Petco's stock plunges after surprise loss reported, outlook slashed amid 'challenging consumer environment'

Shares of Petco Health & Wellness Co. Inc. (WOOF) tumbled 14.3% in premarket trading Wednesday, after the pet care products retailer reported a surprise fiscal third-quarter loss and slashed its full-year outlook, and said it was taking "swift and decisive action" to boost performance. The company swung to a net loss for the quarter to Oct. 28 of $1.24 billion, or $4.63 a share, from net income of $19.9 million, or 7 cents a share, in the year-ago period. Excluding nonrecurring items, such as a $1.2 billion goodwill impairment charge, the adjusted per-share loss was 5 cents, to miss the FactSet consensus for earnings per share of 2 cents. Total sales slipped 0.5% to $1.49 billion, below the FactSet consensus of $1.51 billion, as flat same-store sales missed expectations of 0.5% growth. Among actions it was taking amid a "challenging consumer environment" was the introduction of national cat and dog food value brands. For fiscal 2023, the company reiterated its revenue guidance of $6.150 billion to $6.275 billion but cut its adjusted EPS outlook to approximately 8 cents from 24 cents to 30 cents. The stock has plunged 59.5% year to date through Tuesday while the S&P 500 has gained 18.6%.

-Tomi Kilgore

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11-29-23 0720ET

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