Zoetis Inc. (NYSE: ZTS) shares are trading lower on Thursday as the company reports its first-quarter results. The animal health company reported adjusted earnings of $1.53 per share, missing the consensus of $1.61.
Sales reached $2.26 billion, missing the consensus of $2.31 billion. Revenue increased by 3% year over year and was flat on an organic operational basis.
Segment Performance
Revenue in the U.S. segment was $1.1 billion, reflecting a decrease of 8% on both a reported and an organic operational basis relative to the first quarter of 2025.
Companion animal product sales decreased 11% due to softer end-market demand and an increasingly competitive landscape.
Revenue in the International segment was $1.1 billion, a 17% increase on a reported basis and a 10% increase on an organic operational basis compared with the first quarter of 2025.
Companion animal product sales grew 15% on a reported basis and 7% on an organic operational basis, led by the company's parasiticides portfolio, including Simparica Trio, along with contributions from diagnostics, vaccines, and the timing of price increases.
These gains were partially offset by lower sales of key dermatology products, driven primarily by competitive dynamics.
Zoetis CEO Highlights Softer Pet Care Demand
"The first quarter unfolded in a more challenging operating environment than we anticipated. Pet owners demonstrated increased price sensitivity, resulting in a decline in veterinary visits and softer demand for premium innovative products, where Zoetis leads. At the same time, competition intensified across key pet care categories...", said Kristin Peck, CEO of Zoetis. "...we are well positioned to deliver our next wave of innovation and remain confident in our ability to deliver sustained value for shareholders."
Zoetis Lowers Fiscal 2026 Guidance
Zoetis lowered its fiscal 2026 earnings guidance from $7.00-$7.10 per share to $6.85-$7.00 per share compared to the consensus of $7.02.
The company revised its annual sales guidance from $9.83 billion-$10.03 billion to $9.68 billiob-$9.96 billion versus the consensus of $9.90 billion.
ZTS Technical Outlook: Trend And Key Moving Averages
Currently, the stock is trading significantly below its moving averages, with the 20-day simple moving average (SMA) at $117.32, indicating it is 23.4% below this level. The moving average convergence divergence (MACD) is below its signal line, suggesting that upside momentum is fading, which could indicate a cooling trend unless the stock can reclaim that baseline.
How Zoetis Ranks On Quality And Momentum
Below is the Benzinga Edge scorecard for Zoetis, highlighting its strengths and weaknesses compared to the broader market:
- Quality: 88.12 - The stock demonstrates strong financial health and operational efficiency.
ZTS Price Action: Zoetis shares were down 20.18% at $88.78 at the time of publication on Thursday. The stock is trading at a new 52-week low, according to Benzinga Pro data.