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, selling pet care supplies, companion animals, consumables, and services such as veterinary care, grooming, and training. It also sells through petco.com and its mobile app and markets products under brands including WholeHearted, Reddy, So Phresh, and Well & Good.
In Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, Petco said net sales for the 13 weeks ended August 1, 2026 were $1.49 billion, essentially flat with $1.49 billion a year earlier, while comparable sales rose 0.6% after falling 1.4% in the prior-year quarter. For the 26-week period, net sales were $2.99 billion, up from $2.98 billion, with comparable sales also up 0.6% versus a 1.3% decline a year earlier.
Product sales in the latest quarter were $1.22 billion, down from $1.23 billion, while services and other revenue increased to $272.4 million from $262.9 million. Within product sales, consumables rose to $731.3 million from $729.9 million, while supplies and companion animals fell to $485.6 million from $495.7 million. For the first half, consumables were $1.48 billion, essentially unchanged, and supplies and companion animals declined to $966.8 million from $989.5 million.
Gross profit for the quarter was $591.1 million, up from $585.3 million, and the gross margin improved to 39.7% from 39.3%. Petco said the margin improvement was driven mainly by a $6.8 million net benefit from tariff refunds, partly offset by investment in new assortments and higher fuel and tariff costs.
Selling, general and administrative expenses were $543.3 million in the quarter, compared with $542.3 million a year earlier, equal to 36.5% of net sales versus 36.4%. The company said the increase was driven by higher advertising and depreciation expense and higher employee fringe benefits, partly offset by lower payroll and other compensation costs.
Operating income increased to $47.8 million from $43.0 million in the quarter, and to $72.4 million from $59.4 million for the first half. Net income attributable to Class A and B-1 common stockholders rose to $38.7 million from $14.0 million in the quarter, and to $23.5 million from $2.3 million in the 26-week period.
Adjusted EBITDA increased to $122.2 million from $113.9 million in the quarter and to $219.6 million from $203.3 million for the first half. Interest expense declined to $32.6 million from $33.3 million in the quarter and to $65.3 million from $66.8 million in the first half, reflecting a lower outstanding debt balance partly offset by higher rates.
Petco recorded an $11.8 million loss on extinguishment and modification of debt in the first half tied to its February 2, 2026 refinancing. The company also reported an income tax benefit of $15.7 million for the quarter and $13.5 million for the first half, versus tax expense of $0.7 million and $1.2 million in the prior-year periods.
At the end of the period, Petco operated 1,377 U.S. pet care centers, down from 1,388 a year earlier. As a result of these announcements, the company's shares have moved 7.14% on the market, and are now trading at a price of $2.70. For the full picture, make sure to review Petco Health & Wellness's 10-Q report.
