#USA #San Francisco #Investor Rights #Pets #PETMED EXPRESS

PetMed Express Faces Serious Investor Doubts

PetMed Express (NASDAQ: PETS) is currently facing intense scrutiny from its investors following a notable drop in its stock price, which has plunged approximately 26% since June 16, 2025. This decline coincided with the company's failure to file its annual financial statements on time for the year ending March 31, 2025. This pivotal moment marked the beginning of a more extensive investigation into the company's financial practices by the national shareholders rights firm Hagens Berman.

The firm has begun to probe whether PetMed may have intentionally misled investors regarding its financial results. Officials encourage anyone who has sustained substantial losses from investments in PetMed to come forward and report their experiences. The investigation is particularly focused on the firm’s repeated assurances regarding compliance with generally accepted accounting principles, which are now being called into question.

Timeline of Events

The situation at PetMed has escalated dramatically over the past few months:

• - June 16, 2025: PetMed announces it will not file its annual report on time, suggesting that the company needs additional time to compile necessary information and data. The firm assured investors that they would file within the 15-day extension period.

• - July 1, 2025: The company reveals that its Audit Committee has launched an internal investigation following a whistleblower complaint. This complaint involves issues regarding revenue recognition from certain autoship orders and a coupon promotion that may have distorted key performance indicators.

• - July 28, 2025: The chairwoman of the Audit Committee, Diana Garvis Purcel, abruptly departs from the company, which raises alarms among investors about the internal handling of financial practices.

• - August 11, 2025: PetMed announces that it will not timely file its quarterly financial statements for the period ending June 30, 2025, citing the ongoing internal investigation.

• - August 12, 2025: CEO Sandra Campos and CFO Robyn D’Elia resign unexpectedly, sparking further concern about the company's leadership and future direction.

• - October 7, 2025: PetMed shocks the market by stating that its financial statements for the years ending March 31, 2024, and March 31, 2023, as well as various interim quarters, should no longer be relied upon. The company admitted to significantly overstating net sales by $6.969 million and $9.01 million across specific periods, reflecting potentially serious accounting irregularities.

As of October 9, 2025, PetMed has yet to file either its annual or most recent quarterly reports, which has led investors and analysts to criticize the company's transparency and overall governance.

The Broader Implications

The fallout from these events reveals significant risks for PetMed Express, not only impacting its current stock performance but also challenging investor confidence in the company’s future operations. Hagens Berman is dedicated to exploring whether investors have been inaccurately informed about the company's compliance with necessary accounting standards. Their investigation aims at determining the extent of investor loss and whether legal actions might be warranted.

Reed Kathrein, a partner at Hagens Berman, emphasized, "We're focused on investors' losses and whether PetMed may have intentionally misled investors about its adherence to applicable accounting rules." This statement indicates the seriousness of the investigation and the potential ramifications for company leadership if malfeasance is proven.

The situation continues to evolve as further information emerges, and stakeholders are closely monitoring the developments to gauge the long-term repercussions for PetMed Express. Investors are encouraged to voice their concerns and participate in the growing investigation as the firm aims to hold accountable those responsible for financial mismanagement.

Overall, this case serves as a significant reminder of the importance of transparency and integrity in financial reporting, as well as the potential consequences for companies that fail to adhere to these principles.