Wag! and Rover satisfied with performance but aiming for more

Seattle-based Rover earned $41.1 million (€37.4M) in the first 3 months of the year, a turnover that CEO and Co-Founder Aaron Easterly qualified as “excellent.”

He added that the company has “delivered revenue growth of 48% while significantly expanding margins year over year.” Company revenue reached $27.8 million (€25.3M) in Q1 2022.

Similarly, US pet care company Wag! also expressed great satisfaction with its “record-breaking” Q1 results. In the 3 months to the end of March, Wag! posted $20.6 million (€18.9M). This is a 113% increase from last year’s quarter when the firm hit $9.7 million (€8.8M).

More profitability

Garrett Smallwood, CEO and Chairman of Wag!, said the company was pleased with the performance but recognized “the need to balance growth and profitability” for the rest of the year.

“We will continue to monitor the macro environment closely and adjust our strategy to ensure we are well-positioned for long-term success,” he said to investors.

In reality, Wag! earnings in the first quarter of the year significantly exceeded analyst predictions, who were expecting $16.8 million (€15.4M).

“This is down sequentially from the prior month and would be the first sequential decline since going public,” stock news site MarketBeat wrote in April.

Key data

The biggest Wag! revenue earner for this quarter was the wellness segment totaling $13.8 million (€12.6M).

The earnings report detailed the wellness category’s expansion as Wag! became “the exclusive marketing partner of Paw Protect, the only pet insurance with instant pay.” 

A key highlight for Seattle-based platform Rover was the 36% Gross Booking Revenue (GBV) totaling $209.4 million (€190.7M). 

Reflecting Rover’s Q1 success, new bookings were also on the rise, reaching 208,000 compared to Q1 last year, with 179,000 bookings. In 2022, the total number of bookings reached 5.6 million.

The loyal customer base increased as repeat bookings rose by 29% reaching 1.3 million compared to 1 million in Q1, 2022.

However, Rover reduced its total net loss from $8.1 million (€7.4M) in Q1 2022 to $4.7 million (€4.3M) in the first 3 months of 2023.

Investors website Investing.com described Rover’s financial performance as “fair.”

Forecast 

Predicting the rest of 2023, Wag! has estimated revenue to fall between $80 to $84 million (€73.2 to €76.9M) by the end of the year.

This is despite the company recently closing two major acquisitions. In April, Wag! acquired Maxbone, an online platform for pet essentials. 

Earlier this year, the company also took over Dog Food Advisor. The deal accumulated $1.4 million (€1.3M) in revenue for Wag! this quarter, a solid start to its entrance to the food and treat market.

Rover hopes to generate between $51 and $53 million (€46.4 and €48.3M) in Q2. Overall, the pet marketplace wants to hit a revenue of $207 to $217 million (€188.5 to €197.6M) by the end of the year. 

Rover’s CEO Aaron Easterly said the company will “focus on achieving profitable growth, sustaining our momentum outside the United States, improving our customer experience, and expanding our product portfolio.”