Petco Stock Surges After-Market On Q4 Revenue Beat: Retail’s Optimistic

Shares of Petco Health and Wellness Co. (WOOF) jumped nearly 10% on Wednesday after-hours trading following the pet retailer’s mixed fourth-quarter results, but retail investors were optimistic about continued share gains.

While Petco’s loss per share came in at $0.05 compared to the consensus estimate of loss per share of $0.01, its Q4 revenue of  $1.6 billion was above consensus estimate of $1.56 billion. However, revenue fell by 7.3% due to the loss of an extra week in the 2023 calendar.

Its Q4 net loss narrowed to $13.8 million compared to $22.6 million from the same period last year, and comparable sales increased 0.5% year-over-year.

"Our results in the fourth quarter demonstrate the progress we've made to return Petco to retail operating excellence," said Joel Anderson, Petco's CEO.

"While there is more work ahead, I am confident our new leadership team is well-positioned to build on this early momentum, deliver double-digit adjusted EBITDA improvement in 2025 and set the business up for sustainable profitable growth."

For fiscal 2025, it expects revenue to be down in low single digits year-over-year, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to range between $375 million and $390 million.

Petco recently made major changes to its leadership team aimed at operational improvements and helping it return to profitable growth.

The company said it plans to close 20-30 stores in 2025 as part of this effort.

Sentiment on Stocktwits jumped to ‘extremely bullish’ from ‘neutral’ a day ago. Message volume also climbed to ‘extremely high’ from ‘low.’

Despite the mixed earnings, a bullish investor called the results a victory predicting a gradual rise in the share price.

In November, Petco named Joe Venezia its Chief Revenue Officer.

Petco stock is down 36% year-to-date.

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