Revenue Exceeds the Midpoint of Guidance
First Quarterly Positive Free Cash Flow1 since 2020
The Beachbody Company, Inc. (NYSE: BODi) (“BODi” or the
“Company”), a leading subscription health and fitness company,
today announced financial results for its first quarter ended March
31, 2024.
"We are pleased with our performance in the first quarter,
beating the midpoint of our revenue and adjusted EBITDA guidance,
all while delivering against our strategic initiatives. Most
notably, we are excited to announce that we have achieved our first
positive free cash flow quarter since 2020,” said Carl Daikeler,
BODi’s Co-Founder and Chief Executive Officer. “We have had an
excellent start to 2024 and for the remainder of the year, we will
continue to deliver against the objectives in our turnaround
plan."
First Quarter 2024 Results
- Total revenue was $120.0 million compared to $144.9 million in
the prior year period.
- Digital revenue was $61.5 million compared to $64.8 million in
the prior year period and digital subscriptions totaled 1.22
million in the first quarter.
- Nutrition and Other revenue was $55.5 million compared to $74.1
million in the prior year period and nutritional subscriptions
totaled 0.15 million in the first quarter.
- Connected Fitness revenue was $3.0 million compared to $6.0
million in the prior year period and approximately 3,500 bikes were
delivered in the first quarter.
- Total operating expenses were $92.1 million compared to $118.8
million in the prior year period.
- Operating loss improved by $16.6 million to $10.8 million
compared to an operating loss of $27.4 million in the prior year
period.
- Net loss was $14.2 million compared to a net loss of $29.2
million in the prior year period.
- Adjusted EBITDA1 was $4.6 million compared to $(0.9) million in
the prior year period.
- Cash provided by operating activities for the three months
ended March 31, 2024 was $9.1 million compared to cash used in
operating activities of $7.9 million in the prior year period, and
cash provided by investing activities was $3.9 million compared to
cash used in investing activities of $3.4 million in the prior year
period. Free cash flow was $7.4 million compared to $(11.3) million
in the prior year period.
Marc Suidan, Chief Financial Officer, stated: "We made a
concerted effort to improve our liquidity position. Our net cash
position1 increased from $3.9 million at December 31, 2023 to $14.4
million at March 31, 2024. This represents approximately a $10
million improvement in our liquidity in one quarter.”
1 A definition of (1) Adjusted EBITDA and reconciliation to net
loss, (2) free cash flow and (3) net cash position are at the end
of this release.
Key Operational and Business
Metrics
For the
Three Months Ended March 31,
2024
2023
Change v 2023
Digital Subscriptions (in millions)
1.22
1.75
(30.4
%)
Nutritional Subscriptions (in
millions)
0.15
0.21
(28.0
%)
Total Subscriptions (in millions)
1.37
1.96
(30.2
%)
Average Digital Retention
95.7
%
95.9
%
(20
bps)
Total Streams (in millions)
25.6
29.7
(13.6
%)
DAU/MAU
33.2
%
32.5
%
70
bps
Connected Fitness Units Delivered (in
thousands)
3.5
4.7
(24.4
%)
Digital
$
61.5
$
64.8
(5.0
%)
Nutrition & Other
$
55.5
$
74.1
(25.1
%)
Connected Fitness
$
3.0
$
6.0
(49.6
%)
Revenue (in millions)
$
120.0
$
144.9
(17.2
%)
Net Loss (in millions)
$
(14.2
)
$
(29.2
)
51.3
%
Adjusted EBITDA (in millions)
$
4.6
$
(0.9
)
NM
NM: Not Meaningful
Outlook for The Second Quarter of
2024
Outlook
For Quarter Ending June 30, 2024
(in millions)
Revenue
$
103
$
113
Net Loss
$
(20
)
$
(14
)
Adjustments:
Depreciation
$
5
$
5
Amortization of Content Assets
$
4
$
4
Interest Expense
$
2
$
2
Equity-Based Compensation
$
5
$
5
Other Adjustment Items
$
1
$
1
Total Adjustments
$
17
$
17
Adjusted EBITDA
$
(3
)
$
3
Conference Call and Webcast Information
BODi will host a conference call at 5:00pm ET on Monday, May 6,
2024, to discuss its financial results and matters other than past
results, such as guidance. To participate in the live call, please
dial (833) 470-1428 (U.S. & Canada), or +1 (929) 526-1599 (all
other locations) and provide the conference identification number:
460282. The conference call will also be available to interested
parties through a live webcast at
https://investors.thebeachbodycompany.com/.
A replay of the call will be available until May 13, 2024, by
dialing (866) 813-9403 (U.S & Canada), or + 44 (204) 525-0658
(all other locations). The replay passcode is 381485.
After the conference call, a webcast replay will remain
available on the investor relations section of the Company’s
website for one year.
About BODi and The Beachbody Company, Inc.
Originally known as Beachbody, BODi has been innovating
structured step-by-step home fitness and nutrition programs for 25
years such as P90X, Insanity, and 21-Day Fix, plus the first
premium superfood nutrition supplement, Shakeology. Since its
inception in 1999 BODi has helped over 30 million customers pursue
extraordinary life-changing results. The BODi community represents
millions of people helping each other stay accountable to goals of
healthy weight loss, improved strength and energy, and resilient
mental and physical well-being. For more information, please visit
TheBeachBodyCompany.com.
Safe Harbor Statement
This press release of The Beachbody Company, Inc. (“we,” “us,”
“our,” and similar terms) contains "forward-looking" statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which are statements other than statements of historical
facts and statements in future tense. These statements include but
are not limited to, statements regarding our future performance and
our market opportunity, including expected financial results for
the second quarter and full year, our business strategy, our plans,
and our objectives and future operations.
Forward-looking statements are based upon various estimates and
assumptions, as well as information known to us as of the date
hereof, and are subject to risks and uncertainties. Accordingly,
actual results could differ materially due to a variety of factors,
including: our ability to effectively compete in the fitness and
nutrition industries; our ability to successfully acquire and
integrate new operations; our reliance on a few key products;
market conditions and global and economic factors beyond our
control; intense competition and competitive pressures from other
companies worldwide in the industries in which we operate; and
litigation and the ability to adequately protect our intellectual
property rights. You can identify these statements by the use of
terminology such as "believe", “plans”, "expect", "will", "should,"
"could", "estimate", "anticipate" or similar forward-looking terms.
You should not rely on these forward-looking statements as they
involve risks and uncertainties that may cause actual results to
vary materially from the forward-looking statements. For more
information regarding the risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
in these forward-looking statements, as well as risks relating to
our business in general, we refer you to the "Risk Factors" section
of our Securities and Exchange Commission (SEC) filings, including
those risks and uncertainties included in the Form 10-K filed with
the SEC on March 11, 2024 and any subsequent Quarterly Reports on
Form 10-Q or Current Reports on Form 8-K, which are available on
the Investor Relations page of our website at
https://investors.thebeachbodycompany.com and on the SEC website at
www.sec.gov.
All forward-looking statements contained herein are based on
information available to us as of the date hereof and you should
not rely upon forward-looking statements as predictions of future
events. The events and circumstances reflected in the
forward-looking statements may not be achieved or occur. Although
we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
performance, or achievements. We undertake no obligation to update
any of these forward-looking statements for any reason after the
date of this press release or to conform these statements to actual
results or revised expectations, except as required by law. Undue
reliance should not be placed on forward-looking statements.
The Beachbody Company, Inc. Condensed
Consolidated Balance Sheets (in thousands, except share and
per share data)
March 31,
December 31,
2024
2023
(unaudited)
Assets
Current assets:
Cash and cash equivalents (restricted cash
of $0.1 million at March 31, 2024 and December 31, 2023,
respectively)
$
38,929
$
33,409
Restricted short-term investments
4,250
4,250
Inventory
20,807
24,976
Prepaid expenses
10,008
10,715
Other current assets
42,448
45,923
Total current assets
116,442
119,273
Property and equipment, net
36,560
45,055
Content assets, net
18,651
21,359
Goodwill
85,166
85,166
Right-of-use assets, net
3,876
3,063
Other assets
2,327
2,923
Total assets
$
263,022
$
276,839
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
8,432
$
10,659
Accrued expenses
40,724
42,147
Deferred revenue
101,873
97,169
Current portion of lease liabilities
1,927
1,835
Current portion of Term Loan
5,875
8,068
Other current liabilities
3,848
5,325
Total current liabilities
162,679
165,203
Term Loan
18,680
21,491
Long-term lease liabilities, net
2,253
1,425
Deferred tax liabilities
—
10
Other liabilities
6,669
5,950
Total liabilities
190,281
194,079
Stockholders’ equity:
Preferred stock, $0.0001 par value;
100,000,000 shares authorized, none issued and outstanding at March
31, 2024 and December 31, 2023
—
—
Common stock, $0.0001 par value,
1,900,000,000 shares authorized (1,600,000,000 Class A, 200,000,000
Class X and 100,000,000 Class C);
Class A: 4,138,474 and 3,978,356 shares
issued and outstanding at March 31, 2024 and December 31, 2023,
respectively;
1
1
Class X: 2,729,003 shares issued and
outstanding at March 31, 2024 and December 31, 2023,
respectively;
1
1
Class C: no shares issued and outstanding
at March 31, 2024 and December 31, 2023
—
—
Additional paid-in capital
658,816
654,657
Accumulated deficit
(586,092
)
(571,876
)
Accumulated other comprehensive income
(loss)
15
(23
)
Total stockholders’ equity
72,741
82,760
Total liabilities and stockholders’
equity
$
263,022
$
276,839
The Beachbody Company, Inc. Unaudited
Condensed Consolidated Statements of Operations (in
thousands, except per share data)
Three months ended March
31,
2024
2023
Revenue:
Digital
$
61,506
$
64,773
Nutrition and other
55,512
74,120
Connected fitness
3,028
6,008
Total revenue
120,046
144,901
Cost of revenue:
Digital
12,862
14,967
Nutrition and other
22,284
31,039
Connected fitness
3,618
7,555
Total cost of revenue
38,764
53,561
Gross profit
81,282
91,340
Operating expenses:
Selling and marketing
59,261
76,576
Enterprise technology and development
17,717
19,096
General and administrative
13,483
17,716
Restructuring
1,644
5,387
Total operating expenses
92,105
118,775
Operating loss
(10,823
)
(27,435
)
Other income (expense):
Loss on partial debt extinguishment
(1,209
)
—
Change in fair value of warrant
liabilities
(724
)
57
Interest expense
(1,875
)
(2,331
)
Other income, net
477
569
Loss before income taxes
(14,154
)
(29,140
)
Income tax provision
(62
)
(48
)
Net loss
$
(14,216
)
$
(29,188
)
Net loss per common share, basic and
diluted
$
(2.10
)
$
(4.72
)
Weighted-average common shares
outstanding, basic and diluted
6,761
6,183
The Beachbody Company, Inc. Unaudited
Condensed Consolidated Statements of Cash Flows (in
thousands)
Three months ended March
31,
2024
2023
Cash flows from operating
activities:
Net loss
$
(14,216
)
$
(29,188
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation and amortization expense
5,378
10,713
Amortization of content assets
4,540
5,561
Provision for inventory and inventory
purchase commitments
635
2,734
Realized (gains) losses on hedging
derivative financial instruments
64
(87
)
Change in fair value of warrant
liabilities
724
(57
)
Equity-based compensation
4,365
9,555
Deferred income taxes
(3
)
(53
)
Amortization of debt issuance costs
585
479
Paid-in-kind interest expense
214
374
Loss on partial debt extinguishment
1,209
—
Change in lease assets
(813
)
—
Gain on sale of property and equipment
(784
)
—
Changes in operating assets and
liabilities:
Inventory
3,497
3,056
Content assets
(1,831
)
(2,224
)
Prepaid expenses
707
1,652
Other assets
4,084
(4,958
)
Accounts payable
(2,212
)
(1,366
)
Accrued expenses
(1,362
)
(8,768
)
Deferred revenue
4,907
4,746
Other liabilities
(554
)
(38
)
Net cash provided by (used in) operating
activities
9,134
(7,869
)
Cash flows from investing
activities:
Purchase of property and equipment
(1,699
)
(3,417
)
Proceeds from sale of property and
equipment
5,600
—
Net cash provided by (used in) investing
activities
3,901
(3,417
)
Cash flows from financing
activities:
Debt repayments
(7,013
)
(313
)
Tax withholding payments for vesting of
restricted stock
(206
)
(2,128
)
Net cash used in financing activities
(7,219
)
(2,441
)
Effect of exchange rates on cash and cash
equivalents
(296
)
29
Net increase (decrease) in cash and cash
equivalents
5,520
(13,698
)
Cash, cash equivalents and restricted
cash, beginning of period
33,409
80,091
Cash and cash equivalents, end of
period
$
38,929
$
66,393
Supplemental disclosure of cash flow
information:
Cash paid during the period for
interest
$
1,111
$
1,464
Cash (received) paid during the period for
income taxes, net
29
(265
)
Supplemental disclosure of noncash
investing activities:
Property and equipment acquired but not
yet paid for
$
453
$
1,291
The Beachbody Company, Inc. Adjusted EBITDA
We use Adjusted EBITDA, which is a non-GAAP performance measure,
to supplement our results presented in accordance with accounting
principles generally accepted in the United States of America
("GAAP"). We believe Adjusted EBITDA is useful in evaluating our
operating performance, as it is similar to measures reported by our
public competitors and is regularly used by security analysts,
institutional investors, and other interested parties in analyzing
operating performance and prospects. Adjusted EBITDA is not
intended to be a substitute for any GAAP financial measure and, as
calculated, may not be comparable to other similarly titled
measures of performance of other companies in other industries or
within the same industry.
We define and calculate Adjusted EBITDA as net income (loss)
adjusted for depreciation and amortization, amortization of
capitalized cloud computing implementation costs, amortization of
content assets, interest expense, income taxes, equity-based
compensation, and other items that are not normal, recurring,
operating expenses necessary to operate the Company’s business as
described in the reconciliation below.
We include this non-GAAP financial measure because it is used by
management to evaluate BODi’s core operating performance and trends
and to make strategic decisions regarding the allocation of capital
and new investments. Adjusted EBITDA excludes certain expenses that
are required in accordance with GAAP because they are non-cash (for
example, in the case of depreciation and amortization, impairment
of goodwill and intangible assets and equity-based compensation) or
are not related to our underlying business performance (for
example, in the case of restructuring costs, interest income and
expense).
The table below presents our Adjusted EBITDA reconciled to our
net loss, the closest GAAP measure, for the periods indicated:
Three months ended March
31,
(in thousands)
2024
2023
Net loss
$
(14,216
)
$
(29,188
)
Adjusted for:
Loss on partial debt extinguishment
(1)
1,209
—
Depreciation and amortization
5,378
10,713
Amortization of capitalized cloud
computing implementation costs
37
41
Amortization of content assets
4,540
5,561
Interest expense
1,875
2,331
Income tax provision
62
48
Equity-based compensation
4,365
9,555
Employee incentives, expected to be
settled in equity (2)
—
(5,466
)
Restructuring and platform consolidation
costs (3)
1,644
6,059
Change in fair value of warrant
liabilities
724
(57
)
Gain on sale of property and equipment
(784
)
—
Non-operating (4)
(280
)
(484
)
Adjusted EBITDA
$
4,554
$
(887
)
1 Represents the loss related to the $1.0 million and $5.5
million partial debt prepayments that the Company made on January
9, 2024 and February 29, 2024, respectively. 2 The non-cash charge
for employee incentives which were expected to be settled in equity
was recorded and included in the Adjusted EBITDA calculation during
the year ended December 31, 2022. During the three months ended
March 31, 2023, we reclassified the non-cash charge from employee
incentives expected to be settled in equity to equity-based
compensation because we settled certain employee incentives with
RSU awards during the period. 3 Includes restructuring expense and
personnel costs associated with the Company's key initiatives
during the three months ended March 31, 2024 and with executing our
key growth priorities during the three months ended March 31, 2023.
4 Primarily includes interest income.
The Beachbody Company, Inc. Net Cash Position and Free
Cash Flow
Net Cash Position
We use net cash position, which is a non-GAAP liquidity measure,
to supplement our liquidity as presented in accordance with GAAP.
We believe that net cash position is useful in viewing our
liquidity, as it is similar to measures reported by our public
competitors and is regularly used by security analysts,
institutional investors, and other interested parties in analyzing
liquidity. Net cash position is not intended to be a substitute for
GAAP financial measures and, as calculated may not be comparable to
other similarly titled measures of liquidity for other companies in
other industries or within the same industry.
The table below presents our net cash position, which is our
cash and cash equivalents less the debt on our balance sheet for
the periods indicated:
March 31,
December 31,
(in thousands)
2024
2023
Cash and cash equivalents
$
38,929
$
33,409
Less:
Current portion of Term Loan
5,875
8,068
Term Loan
18,680
21,491
Net cash position
$
14,374
$
3,850
Free Cash Flow
We use free cash flow, which is a non-GAAP liquidity measure, to
supplement our cash provided by (used in) operating activities as
presented in accordance with GAAP. We believe that free cash flow
is useful in evaluating our liquidity, as it is similar to measures
reported by our public competitors and is regularly used by
security analysts, institutional investors, and other interested
parties in analyzing liquidity. Free cash flow is not intended to
be a substitute for GAAP financial measures and, as calculated may
not be comparable to other similarly titled measures of liquidity
for other companies in other industries or within the same
industry.
The table below presents our free cash flow, which is our net
cash provided by (used in) operating activities less cash used for
the purchase of property and equipment for the periods
indicated:
Three months ended March
31,
(in thousands)
2024
2023
Net cash provided by (used in) operating
activities
$
9,134
$
(7,869
)
Less:
Cash used in the purchase of property and
equipment
1,699
3,417
Free cash flow
$
7,435
$
(11,286
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240506305350/en/
Investor Relations IR@BODi.com
Beachbody (NYSE:BODI)
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