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Petco's revamped loyalty programme, Petco Perks, cost the retailer millions in its second quarter after customer redemptions significantly exceeded projections. CEO Joel Anderson said on Wednesday's earnings call that the impact reached "mid-single-digit millions", causing sales to remain flat year over year instead of growing 0.3% as forecast. The relaunched programme, which began in late June, removed friction from the previous version. Members now earn 10 points per dollar spent on most products and 30 points per dollar on private label brands, with 1,000 points worth $1. Petco has since implemented guardrails on redemption velocity. Anderson said the company believes peak redemption volumes have passed and expects the programme to support long-term growth starting in 2027.

Petco reported flat second-quarter sales of $1.49 billion, meeting analyst expectations, but delivered a significant earnings beat with non-GAAP profit of $0.15 per share versus estimates of $0.07. Adjusted EBITDA of $122.2 million exceeded forecasts by 10.9%. CEO Joel Anderson attributed the performance to improved customer engagement following the relaunch of the Petco Perks membership programme, though increased point redemption temporarily pressured net sales. Same-store sales were flat year on year. The company guided third-quarter revenue to $1.47 billion, in line with expectations. Management highlighted growth in companion animal categories and resilience in consumables as stabilising factors. Petco operates 1,377 locations, down from 1,388 a year earlier. The company plans to continue investing in veterinary services, fresh food partnerships, and personalised marketing to deepen customer loyalty whilst managing supply chain cost pressures.

Sprouts names new CEO to lead next phase of national expansion. inbusinessPHX.com Sprouts Farmers Market, Inc. announced a planned leadership transition, effective January 4, 2027, whereby Nick Konat (left), current president and chief operating officer, will take on the role of chief executive officer and join the board of directors. Jack Sinclair (right), who has served as CEO since 2019, will transition to the role of executive chairman. Sinclair said, "The Board and I have spent significant time and consideration developing our succession plan, and we believe that now is the right time to transition Sprouts to its next generation of leadership. Following the Board's comprehensive search process, we determined that Nick was the right leader for Sprouts. I've worked closely with Nick since he joined Sprouts in 2022 and seen firsthand his talent, drive and strong dedication to our people. He played a central role in shaping and executing our strategy, and I have tremendous confidence in his ability to lead the company to new heights. I want to thank all our team members for their deep commitment to Sprouts and their support for each other, our customers, our communities and our shareholders. I will be supporting Nick during the transition period, and it will be a privilege for me to continue serving Sprouts as its executive chairman." "Jack has guided the company through a significant phase of transformation and value creation. We are extremely grateful for his leadership," said Joe Fortunato, chairman of the board of Sprouts. "I am proud of the work that our Board has put into our succession planning. The Board believes that Nick's experience, along with his deep knowledge of our business and Sprouts' unique culture and market position, make him the ideal leader for the next phase of the company's journey. We are also pleased that Jack will continue serving as a trusted partner to him. This transition enables Jack's ongoing involvement while allowing Nick's significant depth and breadth of experience to shine even brighter." "It will be an honor to serve as the next CEO of Sprouts at this exciting and important time for our company," said Konat. "We remain focused on executing our growth strategy, expanding into new markets and strengthening our connection with customers as we navigate an evolving consumer environment. I am grateful to Jack and our Board for their leadership, support, and confidence in me. I look forward to continuing to work closely with Jack to ensure a seamless transition. Since I joined Sprouts, our dedicated team and our purpose - to help people live and eat better - have inspired me every day. Looking ahead, I am confident in the opportunities before us and in our ability to build on our momentum and create long-term value for our shareholders." As part of this leadership transition, Joe Fortunato will serve as lead independent director beginning January 4, 2027, the first day of Sprouts' 2027 fiscal year. Konat joined Sprouts in March 2022 as president and chief operating officer where he has overseen the company's operations, marketing, merchandising, supply chain, and innovation functions. Konat previously served at Petco Health and Wellness Company for over six years, culminating as chief merchandising officer. Prior to joining Petco, Konat served over nine years at Target Corporation, where he held a range of merchandising, planning, and leadership roles across the food and fashion categories. Konat also spent six years with Accenture plc, a multinational professional services company. Konat holds an honors bachelor's degree in political science and government from St. John's University.