Petco Health and Wellness Company, Inc. (WOOF) saw its shares surge 7.14% in pre-market trading on Friday, following the release of its third-quarter 2024 earnings results and strategic updates from the new CEO.
The pet retailer reported better-than-expected financial results for the third quarter, with revenue increasing 1% year-over-year to $1.51 billion, surpassing analysts' expectations. Additionally, comparable sales grew by an impressive 2%, driven by strength in consumables and services segments. The company's gross margin expanded by 130 basis points to 38.1%, attributed to improvements in product cost management and services margin.
Newly appointed CEO Joel Anderson outlined a series of strategic changes aimed at enhancing profitability and competitiveness. These include optimizing product assortment and shelf space to focus on high-demand items, honing pricing strategies to stay competitive, enhancing pet care services, streamlining operations to reduce costs, and renegotiating vendor and shipping contracts. Anderson expressed confidence in Petco's long-term growth potential, stating, "While there is more work to do, our improving results increase our conviction that we are on the right path to position Petco to win long-term."
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