NEW YORK, May 8, 2026, 07:03 EDT
- Zoetis trimmed its 2026 revenue forecast to a range of $9.68 billion to $9.96 billion and lowered its adjusted EPS projection to $6.85 to $7.00, citing softer demand in the first quarter.
- Sales of U.S. companion-animal products dropped 11% as demand cooled, with stiffer competition and more cost-conscious pet owners weighing on results.
- Zoetis was recently changing hands at $87.31—a slide of $23.86 from its prior finish—giving the company a valuation near $36.9 billion.
Zoetis Inc. slashed its outlook for 2026 profit and revenue, following a first-quarter miss that caught Wall Street off guard—a notable setback for the animal-health firm known for riding premium pet drug demand. Shares slid after Zoetis pointed to U.S. pet owners pulling back on vet appointments and opting out of pricier care.
Timing comes into play here. The company’s U.S. companion-animal segment—think treatments for dogs and cats—dropped 11% last quarter. Dermatology, Simparica Trio, Librela: all softer. Investors were counting on stable pricing in this area, not a sharp hit to demand.
Zoetis turned in first-quarter revenue of $2.3 billion—a 3% rise—with net income landing at $601 million, or $1.42 per diluted share. On an adjusted basis, which leaves out purchase accounting, deal-related costs, and a handful of other items, diluted EPS came in at $1.53. As for organic operational growth, excluding impacts from currency and certain transactions, the figure stayed flat.
Wall Street was looking for adjusted earnings of $1.61 per share on $2.31 billion in revenue, LSEG numbers reported by Reuters show. Zoetis revised its adjusted EPS outlook to a $6.85–$7.00 range, down from $7.00–$7.10, and trimmed its annual revenue projection to between $9.68 billion and $9.96 billion, previously $9.83 billion to $10.03 billion.
Chief Executive Kristin Peck described the first quarter as tougher than Zoetis had expected, calling out price-wary pet owners, a drop in vet visits, and weaker demand for high-end products. Competition also ramped up in dermatology and parasiticides, two key areas for the company’s pet-care business, she said.
Chief Financial Officer Wetteny Joseph didn’t sugarcoat it on the earnings call: “below our expectations this quarter.” Macro headwinds, softer clinic visits, and stiff competition all landed at once. Joseph also flagged a timing shift—about $100 million in international sales got pulled forward into Q1 due to a fiscal-year change. Strip that out, and global organic operational revenue would have dropped 5%. The Motley Fool
Daniel Clark over at Leerink Partners flagged U.S. companion-animal sales as “well below expectations,” blaming stiff competition and a more price-sensitive market. Stifel’s take: once that $100 million timing boost is stripped out, they put organic operational revenue growth at 600 to 700 basis points—so 6 to 7 percentage points—shy of what the Street was looking for. Reuters
But things weren’t universally downbeat. International revenue jumped 17% as reported, or 10% on an organic operational basis. Livestock sales outside the U.S. climbed 19% reported, 14% organic operational. In the U.S., livestock sales advanced 7%, with demand for cattle, poultry and swine providing support.
Competitive pressure on Zoetis is very real. Elanco Animal Health is stepping right into core Zoetis markets. The company’s Zenrelia, a new canine dermatitis drug, is set to launch about 20% cheaper than Zoetis’ Apoquel. There’s also Credelio Quattro, Elanco’s entry in the parasiticide space—Simparica Trio, a major Zoetis product, faces fresh competition here.
Zoetis is ramping up its direct-to-consumer efforts while increasing its focus on veterinarians. Peck told analysts the company is eyeing more point-of-sale loyalty programs—trying to help pet owners with costs right at checkout, instead of sticking to incentives that pay out later.
A rebound isn’t guaranteed here. Joseph pointed out that Zoetis isn’t building in any recovery for distributor inventories, with management bracing for ongoing macro headwinds instead of a quick turnaround. The company also cut its expected total price contribution to 1%-2%, down from the earlier 2%-3%, indicating less pricing power helping results this year.
Zoetis continues to highlight a pipeline boasting over a dozen possible blockbusters—those are products projected to pull in at least $100 million a year. The company is also sticking to its timeline for closing the Neogen animal genomics acquisition, targeting the back half of 2026. But the immediate challenge looks more basic: U.S. pet-care demand needs to steady before rivals and wary consumers bite deeper.
