PetMed Express, Inc. — Second Quarter 2026 Earnings Summary

Financial Performance:

• Net sales for the quarter ended September 30, 2026, were $35.8 million, a 19.4% decrease from $44.4 million in the prior year period.
• Net loss for the quarter was $6.4 million, or $(0.31) per diluted share, compared to a net loss of $8.5 million, or $(0.41) per diluted share, in the prior year period.
• Adjusted EBITDA for the quarter was $(3.6) million, compared to $(2.3) million in the prior year period.
• Gross profit decreased due to an unfavorable product mix shift and lower manufacturer rebates as a percentage of sales, partially offset by lower net freight costs per order.
• General and administrative expenses and advertising expenses decreased year-over-year, contributing to the reduction in net loss.
• Cash and cash equivalents decreased to $11.4 million at September 30, 2026, from $21.4 million at March 31, 2026.
• Total current liabilities were $42.4 million at September 30, 2026, compared to $52.0 million at March 31, 2026.
• Deferred revenue was $588 thousand at September 30, 2026, down from $689 thousand at March 31, 2026.
• Net cash used in operating activities for the six months ended September 30, 2026, was $8.7 million, compared to $14.4 million in the prior year period.
• Net cash used in investing activities for the six months ended September 30, 2026, was $1.2 million, compared to $3.9 million in the prior year period.

Business Segments and Product Lines:

• The decline in net sales was primarily driven by a decrease in prescription medication sales and higher consumer promotional usage.
• The company is repositioning its core direct-to-consumer pharmacy business to improve profitability.

Management Commentary and Tone:

• CEO Jeff Willard stated that the company has stabilized operations and is focused on transforming the core business into a leaner, more profitable entity.
• Management reported a 32% reduction in the cost to acquire a new customer compared to the prior year.
• Strategic initiatives include repositioning the brand, improving marketing efficiency, enhancing website usability, and increasing customer retention.

Other Key Points:

• The company hosted an earnings webcast on November 10, 2026, to review results.
• The press release included a reconciliation of GAAP net loss to Adjusted EBITDA, excluding share-based compensation, depreciation, amortization, income taxes, interest, and certain non-operational expenses like employee severance and professional fees related to a completed Audit Committee investigation.
• Professional fees related to the Audit Committee investigation were $2.1 million in the prior year quarter and $0 in the current quarter.
• Employee severance expenses were $74 thousand in the current quarter compared to $1.2 million in the prior year quarter.
• Impairment of goodwill and intangible assets was $0 in the current quarter compared to $27.3 million in the prior year period (six-month comparison).
• The company has 22,131,508 shares of common stock issued and outstanding as of September 30, 2026.
• No dividends were paid in the six months ended September 30, 2026, compared to $23 thousand in the prior year period.