Petco Health and Wellness Company, Inc. (WOOF) saw its shares surge 11.11% in pre-market trading following the release of its better-than-expected third-quarter earnings and an upward revision of its full-year guidance.

The pet retailer reported earnings per share of $0.03, surpassing analyst estimates of $0.00, and demonstrated improved profitability with a gross margin increase of 0.8 percentage points to 38.9%. Operating income also rose by $25.2 million to $29.2 million. Investors reacted positively to the company's raised earnings outlook, which signals confidence in its ongoing turnaround strategy.

Additional optimism stems from Petco's strategic initiatives, including plans to close about 20 stores in fiscal 2025 to optimize its retail footprint. Despite a 3.1% year-over-year revenue decline, the market appears to be betting on the company's ability to drive long-term growth in the competitive pet care sector.