 million, or $0.47 per diluted share, also declined from the prior year.

The dental segment reported net sales of $611.7 million, with internal sales decreasing 2.3 percent compared to the fiscal 2024 second quarter. The company attributed this decline to lower sales of dental equipment and the continued negative impact of the widely reported cybersecurity attack on vendor Change Healthcare within the value-added services category. The animal health segment, however, reported strong results, with internal sales increasing 1.9 percent driven by robust consumable sales and value-added services growth.

Patterson Companies revised its fiscal 2025 GAAP earnings guidance range to $1.83 to $1.93 per diluted share and adjusted earnings guidance range to $2.25 to $2.35 per diluted share. Additionally, the company announced an evaluation of strategic alternatives to maximize shareholder value.

Patterson's President and CEO, Don Zurbay, acknowledged the challenging end market environment and emphasized the company's cost management actions and targeted investments in complementary businesses to support sustainable, long-term growth. Despite the mixed results, Patterson's stock price surged 6.54 percent during the premarket session following the earnings announcement.

In conclusion, Patterson Companies Inc's Q2 2025 earnings call revealed a mixed performance amid a challenging end market environment. The company's strategic initiatives and strong animal health segment contributed to its financial performance, but the impact of the cybersecurity attack on Change Healthcare and lower dental equipment sales remain concerns. Continued monitoring of Patterson's strategic alternatives and earnings guidance will be crucial for investors as the company navigates the current market landscape.