Petco Health 2026 Q3 Earnings Turns Profitability with 156% Net Income Surge

Petco Health (WOOF) reported fiscal 2026 Q3 earnings on Nov 25, 2025, delivering a surprise profit of $0.03 EPS (vs. $0.06 loss in 2025 Q3) and raising full-year EBITDA guidance to $395–$397 million. Despite a 3.1% revenue decline to $1.46 billion, the company demonstrated strong cost discipline and margin expansion. The stock surged 9.4% premarket following the results, reflecting optimism about its turnaround strategy.

Revenue

Product sales accounted for the bulk of revenue at $1.21 billion, while services and other segments contributed $254.81 million, bringing total net sales to $1.46 billion. The decline from $1.51 billion in 2025 Q3 was driven by weaker consumables and supplies categories, partially offset by growth in services.

Earnings/Net Income

Petco returned to profitability with $0.03 EPS, a 150% positive swing from a $0.06 loss in 2025 Q3. Net income surged to $9.33 million, reversing a $16.67 million loss, a 156% improvement. The significant turnaround underscores Petco’s effective cost management and operational improvements.

Post-Earnings Price Action Review

The stock’s post-earnings reaction was mixed. Shares rose 4.95% on the day of the report and 3.48% for the week, but fell 18.85% month-to-date. The sharp intraday gains aligned with the improved profitability and raised guidance, though longer-term investors remained cautious amid the revenue decline and competitive pressures in the pet retail sector.

CEO Commentary

CEO Joel Anderson highlighted operational progress, including $99 million in adjusted EBITDA and $61 million in free cash flow, emphasizing cultural transformation and retail discipline. Strategic priorities include product differentiation, enhanced store experiences, scalable veterinary services, and omni-channel integration. The company aims to leverage these initiatives for Phase 3 growth in 2026.

Guidance

CFO Sabrina Simmons reiterated 2025 adjusted EBITDA guidance of $395–$397 million (up 18% at midpoint) and narrowed full-year net sales decline to 2.5–2.8%. Q4 2025 is expected to see low single-digit sales declines and $93–$95 million in adjusted EBITDA. Capital expenditures remain targeted at $125–$130 million, with 20 net store closures planned.

Additional News

1. Uber Eats Partnership: Petco expanded its digital footprint via a nationwide delivery partnership with Uber Eats, offering pet essentials with promotional discounts.

2. C-Level Hire: The company announced Michael Romanko as Chief Customer and Product Officer, with a substantial equity package tied to performance metrics.

3. Leadership Restructuring: CEO Joel Anderson has restructured senior leadership across finance, marketing, and merchandising to accelerate operational improvements and customer-focused initiatives.

Revenue

Earnings/Net Income

Price Action