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Beachbody (BODI) Q2 Revenue Falls 42%
The Motley Fool· 2025-08-06 02:59
Core Insights - Beachbody reported Q2 2025 revenue of $63.9 million, exceeding analyst expectations by $6.3 million or 10.9% [1] - The company experienced a loss per share of $0.85, which was an improvement from last year's loss of $1.59, but still fell short of analyst projections [1][2] - Year-over-year revenue declined sharply by 42.0%, with significant drops in digital and nutrition subscriptions [1][5] Financial Performance - Revenue for Q2 2025 was $63.9 million, compared to estimates of $57.6 million and $110.2 million in Q2 2024 [2] - Adjusted EBITDA was $4.6 million, down 6.1% from the previous year, marking the seventh consecutive quarter of positive adjusted EBITDA [2][7] - Digital subscriptions decreased by 18.3% year-over-year to 0.94 million, while nutritional subscriptions fell by 52.1% to 0.07 million [2][6] Business Model Transition - Beachbody shifted from a multi-level marketing approach to a single-level affiliate model and e-commerce-first retail strategy [4] - The transition aims to simplify operations and expand product reach, with success dependent on digital subscriber retention and effective product innovation [4][14] - The company plans to roll out retail versions of its nutritional products in late 2025 and into 2026, targeting a broader audience despite lower gross margins [10][14] Engagement and Retention - Despite a high digital subscription retention rate of 96.7%, overall engagement metrics, including total streams and DAU/MAU ratios, have declined [6][9] - Total streaming activity decreased by 20.4% year-over-year to 18.0 million streams [6][9] - The company acknowledges challenges in attracting new subscribers amid a competitive digital fitness landscape [9] Future Outlook - Management projects Q3 FY2025 revenue between $51 million and $58 million, with adjusted EBITDA expected to be between $2 million and $6 million [13] - Key factors to monitor include the pace of digital subscriber declines, effectiveness of new retail and affiliate strategies, and cash flow management [14]