Swedencare maintains double-digit growth despite margin challenges

The Malmö-headquartered pet player reported preliminary net revenue of SEK 682 million ($77M/€64.6) for the fourth quarter of 2025, representing 11% organic growth. 

While this continues the company’s trend of outperforming the broader market, operational challenges, particularly in North America, have weighed on the bottom line.

In a trading update for the fourth quarter of 2025 released on 30 January, the firm expects a preliminary operational EBITDA margin of 15%-16%, bringing the full-year margin to an estimated 19%. 

For the full year 2025, Swedencare’s net revenue reached SEK 2.7 billion ($300M/€250M), reflecting a 9% organic growth. 

This performance aligns with the trajectory seen earlier in the year. In Q3 2025, Swedencare reported 11% revenue growth as European sales surged, largely driven by the acquisition of the UK veterinary pharmaceuticals firm Summit. 

Profitability under pressure

While sales continue to grow organically at double-digit rates, profitability was lower than expected due to extraordinary marketing and sales efforts.

“Swedencare should continuously deliver double-digit growth combined with strong profitability, which makes me disappointed with the profitability outcome this quarter,” says CEO Håkan Lagerberg.

The company attributes this dip in profitability to several “one-off” items that the company characterizes as necessary investments for future scaling. 

This includes transitioning the NaturVet Amazon account, as the company has been working to bring it under internal management to improve control over marketing and pricing. This follows warnings earlier in 2025 that sales were temporarily affected by the transition.

During the quarter, Swedencare has also invested in marketing to build “pull and awareness” for its brands in large-scale retail environments. This included a low-margin display campaign rolled out across 2,000 Walmart stores, 1,400 existing locations and 600 new ones.

Looking forward

Lagerberg expects that by 2026, the Amazon transitions in both Europe and North America will be finished, granting the group “full control of marketing and pricing.”

The CEO also highlighted a silver lining in early 2026 data, noting that the massive Walmart display investment is already showing results. According to Lagerberg, the company has “almost doubled” its Walmart out-the-door sales in January 2026.

Swedencare is also targeting growth in the veterinary sector across North America and Europe, as well as expansion of its CDMO (Contract Development and Manufacturing Organization) business in the pharmaceutical sector.

While the 2025 fiscal year ended with a narrower profit margin than expected, Swedencare is positioning the year as a bridge to a more profitable 2026.