UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~November~~May 12, ~~2025~~2026


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-39878

Petco Health and Wellness Company, Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware	81-1005932
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

10850 Via Frontera San Diego, California	92127
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (858) 453-7845

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Class A Common Stock, par value $0.001 per share

     WOOF

     The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s Class A Common Stock outstanding as of ~~December~~June 3, ~~2025~~2026 was ~~243~~247,~~453~~774,~~341~~472.

The number of shares of the registrant’s Class B-1 Common Stock outstanding as of ~~December~~June 3, ~~2025~~2026 was 37,790,781.

The number of shares of the registrant’s Class B-2 Common Stock outstanding as of ~~December~~June 3, ~~2025~~2026 was 37,790,781.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	4
Item 1.	Financial Statements (Unaudited)	4
	Consolidated Balance Sheets	4
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Loss	6
	Consolidated Statements of Equity	7
	Consolidated Statements of Cash Flows	8
	Notes to Unaudited Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2423
Item 4.	Controls and Procedures	24
PART II.	OTHER INFORMATION	2625
Item 1.	Legal Proceedings	2625
Item 1A.	Risk Factors	2625
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2625
Item 3.	Defaults Upon Senior Securities	2625
Item 4.	Mine Safety Disclosures	2625
Item 5.	Other Information	2625
Item 6.	Exhibits	2826
Signatures		2928

Forward-Looking Statements

This Quarterly Report on Form 10-Q (this “Form 10-Q”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, concerning expectations, beliefs, plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are not statements of historical fact, including, but not limited to, statements regarding: our expectations with respect to our revenue, expenses, profitability, and other operating results; our growth plans; our ability to compete effectively in the markets in which we participate; the execution on our transformation initiatives; and the impact of certain macroeconomic factors, including tariffs, inflationary and interest rate pressures, consumer spending patterns, global supply chain constraints, and global economic and geopolitical developments, on our business. Forward-looking and other statements in this Form 10-Q may also address our progress, plans, and goals with respect to sustainability initiatives, and the inclusion of such statements is not an indication that these contents are necessarily material to investors or required to be disclosed in our filings with the U.S. Securities and Exchange Commission (the “SEC”). Such plans and goals may change, and statements regarding such plans and goals are not guarantees or promises that they will be met. In addition, historical, current, and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.

Such forward-looking statements can generally be identified by the use of forward-looking terms such as “believes,” “expects,” “may,” “intends,” “will,” “shall,” “should,” “anticipates,” “opportunity,” “illustrative”, or the negative thereof or other variations thereon or comparable terminology. Although we believe that the expectations and assumptions reflected in these statements are reasonable, there can be no assurance that these expectations will prove to be correct or that any forward-looking results will occur or be realized. Nothing contained in this Form 10-Q is, or should be relied upon as, a promise or representation or warranty as to any future matter, including any matter in respect of our operations or business or financial condition. All forward-looking statements are based on current expectations and assumptions about future events that may or may not be correct or necessarily take place and that are by their nature subject to significant uncertainties and contingencies, many of which are outside of our control.

Forward-looking statements are subject to many risks, uncertainties and other factors that could cause actual results or events to differ materially from the potential results or events discussed in such forward-looking statements, including, without limitation, those identified in this Form 10-Q as well as the following: (i) increased competition (including from multi-channel retailers, mass and grocery retailers, and e-Commerce providers); (ii) reduced consumer demand for our products and/or services; (iii) our reliance on key vendors; (iv) our ability to attract and retain qualified employees; (v) risks arising from statutory, regulatory, and/or legal developments; (vi) macroeconomic pressures in the markets in which we operate, including inflation, prevailing interest rates, and the impact of tariffs; (vii) failure to effectively manage our costs; (viii) our reliance on our information technology systems; (ix) our ability to prevent or effectively respond to a data privacy or security breach; (x) our ability to effectively manage or integrate strategic ventures, alliances, or acquisitions and realize the anticipated benefits of such transactions; (xi) economic or regulatory developments that might affect our ability to provide attractive promotional financing; (xii) business interruptions and other supply chain issues; (xiii) catastrophic events, political tensions, conflicts and wars (such as the ongoing conflicts in Ukraine and the Middle East), government shutdowns, health crises, and pandemics; (xiv) our ability to maintain positive brand perception and recognition; (xv) product safety and quality concerns; (xvi) changes to labor or employment laws or regulations; (xvii) our ability to effectively manage our real estate portfolio; (xviii) constraints in the capital markets or our vendor credit terms; (xix) changes in our credit ratings; (xx) impairments of the carrying value of our goodwill and other intangible assets; (xxi) our ability to successfully implement our operational adjustments, achieve the expected benefits of our cost action plans, and drive improved profitability; (xxii) our ability to deliver sustainable, profitable growth; and (~~xxii~~xxiii) the other risks, uncertainties and other factors referred to under “Risk Factors” and identified elsewhere in this Form 10-Q and our other filings with the SEC. The occurrence of any such factors could significantly alter the results set forth in these statements.

We caution that the foregoing list of risks, uncertainties and other factors is not complete, and forward-looking statements speak only as of the date they are made. We undertake no duty to update publicly any such forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law, regulation, or other competent legal authority.

In addition, statements such as “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Form 10-Q. While ~~we believe that information provides a reasonable basis for these statements, that information may be limited or~~

we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

	November 1,2025			February 1,2025
	May 2,2026			January 31,2026
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	~~237~~166,~~413~~804		$	~~165~~256,~~756~~736
Receivables, less allowance for credit losses ($940 and $1,594, respectively)		42,900			40,425
Receivables, less allowance for credit losses ($858 and $779, respectively)		36,928			45,812
Merchandise inventories, net		~~617~~632,~~896~~912			~~653~~590,~~329~~210
Prepaid expenses		4364,~~721~~036			5351,~~515~~747
Other current assets		6560,~~470~~164			6075,~~594~~281
Total current assets		1960,~~007,400~~844			~~973~~1,~~619~~019,786
Fixed assets		2,~~342~~404,~~513~~132			2,~~265~~378,~~915~~208
Less accumulated depreciation		(1,~~672~~758,~~868~~226	)		(1,~~540~~722,~~477~~060	)
Fixed assets, net		~~669,~~645,906			~~725~~656,~~438~~148
Operating lease right-of-use assets		1,~~306~~265,~~554~~299			1,~~302~~288,~~346~~593
Goodwill		980,064			980,064
Trade name		1,025,000			1,025,000
Other long-term assets		~~216~~207,~~461~~473			~~187~~203,~~963~~834
Total assets	$	5,~~205~~084,~~124~~586		$	5,~~194~~173,~~430~~425
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and book overdrafts	$	~~429~~480,~~978~~656		$	~~492~~450,~~878~~552
Accrued salaries and employee benefits		~~111~~107,~~919~~784			~~157~~154,~~460~~148
Accrued expenses and other liabilities		~~209~~216,~~811~~183			~~177~~204,~~079~~751
Current portion of operating lease liabilities		~~346~~312,~~650~~399			~~306~~320,~~400~~082
Current portion of long-term debt and other lease liabilities		513,~~102~~245			54,~~346~~608
Total current liabilities		1,~~103~~130,~~460~~267			1,~~139~~134,~~163~~141
Senior secured credit facilities, net, excluding current portion		1874,~~581,950~~116			1,~~578~~488,~~091~~527
Operating lease liabilities, excluding current portion		1,035,774			1,037,206
Senior notes, net		590,146			—
Deferred taxes, net		220,651			217,712
Operating lease liabilities, excluding current portion		994,995			1,047,185
Other long-term liabilities		105,693			108,628
Deferred taxes, net		235,197			234,911
Total liabilities		4,047,528			4,080,800
Other long-term liabilities		104,560			104,407
Commitments and contingencies (Notes 4 and 8)
Total liabilities		3,929,281			4,009,171
Commitments and contingencies (Note 8)
Stockholders' equity:
Class A common stock, $0.001 par value: Authorized - 1.0 billion shares; Issued and outstanding - 243.1 million and 239.1 million shares, respectively		243			239
Class A common stock, $0.001 par value: Authorized - 1.0 billion shares; Issued and outstanding - 247.4 million and 243.7 million shares, respectively		247			244
Class B-1 common stock, $0.001 par value: Authorized - 75.0 million shares; Issued and outstanding - 37.8 million shares		38			38
Class B-2 common stock, $0.000001 par value: Authorized - 75.0 million shares; Issued and outstanding - 37.8 million shares		—			—
Preferred stock, $0.001 par value: Authorized - 25.0 million shares; Issued and outstanding - none		—			—
Additional paid-in-capital		2,~~304~~318,~~491~~877			2,~~280~~312,~~495~~354
Accumulated deficit		(1,~~137~~155,~~418~~139	)		(1,~~149~~139,~~059~~993	)
Accumulated other comprehensive loss		(98,~~758~~718	)		(188,~~083~~389	)
Total stockholders’ equity		1,~~157~~155,~~596~~305			1,~~113~~164,~~630~~254
Total liabilities and stockholders’ equity	$	5,~~205~~084,~~124~~586		$	5,~~194~~173,~~430~~425

See accompanying notes to consolidated financial statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts) (Unaudited)

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Net sales:
Products	$	1,~~209~~228,~~601~~087		$	1,~~263~~241,~~194~~891		$	~~3,677,097~~		$	~~3,806,674~~
Services and other		~~254~~268,~~810~~645			~~248~~251,~~243~~508			~~769,242~~			~~757,658~~
Total net sales		1,~~464~~496,~~411~~732			1,~~511~~493,~~437~~399			~~4,446,339~~			~~4,564,332~~
Cost of sales:
Products		~~739~~757,~~893~~778			~~782~~766,~~240~~285			~~2,253,321~~			~~2,362,065~~
Services and other		~~155~~164,~~503~~529			~~153~~157,~~440~~146			~~468,716~~			~~467,125~~
Total cost of sales		~~895~~922,~~396~~307			~~935~~923,~~680~~431			~~2,722,037~~			~~2,829,190~~
Gross profit		~~569~~574,~~015~~425			~~575~~569,~~757~~968			~~1,724,302~~			~~1,735,142~~
Selling, general and administrative expenses		~~539~~549,~~819~~799			~~571~~553,~~780~~609			~~1,635,725~~			~~1,745,479~~
Operating income (loss)		29,196			3,977			88,577			(10,337	)
Operating income		24,626			16,359
Interest income		(1,~~814~~497	)		(1,~~346~~359	)		~~(4,082~~	)		~~(2,436~~	)
Interest expense		32,~~827~~785			3533,~~797~~494			~~99,618~~			~~109,420~~
Other non-operating income		—			(8,465	)		—			(5,800	)
Loss on extinguishment and modification of debt		11,840			—
Loss before income taxes and income from equity method investees		(118,~~817~~502	)		(2215,~~009~~776	)		~~(6,959~~	)		~~(111,521~~	)
Income tax benefit		(6,276	)		(857	)		(5,035	)		(9,985	)
Income tax expense		2,199			495
Income from equity method investees		(45,~~871~~555	)		(4,~~479~~610	)		~~(13,565~~	)		~~(13,557~~	)
Net income (loss) attributable to Class A and B-1 common stockholders	$	9,330		$	(16,673	)	$	11,641		$	(87,979	)
Net loss attributable to Class A and B-1 common stockholders	$	(15,146	)	$	(11,661	)
Net income (loss) per Class A and B-1 common share:
Net loss per Class A and B-1 common share:
Basic	$	(0.0305	)	$	(0.0604	)	$	~~0.04~~		$	~~(0.32~~	)
Diluted	$	(0.0305	)	$	(0.0604	)	$	~~0.04~~		$	~~(0.32~~	)
Weighted average shares used in computing net income (loss) per Class A and B-1 common share:
Weighted average shares used in computing net loss per Class A and B-1 common share:
Basic		~~280~~283,~~380~~684			~~274~~277,~~495~~548			~~278,995~~			~~272,446~~
Diluted		~~288~~283,~~221~~684			~~274~~277,~~495~~548			~~285,640~~			~~272,446~~

See accompanying notes to consolidated financial statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE ~~INCOME (~~LOSS)

(In thousands) (Unaudited)

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Net income (loss) attributable to Class A and B-1 common stockholders	$	9,330		$	(16,673	)	$	11,641		$	(87,979	)
Net loss attributable to Class A and B-1 common stockholders	$	(15,146	)	$	(11,661	)
Other comprehensive income (loss), net of tax:
Other comprehensive loss, net of tax:
Foreign currency translation adjustment		2(1,~~178~~118	)		~~(7,198~~32	)		~~9,847~~			~~(16,454~~	)
Unrealized gain (loss) on derivatives		~~306~~752			5(2,~~127~~267	)		~~(1,100~~	)		~~3,651~~
Gains on derivatives reclassified to income		(111	)		(574	)		(422	)		(2,286	)
Losses (gains) on derivatives reclassified to income		37			(159	)
Total other comprehensive income (loss), net of tax		2,373			(2,645	)		8,325			(15,089	)
Total other comprehensive loss, net of tax		(329	)		(2,394	)
Comprehensive income (loss) attributable to Class A and B-1 common stockholders	$	11,703		$	(19,318	)	$	19,966		$	(103,068	)
Comprehensive loss attributable to Class A and B-1 common stockholders	$	(15,475	)	$	(14,055	)

See accompanying notes to consolidated financial statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(In thousands) (Unaudited)

	Common stock
	Class A (shares)		Class B-1 (shares)		Class B-2 (shares)		Amount		Additional paid-in capital			Accumulateddeficit			Accumulatedothercomprehensiveloss			Totalstockholders’equity
Balance at February 1, 2025		239,066		37,791		37,791	$	277	$	2,280,495		$	(1,149,059	)	$	(18,083	)	$	1,113,630
Balance at January 31, 2026		243,719		37,791		37,791	$	282	$	2,312,354		$	(1,139,993	)	$	(8,389	)	$	1,164,254
Equity-based compensation expense (Note 7)		—		—		—		—		9,~~445~~451			—			—			9,~~445~~451
Net loss		—		—		—		—		—			(1115,~~661~~146	)		—			(1115,~~661~~146	)
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			32(1,118	)		32(1,118	)
Unrealized loss on derivatives (Note 5), net of tax		—		—		—		—		—			—			(2,267	)		(2,267	)
Unrealized gain on derivatives (Note 5), net of tax		—		—		—		—		—			—			752			752
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(159	)		(159	)
Losses on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			37			37
Issuance of common stock, net of tax withholdings		13,~~765~~634		—		—		23		(12,~~692~~928	)		—			—			(12,~~690~~925	)
Balance at May 3, 2025		240,831		37,791		37,791	$	279	$	2,288,248		$	(1,160,720	)	$	(20,477	)	$	1,107,330
Balance at May 2, 2026		247,353		37,791		37,791	$	285	$	2,318,877		$	(1,155,139	)	$	(8,718	)	$	1,155,305
Equity-based compensation expense (Note 7)		—		—		—		—		8,807			—			—			8,807
Net income		—		—		—		—		—			13,972			—			13,972
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			7,637			7,637
Unrealized gain on derivatives (Note 5), net of tax		—		—		—		—		—			—			861			861
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(152	)		(152	)
Issuance of common stock, net of tax withholdings		1,233		—		—		1		647			—			—			648
Balance at August 2, 2025		242,064		37,791		37,791	$	280	$	2,297,702		$	(1,146,748	)	$	(12,131	)	$	1,139,103
Equity-based compensation expense (Note 7)		—		—		—		—		7,152			—			—			7,152
Net income		—		—		—		—		—			9,330			—			9,330
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			2,178			2,178
Unrealized gain on derivatives (Note 5), net of tax		—		—		—		—		—			—			306			306
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(111	)		(111	)
Issuance of common stock, net of tax withholdings		1,032		—		—		1		(363	)		—			—			(362	)
Balance at November 1, 2025		243,096		37,791		37,791		281		2,304,491			(1,137,418	)		(9,758	)		1,157,596

	Common stock
	Class A (shares)		Class B-1 (shares)		Class B-2 (shares)		Amount		Additional paid-in capital			Accumulateddeficit			~~Accumulatedothercomprehensiveincome (loss)~~Accumulatedothercomprehensiveloss			Totalstockholders’equity
Balance at February 3, 2024		231,156		37,791		37,791	$	269	$	2,229,582		$	(1,047,243	)	$	1,821		$	1,184,429
Balance at February 1, 2025		239,066		37,791		37,791	$	277	$	2,280,495		$	(1,149,059	)	$	(18,083	)	$	1,113,630
Equity-based compensation expense (Note 7)		—		—		—		—		179,~~451~~445			—			—			179,~~451~~445
Net loss		—		—		—		—		—			(4611,~~483~~661	)		—			(4611,~~483~~661	)
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			~~1,665~~32			~~1,665~~32
Unrealized gain on derivatives (Note 5), net of tax		—		—		—		—		—			—			6,372			6,372
Unrealized loss on derivatives (Note 5), net of tax		—		—		—		—		—			—			(2,267	)		(2,267	)
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(~~850~~159	)		(~~850~~159	)
Issuance of common stock, net of tax withholdings		1,~~793~~765		—		—		2		(~~277~~1,692	)		—			—			(~~275~~1,690	)
Balance at May 4, 2024		232,949		37,791		37,791	$	271	$	2,246,756		$	(1,093,726	)	$	9,008		$	1,162,309
Balance at May 3, 2025		240,831		37,791		37,791	$	279	$	2,288,248		$	(1,160,720	)	$	(20,477	)	$	1,107,330
Equity-based compensation expense (Note 7)		—		—		—		—		11,879			—			—			11,879
Net loss		—		—		—		—		—			(24,823	)		—			(24,823	)
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			(10,921	)		(10,921	)
Unrealized loss on derivatives (Note 5), net of tax		—		—		—		—		—			—			(7,848	)		(7,848	)
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(862	)		(862	)
Issuance of common stock, net of tax withholdings		2,878		—		—		3		1,746			—			—			1,749
Balance at August 3, 2024		235,827		37,791		37,791	$	274	$	2,260,381		$	(1,118,549	)	$	(10,623	)	$	1,131,483
Equity-based compensation expense (Note 7)		—		—		—		—		11,330			—			—			11,330
Net loss		—		—		—		—		—			(16,673	)		—			(16,673	)
Foreign currency translation adjustment, net of tax		—		—		—		—		—			—			(7,198	)		(7,198	)
Unrealized gain on derivatives (Note 5), net of tax		—		—		—		—		—			—			5,127			5,127
Gains on derivatives reclassified to income (Note 5), net of tax		—		—		—		—		—			—			(574	)		(574	)
Issuance of common stock, net of tax withholdings		1,331		—		—		1		(659	)		—			—			(658	)
Balance at November 2, 2024		237,158		37,791		37,791	$	275	$	2,271,052		$	(1,135,222	)	$	(13,268	)	$	1,122,837

See accompanying notes to consolidated financial statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands) (Unaudited)

	Thirty-nine weeks ended
	Thirteen weeks ended
	November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Cash flows from operating activities:
Net income (loss)	$	11,641		$	(87,979	)
Net loss	$	(15,146	)	$	(11,661	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		~~148~~49,~~466~~041			~~149~~49,~~414~~811
Amortization of debt discounts and issuance costs		31,~~760~~337			31,~~661~~246
Provision for deferred taxes		~~(50~~288	)		(359,~~629~~218	)
Equity-based compensation		259,~~372~~451			409,~~705~~420
Impairments, write-offs and losses on sale of fixed and other assets		677			8,449
Loss on extinguishment and modification of debt		11,840			—
Income from equity method investees		(135,~~565~~555	)		(134,~~557~~610	)
Amounts reclassified out of accumulated other comprehensive loss		~~(561~~51	)		(~~3,035~~212	)
Non-cash operating lease costs		~~308~~103,~~297~~080			~~311~~102,~~347~~132
Other non-operating loss (income)		—			(5,800	)
Changes in assets and liabilities:
Receivables		(28,~~709~~884	)		4,~~287~~229
Merchandise inventories		35(42,~~433~~702	)		(67,~~194~~857	)
Prepaid expenses and other assets		(28,~~437~~299	)		(1,~~601~~673	)
Accounts payable and book overdrafts		~~(63~~30,~~121~~577	)		(3619,~~427~~028	)
Accrued salaries and employee benefits		(46,~~238~~362	)		28(51,~~986~~130	)
Accrued expenses and other liabilities		3011,~~028~~559			~~(817~~12,426	)
Operating lease liabilities		(~~273~~139,~~942~~677	)		(~~280~~103,~~101~~780	)
Other long-term liabilities		~~(523~~664	)		2(1,~~769~~263	)
Net cash provided by operating activities		160,528			81,680
Net cash used in operating activities		(30,969	)		(15,454	)
Cash flows from investing activities:
Cash paid for fixed assets		(8938,~~960~~153	)		(9128,~~041~~412	)
Cash paid for acquisitions, net of cash acquired		—			(464	)
Insurance recoveries		230			—
Cash paid for investment		—			(457	)
Proceeds from sale of assets		—			1,279
Proceeds from investment		—			998
Cash received from partial surrender of officers' life insurance		74			—
Proceeds from sale of assets		2,541			1,252
Net cash used in investing activities		(37,849	)		(27,133	)
Cash received from partial surrender of officers' life insurance		—			206
Net cash used in investing activities		(87,419	)		(89,506	)
Cash flows from financing activities:
Borrowings under long-term debt agreements		—1,500,000			~~201,000~~—
Repayments of long-term debt		—(1,500,000	)		~~(201,000~~—	)
Debt refinancing costs		—			(3,028	)
Debt refinancing costs and original issue discount		(28,442	)		—
Payments for finance lease liabilities		(41,~~433~~110	)		(41,~~608~~143	)
Proceeds from employee stock purchase plan and stock option exercises		21,~~738~~008			~~2,585~~967
Tax withholdings on stock-based awards		(34,~~656~~094	)		(~~5,251~~158	)
Proceeds from issuance of common stock		—			2,500
Net cash used in financing activities		(32,638	)		(334	)
Net cash used in financing activities		(5,351	)		(7,802	)
Net decrease in cash, cash equivalents and restricted cash		(101,456	)		(42,921	)
Net increase (decrease) in cash, cash equivalents and restricted cash		67,758			(15,628	)
Cash, cash equivalents and restricted cash at beginning of period		269,412			181,665
Cash, cash equivalents and restricted cash at beginning of period		181,665			136,649
Cash, cash equivalents and restricted cash at end of period	$	167,956		$	138,744
Cash, cash equivalents and restricted cash at end of period	$	249,423		$	121,021
Supplemental cash flow disclosure:
Supplemental cash flow disclosures:
Interest paid, net	$	21,271		$	31,112
Interest paid, net	$	94,088		$	105,252
Income taxes paid	$	3,917		$	24,652
Supplemental non-cash investing and financing activities disclosure:
Accounts payable and accrued expenses for capital expenditures	$	1517,~~665~~056		$	1413,~~936~~010

See accompanying notes to consolidated financial statements.

PETCO HEALTH AND WELLNESS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Summary of Significant Accounting Policies

Basis of Presentation

Petco Health and Wellness Company, Inc. (together with its consolidated subsidiaries, the “Company”) is a leading pet specialty retailer focused on improving the lives of pets, pet parents, and its own partners. The Company manages its business as one reportable operating segment.

In the opinion of management, the accompanying consolidated financial statements contain all adjustments necessary for a fair presentation as prescribed by accounting principles generally accepted in the United States (“GAAP”). All adjustments were comprised of normal recurring adjustments, except as noted in these Notes to Consolidated Financial Statements.

There have been no significant changes from the significant accounting policies disclosed in Note 1 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February~~January 131, ~~2025~~2026.

The accompanying consolidated financial statements have been prepared in accordance with GAAP for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Interim financial results are not necessarily indicative of results anticipated for the full year. The accompanying consolidated financial statements and these Notes to Consolidated Financial Statements should be read in conjunction with the audited consolidated financial statements and Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February~~January 131, ~~2025~~2026, from which the prior year balance sheet information herein was derived.

Use of Estimates

The preparation of these consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates are based on information that is currently available and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could vary from those estimates under different assumptions or conditions.

Derivative Instruments

InThe ~~November 2022, the~~ Company has entered into ainterest ~~series~~rate ofcollar and interest rate ~~cap~~swap agreements to limit the maximum interest on a portion of the Company’s variable-rate debt and decrease its exposure to interest rate variability relating to ~~the~~ three-month ~~Secured Overnight Financing Rate as published by CME Group ("~~Term SOFR"). The interest rate ~~caps~~collars ~~became effective December 30, 2022~~ and ~~expired~~swap onare ~~December 31, 2024. The interest rate caps were~~ accounted for as cash flow hedges, and changes in the fair value ~~of the interest rate caps~~ are reported as a component of accumulated other comprehensive income (loss) ("AOCI").

The Company has also entered into interest rate collar and interest rate swap agreements to limit the maximum interest on a portion of the Company’s variable-rate debt and decrease its exposure to interest rate variability relating to three-month Term SOFR.

The interest rate collars and swap are accounted for as cash flow hedges, and changes in the fair value are reported as a component of AOCI.

Cash and Cash Equivalents

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets to the total amounts reported in the consolidated statements of cash flows (in thousands):

	November 1,2025		February 1,2025
	May 2,2026		January 31,2026
Cash and cash equivalents	$	~~237~~166,~~413~~804	$	~~165~~256,~~756~~736
Restricted cash included in other current assets		121,~~010~~152		1512,~~909~~676
Total cash, cash equivalents and restricted cash in the statement of cash flows	$	~~249~~167,~~423~~956	$	~~181~~269,~~665~~412

2. Revenue Recognition

Net sales by product type and services were as follows (in thousands):

Thirteen weeks ended

~~Thirty-nine weeks ended~~

November 1,2025

November 2,2024

November 1,2025

November 2,2024

May 2,2026

May 3,2025

Consumables

~~731~~746,~~456~~827

~~753~~748,~~230~~070

~~2,209,444~~

~~2,261,970~~

Supplies and companion animals

~~478~~481,~~145~~260

~~509~~493,~~964~~821

~~1,467,653~~

~~1,544,704~~

Services and other

~~254~~268,~~810~~645

~~248~~251,~~243~~508

~~769,242~~

~~757,658~~

Net sales

1,~~464~~496,~~411~~732

1,~~511~~493,~~437~~399

~~4,446,339~~

~~4,564,332~~

3. ~~Goodwill~~Senior Secured Credit Facilities

The Company ~~has~~had ~~one~~a ~~reporting~~$1,700.0 ~~unit~~million secured term loan facility originally maturing on March 4, 2028 (the “First Lien Term Loan”). ~~The~~As of January 31, 2026, the outstanding principal balance of the First Lien Term Loan was $1,500.0 million. On February 2, 2026, the Company ~~performs~~entered ~~its~~into ~~annual~~a ~~impairment~~refinancing ~~test~~amendment ~~during~~to the ~~fourth~~credit ~~quarter~~agreement ofgoverning ~~each~~the ~~fiscal~~First ~~year~~Lien orTerm ~~more~~Loan ~~frequently~~and ~~when~~issued ~~warranted~~$600.0 bymillion ~~events~~in oraggregate principal amount of senior secured notes (the “Senior Secured Notes”). Among other changes, the amendment provided that certain lenders would provide new term loans to the Company in ~~circumstances~~an aggregate principal amount of $900.0 million (the “Amended First Lien Term Loan”), the proceeds of which, together with cash on hand and the proceeds from the Company's issuance of the Senior Secured Notes, would be used to repay the then outstanding principal on the First Lien Term Loan.

~~During~~Interest under the ~~first~~Amended ~~quarter~~First ofLien ~~fiscal~~Term ~~2024~~Loan is, ~~due~~at ~~to declines in~~ the Company'’s ~~share price~~option, ~~the~~either ~~Company~~a ~~performed~~base anrate ~~interim~~plus ~~impairment test~~3.25% Asor ~~the~~Term ~~estimated~~SOFR ~~fair~~plus ~~value~~4.25%, ofpayable ~~the~~quarterly ~~Company's reporting unit was~~ in ~~excess of its carrying value, the Company concluded that goodwill was not impaired during the first quarter of fiscal 2024~~arrears. The ~~fair~~base ~~value~~rate ofis the ~~Company's~~greater ~~reporting unit was based upon an equal weighting~~ of the ~~income~~bank ~~and~~prime ~~market approaches~~rate, ~~utilizing~~federal ~~estimated~~funds ~~cash~~effective ~~flows~~rate ~~and~~plus a0.5% ~~terminal~~or ~~value,~~one ~~discounted~~month atTerm aSOFR ~~rate~~plus of1.0%. ~~return~~The ~~that~~Amended ~~reflects~~First ~~the~~Lien ~~relative~~Term ~~risk~~Loan ofmatures ~~the~~on ~~cash~~February ~~flows~~2, as2031. ~~well~~Principal aspayments ~~valuation multiples derived from comparable publicly traded companies that~~ are ~~applied~~$2.25 tomillion ~~operating~~quarterly ~~performance~~and ofcommence ~~the~~on ~~reporting~~June ~~unit.~~30, 2026.

~~Significant~~The ~~assumptions~~Company ~~used~~has ina ~~the~~secured ~~determination~~asset-based ofrevolving ~~fair~~credit ~~value~~facility of(as amended from time to time, the ~~reporting~~“ABL ~~unit~~Revolving ~~generally~~Credit ~~include~~Facility”). ~~prospective~~The ~~financial~~first ~~information,~~tranche ~~discount~~of ~~rates,~~the ~~terminal~~ABL ~~growth~~Revolving ~~rates~~Credit Facility, ~~and~~which ~~earnings~~had ~~multiples.~~availability ~~The~~of ~~discounted~~up ~~cash~~to ~~flow~~$35.0 ~~model~~million, ~~used~~subject to ~~determine~~a ~~the~~borrowing ~~fair~~base, ~~value~~matured ofon ~~the~~March ~~reporting~~4, ~~unit~~2026. ~~during~~The ~~the~~remaining ~~first~~tranche ~~quarter~~has availability of ~~fiscal~~up ~~2024~~to ~~reflected~~$546.0 ~~the~~million, ~~Company's~~subject ~~most~~to ~~recent~~a ~~cash~~borrowing ~~flow projections~~base, amaturing ~~discount~~on ~~rate~~March of29, 132029.~~2%,~~ ~~and~~Interest aon ~~terminal~~the ~~growth~~ABL ~~rate~~Revolving ofCredit ~~3%.~~Facility ~~The~~is ~~reporting~~based ~~unit~~on, ~~fair~~at ~~value~~the ~~measurement~~Company's isoption, ~~classified~~either asthe ~~Level~~base 3rate insubject ~~the~~to ~~fair~~a ~~value~~1% ~~hierarchy~~floor, ~~because~~or itTerm ~~involves~~SOFR ~~significant~~subject ~~unobservable~~to ~~inputs.~~a floor of 0%, plus an applicable margin.

There were no triggering events identified and no indications of impairment of the Company’s goodwill during the thirteen week period ended November 2, 2024 and the thirteen and thirty-nine week periods ended November 1, 2025.

4. Senior Secured Credit Facilities

The Company has a secured term loan facility maturing on March 4, 2028 (the “First Lien Term Loan”) and a secured asset-based revolving credit facility with availability of up to $581.0 million, subject to a borrowing base (as amended from time to time, the “ABL Revolving Credit Facility”). The first tranche of the ABL Revolving Credit

~~Facility~~As ~~has availability~~ of upMay ~~to $35.0 million~~2, ~~subject to a borrowing base~~2026, ~~maturing~~the onCompany ~~March~~was 4,in ~~2026.~~compliance ~~The~~with ~~second~~its ~~tranche~~covenants ~~has~~under ~~availability~~the ofAmended upFirst toLien ~~$546.0~~Term ~~million,~~Loan ~~subject~~and ~~to a borrowing base, maturing on March 29, 2029. Interest on~~ the ABL Revolving Credit Facility ~~is based on, at the Company's option, either the base rate subject to a 1% floor, or Term SOFR subject to a floor of 0%, plus an applicable margin~~.

As of November 1, 2025, the Company was in compliance with its covenants under the First Lien Term Loan and the ABL Revolving Credit Facility.

Term Loan Facilities

AsIn ofconnection ~~November~~with 1the February 2, ~~2025~~2026 transaction, the ~~outstanding~~Company ~~principal~~recognized ~~balance~~a ofloss ~~the~~on ~~First~~debt ~~Lien~~extinguishment ~~Term~~and ~~Loan~~modification ~~was~~of $~~1,595~~11.38 million, (which consisted of a $~~1,585~~4.50 million, ~~net~~write-off of ~~the~~ unamortized debt discount and ~~debt~~ issuance costs) on the First Term Loan Facility and $7.8 Asmillion of ~~February~~third-party 1,expenses. ~~2025,~~Fees ~~the~~relating ~~outstanding~~to ~~principal~~the ~~balance~~Company’s ofentry into the Amended First Lien Term Loan ~~was~~consisted ~~$1,595~~of arranger fees and other third-party expenses.3 ~~million~~Of (those fees, $1~~,582~~.54 million, ~~net~~was ofcapitalized ~~the~~as ~~unamortized discount and~~ debt issuance costs)., ~~The~~along ~~weighted~~with ~~average~~$9.0 ~~interest~~million ~~rate~~of onoriginal ~~the~~issue ~~borrowings outstanding was 7~~discount.6% ~~and~~The ~~7.9%~~remaining asportion of ~~November~~original 1,issue ~~2025~~discount and ~~February~~debt 1,issuance ~~2025,~~costs ~~respectively.~~of ~~Debt~~the ~~issuance~~First ~~costs~~Term ~~are~~Loan Facility previously capitalized is being amortized over the contractual term of the Amended First Lien Term Loan to interest expense using the effective interest rate in effect at issuance~~. As of November 1~~, ~~2025~~as ~~and~~these ~~February~~amounts 1,represent ~~2025,~~ the ~~estimated~~portion ~~fair~~that ~~value of the First Lien Term Loan~~ was ~~approximately~~not ~~$1,569.4~~substantially ~~million and $1,529~~modified.~~5 million, respectively, based upon Level 2 fair value hierarchy inputs.~~

As of May 2, 2026, the outstanding principal balance of the Amended First Lien Term Loan was $900.0 million ($886.1 million, net of the unamortized discount and debt issuance costs). As of January 31, 2026, the outstanding principal balance of the First Lien Term Loan was $1,500.0 million ($1,491.8 million, net of the unamortized discount and debt issuance costs). The weighted average interest rate on the borrowings outstanding was 8.1% and 7.3% as of May 2, 2026 and January 31, 2026, respectively. Debt issuance costs are being amortized over the contractual term to interest expense using the effective interest rate in effect at issuance. As of May 2, 2026, the estimated fair value of the Amended First Lien Term Loan was approximately $893.3 million, based upon Level 2 fair value hierarchy inputs. As of January 31, 2026, the estimated fair value of the First Lien Term Loan was $1,496.3 million, based upon Level 2 fair value hierarchy inputs.

Revolving Credit Facilities

InAs ~~March~~of ~~2024~~May 2, ~~the~~2026 ~~Company~~and ~~amended~~January 31, 2026, no amounts were outstanding under the ABL Revolving Credit Facility. toAs ~~increase~~of ~~its~~May ~~total~~2, ~~availability~~2026, ~~and~~$487.6 ~~extend~~million ~~the~~was ~~maturity~~available onunder athe ~~portion~~ABL ofRevolving ~~the~~Credit ~~availability.~~Facility, ~~Fees~~which is net of $358.04 million ~~relating~~of tooutstanding ~~the~~letters ~~Company’s~~of ~~entry~~credit ~~into~~issued in the ~~amendment~~normal ~~were~~course ~~capitalized~~of asbusiness. ~~debt~~As ~~issuance~~of ~~costs.~~May ~~These~~2, ~~fees~~2026 ~~consisted~~and ofJanuary ~~arranger~~31, ~~fees~~2026, ~~and~~unamortized ~~other~~debt ~~third-party~~issuance ~~expenses.~~costs ~~The~~of ~~unamortized~~$3.0 ~~portion~~million ofand ~~the~~$3.2 ~~debt~~million, ~~issuance~~respectively, ~~costs~~relating ofto the ABL Revolving Credit Facility ~~previously~~were ~~capitalized~~outstanding isand were being amortized ~~over~~using the ~~amended~~straight-line ~~contractual~~method over the remaining term of the agreement.

AsInterest ofon ~~November 1, 2025 and February 1, 2025, no amounts were outstanding under~~ the ABL Revolving Credit Facility. Asis ofbased ~~November 1~~on, ~~2025,~~at ~~$495.5 million was available under~~ the ~~ABL~~Company’s ~~Revolving Credit Facility~~option, ~~which~~either ~~is net of $58.4 million of outstanding letters of credit issued in~~ the ~~normal~~base ~~course~~rate ofsubject ~~business~~to ~~and~~ a ~~$27.~~1% ~~million~~floor, ~~borrowing~~or ~~base~~Term ~~reduction~~SOFR ~~based~~subject onto ~~qualifying~~a ~~assets.~~floor As of ~~November 1~~0%, ~~2025~~plus ~~and~~an ~~February~~applicable 1,margin. ~~2025,~~The ~~unamortized~~applicable ~~debt~~margin ~~issuance~~is ~~costs~~currently ofequal ~~$3.5~~to ~~million~~25 ~~and~~basis ~~$4.4~~points ~~million,~~in ~~respectively, relating to~~ the ~~ABL~~case ~~Revolving~~of ~~Credit~~base ~~Facility~~rate ~~were~~loans ~~outstanding~~ and ~~were~~125 ~~being~~basis ~~amortized~~points ~~using~~in the ~~straight-line~~case ~~method over the remaining term~~ of ~~the~~Term ~~agreement~~SOFR loans.

Prior to the March 2024 amendment, interest on the ABL Revolving Credit Facility was based on, at the Company’s option, either the base rate or Adjusted Term SOFR subject to a floor of 0%, in either case, plus an applicable margin4. ~~Following~~Senior ~~the~~Secured March 2024 amendment, interest on the ABL Revolving Credit Facility is now based on, at the Company’s option, either the base rate subject to a 1% floor, or Term SOFR subject to a floor of 0%, plus an applicable margin. The applicable margin is currently equal to 25 basis points in the case of base rate loans and 125 basis points in the case of Term SOFR loans.Notes

As part of the February 2, 2026 refinancing of the First Lien Term Loan described in Note 3, "Senior Secured Credit Facilities", the Company issued $600.0 million in aggregate principal amount of senior secured notes. The Senior Secured Notes bear interest at 8.25% per annum, payable semiannually in arrears, and mature on February 1, 2031. Approximately $10.3 million of arranger fees and other third-party expenses relating to the Company’s issuance of the Senior Secured Notes were capitalized as debt issuance costs.

As of May 2, 2026, the outstanding principal balance of the Senior Secured Notes was $600.0 million ($590.1 million, net of the unamortized debt issuance costs). As of May 2, 2026, the weighted average interest rate on the borrowings outstanding was 8.3%. Debt issuance costs are being amortized over the contractual term to interest expense using the effective interest rate in effect at issuance. As of May 2, 2026, the estimated fair value of the Senior Secured Notes was approximately $601.5 million, based upon Level 2 fair value hierarchy inputs.

5. Derivative Instruments

The interest rate swap, ~~caps~~ and collars are accounted for as cash flow hedges because they are expected to be highly effective in hedging variable rate interest payments. Changes in the fair value of the cash flow hedges are reported as a component of AOCI. As of November 1, 2025, AOCI included unrealized losses of $1.7 million ($1.3 million, net of tax). As of February 1, 2025, AOCI included unrealized gains of $0.4 million ($0.3 million, net of tax). Approximately $0.2 million and $0.6 million of pre-tax gains deferred in AOCI were reclassified to interest expense during the thirteen and thirty-nine week periods ended November 1, 2025, respectively. Approximately $0.8 million and $3.0 million of pre-tax gains deferred in AOCI were reclassified to interest expense during the thirteen and thirty-nine week periods ended November 2, 2024, respectively. The Company currently estimates that $0.3 million of losses related to trade date costs on its cash flow hedges that are currently deferred in AOCI will be reclassified to interest expense in the consolidated statement of operations within the next twelve months. This estimate could vary based on actual amounts as a result of changes in market conditions.

reported as a component of AOCI. As of May 2, 2026, AOCI included unrealized gains of $0.1 million ($0.1 million, net of tax). As of January 31, 2026, AOCI included unrealized losses of $1.0 million ($0.8 million, net of tax). Approximately $0.1 million of pre-tax losses and $0.2 million of pre-tax gains deferred in AOCI were reclassified to interest expense during the thirteen week periods ended May 2, 2026 and May 3, 2025, respectively.

The cash flow hedges are reflected in the Company’s consolidated balance sheets as follows (in thousands):

Assets (Liabilities)	Balance sheet location	~~November~~May 12,~~2025~~2026			~~February~~January 131,~~2025~~2026
Current asset portion of cash flow hedges	Other current assets	$	~~141~~163		$	~~1,194~~—
Non-current asset portion of cash flow hedges	Other long-term assets		—			~~746~~—
Current liability portion of cash flow hedges	Accrued expenses and other liabilities		(~~662~~72	)		(~~107~~853	)
Non-current liability portion of cash flow hedges	Other long-term liabilities		~~(789~~—	)		~~(554~~—	)
Total cash flow hedges		$	~~(1,310~~91	)	$	~~1,279~~(853	)

6. Fair Value Measurements

Assets and Liabilities Measured on a Recurring Basis

The following table presents information about assets and liabilities that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value (in thousands):

November 1, 2025

May 2, 2026

Level 1

Level 2

Level 3

Assets (liabilities):

Money market mutual funds

~~200~~114,~~510~~652

—

Investments of officers' life insurance

—

1516,~~892~~415

—

Non-qualified deferred compensation plan

—

(1413,~~302~~975

)

—

February 1, 2025

January 31, 2026

Level 1

Level 2

Level 3

Assets (liabilities):

Money market mutual funds

~~127~~216,~~109~~676

—

Investments of officers' life insurance

—

1416,~~630~~109

—

Non-qualified deferred compensation plan

—

(13,~~996~~447

)

—

The fair value of money market mutual funds is based on quoted market prices, such as quoted net asset values published by the fund as supported in an active market. Money market mutual funds included in the Company’s cash and cash equivalents were $~~188~~113.5 million and $~~111~~204.50 million as of ~~November~~May 12, ~~2025~~2026 and ~~February~~January 131, ~~2025~~2026, respectively. Also included in the Company’s money market mutual funds balances were $121.02 million and $1512.67 million as of ~~November~~May 12, ~~2025~~2026 and ~~February~~January 131, ~~2025~~2026, respectively, which relate to the Company’s restricted cash, and are included in other current assets in the consolidated balance sheets.

The Company maintains a deferred compensation plan for key executives and other members of management, which is funded by investments in officers’ life insurance. The fair value of this obligation is based on participants’ elected investments, which reflect the closing market prices of similar assets.

The Company holds certain investments in equity securities without readily determinable fair values. When an upward or downward adjustment occurs, the resulting gains or losses are included in other non-operating income in the consolidated statements of operations.

Assets Measured on a Non-Recurring Basis

The Company’s non-financial assets, which primarily consist of goodwill, other intangible assets, fixed assets and equity and other investments, are reported at carrying value, or at fair value as of the date of the Company’s acquisition of Petco Holdings, Inc. LLC on January 26, 2016, and are not required to be measured at fair value on a recurring basis. However, on a periodic basis (at least annually for goodwill and indefinite-lived intangibles or

~~whenever~~Assets ~~events~~Measured oron ~~changes~~a ~~in circumstances indicate that the carrying value of an asset may not be recoverable), non~~Non-~~financial~~Recurring ~~assets are assessed for impairment. If impaired, the carrying values of the assets are written down to fair value using Level 3 inputs.~~Basis

The Company’s ~~trade~~non-financial ~~name~~assets, ~~has~~which anprimarily ~~indefinite~~consist ~~life.~~of ~~The~~goodwill, ~~Company~~other ~~performs~~intangible ~~its~~assets, ~~annual~~fixed ~~impairment~~assets ~~test~~and ~~during~~equity ~~the~~and ~~fourth~~other ~~quarter~~investments, ofare ~~each~~reported ~~fiscal~~at ~~year~~carrying value, or ~~more~~at ~~frequently~~fair ~~when~~value ~~warranted~~as byof ~~events~~the ordate ~~changes~~of inthe ~~circumstances.~~Company’s ~~During~~acquisition ~~the~~of ~~first~~Petco ~~quarter~~Holdings, ofInc. ~~fiscal~~LLC ~~2024~~on January 26, ~~due~~2016, and are not required to ~~declines~~be inmeasured ~~the~~at ~~Company's~~fair ~~share~~value ~~price,~~on ~~the~~a ~~Company~~recurring ~~performed~~basis. anHowever, ~~interim~~on ~~impairment~~a ~~test~~periodic ofbasis ~~its~~(at least annually for goodwill and indefinite-lived ~~trade~~intangibles ~~name.~~or ~~Refer~~whenever toevents ~~Note~~or 3changes ~~for~~in ~~further~~circumstances ~~discussion~~indicate ofthat the ~~results~~carrying value of ~~interim~~an asset may not be recoverable), non-financial assets are assessed for impairment. ~~testing~~If ~~performed~~impaired, onthe carrying values of the ~~Company’s~~assets ~~goodwill.~~are written down to fair value using Level 3 inputs.

~~The~~There ~~fair~~were ~~value~~no oftriggering ~~the~~events ~~Company’s~~identified ~~trade~~and ~~name~~no ~~was~~indications ~~estimated~~of byimpairment ~~management~~of ~~using~~ the ~~relief~~Company’s ~~from~~goodwill, ~~royalty~~indefinite-lived ~~valuation~~trade ~~method~~name, ~~which~~or ~~estimates~~equity ~~the~~and ~~hypothetical~~other ~~royalties~~investments ~~that~~during ~~would~~the ~~have~~thirteen toweek beperiods ~~paid~~ended ifMay ~~the~~2, ~~trade~~2026 ~~name~~and ~~was~~May ~~not~~3, ~~owned~~2025. ~~The~~During ~~fair value of~~ the ~~Company's~~thirteen ~~trade~~week ~~name~~periods ~~reflected~~ended ~~the~~May ~~Company's most recent revenue projections~~2, a2026 ~~discount rate of 14.2%~~ and aMay ~~terminal growth rate of~~ 3%., ~~The~~2025, ~~Company concluded that~~ the ~~fair~~Company ~~value~~recorded offixed ~~its~~asset ~~trade name exceeded its carrying value,~~ and ~~therefore~~right-of-use noasset ~~trade name~~ impairment ~~charge~~charges ~~was recorded during the first quarter~~ of ~~fiscal 2024~~$0.1 ~~The~~million ~~Company's~~and ~~trade~~$0.6 ~~name~~million, ~~fair value measurement is classified as Level 3 in the fair value hierarchy because it involves significant unobservable inputs~~respectively.

There were no triggering events identified and no indications of impairment of the Company’s goodwill, indefinite-lived trade name, other intangible assets or equity and other investments during the thirteen and thirty-nine week periods ended November 1, 2025. There were no indications of impairment of the Company’s other intangible assets or equity and other investments during the thirteen and thirty-nine week periods ended November 2, 2024. During the thirteen and thirty-nine week periods ended November 1, 2025, the Company recorded fixed asset and right-of-use asset impairment charges of $0.1 million and $1.1 million, respectively. During the thirteen and thirty-nine week periods ended November 2, 2024, the Company recorded fixed asset and right-of-use asset impairment charges of $1.3 million and $8.2 million, respectively.

7. Stockholders’ Equity

Equity-Based Compensation

Equity-based compensation awards under the Company’s current equity incentive plan (as amended, the “2021 Equity Incentive Plan”) include restricted stock units (“RSUs,” which include performance-based stock units and market-based stock units), restricted stock awards (“RSAs”), non-qualified stock options, and other equity compensation awards. In addition, the Company has made equity-based compensation awards of RSUs and non-qualified stock options outside of the 2021 Equity Incentive Plan as employment inducement awards (collectively, the “Inducement Awards”). The Company also has an employee stock purchase plan (“ESPP”).

The Company’s controlling parent, Scooby LP, also maintains an incentive plan (the “2016 Incentive Plan”) under which it has awarded partnership unit awards to certain current and former employees, consultants, and non-employee directors of the Company that are restricted profit interests in Scooby LP subject to a distribution threshold (“Series C Units”). No additional Series C Units have been or will be awarded following the Company’s initial public offering. As of ~~November~~May 12, ~~2025~~2026, substantially all Series C Units are fully vested.

The following table summarizes the Company’s equity-based compensation expense by award type (in thousands):

Thirteen weeks ended

~~Thirty-nine weeks ended~~

November 1,2025

November 2,2024

November 1,2025

November 2,2024

May 2,2026

May 3,2025

RSUs and RSAs

57,~~314~~763

87,~~210~~735

~~19,957~~

~~27,879~~

Options

1,~~427~~403

21,~~175~~365

~~4,230~~

~~10,193~~

ESPP

~~412~~285

~~746~~338

~~1,165~~

~~1,380~~

Other awards

10—

~~226~~(18

)

~~1,253~~

Total equity-based compensation expense

79,~~163~~451

119,~~357~~420

~~25,372~~

~~40,705~~

Activity under the 2021 Equity Incentive Plan and the Inducement Awards was as follows (shares and dollars in thousands):

	RSUs and RSAs			Options
Nonvested/outstanding, February 1, 2025		12,180			11,685
Nonvested/outstanding, January 31, 2026		19,845			13,562
Granted		1513,~~713~~194			~~3,050~~—
Vested and delivered/exercised		(4,~~224~~651	)		—(59	)
Forfeited/expired		(~~2,239~~728	)		(~~957~~95	)
Nonvested/outstanding, November 1, 2025		21,430			13,778
Nonvested/outstanding, May 2, 2026		27,660			13,408
Unrecognized compensation expense as of November 1, 2025	$	41,705		$	10,384
Unrecognized compensation expense as of May 2, 2026	$	57,084		$	7,272
Weighted average remaining expense period as of November 1, 2025	2.1 years			1.9 years
Weighted average remaining expense period as of May 2, 2026	2.4 years			1.4 years

The ESPP allows eligible employees to contribute up to 15% of their base earnings towards purchases of Class A common stock, subject to an annual maximum. The purchase price will be 85% of the lower of (i) the fair market value of the stock on the associated lookback date and (ii) the fair market value of the stock on the last day of the related purchase period.

~~Earnings (~~Loss) Per Share

Potentially dilutive securities include potential Class A common shares related to outstanding stock options, unvested RSUs and RSAs, and the ESPP, calculated using the treasury stock method. The calculation of diluted shares outstanding excludes securities where the combination of the exercise or purchase price (in the case of options and the ESPP) and the associated unrecognized compensation expense is greater than the average market price of Class A common shares because the inclusion of these securities would be anti-dilutive.

~~There~~ All ~~were~~outstanding ~~approximately~~equity ~~15.1~~awards ~~million potential shares that~~ were ~~anti-dilutive and~~ excluded from the ~~computation~~calculation of diluted ~~shares~~loss ~~outstanding~~per ~~during~~Class ~~the~~A ~~thirty~~and B-~~nine~~1 common share in the thirteen weeks ended ~~November~~May 12, 2026 and May 3, 2025, as their effect would be antidilutive in a net loss period.

All outstanding equity awards were excluded from the calculation of diluted loss per Class A and B-1 common share in the thirty-nine weeks ended November 2, 2024, as their effect would be antidilutive in a net loss period.

8. Commitments and Contingencies

The Company is involved in legal proceedings and is subject to other claims and litigation arising in the ordinary course of its business. The Company has made accruals with respect to certain of these matters, where appropriate, which are reflected in the Company’s consolidated financial statements but are not, individually or in the aggregate, considered material. For other matters, the Company has not made accruals because management has not yet determined that a loss is probable or because the amount of loss cannot be reasonably estimated. While the ultimate outcome of the matters cannot be determined, the Company currently does not expect that these matters will have a material adverse effect on its consolidated financial statements. The outcome of any litigation is inherently uncertain, however, and if decided adversely to the Company, or if the Company determines that settlement of particular litigation is appropriate, the Company may be subject to liability that could have a material adverse effect on its consolidated financial statements.

9. Reportable Segment

The Company has one reportable segment managed on a consolidated basis. The measure of segment profit or loss is consolidated net income (loss) that is reported on the consolidated statement of operations. The measure of segment assets is reported on the consolidated balance sheet as total assets.

The following represents segment information for the Company’s single operating segment, for the periods presented (in thousands):

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Revenue	$	1,~~464~~496,~~411~~732		$	1,~~511~~493,~~437~~399		$	~~4,446,339~~		$	~~4,564,332~~
Add (deduct):
Cost of sales		(~~895~~922,~~396~~307	)		(~~935~~923,~~680~~431	)		~~(2,722,037~~	)		~~(2,829,190~~	)
Advertising and marketing expenses		(3839,~~063~~087	)		(3735,~~638~~446	)		~~(111,430~~	)		~~(117,472~~	)
Stock compensation - general and administrative		(79,~~043~~342	)		(119,~~357~~323	)		~~(25,022~~	)		~~(40,705~~	)
Other general and administrative expenses (1)		(~~494~~501,~~713~~370	)		(~~522~~508,~~785~~840	)		~~(1,499,273~~	)		~~(1,587,302~~	)
Interest income		1,~~814~~497			1,~~346~~359			~~4,082~~			~~2,436~~
Interest expense		(32,~~827~~785	)		(3533,~~797~~494	)		~~(99,618~~	)		~~(109,420~~	)
Other non-operating income		—			8,465			—			5,800
Loss on extinguishment and modification of debt		(11,840	)		—
Income tax benefit		6,276			857			5,035			9,985
Income tax expense		(2,199	)		(495	)
Income from equity method investees		45,~~871~~555			4,~~479~~610			~~13,565~~			~~13,557~~
Consolidated net income (loss)	$	9,330		$	(16,673	)	$	11,641		$	(87,979	)
Consolidated net loss	$	(15,146	)	$	(11,661	)

(1)

Other general & administrative expenses include pet care center expenses, support center labor and occupancy costs, legal, accounting, information technology, ~~and~~ consulting costs, ~~depreciation~~ and ~~amortization,~~depreciation ~~as well as impairments, write-offs,~~ and ~~losses on the sale of fixed and other assets~~amortization.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q (this “Form 10-Q”), as well as the corresponding Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended ~~February~~January 131, ~~2025~~2026 (the “~~2024~~2025 Form 10-K”). The discussion and analysis below contains certain forward-looking statements about our business and operations that are subject to the risks, uncertainties, and other factors referred to in Part II, Item 1A, “Risk Factors” of this Form 10-Q. These risks, uncertainties, and other factors could cause our actual results to differ materially from those expressed in, or implied by, the forward-looking statements. The risks described in this Form 10-Q and in other documents we file from time to time with the U.S. Securities and Exchange Commission (the “SEC”), including the section entitled “Forward-Looking Statements” in this Form 10-Q, should be carefully reviewed. All amounts herein are unaudited.

Overview

Petco Health and Wellness Company, Inc. (“Petco”, the “Company”, “we”, “our” and “us”) is a leading pet specialty retailer focused on improving the lives of pets, pet parents, and our own partners. ~~Through~~We ~~our~~nurture ~~omnichannel~~the ~~ecosystem,~~pet-human webond ~~provide~~in ~~our~~the ~~customers~~aisles ~~with a comprehensive offering~~ of ~~products and services to fulfill all of their pets’ needs through our~~ more than 1,500 ~~pet~~Petco ~~care~~stores ~~centers~~ across the U.S., Mexico, and ~~Puerto Rico, our digital channel, and our flexible fulfillment options~~Chile.

Our multicategory strategy integrates our digital assets with our nationwide physical footprint to meet the needs of pet parents who are looking for a single source for all their pets' needs. Petco.com, our e-commerce site, and the Petco app, our personalized mobile app, together serve as hubs for pet parents to book appointments and manage all of their pets’ needs, while enabling them to shop wherever, whenever, and however they want. We are focused on continually improving both our digital capabilities as well as our membership offering.

We strive to be a company that is improving millions of pet lives as well as the lives of pet parents and the partners who work for us. In tandem with Petco Love, an independent 501(c)(3) nonprofit organization, we work with and support thousands of local animal welfare groups nationwide and, through these partnerships and in-store adoption events, we have helped find homes for over 7 million animals.

Macroeconomic factors, including interest rates, potential inflationary pressures, supply chain constraints, tariffs, and global economic and geopolitical developments, including geopolitical conflicts and tensions, have had varying impacts on our results of operations that are difficult to isolate and quantify. We cannot predict the duration or ultimate severity of these macroeconomic factors or the ultimate impact on our operations and liquidity. Please refer to the risk factors referred to in Part II, Item 1A, “Risk Factors” of this Form 10-Q.

On February 20, 2026, the U.S. Supreme Court issued a decision invalidating certain tariffs previously imposed under the International Emergency Economic Power Act ("IEEPA"). We have applied for a refund of tariffs paid, following the processes established by U.S. Customs and Border Protection. We will continue to evaluate new information and will recognize any IEEPA tariff refunds or related receivables when they are realized or realizable.

How We Assess the Performance of Our Business

In assessing our performance, we consider a variety of performance and financial measures, including the following:

Comparable Sales

Comparable sales is an important measure throughout the retail industry and includes both retail and digital sales of products and services. A new location or digital site is included in comparable sales beginning on the first day of the fiscal month following 12 full fiscal months of operation and is subsequently compared to like time periods from the previous year. Relocated pet care centers become comparable pet care centers on the first day of operation if the original pet care center was open longer than 12 full fiscal months. If, during the period presented, a pet care center was closed, sales from that pet care center are included up to the first day of the month of closing. There may be variations in the way in which some of our competitors and other retailers calculate comparable sales. As a result, data in this filing regarding our comparable sales may not be comparable to similar data made available by other retailers.

Comparable sales allow us to evaluate how our overall ecosystem is performing by measuring the change in period-over-period net sales from locations and digital sites that have been open for the applicable period. We intend to improve comparable sales by continuing initiatives aimed to increase customer retention, frequency of visits, and basket size. General macroeconomic and retail business trends are also a key driver of changes in comparable sales.

Non-GAAP Financial Measures

Management and our board of directors review, in addition to GAAP (as defined herein) measures, certain non-GAAP financial measures, including Adjusted EBITDA and Free Cash Flow, to evaluate our operating performance, generate future operating plans, and make strategic decisions regarding the allocation of capital. Further explanations of these non-GAAP measures, along with reconciliations to their most comparable GAAP measures, are presented below under “Reconciliation of Non-GAAP Financial Measures to GAAP Measures.”

Executive Summary

Comparing the thirteen weeks ended ~~November~~May 12, ~~2025~~2026 with the thirteen weeks ended ~~November~~May 23, ~~2024~~2025 (unless otherwise noted), our results included the following:

•

aan ~~decrease~~increase in net sales from $1.5149 billion to $1.4650 billion, representing a period-over-period ~~decrease~~growth of 30.12% and a comparable sales ~~decrease~~increase of 20.27%;

•

operating income of $2924.26 million, compared to operating income of $416.04 million in the prior year period;

•

net ~~income~~loss attributable to Class A and B-1 common stockholders of $915.31 million, compared to net loss attributable to Class A and B-1 common stockholders of $1611.7 million in the prior year period; and

•

an increase in Adjusted EBITDA from $8189.24 million to $9897.63 million.

Results of Operations

The following tables summarize our results of operations and the percent of net sales of line items included in our consolidated statements of operations (dollars in thousands):

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Net sales:
Products	$	1,~~209~~228,~~601~~087		$	1,~~263~~241,~~194~~891		$	~~3,677,097~~		$	~~3,806,674~~
Services and other		~~254~~268,~~810~~645			~~248~~251,~~243~~508			~~769,242~~			~~757,658~~
Total net sales		1,~~464~~496,~~411~~732			1,~~511~~493,~~437~~399			~~4,446,339~~			~~4,564,332~~
Cost of sales:
Products		~~739~~757,~~893~~778			~~782~~766,~~240~~285			~~2,253,321~~			~~2,362,065~~
Services and other		~~155~~164,~~503~~529			~~153~~157,~~440~~146			~~468,716~~			~~467,125~~
Total cost of sales		~~895~~922,~~396~~307			~~935~~923,~~680~~431			~~2,722,037~~			~~2,829,190~~
Gross profit		~~569~~574,~~015~~425			~~575~~569,~~757~~968			~~1,724,302~~			~~1,735,142~~
Selling, general and administrative expenses		~~539~~549,~~819~~799			~~571~~553,~~780~~609			~~1,635,725~~			~~1,745,479~~
Operating income (loss)		29,196			3,977			88,577			(10,337	)
Operating income		24,626			16,359
Interest income		(1,~~814~~497	)		(1,~~346~~359	)		~~(4,082~~	)		~~(2,436~~	)
Interest expense		32,~~827~~785			3533,~~797~~494			~~99,618~~			~~109,420~~
Other non-operating income		—			(8,465	)		—			(5,800	)
Loss on extinguishment and modification of debt		11,840			—
Loss before income taxes and income from equity method investees		(118,~~817~~502	)		(2215,~~009~~776	)		~~(6,959~~	)		~~(111,521~~	)
Income tax benefit		(6,276	)		(857	)		(5,035	)		(9,985	)
Income tax expense		2,199			495
Income from equity method investees		(45,~~871~~555	)		(4,~~479~~610	)		~~(13,565~~	)		~~(13,557~~	)
Net income (loss) attributable to Class A and B-1 common stockholders	$	9,330		$	(16,673	)	$	11,641		$	(87,979	)
Net loss attributable to Class A and B-1 common stockholders	$	(15,146	)	$	(11,661	)

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Net sales:
Products		82.61	%		83.62	%		~~82.7~~	%		~~83.4~~	%
Services and other		17.49			16.48			~~17.3~~			~~16.6~~
Total net sales		100.0			100.0			~~100.0~~			~~100.0~~
Cost of sales:
Products		50.56			51.83			~~50.7~~			~~51.8~~
Services and other		1011.60			10.15			~~10.5~~			~~10.2~~
Total cost of sales		61.16			61.98			~~61.2~~			~~62.0~~
Gross profit		38.94			38.12			~~38.8~~			~~38.0~~
Selling, general and administrative expenses		36.97			37.81			~~36.8~~			~~38.2~~
Operating income (loss)		2.0			0.3			2.0			(0.2	)
Operating income		1.7			1.1
Interest income		(0.1	)		(0.1	)		~~(0.1~~	)		~~(0.1~~	)
Interest expense		2.2			2.53			~~2.3~~			~~2.4~~
Other non-operating income		—			(0.6	)		—			(0.1	)
Loss on extinguishment and modification of debt		0.8			—
Loss before income taxes and income from equity method investees		(0.1.2	)		(1.51	)		~~(0.2~~	)		~~(2.4~~	)
Income tax benefit		(0.4	)		(0.1	)		(0.1	)		(0.2	)
Income tax expense		0.1			0.0
Income from equity method investees		(0.3	)		(0.3	)		~~(0.4~~	)		~~(0.3~~	)
Net income (loss) attributable to Class A and B-1 common stockholders		0.6	%		(1.1	)%		0.3	%		(1.9	)%
Net loss attributable to Class A and B-1 common stockholders		(1.0	)%		(0.8	)%

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
	November 1,2025			November 2,2024			November 1,2025			November 2,2024
	May 2,2026			May 3,2025
Operational Data:
Comparable sales change		(20.27	)%		(1.83	)%		~~(1.6~~	)%		~~0.3~~	%
Total pet care centers (U.S. and Puerto Rico) at end of period		1,389			1,413			1,389			1,413
Total pet care centers (U.S.) at end of period		1,378			1,393
Adjusted EBITDA (in thousands)	$	9897,~~564~~331		$	8189,~~236~~449		$	~~301,873~~		$	~~240,403~~

Thirteen ~~and Thirty-nine~~ Weeks Ended ~~November~~May 12, ~~2025~~2026 Compared with Thirteen ~~and Thirty-nine~~ Weeks Ended ~~November~~May 23, ~~2024~~2025

Net Sales and Comparable Sales

	Thirteen weeks ended										~~Thirty-nine weeks ended~~
(dollars in thousands)	~~November~~May 12,~~2025~~2026		~~November~~May 23,~~2024~~2025		$ Change			% Change			~~November 1,2025~~		~~November 2,2024~~		~~$ Change~~			~~% Change~~
Consumables	$	~~731~~746,~~456~~827	$	~~753~~748,~~230~~070	$	(211,~~774~~243	)		(20.92	%)	$	~~2,209,444~~	$	~~2,261,970~~	$	~~(52,526~~	)		~~(2.3~~	%)
Supplies and companion animals		~~478~~481,~~145~~260		~~509~~493,~~964~~821		(3112,~~819~~561	)		(6.2.5	%)		~~1,467,653~~		~~1,544,704~~		~~(77,051~~	)		~~(5.0~~	%)
Services and other		~~254~~268,~~810~~645		~~248~~251,~~243~~508		617,~~567~~137			2.6.8	%		~~769,242~~		~~757,658~~		~~11,584~~			~~1.5~~	%
Net sales	$	1,~~464~~496,~~411~~732	$	1,~~511~~493,~~437~~399	$	~~(47~~3,~~026~~333	)		(30.12	%)	$	~~4,446,339~~	$	~~4,564,332~~	$	~~(117,993~~	)		~~(2.6~~	%)

Net sales ~~decreased~~increased $473.03 million, or 30.12%, to $1.4650 billion in the thirteen weeks ended ~~November~~May 12, ~~2025~~2026 compared to net sales of $1.5149 billion in the thirteen weeks ended ~~November~~May 23, ~~2024~~2025. ~~Net~~The sales ~~decreased~~increase ~~$118.0~~primarily ~~million,~~reflects orgrowth ~~2.6%,~~in toour ~~$4.45~~services ~~billion~~business, indriven ~~the~~by ~~thirty-nine~~our ~~weeks~~investments ~~ended~~in ~~November~~customer 1,acquisition ~~2025~~and ~~compared~~retention, toas ~~net~~well ~~sales~~as optimization of ~~$4.56~~our ~~billion~~veterinary infootprint. ~~the~~We ~~thirty-nine~~also ~~weeks~~experienced ~~ended~~positive ~~November~~comparable ~~2, 2024. The~~ sales ~~decrease~~trends ~~primarily~~in ~~reflects~~our ~~lower~~consumables ~~transaction~~category, ~~volume~~offset ~~and~~by a lower pet care center count,. asWe ~~well~~continue asto ~~a greater~~ focus on profitability and margin through a ~~more~~ disciplined approach to managing unit costs, pricing, and promotional strategies. We continue to experience momentum in services, driven in part by our strategic investments in customer acquisition and retention, as well as efforts to optimize our existing veterinary hospital footprint.

We are unable to quantify certain factors impacting sales described above due to the fact that such factors are based on input measures or qualitative information that do not lend themselves to quantification.

Gross Profit

As a percentage of net sales, our gross profit rate was 38.94% for the thirteen weeks ended ~~November~~May 12, ~~2025~~2026 compared with 38.12% for the thirteen weeks ended ~~November~~May 23, ~~2024. As a percentage of net sales, our gross profit rate was 38.8% for the thirty-nine weeks ended November 1,~~ 2025 ~~compared with 38~~.0% ~~for~~We ~~the~~continue ~~thirty-nine~~to ~~weeks~~focus ~~ended~~on ~~November~~effectively 2,utilizing ~~2024. The increase between the periods reflects improved utilization of~~ our services footprint, asand ~~well~~managing ~~as more effective management of~~ our inventory, unit costs, pricing, and promotional strategies. We are unable to quantify the factors impacting gross profit rate described above due to the fact that such factors are based on input measures or qualitative information that do not lend themselves to quantification.

Selling, General and Administrative (“SG&A”) Expenses

As a percentage of net sales, SG&A expenses were 36.97% for the thirteen weeks ended ~~November~~May 12, ~~2025~~2026 compared with 37.81% for the thirteen weeks ended ~~November~~May 23, ~~2024. As a percentage of net sales, SG&A expenses were 36.8% for the thirty-nine weeks ended November 1,~~ 2025 ~~compared with 38~~.2% ~~for the thirty-nine weeks ended November 2, 2024.~~ The decrease in SG&A expenses between the periods was primarily due to lower payroll and ~~other compensation costs, which included improved actuarial results from employee benefits optimization initiatives, as well as lower~~ consulting costs~~. In addition~~, ~~the~~partially ~~Company~~offset ~~incurred~~by ~~disposition~~an ~~costs~~increase ~~relating~~in toadvertising ~~its Pupbox business during the thirty-nine weeks ended November 2, 2024~~expenses.

Interest Expense

Interest expense decreased $3.0.7 million, or 82.31%, to $32.8 million in the thirteen weeks ended ~~November~~May 12, ~~2025~~2026 compared with $3533.85 million in the thirteen weeks ended ~~November~~May 23, ~~2024~~2025. ~~Interest~~The ~~expense~~decrease ~~decreased~~was ~~$9.8~~primarily ~~million,~~driven orby ~~9.0%,~~a tolower ~~$99.6~~aggregate ~~million~~outstanding inprincipal ~~the~~balance ~~thirty-nine~~of ~~weeks ended November 1~~indebtedness, ~~2025~~partially ~~compared~~offset ~~with $109.4 million in the thirty-nine weeks ended November 2, 2024. The decrease was primarily driven~~ by ~~lower~~higher interest rates ~~on the First Lien Term Loan~~ during the thirteen ~~and~~weeks ~~thirty-nine week periods~~ ended ~~November~~May 12, ~~2025~~2026. For more information, refer to Note 43, “Senior Secured Credit Facilities,” toand Note 4, "Senior Secured Notes" in the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

~~Other~~Loss ~~Non-Operating~~on ~~Income~~Extinguishment and Modification of Debt

~~There~~Loss ~~was~~on noextinguishment ~~other~~and ~~non-operating~~modification ~~income~~of ordebt ~~loss~~was ~~recognized~~$11.8 ~~during~~million for the thirteen ~~and~~weeks ~~thirty-nine~~ended ~~week~~May ~~periods~~2, ~~ended~~2026. ~~November~~This 1loss was recognized in conjunction with the February 2, ~~2025.~~2026 ~~Other~~debt ~~non-operating~~refinancing ~~income~~transaction ~~was~~described ~~$8.5~~under ~~million~~"Sources of Liquidity—Senior Secured Credit Facilities and $5Senior Secured Notes" below.8 ~~million~~There ~~for~~was ~~the~~no ~~thirteen~~loss on debt extinguishment and ~~thirty-nine~~modification for the thirteen weeks ended ~~November~~May 23, ~~2024, respectively~~2025. For more information, refer to Note 63, “~~Fair~~Senior ~~Value~~Secured ~~Measurements~~Credit Facilities,” and Note 4, "Senior Secured Notes," to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Income Tax ~~Benefit~~Expense

~~Our~~We ~~effective~~compute our tax ~~rates~~provision ~~were~~ (~~205.4~~benefit)% ~~and~~for ~~(76.2)%,~~interim ~~resulting~~periods inby ~~income~~applying ~~tax~~the ~~benefit~~estimated ofannual ~~$6.3~~effective ~~million~~tax ~~and~~rate ~~$5.0~~to ~~million~~our ~~for the thirteen and thirty~~year-~~nine~~to-date ~~weeks~~income ~~ended~~(loss) ~~November~~before 1,income ~~2025~~taxes, ~~respectively,~~adjusted ~~compared~~for todiscrete ~~effective~~items ~~tax~~recognized ~~rates~~during ofthe 4quarter.9% ~~and 10.2%~~However, ~~resulting~~due into ~~income~~the ~~tax~~sensitivity ~~benefit~~ of ~~$0.9~~the ~~million~~estimated ~~and~~annual ~~$10.0~~effective ~~million~~tax ~~for~~rate ~~the~~to ~~thirteen~~changes ~~and~~in ~~thirty-nine~~estimated ~~weeks~~annual ~~ended~~pre-tax ~~November 2~~results, ~~2024,~~we ~~respectively.~~determined ~~The~~that ~~change~~the inactual effective tax ~~rates~~rate ~~for~~method is the ~~thirteen~~appropriate ~~and~~approach ~~thirty-nine~~in ~~weeks~~the ~~ended~~computation ~~November~~of 1,the ~~2025~~interim ~~was~~tax ~~primarily~~provision ~~driven~~for bythe athirteen ~~change~~weeks inended ~~earnings~~May ~~and~~2, a2026, ~~decrease~~as in the ~~amount~~use of ~~compensation~~the ~~associated~~estimated ~~expenses~~annual ~~not~~effective ~~expected~~tax torate bewould ~~deductible~~provide ~~for~~a ~~corporate~~distortive ~~income tax purposes~~result.

OnOur ~~July~~actual 4,effective ~~2025~~tax rate was (17.0)%, ~~the~~resulting ~~One~~in ~~Big~~income ~~Beautiful~~tax ~~Bill~~expense ~~Act~~of ~~(“OBBBA”)~~$2.2 ~~was~~million ~~signed~~for ~~into~~the ~~law.~~thirteen ~~OBBBA~~weeks ~~introduces~~ended ~~significant~~May ~~changes~~2, to2026, ~~U.S.~~compared ~~income-tax~~to ~~legislation.~~an ~~Key~~estimated ~~provisions~~annual ~~affecting~~effective ~~the~~tax ~~Company~~rate ~~include~~of (i4.5%), ~~100~~resulting ~~percent~~in ~~bonus~~income ~~depreciation~~tax ~~for~~expense ~~qualified~~of ~~property~~$0.5 ~~placed~~million infor ~~service~~the ~~after~~thirteen ~~January~~weeks 19ended May 3, 2025,. ~~(ii)~~The ~~immediate~~change ~~expensing~~in oftax ~~domestic~~rate ~~research~~for ~~and~~the ~~experimental~~thirteen ~~expenditures~~weeks ~~starting~~ended ~~January~~May 12, ~~2025~~2026, ~~and~~was ~~(iii)~~primarily andriven ~~increase~~by toa ~~the~~reduction ~~cap~~of onequity-based ~~the~~compensation ~~deductibility~~not ofexpected ~~business~~to ~~interest~~be ~~expense~~deductible for ~~taxable~~tax ~~years~~purposes, ~~starting~~along ~~after~~with ~~December~~a ~~31,~~change ~~2024.~~in Wepre-tax ~~have~~earnings ~~considered~~and the ~~impact~~application of ~~the OBBBA on~~ our ~~annual~~actual effective tax rate. ~~These~~in ~~provisions~~the ~~did~~current ~~not~~period ~~have~~compared ato ~~material~~the ~~impact~~use toof ~~income~~our ~~taxes~~estimated inannual ~~our~~effective ~~financial~~tax ~~statements~~rate ~~for~~in the ~~third~~prior ~~quarter 2025~~year.

Reconciliation of Non-GAAP Financial Measures to GAAP Measures

The following information provides definitions and reconciliations of certain non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP. Such non-GAAP financial measures are not calculated in accordance with GAAP and should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the most comparable GAAP measures. The non-GAAP financial measures presented may differ from similarly-titled measures used by other companies.

Adjusted EBITDA

We present Adjusted EBITDA, a non-GAAP financial measure, because we believe it enhances an investor’s understanding of our financial and operational performance by excluding certain material non-cash items, unusual or non-recurring items that we do not expect to continue in the future, and certain other adjustments we believe are or are not reflective of our ongoing operations and performance. Adjusted EBITDA enables operating performance to be reviewed across reporting periods on a consistent basis. We use Adjusted EBITDA as one of the principal measures to evaluate and monitor our operating financial performance and to compare our performance to others in our industry. We also use Adjusted EBITDA in connection with establishing discretionary annual incentive compensation targets, to make budgeting decisions, to make strategic decisions regarding the allocation of capital, and to report our quarterly results as defined in our debt agreements, although under such agreements the measure is calculated differently and is used for different purposes.

Adjusted EBITDA is not a substitute for net income (loss), the most comparable GAAP measure, and is subject to a number of limitations as a financial measure, so it should be used in conjunction with GAAP financial measures and not in isolation. There can be no assurances that we will not modify the presentation of Adjusted EBITDA in the future. In addition, other companies in our industry may define Adjusted EBITDA differently, limiting its usefulness as a comparative measure. Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Reconciliation of Non-GAAP Financial Measures to GAAP Measures” included in the ~~2024~~2025 Form 10-K for more information regarding how we define Adjusted EBITDA.

The table below reflects the calculation of Adjusted EBITDA and Adjusted EBITDA Margin for the periods presented:

	Thirteen weeks ended						~~Thirty-nine weeks ended~~
(dollars in thousands)	~~November~~May 12,~~2025~~2026			~~November~~May 23,~~2024~~2025			~~November 1,2025~~			~~November 2,2024~~
Net income (loss) attributable to Class A and B-1 common stockholders	$	9,330		$	(16,673	)	$	11,641		$	(87,979	)
Net loss attributable to Class A and B-1 common stockholders	$	(15,146	)	$	(11,661	)
Interest expense, net		31,~~013~~288			3432,~~451~~135			~~95,536~~			~~106,984~~
Income tax benefit		(6,276	)		(857	)		(5,035	)		(9,985	)
Income tax expense		2,199			495
Depreciation and amortization		49,~~817~~041			5049,~~109~~811			~~148,466~~			~~149,414~~
Income from equity method investees		(45,~~871~~555	)		(4,~~479~~610	)		~~(13,565~~	)		~~(13,557~~	)
Asset impairments and write offs		155			1,380			677			8,449
Loss on extinguishment and modification of debt		11,840			—
Equity-based compensation		79,~~163~~451			119,~~357~~420			~~25,372~~			~~40,705~~
Other non-operating income		—			(8,465	)		—			(5,800	)
Mexico joint venture EBITDA (1)		12,916			10,198
Mexico joint venture EBITDA (1)		11,662			9,984			32,220			30,382
Other costs (2)		1,297			3,661
Acquisition and divestiture-related costs (2)		—			—			—			3,719
Adjusted EBITDA	$	97,331		$	89,449
Other costs (3)		571			4,429			6,561			18,071
Net sales	$	1,496,732		$	1,493,399
Adjusted EBITDA	$	98,564		$	81,236		$	301,873		$	240,403
Net margin (3)		(1.0	)%		(0.8	)%
Net sales	$	1,464,411		$	1,511,437		$	4,446,339		$	4,564,332
Adjusted EBITDA Margin		6.5	%		6.0	%
Net margin (4)		0.6	%		(1.1	)%		0.3	%		(1.9	)%
Adjusted EBITDA Margin		6.7	%		5.4	%		6.8	%		5.3	%

(1)

Mexico joint venture EBITDA represents 50% of the entity’s operating results for the periods presented, as adjusted to reflect the results on a basis comparable to our Adjusted EBITDA. In the financial statements, this joint venture is accounted for as an equity method investment and reported net of depreciation and income taxes. Because such a presentation would not reflect the adjustments made in our calculation of Adjusted EBITDA, we include our 50% interest in our Mexico joint venture on an Adjusted EBITDA basis to ensure consistency. The table below presents a reconciliation of Mexico joint venture net income to Mexico joint venture EBITDA:

Thirteen weeks ended

~~Thirty-nine weeks ended~~

(dollars in thousands)

~~November~~May 12,~~2025~~2026

~~November~~May 23,~~2024~~2025

~~November 1,2025~~

~~November 2,2024~~

Net income

911,~~742~~104

89,~~958~~220

~~27,129~~

~~27,335~~

Depreciation

78,~~725~~306

6,~~880~~597

~~21,115~~

~~20,824~~

Income tax expense

45,~~498~~194

34,~~637~~166

~~12,599~~

~~10,996~~

Foreign currency loss (gain)

~~593~~144

(~~106~~292

)

~~997~~

)

Interest expense, net

~~766~~1,083

~~599~~704

~~2,599~~

~~1,615~~

EBITDA

2325,~~324~~831

1920,~~968~~395

~~64,439~~

~~60,763~~

50% of EBITDA

1112,~~662~~916

910,~~984~~198

~~32,220~~

~~30,382~~

Acquisition and divestiture-related costs include direct costs resulting from acquiring, integrating, or divesting businesses. These include third-party professional and legal fees, losses on sales of divestitures, and other integration-related costs that would not have otherwise been incurred as part of the Company's operations.20

(2)

Other costs include, as incurred: restructuring costs and restructuring-related severance costs; legal reserves associated with significant, non-ordinary course legal or regulatory matters; and costs related to certain significant strategic transactions.

(3)

We define net margin as net ~~income (~~loss) attributable to Class A and B-1 common stockholders divided by net sales and Adjusted EBITDA margin as Adjusted EBITDA divided by net sales.

Free Cash Flow

Free Cash Flow is a non-GAAP financial measure that is calculated as net cash provided by operating activities less cash paid for fixed assets. Management believes that Free Cash Flow, which measures our ability to generate additional cash from our business operations, is an important financial measure for use in evaluating the Company’s financial performance.

The table below reflects the calculation of Free Cash Flow for the periods presented:

	Thirty-nine weeks ended
	Thirteen weeks ended
	November 1,2025			November 2,2024
	May 2,2026			May 3,2025
(dollars in thousands)
Net cash provided by operating activities	$	160,528		$	81,680
Net cash used in operating activities	$	(30,969	)	$	(15,454	)
Cash paid for fixed assets		(8938,~~960~~153	)		(9128,~~041~~412	)
Free Cash Flow	$	70(69,~~568~~122	)	$	(943,~~361~~866	)

Liquidity and Capital Resources

Overview

Our primary sources of liquidity are funds generated by operating activities and available capacity for borrowings on our $~~581~~546.0 million ABL Revolving Credit Facility. Our ability to fund our operations, to make planned capital investments, to make scheduled debt payments and to repay or refinance indebtedness depends on our future operating performance and cash flows, which are subject to prevailing economic conditions and financial, business, and other factors, some of which are beyond our control. Our liquidity as of ~~November~~May 12, ~~2025~~2026 was $~~732~~654.94 million, inclusive of cash and cash equivalents of $~~237~~166.48 million and $~~495~~487.56 million of availability on the ABL Revolving Credit Facility.

We are a party to contractual obligations involving commitments to make payments to third parties. These obligations impact our short-term and long-term liquidity and capital resource needs. We believe that our current resources, together with anticipated cash flows from operations and borrowing capacity under the ABL Revolving Credit Facility will be sufficient to finance our operations, meet our current cash requirements, and fund anticipated capital investments for at least the next 12 months. We may, however, seek additional financing to fund future growth or refinance our existing indebtedness through the debt capital markets, but we cannot be assured that such financing will be available on favorable terms, or at all.

Cash Flows

The following table summarizes our consolidated cash flows:

	Thirty-nine weeks ended
	Thirteen weeks ended
(dollars in thousands)	~~November~~May 12,~~2025~~2026			~~November~~May 23,~~2024~~2025
Total cash provided by (used in):
Total cash used in:
Operating activities	$	~~160~~(30,~~528~~969	)	$	81(15,~~680~~454	)
Investing activities		(8737,~~419~~849	)		(8927,~~506~~133	)
Financing activities		(532,~~351~~638	)		(~~7,802~~334	)
Net increase (decrease) in cash, cash equivalents and restricted cash	$	67,758		$	(15,628	)
Net decrease in cash, cash equivalents and restricted cash	$	(101,456	)	$	(42,921	)

Operating Activities

Our primary source of operating cash is sales of products and services to customers, which are substantially all on a cash basis, and therefore provide us with a significant source of liquidity. Our primary uses of cash in operating activities include: purchases of inventory; freight and warehousing costs; employee-related expenditures; occupancy-related costs for our pet care centers, distribution centers and corporate support centers; credit card fees; interest under our debt agreements; and marketing expenses. Net cash ~~provided~~used byin operating activities is impacted by our net ~~income (~~loss) adjusted for certain non-cash items, including: depreciation, ~~amortization, impairments~~ and ~~write-offs~~amortization; amortization of debt discounts and issuance costs; deferred income taxes; equity-based compensation; impairments of goodwill and intangible assets; other non-operating income; and the effect of changes in operating assets and liabilities.

Net cash ~~provided~~used byin operating activities was $~~160~~31.50 million in the ~~thirty-nine~~thirteen weeks ended ~~November~~May 12, ~~2025~~2026 compared with net cash ~~provided~~used byin operating activities of $8115.75 million in the ~~thirty-nine~~thirteen weeks ended ~~November~~May 23, ~~2024~~2025. The ~~increase~~decrease in operating cash flows were primarily driven by a ~~decrease~~increase in inventory purchases, as well as timing of invoice payments. This was partially offset by a decrease in cash paid for interest and lower payouts of prior year accrued incentive bonuses.

lower payroll and fringe benefits, lower cash paid for income taxes, and lower operational costs, such as consulting fees. This was partially offset by lower sales and higher payouts of prior year accrued incentive bonuses.

Investing Activities

Net cash used in investing activities was $8737.48 million and $8927.51 million for the ~~thirty-nine~~thirteen weeks ended ~~November~~May 12, ~~2025~~2026 and ~~November~~May 23, ~~2024~~2025, respectively, and consisted primarily of capital expenditures to support our business.

Financing Activities

Net cash used in financing activities was $532.46 million for the ~~thirty-nine~~thirteen weeks ended ~~November~~May 12, ~~2025~~2026, compared with $70.83 million used in financing activities for the ~~thirty-nine~~thirteen weeks ended ~~November~~May 23, ~~2024~~2025. Financing cash flows in the ~~thirty-nine~~thirteen weeks ended ~~November~~May 12, ~~2025~~2026 ~~were~~primarily ~~not~~consisted ~~material.~~of ~~Financing~~payments ~~cash~~of ~~flows~~debt inissuance ~~the~~costs ~~thirty-nine~~and ~~weeks~~borrowings ~~ended~~and ~~November~~repayments of debt in connection with the February 2, ~~2024~~2026 ~~consisted~~refinancing ~~primarily~~transaction discussed under "Sources of ~~borrowings~~Liquidity" ~~and~~below. ~~repayments~~Financing oncash flows in the ~~ABL~~thirteen ~~Revolving~~weeks ~~Credit~~ended ~~Facility~~May 3, 2025 were not material.

Sources of Liquidity

Senior Secured Credit Facilities and Senior Secured Notes

The Company ~~has~~had a secured term loan facility originally maturing on March 4, 2028 (the “First Lien Term Loan”), ~~and~~with aan ~~secured~~outstanding ~~asset-based~~principal ~~revolving~~balance ~~credit facility with availability~~ of ~~up to~~ $~~581~~1,500.0 million, ~~subject~~as toof aJanuary ~~borrowing~~31, ~~base~~2026. ~~(as~~On ~~amended~~February ~~from~~2, ~~time to time~~2026, the ~~“ABL~~Company ~~Revolving~~entered ~~Credit~~into ~~Facility”).~~a ~~The~~refinancing ~~first~~amendment ~~tranche~~to ofthe credit agreement governing the ~~ABL~~First ~~Revolving~~Lien ~~Credit~~Term ~~Facility~~Loan ~~has~~(“Amended ~~availability~~First ofLien upTerm toLoan”) and issued $35600.0 million, ~~subject~~in toaggregate aprincipal ~~borrowing~~amount ~~base,~~of ~~maturing~~senior onsecured ~~March~~notes 4,(the ~~2026.~~“Senior ~~The~~Secured ~~second~~Notes”). ~~tranche~~Following ~~has~~the ~~availability~~amendment, ~~of up to~~ $~~546~~900.0 million, ~~subject~~of toprincipal aremained ~~borrowing~~on ~~base,~~the ~~maturing~~Amended onFirst ~~March~~Lien ~~29,~~Term ~~2029~~Loan.

~~For~~The ~~more~~Company ~~information~~has ~~regarding~~a ~~this~~secured ~~indebtedness,~~asset-based ~~refer~~revolving tocredit ~~Note~~facility 4(as amended from time to time, the “~~Senior~~ABL ~~Secured~~Revolving Credit ~~Facilities,~~Facility”). toThe first tranche of the ~~Notes~~ABL Revolving Credit Facility, which had availability of up to ~~Consolidated~~$35.0 ~~Financial~~million, ~~Statements~~subject ~~included~~to ina ~~Part~~borrowing Ibase, ~~Item~~matured 1on March 4, 2026. The remaining tranche has availability of ~~this~~up ~~Form~~to ~~10-Q~~$546.0 million, subject to a borrowing base, maturing on March 29, 2029.

For more information regarding this indebtedness, refer to Note 3, “Senior Secured Credit Facilities,” and Note 4, "Senior Secured Notes," to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Derivative Instruments

The Company has entered into interest rate ~~cap,~~ collar and swap agreements to limit the maximum interest on a portion of the Company’s variable-rate debt and decrease its exposure to interest rate variability relating to three-month Term SOFR. For more information regarding derivative instruments, refer to Note 5, “Derivative Instruments,” to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Critical Accounting Policies and Estimates

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires us to make assumptions and estimates about future results and apply judgments that affect the reported amounts of assets, liabilities, net sales, expenses and related disclosures. We base our estimates and judgments on historical experience, current trends and other factors that we believe to be relevant at the time our consolidated financial statements are prepared. On an ongoing basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

There have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in the ~~2024~~2025 Form 10-K.

Recent Accounting Pronouncements

Refer to Note 1, “Summary of Significant Accounting Policies,” to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q for information regarding recently issued accounting pronouncements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are subject to market risks arising from transactions in the normal course of our business. These risks are primarily associated with interest rate fluctuations, as well as changes in our credit standing, based on the capital and credit markets, which are not predictable. We do not currently hold any instruments for trading purposes.

Interest Rate Risk

We are subject to interest rate risk in connection with the Amended First Lien Term Loan and the ABL Revolving Credit Facility. As of ~~November~~May 12, ~~2025~~2026, we had $~~1,595~~900.30 million outstanding under the Amended First Lien Term Loan and no amounts outstanding under the ABL Revolving Credit Facility. The Amended First Lien Term Loan and the ABL Revolving Credit Facility each bear interest at variable rates. An increase of 100 basis points in the variable rates on the Amended First Lien Term Loan and the ABL Revolving Credit Facility as of ~~November~~May 12, ~~2025~~2026 would have increased annual cash interest in the aggregate by approximately $169.21 million. Additionally, we entered into cash flow hedges to limit the maximum interest rate on a portion of our variable-rate debt and limit our exposure to interest rate variability, refer to Note 5, “Derivative Instruments,” to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

We cannot predict market fluctuations in interest rates and their impact on our debt, nor can there be any assurance that long-term fixed-rate debt will be available at favorable rates, if at all. Consequently, future results may differ materially from estimated results due to adverse changes in interest rates or debt availability.

Credit Risk

As of ~~November~~May 12, ~~2025~~2026, substantially all of our cash and cash equivalents were maintained at major financial institutions in the United States, and our current deposits are likely in excess of insured limits. We believe these institutions have sufficient assets and liquidity to conduct their operations in the ordinary course of business with little or no credit risk to us.

Foreign Currency Risk

Substantially all of our business is currently conducted in U.S. dollars, with a small amount denominated in foreign currencies. Our expenses are generally denominated in the currencies of the jurisdictions in which we conduct our operations. Our results of current and future operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. We do not enter into forward currency contracts to hedge our foreign currency exposure. A hypothetical 10% change in foreign currency exchange rates applicable to our business would not have a material effect on our operating results.

Item 4. Controls and Procedures.

Management’s Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosure.

As of the end of the period covered by this Form 10-Q, our management, under the supervision and with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e). Based upon this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of ~~November~~May 12, ~~2025~~2026.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the quarter ended ~~November~~May 12, ~~2025~~2026, which has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. Management does not expect, however, that our disclosure controls and procedures will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based on certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

2524

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

See Note 8, “Commitments and Contingencies,” to the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q for a description of legal proceedings, which is incorporated herein by reference.

Item 1A. Risk Factors.

Reference is made to Part I, Item 1A, “Risk Factors” included in the ~~2024~~2025 Form 10-K for information concerning risk factors. There have been no material changes with respect to the risk factors disclosed in the ~~2024~~2025 Form 10-K. You should carefully consider such factors, which could materially and adversely affect our business, financial condition and/or results of operations. The risks described in the ~~2024~~2025 Form 10-K are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Insider Trading Arrangements

None of our directors or Section 16 officers adopted or terminated a Rule 10b5-1 trading arrangement (as defined in Item 408(a) of Regulation S-K) or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarterly period covered by this Form 10-Q.

~~Amendment and Restatement of Bylaws~~25

On December 2, 2025, in connection with the effectiveness of new SEC rules regarding universal proxy cards and subsequent Delaware law developments, certain changes to the Delaware General Corporation Law (the “DGCL”), and a periodic review of the bylaws of the Company, the Board of Directors approved and adopted an amendment and restatement of the Company’s Second Amended and Restated Bylaws (as so amended, the “Third A&R Bylaws”). The Third A&R Bylaws became effective immediately upon approval by the board of directors.

Among other things, the amendments effected by the Third A&R Bylaws:

clarify the notice procedures for adjournments of virtual meetings of stockholders and eliminate the requirement that the list of stockholders be open to examination at meetings of stockholders, in each case in accordance with 2022 amendments to the DGCL;

update certain procedural requirements related to director nominations by stockholders in light of the recently adopted Rule 14a-19 under the Exchange Act and reflect certain other related changes, including requiring: (1) additional background information and disclosures regarding stockholders proposing director nominations and other business, director nominees proposed by stockholders, and other persons related to a stockholder’s solicitation of proxies; and (2) any stockholder submitting a nomination notice to make a representation and provide confirmation as to whether such stockholder intends to solicit proxies in support of director nominees other than the Company’s nominees in accordance with Rule 14a-19 under the Exchange Act and the Third A&R Bylaws and to provide evidence that the stockholder has complied with such requirements;

require that a stockholder directly or indirectly soliciting proxies from other stockholders use a proxy card color other than white, which is reserved solely for use for solicitation by the board of directors;

require that a quorum cannot be readily convened for a meeting of the board of directors in order for the emergency bylaws described in Section 3.13 of the Third A&R Bylaws to become operative; and

make certain other non-substantive, ministerial, clarifying and conforming changes, including clarifying procedures around stockholders meetings, who can preside at board and stockholder meetings in Chairman’s absence, when stockholder votes can be disregarded and certain officer provisions to provide additional flexibility.

The foregoing description of the Third A&R Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Third A&R Bylaws, a copy of which is filed as Exhibit 3.1 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.

Item 6. Exhibits.

The following is a list of exhibits filed as part of this Quarterly Report on Form 10-Q:

ExhibitNumber		Description
3.1		Third Amended and Restated Bylaws of Petco Health and Wellness Company, Inc.
4.4		Indenture, dated February 2, 2026, among the Company, the guarantors party thereto, and U.S. Bank Trust Company, National Association (incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K, filed on February 2, 2026)
10.1†		Form of Performance Stock Unit Award Grant Notice and Standard Terms and Conditions under the Petco Health and Wellness Company, Inc. 2021 Equity Incentive Plan (CEO PSU Grant)
10.1		First Lien Credit Agreement, dated March 4, 2021, by and among the Company, the Lenders party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent, as amended by the First Amendment to Credit Agreement, dated December 12, 2022, by and between the Company, and Citibank, N.A., as administrative agent, and as further amended by the Second Amendment to Credit Agreement, dated as of February 2, 2026, among the Company, the guarantors party thereto, certain lenders party thereto and Citibank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K, filed on February 2, 2026)
10.2†		Form of Performance Stock Unit Award Grant Notice and Standard terms and Conditions under the Petco Health and Wellness Company, Inc. 2021 Equity Incentive Plan (2026 CEO Form) (incorporated by reference to Exhibit 10.30 of the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026)
10.3†		Form of Performance Stock Unit Award Grant Notice and Standard terms and Conditions under the Petco Health and Wellness Company, Inc. 2021 Equity Incentive Plan (2026 Executive Form) (incorporated by reference to Exhibit 10.43 of the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026)
10.4†		Form of Restricted Stock Unit Award Grant Notice and Standard Terms and Conditions under the Petco Health and Wellness Company, Inc. 2021 Equity Incentive Plan (2026 Executive Form) (incorporated by reference to Exhibit 10.41 of the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026)
10.5†		Form of Restricted Stock Unit Award Grant Notice and Standard Terms and Conditions under the Petco Health and Wellness Company, Inc. 2021 Equity Incentive Plan (2026 CEO Form) (incorporated by reference to Exhibit 10.42 of the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026)
10.6†		Offer Letter, dated February 17, 2025, between Michael Romanko and Petco Animal Supplies Stores, Inc.
10.7†		Separation Agreement and General Release of Claims, dated December 16, 2025, between Jack Stout and Petco Animal Supplies Stores, Inc.
31.1		Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH		Inline XBRL Taxonomy Extension With Embedded Linkbase Documents
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


†	Management contract or compensatory plan or arrangement.

* Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Petco Health and Wellness Company, Inc.
Date: December 5, 2025	By:		/s/ Sabrina Simmons
Date: June 5, 2026	By:		/s/ Sabrina Simmons
			Sabrina Simmons
			Chief Financial Officer(Principal Financial and Accounting Officer)

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Filing Compare · Petco Health & Wellness Company, Inc.