Petco Health and Wellness Company Inc (WOOF) posted net sales of $1.5 billion for the second quarter of fiscal 2026, roughly flat to the prior-year period, as comparable sales increased 0.6%. The company’s adjusted EBITDA totaled $122 million, representing 8.2% of sales, while normalized adjusted EBITDA—excluding a $6.8 million net tariff refund benefit—stood at $115 million.
Gross profit reached $591 million, with gross margin expanding by 37 basis points to 39.7%, driven by tighter cost controls and improved merchandising. Operating profit rose to $48 million, or 3.2% of sales, compared with $43 million a year earlier. Selling, general and administrative expenses totaled $543 million, or 36.5% of sales. Ending inventory declined 1% year-over-year, and the company’s cash balance increased to $293 million.
Petco’s shares closed at $2.63 in regular trading, up 1.94% from $2.58, before climbing to $2.86 in after-hours activity, a gain of 8.75% and an overall increase of 10.85% from the prior session’s close. The stock has traded between $2.24 and $3.96 over the past 52 weeks.
Executives reaffirmed full-year fiscal 2026 guidance, projecting net sales growth of flat to 1.5% year-over-year and adjusted EBITDA of $415 million to $430 million. For the third quarter, the company expects sales growth of 0.4% to 1.0% and adjusted EBITDA of $100 million to $103 million, with net interest expense of about $122 million, capital expenditures of roughly $140 million, and net store closures of 15 to 20 locations.
CEO Joel Anderson highlighted progress across the company’s four strategic pillars, noting that multi-channel customers—those shopping online, in stores, and using services—generate a fivefold higher net sales per active customer than single-channel customers. Sabrina Simmons, CFO, reiterated the company’s focus on reducing its leverage ratio to two times.
Petco also reported double-digit growth in vet hospital visits and doctor days during the quarter, with its wholly-owned vet hospital model now scaled to approximately 300 locations. Plans include additional vet hospital openings and a new store format rollout beginning in 2027. A seven-store market test of the new format, launched in May, delivered a lift in net promoter score by “hundreds of basis points nearly overnight.”
The cat business outperformed in the quarter, reflecting a demographic shift where kitten-owning households surpassed puppy households starting in spring 2026. The dog category remained subdued due to lower industry-wide adoptions.
