Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $44 million, a decline of 13.7% from the prior year quarter, with adjusted EBITDA at $5.8 million, reflecting a margin of 13.3% compared to 13.5% in Q2 2024 [7][18][20] - Same store revenue declined approximately 22% year-over-year, although it improved marginally from Q1 2025 [8][18] - Average revenue per case was approximately $12,975, consistent with the previous year [18] Business Line Data and Key Metrics Changes - Cases declined by 14.1% to 3,392, primarily due to a challenging market environment [18] - The percentage of patients using financing for procedures increased to 50%, up from 44% in Q1 2025 [19] - Customer acquisition cost decreased to $2,905 per case from $3,325 in the prior year quarter, marking the first quarter-over-quarter decline since going public [20] Market Data and Key Metrics Changes - The company experienced strong consumer interest, with record levels of lead growth and increased consultation volume [7][11] - The macroeconomic environment remains challenging, impacting consumer spending and leading to hesitancy in purchasing decisions [28][46] Company Strategy and Development Direction - The company is focused on five business priorities: enhancing marketing strategies, optimizing sales, introducing new services, improving customer experience, and investing in technology [10][11][12][14] - A pilot for a new skin tightening procedure was launched in Q2 2025, with plans to expand it further [13][31] - The company aims to stabilize sales and return to growth, with no planned new center openings for 2025 [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategy to stabilize sales and improve profitability despite the challenging operating environment [7][15] - The company reiterated its annual outlook, expecting revenue between $160 million and $170 million and adjusted EBITDA between $16 million and $18 million for fiscal 2025 [23] Other Important Information - The CFO announced plans to retire later in the year, with a search underway for a replacement [5] - The company repaid $16 million in debt during the quarter, improving its financial position [21][22] Q&A Session Summary Question: Guidance implies revenues that are flattish in the second half, what are the drivers for the acceleration? - Management noted that while consumer uncertainty persists, record high leads and consultation growth are expected to stabilize revenue and improve EBITDA margins in the second half [28][29] Question: Update on the skin tightening offering and its impact on revenue? - Management confirmed that there are no standalone expectations for skin tightening in guidance, but strong interest has been observed [31][32] Question: Performance of the new centers opened in 2024? - The new centers are performing in line with expectations, though lower than historical averages due to consumer pressures [36][37] Question: Any seasonality considerations for Q3? - Management indicated typical softening in Q3, with expectations for improvement in Q4 as cost initiatives take effect [38][39] Question: Update on the London facility's performance? - The London facility has shown improvement but remains cash flow negative, with management focused on enhancing results [41] Question: Insights on consumer sentiment and market dynamics? - Management noted a choppiness in consumer behavior, with consumers hesitant to make purchases, but believes the company is well-positioned compared to competitors [46]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $39.4 million, a decline of 17.3% from Q1 2024, with adjusted EBITDA at $3.8 million and a margin of 9.5%, down from $7.3 million and 15.4% in the prior year [7][21][24] - Same store revenue declined approximately 24% year-over-year, consistent with expectations and Q4 trends [9][21] - Average revenue per case was $12,799, slightly higher than the first quarter of 2024 [21] Business Line Data and Key Metrics Changes - The decline in revenue was primarily driven by lower case volume, with cases down 17.9% to 3,070 [21] - Cost of service decreased by $2.1 million compared to the prior year, but as a percentage of revenue increased to 40.5% from 37.9% [22][23] - Customer acquisition cost for the quarter was $3,130 per case, up from $2,990 in the prior year quarter [24] Market Data and Key Metrics Changes - The percentage of patients using financing to pay for procedures was 44%, down from 50% in Q4 2024 [22] - The company operates in a challenging macroeconomic environment, impacting consumer spending and case volumes [19][50] Company Strategy and Development Direction - The company is focused on stabilizing performance and laying the foundation for long-term growth, with a plan to improve marketing efficiency and operational rigor [6][19] - New services, such as a skin tightening procedure pilot, are being introduced to tap into more consumer demand [16] - The company is reallocating marketing spend to proven strategies, including search engine and social media marketing, while testing new areas like online video [15][44] Management's Comments on Operating Environment and Future Outlook - Management remains confident in the business's ability to return to growth and improve profitability, despite current challenges [20][19] - The guidance for fiscal 2025 revenue is projected between $160 million and $170 million, with adjusted EBITDA between $16 million and $18 million [18][26] - The company is closely monitoring consumer behavior and economic conditions, particularly inflationary pressures and changes in sentiment [19][50] Other Important Information - The company is focused on reducing leverage to historical levels, with a leverage ratio of 3.76 times as of March 31, 2025 [25] - Cash flow from operations for the quarter was $900,000, down from $3.4 million in Q1 2024 [26] Q&A Session Summary Question: Can you speak to some of the specific cost savings that you saw in the quarter? - Management noted that significant cost savings were achieved through workforce changes, targeting $3 million in savings for the year [29] Question: What is the potential margin you think you can achieve on $160 million to $170 million of revenues? - Management expects to approach long-term EBITDA margins of around 30% as revenue trends improve [31] Question: Have you seen any improvement in the rate of conversion to cases? - Management indicated that the time to book cases remains elongated due to macroeconomic pressures, but lead volume growth is encouraging [38] Question: What does the low end versus the high end of your guidance assume for the current macro environment? - The low end assumes further moderation in consumer spending, while the high end incorporates benefits from initiatives like financing options [49] Question: When will the new financing options roll out? - The rollout of expanded financing options is expected by the end of Q2 2025 [54]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $39.4 million, a decline of 17.3% from Q1 2024, with adjusted EBITDA at $3.8 million and a margin of 9.5%, down from $7.3 million and 15.4% in the prior year [6][23][24] - Same store revenue decreased approximately 24% year-over-year, consistent with previous trends [7][20] - Average revenue per case was $12,799, slightly higher than the first quarter of 2024 [20][23] Business Line Data and Key Metrics Changes - Cases declined by 17.9% to 3,070, primarily due to lower consumer spending and reduced marketing efforts [20][21] - The percentage of patients using financing for procedures was 44%, down from 50% in the previous quarter [21] Market Data and Key Metrics Changes - The company operates in a challenging macroeconomic environment, impacting consumer spending and case volumes [5][18] - Despite the decline, there was an improvement in lead generation and case performance from February to April 2025 [7][20] Company Strategy and Development Direction - The company is focused on stabilizing performance and laying the foundation for long-term growth through cost discipline, marketing efficiency, and operational rigor [5][6] - Strategic priorities include reallocating marketing spend to effective channels, optimizing sales processes, and introducing new services to meet consumer demand [14][15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's transformation efforts and the potential for future growth, despite current economic pressures [5][19] - The guidance for fiscal 2025 anticipates revenue between $160 million and $170 million, with adjusted EBITDA between $16 million and $18 million, reflecting a cautious outlook due to uncertain consumer behavior [17][25] Other Important Information - The company is monitoring inflationary pressures and consumer sentiment, which could impact discretionary spending on procedures [18] - Cost of service decreased by $2.1 million compared to the prior year, but as a percentage of revenue increased to 40.5% due to fixed costs [21][22] Q&A Session Summary Question: Specific cost savings and sustainability - Management noted significant cost savings from workforce changes, targeting $3 million in savings for the year [28] Question: Potential EBITDA margins and case growth - Management expects EBITDA margins to approach historical levels of around 30% as same store revenue improves [30] Question: Momentum in cases and seasonal patterns - Management confirmed improvements in cases were both seasonal and due to strategic initiatives, with a target for same store sales growth by year-end [31] Question: Underlying assumptions in guidance - Guidance incorporates a range of scenarios, with the low end accounting for further moderation in consumer spending [47][48] Question: Financing options and their impact - Financing options are expected to roll out by the end of Q2, which management believes will help increase case volumes [52][54]