Petco Health and Wellness Company, Inc. (WOOF): History, Ownership, Mission, How It Works & Makes Money

Are you looking at the pet care market and wondering how Petco Health and Wellness Company, Inc. (WOOF), a 60-year-old retailer, is navigating the shift to a full-service health and wellness model? With a reported fiscal year 2025 revenue of approximately $6.116 billion, Petco is clearly a major player, but its relatively low market capitalization of around $893 million as of late August 2025 tells a story of a company in a critical turnaround, sacrificing some unprofitable sales for margin expansion. This deep dive will show you how Petco, which is raising its full-year 2025 Adjusted EBITDA outlook to between $385 million and $395 million, is trying to improve the lives of pets and pet parents, and what that means for its ownership structure and future revenue streams.

Petco Health and Wellness Company, Inc. (WOOF) History

You need to understand the roots of Petco Health and Wellness Company, Inc. to grasp its current strategy, especially as it navigates its turnaround. The company's journey is a classic American retail story: a mail-order startup that repeatedly leveraged private equity to fund massive scale, culminating in a pivot to a comprehensive pet health and wellness ecosystem. This history of financial engineering and strategic reinvention is why the company is now focused on profitability over pure top-line growth.

Given Company's Founding Timeline

Year established

The company was established in 1965, starting as a mail-order business for veterinary supplies.

Original location

The original operation, known as United Pharmaceutical Company (UPCO), was founded in San Diego County, California.

Founding team members

The company was founded by Walter Evans, who served as the first CEO, along with five associates.

Initial capital/funding

Walter Evans started the mail-order business with an initial personal investment of $10,000, which he had saved while working for an airline.

Given Company's Evolution Milestones

Given Company's Transformative Moments

Petco's history is defined by a series of transformative decisions that shifted its focus from a discount retailer to an integrated health and wellness provider. The most critical moments involved strategic acquisitions and a commitment to premiumization, often funded by private equity cycles.

The shift to a health and wellness ecosystem is the most recent, and arguably most significant, transformation. This move is about capturing a larger share of the pet parent's wallet by offering high-value services and premium products. Breaking Down Petco Health and Wellness Company, Inc. (WOOF) Financial Health: Key Insights for Investors shows why this is crucial.

• The Private Equity Cycle: The company went public, private, public, private, and public again (1994, 2000, 2002, 2006, 2021). This constant ownership change, with firms like TPG Capital and CVC Capital Partners, injected capital but also saddled the company with debt, forcing a relentless focus on maximizing returns. This is why the current focus is on strengthening retail fundamentals.
• The Wellness Pivot: In 2020, Petco launched Vital Care, a paid wellness plan, and stopped selling specific electronic 'shock' collars. This was a clear, high-stakes move to align the brand with positive pet care and recurring revenue.
• The 2025 Turnaround: As of November 2025, the company is in a critical 'phase two' of its transformation, prioritizing execution and profitability over market share. For the first half of the year, they delivered Q2 2025 net sales of $1.5 billion, and raised the full-year 2025 Adjusted EBITDA outlook to between $385 million and $395 million, up from earlier projections. Honestly, this shows the strategy is working on the bottom line, even if net sales are down low single digits.
• Service Expansion: The company has aggressively scaled its veterinary services, now operating over 280 full-service hospitals and 1,400 mobile clinics per week, which is a key differentiator against online-only competitors.

What this estimate hides is that Petco does not expect to see positive comparable sales until 2026, so the current profitability gains are coming from cost management and margin expansion, not necessarily a surge in customer traffic.

Petco Health and Wellness Company, Inc. (WOOF) Ownership Structure

Petco Health and Wellness Company, Inc. (WOOF) is controlled by a mix of large institutional investors and a significant strategic block, which dictates the company's long-term strategy and governance.

This structure means decision-making is heavily influenced by a few major players, so understanding their interests is defintely key to analyzing the stock.

Petco Health and Wellness Company, Inc.'s Current Status

Petco is a publicly traded company listed on the NASDAQ stock exchange under the ticker symbol WOOF. This public status subjects it to the rigorous reporting and transparency requirements of the U.S. Securities and Exchange Commission (SEC), but its ownership profile is far from a typical widely-held public float.

The company completed its Initial Public Offering (IPO) in January 2021, but a large portion of its outstanding shares remains concentrated with the private equity firms that previously owned it, which means the public float is smaller than you might expect.

Petco Health and Wellness Company, Inc.'s Ownership Breakdown

As of the 2025 fiscal year data, Petco's ownership is split across three main categories, though a single strategic investor holds a dominant stake, which is a crucial point for governance and potential future sales.

Here's the quick math on who holds the shares:

What this estimate hides is the power of the strategic block: Scooby Aggregator LP and CVC Management Holdings II Ltd. collectively hold over 60% of the shares, giving them effective control over major corporate actions despite the general institutional and retail breakdown.

For a deeper dive into these major players, you can check out Exploring Petco Health and Wellness Company, Inc. (WOOF) Investor Profile: Who's Buying and Why?

Petco Health and Wellness Company, Inc.'s Leadership

The company's strategic direction is steered by a leadership team that saw a significant shake-up in late 2024 and early 2025, bringing in seasoned retail veterans to accelerate an operational reset and focus on profitable growth.

The average tenure of the management team is relatively short at about 1.5 years, suggesting a new team is in place to drive change.

• Joel D. Anderson: Chief Executive Officer (CEO). He was appointed in July 2024 and is tasked with leading the company's turnaround. His total yearly compensation was $18.91 million as of the 2025 fiscal year.
• Glenn Murphy: Executive Chairman of the Board of Directors. He provides high-level strategic oversight and governance.
• Sabrina Simmons: Chief Financial Officer (CFO). Appointed in February 2025, she brings extensive financial leadership experience, including a tenure as CFO at Gap, Inc., to refine Petco's financial strategy.
• Michael Romanko: Chief Customer and Product Officer. Appointed in February 2025 to focus on customer experience and product offerings.
• Jack Stout: Chief Merchandising Officer. Also appointed in February 2025, his role is crucial for strengthening retail fundamentals and improving margins.

The clear action here is to monitor the execution of this new leadership team's strategy, especially the CFO's financial discipline, as they work to translate retail expertise into improved margins and a return to growth.

Petco Health and Wellness Company, Inc. (WOOF) Mission and Values

Petco Health and Wellness Company, Inc.'s core purpose transcends selling pet supplies; it is a commitment to a complete health and wellness ecosystem for pets, their parents, and company partners. This purpose drives their strategy, especially as they project a full year 2025 Adjusted EBITDA outlook between $385 million and $395 million, a roughly 16% increase at the midpoint, demonstrating a focus on profitable growth tied to their mission.

You can see the company's cultural DNA in its mission and values, which prioritize pet well-being and responsible care over simple retail transactions. If you want a deeper dive into the market's reaction to this strategy, you should check out Exploring Petco Health and Wellness Company, Inc. (WOOF) Investor Profile: Who's Buying and Why?

Petco Health and Wellness Company, Inc.'s Core Purpose

The company is defintely focused on a 'Pets First' approach, which is a significant differentiator in the competitive pet care market. This focus on a holistic model-merchandise, services, and veterinary care-is what defines their long-term aspiration.

Official mission statement

Petco Health and Wellness Company, Inc.'s mission is to be a category-defining health and wellness company, concentrating its efforts on improving three key areas:

• Improving the lives of pets.
• Improving the lives of pet parents.
• Improving the lives of its own Petco partners (employees).

This mission is evident in the company's operations, like the fact that they operate more than 1,500 pet care centers across the U.S., Mexico, and Puerto Rico, integrating veterinary hospitals and grooming services right into the retail experience.

Vision statement

The vision statement is straightforward and focuses on establishing market trust, which is crucial in the high-touch pet health space.

• To be the most trusted brand in pet care.

Achieving this trust requires consistent execution; for example, in the second quarter of fiscal year 2025, the company reported GAAP net income of $14.0 million, a strong signal that their strategy is beginning to pay off.

Petco Health and Wellness Company, Inc. slogan/tagline

While the company has evolved its branding, the core sentiment that guides its culture and public message remains clear.

• Healthier Pets. Happier People.

This simple credo captures the reciprocal relationship between pet and parent well-being, which is the foundation of the company's transition to a health and wellness provider from a traditional retailer.

Petco Health and Wellness Company, Inc. (WOOF) How It Works

Petco Health and Wellness Company, Inc. operates as an integrated pet care ecosystem, moving beyond traditional retail by positioning its approximately 1,500 Pet Care Centers across the U.S., Mexico, and Puerto Rico as hubs for products, services, and veterinary care. The company generates revenue by selling essential consumables and discretionary supplies both in-store and online, but their core strategy centers on high-margin, recurring services like veterinary and grooming to drive customer lifetime value.

Petco Health and Wellness Company, Inc.'s Product/Service Portfolio

Petco's business model is built on three distinct, yet integrated, revenue streams. In the second quarter of fiscal year 2025, net sales totaled approximately $1.5 billion, with a clear reliance on the essential 'Consumables' category, while 'Services' represents the fastest-growing, highest-margin segment.

Petco Health and Wellness Company, Inc.'s Operational Framework

Petco's operations in 2025 are laser-focused on an 'operational reset' to improve profitability, even as net sales are expected to decline in the low single digits for the full year. They are streamlining their physical footprint, planning approximately 25 net store closures in FY2025, to focus capital on higher-return locations. Here's the quick math: a Q2 2025 gross profit margin of 39.3% was achieved by rigorous cost discipline, not just top-line growth.

• Omnichannel Fulfillment: Stores function as local distribution hubs, supporting Buy Online, Pick Up in Store (BOPIS) and same-day delivery, giving them a speed advantage over pure-play e-commerce competitors.
• Integrated Health Ecosystem: The physical layout integrates high-demand services-like grooming and the 300+ Vetco Total Care hospital and clinic locations-directly into the retail experience to boost traffic and cross-selling.
• Digital Enablement: Investments are targeting digital tools to improve the in-store experience, such as upgrading software for online grooming appointment booking, which nearly 50% of customers use.
• Cost and Inventory Discipline: The company is employing SKU rationalization (cutting slow-moving items) and disciplined pricing strategies to expand gross margin, which grew by over 120 basis points in Q2 2025.

For a deeper dive into the numbers, check out Breaking Down Petco Health and Wellness Company, Inc. (WOOF) Financial Health: Key Insights for Investors.

Petco Health and Wellness Company, Inc.'s Strategic Advantages

Petco's primary advantage in the competitive pet care market is its unique 'Health + Wellness' positioning, which is tough for online-only rivals to replicate. Services are defintely their competitive moat.

• Services as a Moat: The integrated veterinary and grooming services are sticky, high-margin offerings that drive repeat, in-person visits to the stores, where customers then purchase high-margin products.
• Proprietary Merchandise: A focus on exclusive and private label brands, such as the premium pet lifestyle brand Reddy, creates product differentiation that insulates them from direct price competition with mass merchants.
• Vital Care Loyalty Program: The membership program, which provides discounts on pet health needs and services, is being revamped to create a more personalized, long-term loyalty experience, locking in high-value customers.
• Physical Scale with Digital Speed: Operating approximately 1,500 physical locations allows Petco to offer rapid fulfillment options (BOPIS, same-day delivery) that pure-play e-commerce companies cannot match without massive, costly infrastructure build-outs.

Petco Health and Wellness Company, Inc. (WOOF) How It Makes Money

Petco Health and Wellness Company, Inc. (WOOF) generates revenue by operating a 'pet health and wellness ecosystem,' selling a mix of everyday pet consumables, discretionary supplies, and high-margin services like veterinary care, grooming, and training. The core of their model is shifting from a traditional pet retailer to a comprehensive wellness provider, driving repeat visits and higher customer lifetime value (CLV).

Petco Health and Wellness Company, Inc.'s Revenue Breakdown

As of the fiscal year 2025, Petco's revenue is heavily weighted toward essential products, but the strategic focus is clearly on expanding the higher-margin services segment. Here is the breakdown based on the fiscal year 2025 annual data, with the near-term trend from Q2 2025 results.

The biggest chunk of revenue, nearly 50%, still comes from Consumables like pet food and litter, but that segment saw a 2.0% comparable sales decline in Q2 2025, which tells you about the current competitive pressure. Supplies, the discretionary category, is struggling the most, dropping 4.5%. The only growth engine right now is Services and Other, up 1.1% for the segment, which is where the long-term profit story lives.

Business Economics

The company's economic engine is fundamentally a mixed-margin retail model transitioning to a higher-margin service model. They are deliberately sacrificing some unprofitable sales and market share to strengthen their financial position, which explains the top-line sales decline.

• Pricing Strategy: Petco is moving away from aggressive, unprofitable promotions to a more disciplined pricing strategy, especially in the Consumables category, to protect their gross margin (the profit left after cost of goods sold).
• Margin Shift: The key is the Services segment, where gross margins are significantly higher than in product retail. For example, veterinary services and grooming are less susceptible to online price wars than a bag of dog food. Services alone saw a 10% revenue increase in Q2 2025, even though the total segment growth was lower.
• Customer Lifetime Value (CLV): The physical pet care centers (stores) are now viewed as hubs for services. Getting a customer to use a Vetco Total Care hospital or a grooming appointment creates a sticky relationship, which means more predictable, recurring revenue and a higher CLV.
• Operational Reset: Petco is executing an 'operational reset' to improve retail fundamentals and cut costs, which helped expand the overall gross profit margin by approximately 120 basis points to 39.3% in Q2 2025. That's a strong sign of management discipline, defintely.

Petco Health and Wellness Company, Inc.'s Financial Performance

The financial story in 2025 is one of improving profitability despite contracting sales. The focus is clearly on the bottom line (profit) and cash flow, not just the top line (revenue).

• Net Sales Outlook: The company maintained its full-year 2025 net sales outlook, expecting a low single-digit decline from the prior year's $6.12 billion.
• Adjusted EBITDA: Petco raised its full-year 2025 Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) guidance to between $385 million and $395 million. This metric is a solid indicator of core operating health, and the raised guidance shows confidence in their cost-saving and margin-expansion efforts.
• Operating and Net Income: In Q2 2025, operating income improved significantly by $40.6 million to reach $43.0 million. More importantly, GAAP net income (the real profit number) was positive at $14.0 million, a huge improvement from a net loss in the prior year period.
• Free Cash Flow (FCF): Free cash flow for Q2 2025 was over $50 million, a substantial improvement that keeps them on track to be free cash flow positive for the full fiscal year. This is the cash a business generates after accounting for cash outflows to support operations and maintain its capital assets.

Here's the quick math: The gross margin expansion to 39.3% in Q2 2025, combined with better cost management, is what directly drove the operating income jump to $43.0 million. The business is getting leaner, even if it's not growing yet. If you want to dive deeper into the sustainability of these improvements, you should check out our full analysis: Breaking Down Petco Health and Wellness Company, Inc. (WOOF) Financial Health: Key Insights for Investors

Petco Health and Wellness Company, Inc. (WOOF) Market Position & Future Outlook

Petco Health and Wellness Company, Inc. is executing a critical operational reset to stabilize its core profitability, positioning itself as the premier integrated health and wellness destination in the pet space, not just a retailer. While the company faces near-term headwinds like a projected low single-digit net sales decline for the full fiscal year 2025, its focus on high-margin services is the clear path to a stronger financial profile.

Competitive Landscape

The pet retail market is intensely competitive, split between specialty brick-and-mortar, pure-play e-commerce, and mass-market giants. Petco's strength is its physical presence combined with a growing services arm, but online rivals dominate digital mindshare.

Opportunities & Challenges

The company is deliberately sacrificing some unprofitable sales to strengthen its financial position, which is a tough but necessary trade-off. Here's the quick math on the near-term trade-offs.

Industry Position

Petco is in a turnaround phase, prioritizing operational improvements and profitability over top-line growth, which is why the full-year 2025 Adjusted EBITDA is projected between $385 million and $395 million. This is a 'walk before it runs' approach.

• The core strategy is to solidify its position as a destination for pet health, not just products, leveraging its 1,500+ pet care centers.
• The company is actively pruning its physical footprint, planning net store closures of around 25 stores in 2025 to reduce overhead and focus on profitable locations.
• While Petco's forecast annual revenue growth rate of 1.17% is not expected to beat the US Specialty Retail industry average of 5.62%, the focus is on bottom-line enhancements.
• The stock's financial health is currently characterized as defintely 'WEAK,' underscoring the urgency of the turnaround.

Understanding the investor sentiment around this transformation is key. Exploring Petco Health and Wellness Company, Inc. (WOOF) Investor Profile: Who's Buying and Why?