Petco Health and Wellness Company, Inc.

Case Overview
28 Days Left to Seek Lead Plaintiff
Lead Plaintiff Deadline: | Lead Plaintiff Deadline: 08/29/2025 |
Status: | Status: Investigating |
Company Name: | Company Name: Petco Health and Wellness Company, Inc. |
Court: | Court: Southern District of California |
Case Number: | Case Number: 3:25cv01667 |
Class Period: | Class Period: 01/14/2021 - 06/05/2025 |
Ticker: | Ticker: WOOF |
Related Attorneys: | Lead Attorneys: Thomas W. Elrod |
Related Practices: | Related Practices: Securities |
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of California on behalf of those who acquired Petco Health and Wellness Company, Inc. (“Petco” or the “Company”) (NASDAQ:WOOF) securities during the period of January 14, 2024 through June 5, 2025, inclusive (“the Class Period”). Investors have until August 29, 2025 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
?On August 24, 2023, Petco issued a press release announcing its financial results for the second quarter of its FY 2023. Therein, the Company negatively revised its FY 2023 adjusted EBITDA guidance to a range of $460 million to $480 million-down significantly from its prior guidance of $520 million to $540 million-and adjusted EPS guidance to a range of $0.24 to $0.30-down significantly from its prior guidance of $0.40 to $0.48. In explaining the negatively revised guidance, Company management cited a "shift in consumer spending and pressures on our discretionary business[.]" On this news, Petco's stock price fell $1.35 per share, or 20.64%, to close at $5.19 per share on August 24, 2023.
On November 29, 2023, Petco issued a press release announcing its financial results for the third quarter of its FY 2023. Therein, the Company again negatively revised its fiscal FY 2023 adjusted EBITDA guidance to approximately $400 million-down significantly from its prior guidance of $460 million to $480 million-and adjusted EPS guidance to approximately $0.08-down significantly from its prior guidance of $0.24 to $0.30. In the same press release, Company management revealed that Petco had broadened its product offerings to include "value"-i.e., cheaper, lower-quality-pet food brands in an effort to improve sales. On this news, Petco's stock price fell $1.11 per share, or 28.91%, to close at $2.73 per share on November 29, 2023.
On March 13, 2024, Petco issued a press release announcing that Defendant Ronald V. Coughlin, Jr. had stepped down as Petco's Chief Executive Officer, Chairman, and member of the Company's Board of Directors (the "Board"). The same day, Petco issued another press release announcing its financial results for its fiscal fourth quarter and FY 2023, reporting, inter alia, that "[c]omparable sales declined 0.9 percent year over year" in the quarter, as well as a "GAAP net loss of $1.3 billion, or $(4.78) per share, which includes goodwill impairment of $1.2B[.]" On a subsequent investor conference call held the same day, Company management acknowledged that Petco's business model focused on premium products was, in fact, not sustainable as it could not weather ongoing consumer preference trends towards cheaper goods for their pets. Following these disclosures, Petco's stock price fell $0.50 per share, or 19.53%, over the following two trading sessions, to close at $2.06 per share on March 14, 2024. On April 9, 2024, Petco filed a current report on Form 8-K with the United States Securities and Exchange Commission, disclosing that the Company's Board "approved the termination of employment of Darren MacDonald, the Company's Chief Customer Officer, effective as of April 12, 2024[.]" On this news, Petco's stock price fell $0.04 per share, or 2.12%, to close at $1.85 per share on April 10, 2024.
On May 28, 2024, Petco issued a press release announcing further "changes to [its] leadership team [to] accelerate Petco's initiatives to drive retail excellence as we execute on our operational reset," including the departures of the Company's Chief Operating and Chief Merchandising and Supply Chain Officers. On this news, Petco's stock price fell $0.29 per share, or 8.48%, to close at $3.13 per share on May 29, 2024. On February 18, 2025, Petco issued a press release announcing that its then-Chief Financial Officer, Defendant Brian LaRose, had stepped down from this role. On this news, Petco's stock price fell $0.04 per share, or 1.27%, to close at $3.10 per share on February 19, 2025.
Then, on June 5, 2025, Petco issued a press release announcing its financial results for the first quarter of its FY 2025, including, inter alia, a 1.3% year-over-year decline in comparable sales-much larger than the 0.6% decline estimated by Wall Street. Multiple analysts also expressed concerns with Petco's diminishing comparable sales and market share in the wake of Defendants' profitability-focused turnaround plan. On this news, Petco's stock price fell $0.84 per share, or 23.2%, to close at $2.78 per share on June 6, 2025.
The lawsuit alleges that Defendants made materially false and misleading statements regarding Petco's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Petco's pandemic-related tailwinds were unsustainable, as was its business model of selling primarily premium and/or high-grade pet food; (ii) accordingly, the strength of Petco's differentiated product strategy was overstated; (iii) Defendants downplayed the true scope and severity of the foregoing issues, the magnitude of changes needed to rectify those issues, and the likely negative impacts of their mitigation strategy on Petco's comparable sales metric; (iv) accordingly, Defendants overstated Petco's ability to deliver sustainable, profitable growth; and (v) as a result, Defendants' public statements were materially false and misleading at all relevant times.
?On August 24, 2023, Petco issued a press release announcing its financial results for the second quarter of its FY 2023. Therein, the Company negatively revised its FY 2023 adjusted EBITDA guidance to a range of $460 million to $480 million-down significantly from its prior guidance of $520 million to $540 million-and adjusted EPS guidance to a range of $0.24 to $0.30-down significantly from its prior guidance of $0.40 to $0.48. In explaining the negatively revised guidance, Company management cited a "shift in consumer spending and pressures on our discretionary business[.]" On this news, Petco's stock price fell $1.35 per share, or 20.64%, to close at $5.19 per share on August 24, 2023.
On November 29, 2023, Petco issued a press release announcing its financial results for the third quarter of its FY 2023. Therein, the Company again negatively revised its fiscal FY 2023 adjusted EBITDA guidance to approximately $400 million-down significantly from its prior guidance of $460 million to $480 million-and adjusted EPS guidance to approximately $0.08-down significantly from its prior guidance of $0.24 to $0.30. In the same press release, Company management revealed that Petco had broadened its product offerings to include "value"-i.e., cheaper, lower-quality-pet food brands in an effort to improve sales. On this news, Petco's stock price fell $1.11 per share, or 28.91%, to close at $2.73 per share on November 29, 2023.
On March 13, 2024, Petco issued a press release announcing that Defendant Ronald V. Coughlin, Jr. had stepped down as Petco's Chief Executive Officer, Chairman, and member of the Company's Board of Directors (the "Board"). The same day, Petco issued another press release announcing its financial results for its fiscal fourth quarter and FY 2023, reporting, inter alia, that "[c]omparable sales declined 0.9 percent year over year" in the quarter, as well as a "GAAP net loss of $1.3 billion, or $(4.78) per share, which includes goodwill impairment of $1.2B[.]" On a subsequent investor conference call held the same day, Company management acknowledged that Petco's business model focused on premium products was, in fact, not sustainable as it could not weather ongoing consumer preference trends towards cheaper goods for their pets. Following these disclosures, Petco's stock price fell $0.50 per share, or 19.53%, over the following two trading sessions, to close at $2.06 per share on March 14, 2024. On April 9, 2024, Petco filed a current report on Form 8-K with the United States Securities and Exchange Commission, disclosing that the Company's Board "approved the termination of employment of Darren MacDonald, the Company's Chief Customer Officer, effective as of April 12, 2024[.]" On this news, Petco's stock price fell $0.04 per share, or 2.12%, to close at $1.85 per share on April 10, 2024.
On May 28, 2024, Petco issued a press release announcing further "changes to [its] leadership team [to] accelerate Petco's initiatives to drive retail excellence as we execute on our operational reset," including the departures of the Company's Chief Operating and Chief Merchandising and Supply Chain Officers. On this news, Petco's stock price fell $0.29 per share, or 8.48%, to close at $3.13 per share on May 29, 2024. On February 18, 2025, Petco issued a press release announcing that its then-Chief Financial Officer, Defendant Brian LaRose, had stepped down from this role. On this news, Petco's stock price fell $0.04 per share, or 1.27%, to close at $3.10 per share on February 19, 2025.
Then, on June 5, 2025, Petco issued a press release announcing its financial results for the first quarter of its FY 2025, including, inter alia, a 1.3% year-over-year decline in comparable sales-much larger than the 0.6% decline estimated by Wall Street. Multiple analysts also expressed concerns with Petco's diminishing comparable sales and market share in the wake of Defendants' profitability-focused turnaround plan. On this news, Petco's stock price fell $0.84 per share, or 23.2%, to close at $2.78 per share on June 6, 2025.
The lawsuit alleges that Defendants made materially false and misleading statements regarding Petco's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Petco's pandemic-related tailwinds were unsustainable, as was its business model of selling primarily premium and/or high-grade pet food; (ii) accordingly, the strength of Petco's differentiated product strategy was overstated; (iii) Defendants downplayed the true scope and severity of the foregoing issues, the magnitude of changes needed to rectify those issues, and the likely negative impacts of their mitigation strategy on Petco's comparable sales metric; (iv) accordingly, Defendants overstated Petco's ability to deliver sustainable, profitable growth; and (v) as a result, Defendants' public statements were materially false and misleading at all relevant times.