First Quarter Results Exceed
Guidance
Strong Growth Compared to 2019 Pre-COVID
Baseline: Total Digital and Nutritional Subscriptions +35%, Average
Digital Retention +60BPS, Total Streams +44%, DAU/MAU
+200BPS
The Beachbody Company, Inc. (NYSE: BODY) (“Beachbody” or the
“Company”), a leading subscription health and wellness company,
today announced financial results for its first quarter ended March
31, 2022.
“We were pleased to deliver top-and-bottom line results in the
first quarter that were ahead of our guidance. This momentum,
coupled with a positive response to new launches, demonstrates our
ability to quickly create demand through compelling content as well
as the power of our synergistic approach that combines digital
fitness, nutrition and community within a single ecosystem,” said
Carl Daikeler, Beachbody’s Co-Founder, Chairman, and Chief
Executive Officer. “Our performance in a dynamic environment also
reflects the resilience and agility of our content-driven business.
With a steady cadence of exciting content launches throughout 2022,
and a focus on disciplined marketing and efficient customer
acquisition, we expect to not only drive revenue, but also further
enhance our operating metrics. We remain on track to deliver
significant cost savings this year as we implement our One Brand
strategy and other organizational efficiencies.”
First Quarter 2022 Results
- Total revenue was $198.9 million, a 12% decrease compared to
2021 and a 6% decrease compared to 2019
- Digital revenue was $81.7 million, a 14% decrease compared to
2021
- Digital subscriptions were 2.46 million, a 10% decrease
compared to 2021 and a 48% increase compared to 2019
- 95.6% month-over-month average digital retention, a 20-basis
point decrease compared to 2021 and a 60-basis point increase
compared to 2019
- 38.2 million total streams, a 32% decrease compared to 2021,
and a 44% increase compared to 2019
- 31.6% DAU/MAU, a 350-basis point decrease compared to 2021, and
a 200-basis point increase compared to 2019
- Connected Fitness revenue was $19.5 million, compared to none
in 2021, which preceded the Myx Fitness acquisition
- Approximately 16,600 bikes delivered in the first quarter
- On a pre-merger basis, Connected Fitness revenue was $14.7
million in Q1 2021, with approximately 11,900 bikes delivered
- Nutrition and Other revenue was $97.7 million, a 25% decrease
compared to 2021
- Nutritional subscriptions were 0.30 million, compared to 0.42
million in 2021 and 0.38 million in 2019
- Net loss was $73.5 million, compared to a net loss of $30.1
million in 2021 and net income of $7.5 million in 2019
- Adjusted EBITDA1 was ($19.1) million, compared to ($11.7)
million in 2021 and $22.0 million in 2019
_______________ 1 A definition of Adjusted EBITDA and
reconciliation to net loss is at the end of this release.
Key Operational and Business Metrics
For the
Three Months Ended March 31,
2022
2021
Change v 2021
2019
Change v 2019
Pre-Covid
Baseline
Connected Fitness Units Delivered (in thousands)
16.6
0.0
NM
0.0
NM
Digital Subscriptions (in millions)
2.46
2.74
(10%)
1.66
48%
Nutritional Subscriptions (in millions)
0.30
0.42
(29%)
0.38
(21%)
Total Subscriptions
2.76
3.16
(13%)
2.04
35%
Average Digital Retention
95.6%
95.8%
(20bps)
95.0%
60bps
Total Streams (in millions)
38.2
56.0
(32%)
26.5
44%
DAU/MAU
31.6%
35.1%
(350bps)
29.6%
200bps
Digital
$81.7
$95.1
(14%)
$66.0
24%
Connected Fitness
$19.5
$0.0
NM
$0.0
NM
Nutrition & other
$97.7
$131.1
(25%)
$145.0
(33%)
Revenue (in millions)
$198.9
$226.2
(12%)
$211.0
(6%)
Net Income/(Loss) (in millions)
($73.5)
($30.1)
(144%)
$7.5
(1,080%)
Adjusted EBITDA (in millions)
($19.1)
($11.7)
(63%)
$22.0
(187%)
2022 Financial Outlook2
During fiscal 2022, the Company expects to realize a combined
Adjusted EBITDA loss improvement and capex reduction of
approximately $120 million, $10 million more than previous
guidance, compared to 2021.
For the second quarter of 2022 the Company expects:
- Total revenue of $175 million to $185 million
- Adjusted EBITDA loss of $7 million to $12 million
2 Net loss guidance is not reasonably available due to potential
changes in matters that we cannot forecast at this time.
Conference Call and Webcast Information
Beachbody will host a conference call at 5:00pm ET on Monday,
May 9, 2022 to discuss its financial results. To participate in the
live call, please dial (844) 200-6205 (U.S. & Canada), or (646)
904-5544 (all other locations) and provide the conference
identification number: 442851. The conference call will also be
available to interested parties through a live webcast at
https://investors.thebeachbodycompany.com/.
A replay of the call will be available until May 16, 2022 by
dialing (866) 813-9403 (U.S & Canada), or (929) 458-6194 (all
other locations). The replay passcode is 667125.
After the conference call, a webcast replay will remain
available on the investor relations section of the Company’s
website for one year.
About The Beachbody Company, Inc.
Headquartered in Southern California, Beachbody is a leading
digital fitness and nutrition subscription company with over two
decades of creating innovative content and powerful brands. The
Beachbody Company is the parent company of the Beachbody On Demand
streaming platform (BOD) including its live digital streaming
subscription BODi, and the Beachbody Bike powered by MYXfitness,
the Company's connected indoor bike. For more information, please
visit TheBeachbodyCompany.com.
Safe Harbor Statement
This press release contains "forward-looking" statements
pursuant to the safe harbor provisions of the Securities Litigation
Reform Act of 1995, which are statements other than historical fact
or in the future tense. These statements include but are not
limited to statements regarding our future performance and our
market opportunity, including expected financial results for the
first quarter and full year, our business strategy, our plans, and
our objectives and future operations.
Forward-looking statements are based upon various estimates and
assumptions, as well as information known to us as of the date
hereof, and are subject to risks and uncertainties. Accordingly,
actual results could differ materially due to a variety of factors,
including: our ability to effectively compete in the fitness and
nutrition industries; our ability to successfully acquire and
integrate new operations; our reliance on a few key products;
market conditions and global and economic factors beyond our
control; intense competition and competitive pressures from other
companies worldwide in the industries in which we operate; and
litigation and the ability to adequately protect our intellectual
property rights. You can identify these statements by the use of
terminology such as "believe," “plans,” "expect," "will," "should,"
"could," "estimate," "anticipate" or similar forward-looking terms.
You should not rely on these forward-looking statements as they
involve risks and uncertainties that may cause actual results to
vary materially from the forward-looking statements. For more
information regarding the risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
in these forward-looking statements, as well as risks relating to
our business in general, we refer you to the "Risk Factors" section
of our Securities and Exchange Commission (SEC) filings, including
those risks and uncertainties included in the Form 10-K filed with
the SEC on March 1, 2022 and quarterly reports on Form 10-Q, which
are available on the Investor Relations page of the Beachbody
website at https://investors.thebeachbodycompany.com and on the SEC
website at www.sec.gov.
All forward-looking statements contained herein are based on
information available to us as of the date hereof and you should
not rely upon forward-looking statements as predictions of future
events. The events and circumstances reflected in the
forward-looking statements may not be achieved or occur. Although
we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
performance, or achievements. We undertake no obligation to update
any of these forward-looking statements for any reason after the
date of this press release or to conform these statements to actual
results or revised expectations, except as required by law. Undue
reliance should not be placed on forward-looking statements.
The Beachbody Company, Inc.
Condensed Consolidated Balance
Sheets
(in thousands, except par value and share
data)
March 31,
December 31,
2022
2021
(unaudited) Assets Current assets: Cash and cash
equivalents
$63,426
$104,054
Restricted cash
—
3,000
Inventory, net
99,993
132,730
Prepaid expenses
16,154
15,861
Other current assets
40,975
43,727
Total current assets
220,548
299,372
Property and equipment, net
102,978
113,098
Content assets, net
39,749
39,347
Goodwill and intangible assets, net
166,947
171,533
Other assets
13,972
14,262
Total assets
$544,194
$637,612
Liabilities and Stockholders' Equity Current liabilities:
Accounts payable
$25,626
$48,379
Accrued expenses
69,897
74,525
Deferred revenue
108,977
107,095
Other current liabilities
5,785
6,233
Total current liabilities
210,285
236,232
Deferred tax liabilities
2,382
3,165
Other liabilities
13,300
12,830
Total liabilities
225,967
252,227
Commitments and contingencies (Note 9) Stockholders' equity:
Preferred stock, $0.0001 par value; 100,000,000 shares authorized,
none issued and outstanding at March 31, 2022 and December 31, 2021
—
—
Common stock, $0.0001 par value, 1,900,000,000 shares authorized
(1,600,000,000 Class A, 200,000,000 Class X and 100,000,000 Class
C); Class A: 169,465,971 and 168,333,463 shares issued and
outstanding at March 31, 2022 and December 31, 2021, respectively;
17
17
Class X: 141,250,310 shares issued and outstanding at March 31,
2022 and December 31, 2021, respectively;
14
14
Class C: no shares issued and outstanding at March 31, 2022 and
December 31, 2021
—
—
Additional paid-in capital
616,905
610,418
Accumulated other comprehensive loss
(133
)
(21
)
Accumulated deficit
(298,576
)
(225,043
)
Total stockholders’ equity
318,227
385,385
Total liabilities and stockholders' equity
$544,194
$637,612
The Beachbody Company, Inc.
Unaudited Condensed Consolidated
Statements of Operations
(in thousands, except per share data)
Three Months Ended March
31,
2022
2021
Revenue: Digital
$81,745
$95,150
Connected fitness
19,513
—
Nutrition and other
97,664
131,069
Total revenue
198,922
226,219
Cost of revenue: Digital
16,425
11,122
Connected fitness
44,706
—
Nutrition and other
44,774
56,995
Total cost of revenue
105,905
68,117
Gross profit
93,017
158,102
Operating expenses: Selling and marketing
106,444
144,696
Enterprise technology and development
33,697
27,089
General and administrative
20,073
17,946
Restructuring
7,223
—
Total operating expenses
167,437
189,731
Operating loss
(74,420
)
(31,629
)
Other income (expense): Change in fair value of warrant liabilities
264
—
Interest expense
(19
)
(123
)
Other income (expense), net
(64
)
1,299
Loss before income taxes
(74,239
)
(30,453
)
Income tax benefit
706
395
Net loss
($73,533
)
($30,058
)
Net loss per common share, basic and diluted
($0.24
)
($0.12
)
Weighted-average common shares outstanding, basic and
diluted
306,363
243,013
The Beachbody Company, Inc.
Unaudited Condensed Consolidated
Statements of Cash Flows
(in thousands)
Three Months Ended March
31,
2022
2021
Cash flows from operating activities: Net loss
($73,533
)
($30,058
)
Adjustments to reconcile net loss to net cash provided by operating
activities: Depreciation and amortization expense
21,587
13,726
Amortization of content assets
6,164
2,817
Provision for inventory and net realizable value adjustment
16,896
2,040
Realized losses on hedging derivative financial instruments
69
167
Gain on investment in convertible instrument
—
(1,379
)
Change in fair value of warrant liabilities
(264
)
—
Equity-based compensation
4,564
2,573
Deferred income taxes
(808
)
(528
)
Other non-cash items
91
—
Changes in operating assets and liabilities: Inventory
15,887
(2,321
)
Content assets
(6,448
)
(7,425
)
Prepaid expenses
(293
)
(2,139
)
Other assets
2,895
(8,476
)
Accounts payable
(20,752
)
7,137
Accrued expenses
(1,386
)
6,136
Deferred revenue
2,370
9,224
Other liabilities
(410
)
(374
)
Net cash used in operating activities
(33,371
)
(8,880
)
Cash flows from investing activities: Purchase of property
and equipment
(12,403
)
(13,299
)
Investment in convertible instrument
—
(5,000
)
Net cash used in investing activities
(12,403
)
(18,299
)
Cash flows from financing activities: Proceeds from exercise
of stock options
2,115
—
Remittance of taxes withheld from employee stock awards
(192
)
—
Borrowings under Credit Facility
—
20,000
Deferred financing costs
—
(2,242
)
Net cash provided by financing activities
1,923
17,758
Effect of exchange rates on cash
223
243
Net decrease in cash and cash equivalents
(43,628
)
(9,178
)
Cash, cash equivalents and restricted cash, beginning of period
107,054
56,827
Cash and cash equivalents, end of period
$63,426
$47,649
Supplemental disclosure of cash flow information: Cash paid
during the year for interest
$10
$58
Cash paid during the year for income taxes, net
32
16
Supplemental disclosure of noncash investing activities:
Property and equipment acquired but not yet paid for
$4,225
$6,196
Supplemental disclosure of noncash financing activities:
Deferred financing costs, accrued but not paid
—
$3,812
The Beachbody Company, Inc.
Adjusted EBITDA
In addition to our results determined in
accordance with accounting principles generally accepted in the
United States, or GAAP, we believe the following non-GAAP financial
measure of Adjusted EBITDA is useful in evaluating our operating
performance.
We define and calculate Adjusted EBITDA as
net income (loss) adjusted for depreciation and amortization,
amortization of capitalized cloud computing implementation costs,
amortization of content assets, interest expense, income taxes,
equity-based compensation, net realizable value adjustment,
transaction costs, restructuring expense, change in fair value of
warrant liabilities, and other items that are not normal,
recurring, operating expenses necessary to operate the Company’s
business.
The presentation of this non-GAAP
financial measure is not intended to be considered in isolation or
as a substitute for, or superior to, financial information prepared
and presented in accordance with GAAP. Investors are encouraged to
review the reconciliation of this non-GAAP financial measure to its
most directly comparable GAAP financial measure. A reconciliation
of our non-GAAP Adjusted EBITDA to GAAP net loss can be found
below:
(in thousands)
Three Months Ended March
31,
2022
2021
Net loss
($73,533
)
($30,058
)
Adjusted for: Depreciation and amortization
21,587
13,726
Amortization of capitalized cloud computing implementation costs
168
168
Amortization of content assets
6,164
2,817
Interest expense
19
123
Income tax benefit
(706
)
(395
)
Equity-based compensation
4,564
2,573
Inventory net realizable value adjustment (1)
14,934
—
Transaction costs
2
633
Restructuring and platform consolidation costs (2)
7,887
—
Change in fair value of warrant liabilities
(264
)
—
Non-operating (3)
70
(1,331
)
Adjusted EBITDA
($19,108
)
($11,744
)
(1) Represents a non-cash expense to
reduce the carrying value of our connected fitness inventory and
related future commitments. This adjustment is included because of
its unusual magnitude due to disruptions in the connected fitness
market.
(2) Includes restructuring expense and
non-recurring personnel costs associated with the consolidation of
our digital platforms.
(3) Includes interest income, and during
the three months ended March 31, 2021, also includes the gain on
investment on the Myx convertible instrument.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509005804/en/
Media Madeleine O'Hagan madeleine.ohagan@teneo.com
Investor Relations Edward Plank eplank@beachbody.com
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