The online pet supplies retailer has reported a $36.9 million full-year loss, reflecting the challenges it faces from aggressive moves by established players.
Initially backed by high-profile venture capital firms and professional athletes, the company surged during the pandemic as pet adoption soared. However, recent developments have shifted market dynamics. Woolworths’ $586 million acquisition of Petspiration in 2022 and Bunnings' entry into pet products in 2023 have significantly increased competition, making it harder for Pet Circle to retain its market share.
Financial filings reveal that annual sales dropped to $373.42 million for fiscal 2025, down from $384.53 million the previous year. More critically, product margins fell by 156 basis points due to continued discounting and price wars. This decline in margin has contributed to nearly doubling losses compared to the $26.4 million lost last year.
The company also underwent a leadership change in August, with the co-founder stepping down as CEO and a former e-commerce executive taking the helm. This shift followed a $125 million capital raise two years ago that aimed to drive growth through initiatives such as 24-hour virtual vet services. These expansion plans now appear increasingly uncertain.
Although demand for pet products remains steady, the growth in pet ownership has stabilised since the pandemic. Major retail chains are now exerting far greater control over pricing and shelf space. While Pet Circle remains a well-known brand, it faces a tougher road ahead as it tries to return to profitability in a more crowded and competitive market.
