Profitability Overperformance
Petco delivered top-line results in line with expectations and over-delivered on profitability goals. Adjusted EBITDA increased by $13.8 million to $89.4 million, expanding 105 basis points to 6% of sales.
Gross Margin Expansion
Gross margin rate expanded by over 30 basis points to 38.2%, with improvements across both product and services business.
Operational Efficiencies
Achieved more than 180 basis points of expense leverage, excluding last year's one-time costs, leveraged approximately 160 basis points.
Service Segment Growth
Services remain the fastest-growing area, contributing to gross margin expansion with improvements in grooming and vet operations.
Strong Cash Position
Ended the quarter with a cash balance of $139 million, an improvement of $48 million compared to last year.