Petco Health & Wellness has recently released its 10-Q report. Petco Health and Wellness Company, Inc. operates as a pet specialty retailer in the United States, Mexico, Puerto Rico, and Chile. Its business includes veterinary care, grooming, training, pet care supplies, and companion animals, with sales through stores, petco.com, and its mobile app. The company was founded in 1965 and is headquartered in San Diego.
In Item 2, management said the company’s 13-week results ended August 1, 2026 were shaped by a mix of flat total sales, a small gain in comparable sales, and higher profitability. Net sales were $1.49 billion, up $691,000 from $1.49 billion a year earlier, while comparable sales rose 0.6% after a 1.4% decline in the prior-year quarter. Product sales were $1.22 billion, down from $1.23 billion, while services and other revenue increased to $272.4 million from $262.9 million.
Gross profit rose to $591.1 million from $585.3 million, and the gross margin improved to 39.7% from 39.3%. Management said the margin benefited from $6.8 million of tariff refunds, partially offset by investment in new assortments and higher fuel and tariff costs. Selling, general and administrative expenses were $543.3 million, up from $542.3 million, or 36.5% of sales versus 36.4%.
Operating income increased to $47.8 million from $43.0 million. Interest expense fell to $32.6 million from $33.3 million, while interest income rose to $2.5 million from $0.9 million. Petco reported net income attributable to Class A and B-1 common stockholders of $38.7 million, compared with $14.0 million a year earlier, helped by an income tax benefit of $15.7 million versus tax expense of $746,000 in the prior-year quarter.
For the 26-week period, net sales were $2.99 billion, up from $2.98 billion, and comparable sales were up 0.6% versus down 1.3% a year earlier. Gross profit increased to $1.17 billion from $1.16 billion, operating income rose to $72.4 million from $59.4 million, and adjusted EBITDA increased to $219.6 million from $203.3 million. Net income attributable to common stockholders was $23.5 million, compared with $2.3 million in the prior-year period.
The company ended the quarter with 1,377 U.S. pet care centers, down from 1,388 a year earlier. Management said the quarter reflected a temporary disruption from a stronger-than-expected response to the membership program relaunch, continued growth in services, and positive consumables trends, while also noting that lower pet care center count weighed on sales. Following these announcements, the company's shares moved 7.14%, and are now trading at a price of $2.70. For more information, read the company's full 10-Q submission here.
