Petco Health and Wellness Company, Inc.'s earnings call presents a mixed picture with strong EBITDA performance and strategic leadership changes aimed at long-term growth. However, challenges such as net store closures, SG&A increases, and a modest sales outlook suggest underlying issues that need to be addressed. The sentiment balances positive strategic initiatives and operational improvements against current market challenges.

Company Guidance

During the Petco Health and Wellness Company, Inc. earnings call for the fourth quarter and full year 2024, key financial metrics were discussed, including a fourth-quarter revenue of $1.55 billion and an adjusted EBITDA of $96.1 million, which surpassed expectations. The company emphasized its commitment to improving profitability and outlined a strategic plan consisting of three phases: stabilizing profitability, implementing operational efficiencies, and preparing for long-term growth. For 2025, Petco projects a revenue decline in the low single digits and an adjusted EBITDA between $375 and $390 million. The company also aims to expand gross margin rates each quarter and leverage SG&A to enhance earnings power. Additionally, Petco plans to close 20 to 30 locations in 2025 and targets a debt-to-EBITDA leverage ratio below two times.

Revenue and EBITDA Performance

Petco Health and Wellness Company, Inc. delivered a revenue of $1.55 billion in Q4, in line with prior outlook, and adjusted EBITDA of $96.1 million, exceeding expectations. The company expects to deliver double-digit growth on adjusted EBITDA year over year in 2025.

Gross Margin Improvement

Q4 gross margin increased by 180 basis points to 38%, driven by lapsing an inventory and impairment charge from the previous year and progress in margin management.

Positive Cash Flow and Cash Balance

In 2024, Petco achieved $50 million of positive free cash flow and improved its cash balance to $182 million.

Leadership and Strategic Vision

Petco restructured its leadership team with new appointments, focusing on retail fundamentals, cost control, and long-term growth to reinvigorate the brand.

Expansion in Pet Services

Petco is leveraging its leadership in services, the fastest-growing area of the pet category, including grooming and vet locations.

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Petco Health and Wellness Company (WOOF) Earnings, Revenues Date & History

The upcoming earnings date is based on a company’s previous reporting, and may be updated when the actual date is announced

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WOOF Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
May 21, 2025	2025 (Q1)	-0.02 / -	-0.04	―	―	―
Mar 26, 2025	2024 (Q4)	<0.01 / 0.02	0.02	-20.00% (>-0.01)
Dec 05, 2024	2024 (Q3)	-0.04 / -0.02	-0.05	60.00% (+0.03)
Sep 10, 2024	2024 (Q2)	-0.02 / -0.02	0.06	-133.33% (-0.08)
May 22, 2024	2024 (Q1)	-0.06 / -0.04	0.06	-166.67% (-0.10)
Mar 13, 2024	2023 (Q4)	0.02 / 0.02	0.2	-90.00% (-0.18)
Nov 29, 2023	2023 (Q3)	0.02 / -0.05	0.16	-131.25% (-0.21)
Aug 24, 2023	2023 (Q2)	0.06 / 0.06	0.19	-68.42% (-0.13)
May 24, 2023	2023 (Q1)	0.05 / 0.06	0.17	-64.71% (-0.11)
Mar 22, 2023	2022 (Q4)	0.24 / 0.20	0.28	-28.57% (-0.08)

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

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WOOF Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Mar 26, 2025	$2.44	$3.21	+31.56%
Dec 05, 2024	$4.90	$5.29	+7.96%
Sep 10, 2024	$3.07	$4.08	+32.90%
May 22, 2024	$2.45	$2.88	+17.55%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.

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