• by Sarah Mahoney  @mahoney_sarah, May 28, 2024

To celebrate the 25^th anniversary of Petco Love, the retailer isn’t just putting on the dog. It’s putting on the cat, too. The retailer’s foundation is teaming up with Skechers footwear for a massive New York City block party to spur brand awareness, financial support and, ultimately, pet adoptions.

Scheduled for New York City’s Union Square Park next weekend, right outside its New York flagship, the shindig will star 300 adoptable cats and dogs. On the menu: At least 500 slices of cake, cut from either the 7-foot dog bone or, for feline attendees, a heart-shaped cat cake.

In its 25-year history, the foundation has donated nearly $400 million in adoption and other lifesaving efforts, working with more than 4,000 organizations to find homes for 6.8 million pets. And it has given  $10 million to New York City-based animal charities.

Two-footed luminaries are expected to attend, including Antoni Porowski, star of Netflix's “Queer Eye” and cofounder of pet food brand Yummers Pet Supply Co. In addition to the live DJ, Bobs by Skechers footwear -- another brand that gives heavily to animal causes -- is planning a photo booth, with a photographer capturing the first family photos of newly adopted pets and giveaways. Since the launch of Bobs, the sneaker company's cause-related sub-brand, eight years ago, Skechers has given $11 million to pet adoption causes, helping 2 million shelter pets.

Petco isn’t just doing good these days. It’s doing well. The just-released first-quarter financial results beat Wall Street's expectations, partly due to the company’s new back-to-basics retailing approach. Net revenue for the San Diego-based retailer dipped 1.7% to $1.5 billion, with comparable sales slipping 1.2%. Both those declines are lower than forecast, as the company performed well with consumables and services. And its loss of $11.8 million was also less than expected.

“We made meaningful progress against our strategy to reposition the business for sustainable and profitable growth," says Mike Mohan, interim chief executive officer, in its announcement. "The underlying value proposition of this iconic and trusted brand remains strong, and I'm confident that a renewed focus on retail fundamentals and effective delivery of cost transformation will restore profitability and amplify the competitive advantages of our differentiated approach."

Some industry observers agree. “While the company faces some secular pressure from online rivals, the pet category has favorable long-term dynamics that Petco is well-positioned to take advantage of,” writes Seth Basham, an analyst who follows the pet retailer for Wedbush. Basham just bumped the company up to his “Best Ideas” list and is especially encouraged by Petco’s strength in services, such as grooming, training and veterinary care, which is growing faster than the rest of the company. “Promotional intensity remains elevated but is not accelerating,” he notes. “Discretionary hard goods categories remain under pressure, but declines are stabilizing—we project growth for these high-margin sales as soon as the third quarter.”