AirSculpt Technologies(AIRS) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For Q4 2024, revenue totaled $39.2 million, a decline of 17.7$1.9 million or 4.7% of revenue, compared to $10.1 million or 21.2$180.4 million, a decline of 7.9% from fiscal 2023, with adjusted EBITDA of $20.7 million and an adjusted EBITDA margin of 11.5$11 billion total addressable market in the U.S. [11] - The consumer backdrop remains challenging, impacting sales across the aesthetics space [14] Company Strategy and Development Direction - The company aims to enhance its culture and align on a singular vision while improving its go-to-market strategy to drive consistent revenue growth [20] - Five key priorities include marketing to drive consumer interest, sales to convert leads, new services to tap into demand, customer experience improvements, and technology enhancements [20][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that Q4 2024 was a challenging period but remains confident in the strategy to restore growth and profitability [44] - The company expects Q1 same-store revenue performance to mirror Q4 2024 trends, with sequential improvement anticipated as marketing spend increases [30][42] Other Important Information - The company has paused new center openings to focus on improving same-center performance [29] - A revised credit agreement enhances the company's ability to invest in the business during the transformation [31][41] Q&A Session Summary Question: Can you provide more color on sequential growth expectations? - Management expects to see a similar seasonal trend with sequential improvement in same-store performance year-over-year, anticipating Q2 to be higher than Q1 [51] Question: What are the liquidity improvement actions being taken? - The company drew down on its revolving credit facility to maintain marketing efforts while facing challenges in Q4 results [56] Question: Can you elaborate on the marketing spend versus customer acquisition cost (CAC)? - The elevated CAC was driven by lower case volumes and reduced lead volumes due to decreased marketing spend [62] Question: What is the status of the cost savings program? - The company has executed a $3 million annual savings plan primarily from corporate headcount reductions, with benefits expected to start in Q1 [67] Question: Can you provide specifics on new marketing efforts? - The company is utilizing a combination of paid search and social marketing, with a focus on returns-based approaches and testing new channels like online video [72] Question: What are the plans for new services, particularly skin tightening? - The company plans to pilot skin tightening as a standalone service, capitalizing on consumer interest and trends [76]