Zoetis Plunges on Earnings Miss and Lowered Guidance

Published: 2026-05-07 16:52:54 ET ZTS

Zoetis shares tumbled on Wall Street following a quarterly release that calls into question the resilience of its historical growth engine. The stock plummeted 20%, marking the steepest decline in the S&P 500, and bringing its YTD losses to approximately 30% and 40% over the past twelve months.

Kevin Smith

Published on 05/07/2026 at 04:52 pm EDT

For the January-to-March quarter, the global leader in animal health reported revenue of $2.26bn, up 3% y-o-y, but falling short of the $2.30bn consensus. Adjusted EPS also missed expectations, coming in at $1.53, against the $1.604 anticipated. Furthermore, organic operational revenue growth remained flat, a discouraging signal for a stock long favored for its consistent expansion.In its core US market, Zoetis saw sales retreat by 8%, with an 11% decline in the companion animal segment. Management cited increased price sensitivity among pet owners, a decrease in veterinary visits, and softer demand for innovative premium products. Competition has also intensified in dermatology and parasiticides, while generics are weighing on Convenia and Cerenia. Sales of Librela, a treatment for osteoarthritis pain in dogs, also declined.The group nevertheless maintains pockets of growth, with a 17% increase internationally and a 15% rise in livestock, supported by cattle, poultry, swine, and fish. This momentum was, however, partially aided by fiscal alignment calendar effects, estimated at approximately $100m for the quarter.In light of this more challenging environment, Zoetis has lowered its full-year targets and now forecasts revenue of $9.68bn to $9.96bn, along with adjusted EPS of $6.85 to $7.