Wag! Group Co. Reports 10.4% Revenue Decline and Files for Chapter 11 Bankruptcy

Wag! Group Co. reported a significant decline in financial performance for the second quarter of 2025, with revenues totaling $16.7 million, down 10.4% from $18.7 million in the same period last year. For the first half of 2025, revenues decreased by 23.8% to $31.9 million compared to $41.9 million in the first half of 2024. The company attributed this decline to reduced service and wellness revenues, alongside a decrease in platform participants, which fell by 7.9% year-over-year. The net loss for the second quarter was $6.1 million, a substantial increase from a loss of $2.3 million in the prior year, reflecting a 173% rise in losses.

In terms of operational metrics, Wag! Group Co. reported a total of 430 platform participants as of June 30, 2025, a decrease from 467 participants a year earlier. The company has also faced challenges in managing its costs, with total expenses rising to $21.3 million in the second quarter, up from $19.3 million in the same period last year. Notably, sales and marketing expenses increased by 12.4% to $12.4 million, driven by investments in partnerships related to wellness offerings. General and administrative expenses also rose by 21.2% to $4.6 million, primarily due to increased professional services costs.

Strategically, Wag! Group Co. has undergone significant changes, including the sale of its prescription management software, Furscription, for $5 million, with proceeds used to reduce debt. However, the company filed for Chapter 11 bankruptcy on July 21, 2025, as it struggled with liquidity and debt obligations exceeding its cash balance. The filing has led to an acceleration of its debt obligations, totaling approximately $16.3 million under its financing agreement. The company is currently operating as a debtor-in-possession, with plans to restructure its operations under the supervision of the Bankruptcy Court.

As of June 30, 2025, Wag! Group Co. reported total liabilities of $32.4 million, with a stockholders' deficit of $8 million. The company has indicated substantial doubt regarding its ability to continue as a going concern, emphasizing the uncertainty surrounding its liquidity and capital resources. The outlook remains challenging, with the company needing to secure additional financing and successfully implement its restructuring plan to stabilize its operations and financial position.

Looking ahead, Wag! Group Co. is focused on executing its Chapter 11 plan, which includes potential asset sales and restructuring efforts to improve its financial health. The company has acknowledged that its historical financial performance may not be indicative of future results due to the ongoing bankruptcy proceedings and the associated risks. The management is actively working to address its operational challenges while navigating the complexities of the restructuring process.