Yahoo Finance

• Revenue: $193 million for Q3 2024.

• Subscription Revenue: $191 million, down 6% year-over-year.

• Clinical Subscription Revenue: $19.1 million included in subscription revenues.

• Subscribers: 3.7 million at the end of Q3, a decline of 9% year-over-year.

• Clinical Subscribers: 78,000 at the end of Q3, representing 71% growth compared to prior year.

• Adjusted Gross Margin: 69.1%, up from 66.2% in the prior year.

• Marketing Expenses: $44 million, down 8% year-over-year.

• Adjusted G&A: $53 million, down 7% versus prior year.

• Adjusted Operating Income: $36 million, with an operating margin of 18.5%.

• Adjusted EBITDAS: $40 million.

• Adjusted EPS: $0.24, including a $0.33 tax benefit.

• Cash Position: $57 million at the end of Q3.

• Net Debt to Adjusted EBITDAS Ratio: 10.4 times at the end of Q3.

• Full Year Revenue Guidance: At least $770 million.

• Full Year Adjusted Operating Income Guidance: At least $100 million.

• Full Year Adjusted EBITDAS Guidance: At least $150 million.

• Warning! GuruFocus has detected 3 Warning Signs with WW.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• WW International Inc (NASDAQ:WW) has a comprehensive weight management platform that is uniquely positioned to meet members' needs across their weight journey.

• The company has a strong scientific foundation with over 175 published papers of clinical research, proving the efficacy of its solutions.

• WW International Inc (NASDAQ:WW) has a highly engaged community, with members who participate in dynamic online and in-person communities, enhancing retention and weight loss success.

• The company is leveraging its iconic and trusted brand, with plans to refresh its brand to engage both existing and potential future customers.

• WW International Inc (NASDAQ:WW) is expanding its clinical offerings, including compounded semaglutide, to address drug shortages and improve member retention.

Negative Points

• The company is facing significant challenges in changing the business trajectory due to industry disruptions and increased competition.

• There is a high cost of customer acquisition, which has led to cautious marketing spending and impacted sign-up trends.

• WW International Inc (NASDAQ:WW) is dealing with drug shortages and insurance coverage issues, which are primary reasons for churn in its clinical subscribers.

• The company has a significant debt burden, with a net debt to adjusted EBITDAS ratio of 10.4 times, prompting the appointment of advisers to evaluate capital structure options.

• Despite efforts to improve digital member journeys, the company acknowledges accumulated friction and complexity in its digital experience, which needs to be addressed.