Key Highlights

  • Net sales fell 19.4% to USD 35.8 million in the quarter ended September 30, 2026, from USD 44.4 million a year earlier, driven mainly by lower prescription medication sales.
  • The net loss narrowed to USD 6.4 million, or USD 0.31 per share, from USD 8.5 million, or USD 0.41 per share, as Advertising spending dropped 52.3% to about USD 2.1 million.
  • Adjusted EBITDA, a non-GAAP measure, was a loss of USD 3.6 million against a loss of USD 2.3 million a year earlier, so the cost cuts did not carry through to that measure.
  • Cash and equivalents fell to USD 11.4 million at September 30, 2026, from USD 21.4 million at March 31, 2026, while Working Capital stood at negative USD 17.0 million.

Sales Slide Continues but at a Slower Pace

PetMed Express (NASDAQ:PETS), which operates the PetMeds and PetCareRx online pet pharmacies, filed its Quarterly Report for fiscal Q2 2027 on November 10, 2026. Net sales for the quarter ended September 30, 2026 were USD 35.8 million, a decline of 19.4% from USD 44.4 million. The rate of decline was smaller than the 23.6% fall a year earlier. Reorder sales dropped 20.0% to about USD 29.9 million, new order sales fell 20.4% to about USD 4.2 million, and membership fees were almost flat at USD 1.6 million. The company added about 41,000 new customers, compared with about 58,000 a year earlier. Recurring sales, which include AutoShip and Save subscriptions and memberships, were 64.2% of gross sales, up from 60.8%.

Cost Cuts Narrow the Loss, Margins Slip

Gross profit fell 21.0% to USD 9.8 million, and gross Margin eased to 27.4% from 28.0% because of an unfavorable product mix and lower manufacturer rebates. General and administrative expenses dropped 15.6% to about USD 12.0 million, helped by lower professional fees and severance. Advertising spending fell to about USD 2.1 million, and the company said the cost of acquiring a new customer was USD 51 against USD 75. The operating loss was USD 6.4 million, compared with USD 8.4 million. For the six months, the net loss was USD 12.6 million, or USD 0.60 per share, versus USD 42.7 million, or USD 2.05, a year earlier, when a USD 27.3 million Goodwill and intangible Impairment was booked.

Going-Concern Doubt, Property Sale Talks and Control Weaknesses

Management said conditions including falling cash, negative working capital, shrinking sales and operating losses first raised substantial doubt about the company's ability to continue as a going concern. It concluded the doubt is alleviated by its plan to trim advertising and operating costs and limit capital spending. Operating cash outflow for the six months was USD 8.7 million, versus USD 14.4 million. On July 23, 2026 the company agreed to sell its Delray Beach headquarters and distribution properties for USD 37.0 million with a 10-year leaseback, but as of September 30, 2026 it was still discussing terms with the buyer and said completion is not certain. The filing also states that disclosure controls were not effective because material weaknesses were not fully remediated.

Where Things Stand

Sales fell because prescription volumes and new orders both shrank, while the narrower loss came from cost cuts rather than growth. PetMed Express (NASDAQ:PETS) cut the quarterly loss to USD 0.31 per share, yet adjusted EBITDA was weaker and cash declined to USD 11.4 million. The filing gives no guidance. Markers to follow include whether the USD 37.0 million property sale closes, whether sales declines keep easing from 19.4%, and progress on the control weaknesses.