Summary of Nextdoor (KIND) 2025 Conference Call Company Overview - **Company**: Nextdoor - **Industry**: Social Networking - **User Base**: Over 100 million verified neighbors - **Recent Changes**: Launched a new platform transformation in July 2025 Core Points and Arguments 1. **Mission and Opportunity**: Nextdoor aims to become the essential local application that provides immediate information about local communities, filling a gap not addressed by existing platforms like Google or Meta [4][5][6] 2. **Product-Led Growth (PLG)**: The company is shifting towards a product-led growth culture, emphasizing the importance of evolving the product to retain and attract users, rather than relying solely on marketing strategies [6][7] 3. **Transformation Phases**: The transformation involves three phases: reset, rebuild, and reaccelerate. Currently, Nextdoor is in the early stages of the rebuild phase, focusing on improving the product [8][9][10] 4. **New Features**: The new Nextdoor includes three pillars: news, alerts, and recommendations (faves). This marks a shift from solely neighbor-generated content to integrating third-party content, including local news from 5,000 publishers [11][13][14] 5. **Content Strategy**: The platform is expanding its content offerings to include local news, alerts about natural disasters, and community events, aiming to provide a comprehensive view of local life [15][18][19] 6. **AI Integration**: Nextdoor is leveraging AI to enhance user experience, including personalized content recommendations and AI-generated conversation starters to increase engagement [16][20][24][25] 7. **User Engagement**: Currently, only about 25 million out of 100 million verified users visit Nextdoor weekly. The company aims to increase this engagement by reactivating dormant users and attracting new demographics [31][32][35] 8. **Monetization Strategy**: The revenue model is primarily ad-based, with a focus on increasing user engagement to drive revenue. The company is also exploring programmatic advertising and integrating small businesses into conversations on the platform [27][40][41][42] 9. **Profitability Goals**: Nextdoor aims to break even by Q4 2025 and in 2026, emphasizing a culture of judicious spending and investment in growth opportunities [50][51] Important but Overlooked Content 1. **User Personalization**: The platform is developing sophisticated user profiles based on location and engagement to tailor content effectively [22][23] 2. **Community Engagement**: The company recognizes the need for a diverse range of content to appeal to various demographics, including younger users, by focusing on universally relevant alerts and events [36][37][38] 3. **Cultural Shift**: The leadership emphasizes a cultural shift towards treating every dollar spent as sacred, fostering a mindset of innovation and efficiency [50][51] This summary encapsulates the key insights and strategic directions discussed during the Nextdoor conference call, highlighting the company's focus on product evolution, user engagement, and monetization strategies.

Financial Data and Key Metrics Changes - For Q2, total net revenue rose 7% to $2.5 billion, with comparable sales increasing 1% [26] - Gross profit was $1.48 billion, representing 58.5% of net revenue, down from 59.6% in Q2 2024 [27][28] - Net income for the quarter was $371 million, or $3.10 per diluted share, compared to $3.15 in the same period last year [30] Business Line Data and Key Metrics Changes - Men's revenue increased 6%, women's revenue increased 5%, and accessories and other grew 15% [27] - Performance apparel continues to grow, while lounge and social product offerings have become stale, impacting sales negatively [12][13] Market Data and Key Metrics Changes - In the U.S., revenue was flat, with comparable sales down 3% [26] - China revenue increased 25%, with comparable sales up 16% [27] - The rest of the world segment saw a revenue growth of 19%, with comparable sales increasing by 9% [27] Company Strategy and Development Direction - The company is focusing on increasing the number and frequency of new styles in its product assortment, aiming to raise new styles from 23% to 35% [16] - A new Chief AI and Technology Officer has been appointed to enhance product innovation and agility [18] - The company plans to navigate increased costs from tariffs through strategic pricing and supply chain initiatives [25][22] Management's Comments on Operating Environment and Future Outlook - Management expressed dissatisfaction with current U.S. results and acknowledged the need for product innovation to meet consumer expectations [6][24] - The company expects revenue growth of 4% to 6% for the year, with a decline in U.S. revenue projected at 1% to 2% [22][32] - Management remains optimistic about international growth, particularly in China, where growth is expected to be 20% to 25% [22][32] Other Important Information - The company ended the quarter with $1.16 billion in cash and cash equivalents, and inventory increased 21% to $1.7 billion [31] - Capital expenditures for the quarter were approximately $178 million, reflecting timing of store openings [31] Q&A Session Summary Question: What changes are being made in the product department? - The focus is on maintaining momentum in performance activities, introducing new styles in lounge and social, and refreshing iconic items [46] Question: How are recent tariff increases affecting pricing strategy? - Modest price increases are being instituted on a small portion of the assortment, with ongoing evaluations of pricing strategies [49] Question: What is the right mix of casual and performance products? - A 60/40 split is considered a good benchmark, with ongoing adjustments based on consumer response to new styles [53] Question: How will the company manage inventory and course corrections before 2026? - New processes are in place to improve agility and speed in responding to consumer demand [79] Question: What impact does the de minimis exemption removal have on e-commerce? - Approximately two-thirds of U.S. e-commerce orders are fulfilled through Canada, and the removal of the exemption has a significant impact [80]

Financial Data and Key Metrics Changes - The company reported a 4% organic growth in the consumables business for the second quarter and expects sequential sales growth to average mid-single digits for the year [4][5] - The guidance for 2025 was updated, with the high end of the range adjusted from $425 million to $408 million due to the divestment of solutions and unexpected tariffs amounting to $30 million [41][42] Business Segment Data and Key Metrics Changes - The consumables business has compounded growth at 5% to 7% annually for over five years, driven by good clinical outcomes, brand inertia, and market share gains due to industry shortages [5][6] - The LVP (Large Volume Pump) revenue experienced double-digit growth, attributed to increased utilization and competitive wins, with a new product, Plum Duo, recently installed at customers [10][12] - The Vital Care segment saw a negative 4% organic growth in the second quarter, with expectations for flat sales in 2025 [33] Market Data and Key Metrics Changes - The overall market for infusion pumps has been abnormal, with significant catch-up growth due to actions taken by other manufacturers [10] - The competitive environment is shifting, with recalls and sales pauses affecting market dynamics, leading to a need for hospitals to decide on infusion pump platforms in the next 18 to 24 months [18][19] Company Strategy and Development Direction - The company is focused on maintaining competitive advantages through product innovation and integration of all pumps on a single platform, which enhances operational efficiency for customers [30] - The joint venture with Otsuka Pharmaceutical is seen as a strategic move to align with a leading innovator in the market, enhancing the company's product offerings without the capital intensity of traditional manufacturing [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the utilization rates across geographies, indicating a stable operating environment despite some challenges [3] - The company anticipates that the replacement cycle for its pump products will begin towards the end of next year, which could drive future revenue growth [16][17] Other Important Information - The company is navigating a complex regulatory environment, with ongoing scrutiny and multiple product approvals in the pipeline, which are critical for future growth [23][24] - Management highlighted the importance of not annualizing the impact of tariffs, as they are actively working on mitigating their effects through various strategies [56] Q&A Session Summary Question: What are the drivers of the consumables business growth? - Management identified good clinical outcomes, brand inertia, and market share gains from industry shortages as key drivers [5][6] Question: How does the company view the competitive environment for LVP? - Management noted that the competitive landscape is changing due to recalls and the need for hospitals to make decisions on infusion pump platforms [18][19] Question: What is the expectation for the approval of new devices? - Management expects a minimum of nine months for the approval of new devices, with ongoing efforts to streamline the process [26] Question: How does the company plan to address the Vital Care segment's performance? - Management indicated they are exploring the right solutions for the Vital Care segment, acknowledging its different growth rates compared to other segments [33][34] Question: What is the company's strategy for capital deployment once leverage ratios improve? - Management stated that they are focused on organic growth and do not feel pressured to pursue M&A, emphasizing the importance of R&D investments [61][62]

Financial Data and Key Metrics Changes - The company is focused on the next generation of obesity therapy, particularly therapeutic peptides targeting nutrient-stimulated hormone pathways, with a strong emphasis on scalability and combinability [2][3] - The clinical stage assets include MET-097i, an ultra-long-acting GLP-1 receptor agonist, which is rapidly approaching phase three trials [3][4] Business Line Data and Key Metrics Changes - MET-097i has shown to be tenfold more potent than tirzepatide, which improves manufacturability and lowers active pharmaceutical ingredient (API) requirements [4][5] - The amylin analog MET-233i is designed to be co-formulated with MET-097i, allowing for monthly dosing due to matched half-lives of 18 and 19 days respectively [5][6] Market Data and Key Metrics Changes - The company is addressing the challenges of oral peptide delivery, aiming to achieve injectable-like efficacy with low-dose oral formulations [7][8] - The competitive landscape includes dual agonists like tirzepatide, with MET-097i expected to perform similarly in terms of efficacy and tolerability [15][28] Company Strategy and Development Direction - The company aims to position MET-097i as a best-in-class candidate for obesity treatment, focusing on monthly dosing and competitive tolerability [37][56] - There is a strong emphasis on maintenance therapies, with plans to explore prodrugs that could allow for quarterly dosing [71][72] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming clinical data readouts, particularly for MET-097i and the amylin analog, which are expected to demonstrate strong efficacy and tolerability [19][39] - The company is optimistic about the potential for combination therapies to enhance weight loss outcomes while maintaining tolerability [56][57] Other Important Information - The company has a broad pipeline with multiple catalysts expected in the next 9 to 12 months, including phase two readouts for MET-097i [9][19] - The oral peptide strategy is seen as a significant advancement, with the potential to overcome the limitations of current oral peptide formulations [63][67] Q&A Session Summary Question: Can you elaborate on the long half-life and its impact on tolerability? - Management explained that the long half-life allows for a smoother rise in drug concentration, reducing gastrointestinal adverse events associated with rapid concentration changes [11][12] Question: What is the rationale behind the study design for VESPER-1? - The design was focused on dose selection without titration to expedite the process of moving towards phase three trials [21][22] Question: How does the company view the competitive landscape for MET-097i? - The company believes MET-097i can achieve dual agonist-like efficacy while being more tolerable, positioning it favorably against competitors [28][37] Question: What are the expectations for the upcoming data releases? - Management anticipates that the data will support the efficacy and tolerability claims for both MET-097i and the amylin analog, with significant implications for market positioning [61][72]

Financial Data and Key Metrics Changes - The company reported revenue of $180 million for Q2 2026, representing a 24% year-over-year increase and an 11% increase from the prior quarter [6][18] - Non-GAAP operating income was $6 million, with a non-GAAP net income of $17 million, and free cash flow of $4 million [6][24] - The company achieved three consecutive quarters of positive non-GAAP operating income and free cash flow, and five consecutive quarters of positive non-GAAP net income [7] Business Line Data and Key Metrics Changes - Subscription revenue accounted for 95% of total revenue, with the remaining 5% from professional services and onboarding fees [18] - The total customer count increased by 12% year-over-year to 2,422, with large customers (spending at least $500,000 annually) growing by 27% year-over-year to 282 [18][19] - Dollar-based net retention was 108% overall and 111% for large customers, indicating strong expansion across industries and regions [20] Market Data and Key Metrics Changes - Revenue outside the U.S. contributed 45% of total revenue, down approximately 60 basis points sequentially but in line with the prior year [20] - The total remaining performance obligation was $862 million, up 25% year-over-year, with current RPO at $558 million, up 27% year-over-year [21] Company Strategy and Development Direction - The company aims to drive higher profitability while reinvesting in business growth and maintaining its competitive advantage in customer engagement [7][17] - The integration of OfferFit is expected to enhance the company's AI capabilities and customer engagement strategies, with a focus on autonomous personalization [12][13] - The company is committed to improving customer engagement through AI-driven innovations and enhancing the user experience [10][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of the year, citing strong pipeline generation and competitive strength despite global trade and economic concerns [7][32] - The company noted that the demand environment remains stable, with improved execution and high competitive win rates contributing to positive performance [32][33] - Management highlighted the importance of AI in transforming customer engagement and enhancing marketer productivity [66] Other Important Information - The company expects Q3 2026 revenue to be in the range of $183.5 million to $184.5 million, representing a year-over-year growth rate of approximately 21% [26] - For the full fiscal year 2026, total revenue is expected to be in the range of $717 million to $720 million, with OfferFit contributing approximately two percentage points to year-over-year growth [28][29] Q&A Session Summary Question: What has changed in the demand environment and the appetite for Braze? - Management noted that there hasn't been a meaningful change in the macro or demand environment, but execution has improved globally, leading to high competitive win rates and efficient late-stage pipeline operations [32] Question: What are the expectations for OfferFit's integration and its impact on ACV? - Management reported strong early wins from OfferFit across all regions and expressed confidence in high attach rates for the offering, which is priced around $300,000 annually [41][45] Question: How is the usage of AI products trending? - Management indicated rapid adoption of AI features across various verticals, enhancing customer engagement and closing the gap between capability and accessibility for customers [52][53] Question: How has sales execution improved? - Management highlighted synchronization of operational changes and investments leading to improved sales efficiency and better prioritization of late-stage pipeline opportunities [56][57] Question: What changes have been observed in the demand environment across geographies? - Management noted strong performance globally, with contributions from all regions, particularly from the ANZ region due to investments like the new data center [80]

Financial Data and Key Metrics Changes - The company is preparing to file its New Drug Application (NDA) for bitopertin in October, with a potential PDUFA date between June and October of the following year, marking a significant milestone for the company [4][5] - The company reported a P-value of less than 0.001 for the reduction in protoporphyrin-9 (PP9), indicating a clinically meaningful reduction in patients with erythropoietic protoporphyria [9][10] Business Line Data and Key Metrics Changes - The lead program, bitopertin, is in the accelerated approval pathway with the FDA, focusing on rare diseases related to red blood cell biology [4][5] - The second program is expected to present data on anemia of myelofibrosis and anemia of chronic kidney disease at upcoming conferences [5][6] Market Data and Key Metrics Changes - The company identified approximately 14,000 diagnosed patients in the U.S. for the target disease, with enrollment in trials not being a problem due to strong patient advocacy [18][23] - The company plans to leverage claims data to identify and validate physicians treating these patients, enhancing their market access strategy [23][24] Company Strategy and Development Direction - The company is focused on increasing disease awareness and ensuring that patients and physicians are informed about available therapies, as historically there have been no options for these patients [22][23] - The company aims to build a self-sustaining entity driven by revenues from bitopertin, with plans to explore additional indications within their iron modulation programs [60][61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the regulatory pathway for bitopertin, citing positive interactions with the FDA regarding the use of PP9 as a surrogate endpoint [10][11] - The management highlighted the importance of continuous engagement with healthcare providers to ensure that patients receive appropriate care and treatment options [26][30] Other Important Information - The company has a strong financial position with $650 million on the balance sheet, which is expected to fund operations into 2028 [60] - The company has orphan protection for bitopertin, providing seven years of exclusivity in the U.S. plus potential pediatric extensions [36] Q&A Session Summary Question: Can you recap the interactions with the FDA regarding the accelerated approval path for bitopertin? - Management detailed a series of meetings with the FDA that led to the decision to pursue an accelerated approval pathway, emphasizing the strong rationale for using PP9 as a surrogate endpoint [10][11] Question: What are the key differences between the Apollo and Aurora trials? - Management explained that the Apollo trial will focus on measuring the time patients can spend in light, which is a clinically meaningful endpoint, alongside the reduction in PP9 levels [18][19] Question: How does the company plan to address the patient population for bitopertin? - Management discussed the importance of identifying engaged patients who regularly seek healthcare, estimating about 6,000 such patients, while also planning to reach out to the remaining diagnosed but less engaged patients [26][27] Question: What is the expected market opportunity for the company's anemia treatments? - Management indicated that there is a significant unmet need for anemia treatments in myelofibrosis, with an estimated market of about 22,000 patients, and potential pricing similar to existing therapies [42][44] Question: How does the company view its capital position and future financing needs? - Management expressed confidence in their capital position, indicating that they are well-funded to support ongoing trials and commercial preparations without immediate need for additional equity financing [60][61]

Financial Data and Key Metrics Changes - For Q2, total net revenue rose 7% to $2.5 billion, with comparable sales increasing 1% [25][26] - Gross profit was $1.48 billion, representing 58.5% of net revenue, down from 59.6% in Q2 2024 [26][27] - Net income for the quarter was $371 million, or $3.10 per diluted share, compared to $3.15 in the same period last year [28] Business Line Data and Key Metrics Changes - Men's revenue increased 6%, women's revenue increased 5%, and accessories and other grew 15% [26] - Performance apparel continues to grow, while lounge and social product offerings have become stale, impacting sales negatively [11][12] Market Data and Key Metrics Changes - In the U.S., revenue was flat, with comparable sales down 3% [25][26] - China mainland revenue increased 25%, with comparable sales up 16% [26][21] - The rest of the world segment saw a revenue growth of 19%, with comparable sales increasing by 9% [26] Company Strategy and Development Direction - The company is focusing on increasing the number and frequency of new styles in its product assortment, aiming to raise new styles from 23% to 35% by spring 2026 [15][16] - A new Chief AI and Technology Officer has been appointed to enhance product innovation and agility [17] - The company plans to navigate increased costs from tariffs and the removal of the de minimis exemption through strategic pricing and supply chain initiatives [24][20] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns over the U.S. business performance and the impact of tariffs on guidance [5][20] - The company expects revenue growth of 4% to 6% for the year, with a decline in U.S. revenue projected at 1% to 2% [20][31] - Management remains optimistic about international growth, particularly in China, where growth is expected to be 20% to 25% [20][31] Other Important Information - The company ended the quarter with $1.16 billion in cash and cash equivalents, and inventory increased 21% to $1.7 billion [30] - Capital expenditures for the quarter were approximately $178 million, reflecting timing of store openings [29] Q&A Session Summary Question: Insights on product department changes and impact on the back half of the year - The company is focusing on three key areas: maintaining momentum in performance activities, introducing new styles in lounge and social, and refreshing iconic items [47] Question: Impact of recent tariff increases on pricing strategy - The company is implementing modest price increases on a small portion of its assortment and will continue to evaluate pricing as a lever [50] Question: Context on lifestyle assortment and performance versus casual - The company believes a 60/40 split between performance and casual is a good benchmark, with ongoing innovation in both segments [54] Question: Timeline for new innovation to offset pressure from casual platforms - The company expects the new styles introduced in spring 2026 to help offset pressures from casual offerings [59] Question: Speed of supply chain improvements and lead times - The company is working to improve lead times and agility in its supply chain processes, aiming to reduce lead times significantly [66] Question: Inventory management and de minimis exemption impact - The company fulfills approximately two-thirds of U.S. e-commerce orders through Canada, which previously benefited from the de minimis exemption [81]

Financial Data and Key Metrics Changes - For the full year 2025, the company projects total revenues between $210 million and $250 million, with a midpoint of $230 million [23] - In the second quarter of 2025, the company reported revenue of $52.6 million, with net product sales from Fanapt at $29.3 million, Hetlioz at $16.2 million, and Ponvory at $7.1 million [23] - For the six months ended June 30, 2025, total revenue was approximately $103 million, with Fanapt being the lead revenue generator at approximately $53 million [23] - Operating expenses for the same period were approximately $182 million, resulting in a net loss of approximately $57 million [23] - The company ended the second quarter with approximately $325 million in cash and no debt [4][24] Business Line Data and Key Metrics Changes - Fanapt has seen significant prescription growth, reaching approximately 2,300 TRXs per week in mid-August 2025, compared to 1,300 to 1,400 TRXs per week around the same time last year [5] - New-to-brand prescriptions for Fanapt increased to about 240 NBRXs per week recently, up from about 40 NBRXs per week at the same time last year [5] - Hetlioz continues to face revenue erosion due to generic competition but maintains the majority of its patient population [6][7] - Ponvory, acquired from Johnson & Johnson, has shown higher patient demand in the second quarter of 2025 compared to the first quarter post-acquisition [9] Market Data and Key Metrics Changes - The company is focused on expanding its commercial footprint in the U.S. for Fanapt, increasing its sales representatives from approximately 150 to about 300 [4] - The company is pursuing FDA approval for Bysanti, with a PDUFA date set for February 21, 2026, and is also working on a clinical program for major depressive disorder [5][11] Company Strategy and Development Direction - The company aims to increase revenue both organically through existing products and through business development opportunities, as evidenced by the acquisition of Ponvory and in-licensing of imsidolumab [9][10] - The strategic focus includes advancing the pipeline with upcoming regulatory milestones that could increase the number of commercialized products from three to potentially six by the end of next year [10] - The company is committed to enhancing patient access and affordability for its medications while engaging directly with consumers [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the upcoming regulatory milestones and the potential for increased commercial presence [10] - The company remains focused on retaining market share for Hetlioz despite generic competition and is pursuing additional indications for the product [11] - Management highlighted the significant unmet medical need for gastroparesis and the potential market opportunity for tradipitant if approved [17] Other Important Information - The company has a robust pipeline with several products at various stages of development, including tradipitant for gastroparesis and motion sickness, with PDUFA dates approaching [12][16] - The company is also pursuing additional treatments for Ponvory in ulcerative colitis and psoriasis [12] Q&A Session Summary Question: What is the expected revenue for 2025? - The company projects total revenues between $210 million and $250 million for 2025, with a midpoint of $230 million [23] Question: How is the commercial launch of Ponvory progressing? - The company noted that patient demand for Ponvory in the second quarter was higher than in the first quarter post-acquisition, indicating positive momentum [9] Question: What are the plans for Hetlioz in light of generic competition? - Management stated that they are focused on retaining market share and pursuing additional indications for Hetlioz, particularly in the Smith-Magenis syndrome market [11]

Financial Data and Key Metrics Changes - The company has approximately $500 million left in regulatory milestones and about $860 million in commercial milestones, with royalties ranging from 10% to 20% based on net sales [10][11][12] Business Line Data and Key Metrics Changes - The zanidatamab program is a significant focus, with upcoming Phase 3 study readouts expected in Q4, which could drive value for the company [6][10] - ZW171 has been discontinued due to on-target, off-tumor toxicity, reflecting the company's disciplined approach to capital allocation [14][16][17] Market Data and Key Metrics Changes - The competitive landscape for zanidatamab includes potential opportunities in breast cancer, with Jazz Pharmaceuticals exploring this area [11][12] - ZW191 is positioned as a strong contender in the folate receptor alpha ADC space, with a focus on differentiating its product through superior internalization and potency [20][21][22] Company Strategy and Development Direction - The company emphasizes a disciplined approach to capital allocation and decision-making regarding its pipeline programs, focusing on those with the highest potential for patient benefit [14][16] - The strategy includes exploring partnerships for various programs, particularly ZW191, to enhance development and market reach [30][39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the upcoming data readouts and the potential for zanidatamab to capture significant market value, estimating a valuation of over $2 billion [12][13][45] - The company is preparing for multiple catalysts over the next 12 to 18 months, including clinical studies for ZW251 and ZW209 [45] Other Important Information - The ZW209 program, utilizing a tri-TCE platform, is expected to enter clinical trials in the first half of 2026, showcasing the company's commitment to advancing its innovative pipeline [34][45] - The company is also exploring early-stage pipeline opportunities, including novel targets and ADCs, to leverage its protein engineering capabilities [33][34] Q&A Session Summary Question: What is the significance of the upcoming zanidatamab readout? - The readout is expected to provide clarity on the differentiation of zanidatamab in the competitive landscape, particularly in gastroesophageal adenocarcinoma [6][7] Question: What are the financial implications of the zanidatamab program? - The company has significant regulatory and commercial milestones associated with zanidatamab, which could lead to substantial revenue through royalties and milestone payments [10][11] Question: What led to the discontinuation of ZW171? - The decision was based on a lack of efficacy and on-target, off-tumor toxicity, demonstrating the company's commitment to prudent capital allocation [14][16][17] Question: How does Zymeworks differentiate its ADCs? - The company focuses on the holistic design of ADCs, ensuring that the antibody is optimized for internalization and payload delivery, which sets it apart from competitors [20][21][22] Question: What are the next steps for ZW191? - The company is considering partnerships for ZW191 and exploring various tumor types for clinical trials, including ovarian and endometrial cancers [30][39]

Financial Data and Key Metrics Changes - Revenues increased approximately 13% year over year to $55.1 million, driven largely by the MindBody GLP-1 System [5] - Adjusted EBITDA of $4.8 million was flat versus last year's fourth quarter, with adjusted non-GAAP net income of $2.3 million, or $0.17 per fully diluted share [17][18] - Gross margin expanded by 40 basis points to 79.9% compared to the prior year period, primarily due to lower shipping costs and a favorable product mix [16] Business Line Data and Key Metrics Changes - Revenue in the Americas region increased 14% to $43.5 million, benefiting from the success of the MindBody GLP-1 System [15] - Active accounts in the Americas were up 6%, with increases in both consultants and customers [6] - Revenue in Asia-Pacific/Europe increased by 7.6% to $11.6 million, reflecting the positive impact of the international MindBody rollout [16] Market Data and Key Metrics Changes - The international business returned to growth for the first time in 12 quarters, with revenues in Asia-Pacific/Europe increasing by 8% [5] - The global gut health supplement market is projected to grow from $14.4 billion in 2025 to $32.4 billion by 2035, with a CAGR of 8.4% [7][8] Company Strategy and Development Direction - The company announced a definitive agreement to acquire LoveBiome, which focuses on microbiome health, enhancing its product portfolio and market presence [6][10] - The partnership with LoveBiome aims to accelerate growth through cross-selling opportunities and operational leverage [9][10] - The company is committed to modernizing its technology and marketing stack through a partnership with Shopify to enhance consumer experience [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver sustainable long-term value, supported by the successful rollout of the MindBody GLP-1 System and the LoveBiome acquisition [15] - The outlook for fiscal 2026 anticipates full-year revenue in the range of $225 million to $240 million, with adjusted non-GAAP EBITDA expected between $23 million and $26 million [20] Other Important Information - The company repurchased approximately 160,000 shares during the fourth quarter at an average price of $12.74 per share [19] - A quarterly cash dividend of $0.04 per share was announced, totaling approximately $600,000 [19] Q&A Session Summary Question: What caused the disconnect in fourth quarter revenue expectations? - Management noted that the U.S. experienced some softness due to seasonality impacts, while international numbers remained strong [22][23] Question: How much of the fiscal 2026 growth will come from LoveBiome versus organic growth? - Management indicated that the integration of LoveBiome is still being assessed, with a modest amount of revenue expected from the acquisition [23] Question: Can you provide details on LoveBiome's sales and consultant numbers? - Management refrained from disclosing specific revenue metrics or consultant numbers for LoveBiome at this time [24] Question: What is the market position of LoveBiome? - LoveBiome is a relatively young company, established in 2022, with a focus on gut microbiome health [26][29] Question: How does P84 compare to existing products? - P84 is marketed as a comprehensive product focused on the microbiome, complementing existing prebiotic and probiotic offerings [34]