April 28, 2020
WW (Weight Watchers reported today that:
- Q1 2020 End of Period Subscribers up 9% year-over-year to 5.0 million, an all-time Q1-end high.
- Q1 2020 Revenues of $400 million, up 10%, or 11% on a constant currency basis, year-over-year.
- Launches Virtual Workshops globally, as a response to Studio closures, keeping the WW community connected across all platforms.
- Accelerates digital transformation to provide all members globally.
- Service Revenues in Q1 2020 were $324.7 million. On a constant currency basis, these revenues increased 6.9% versus the prior year period.
- Product Sales and Other in Q1 2020 were $75.7 million. On a constant currency basis, these revenues increased 35.0% versus the prior year.
- Net Loss in Q1 2020 was $6.1 million compared to a net loss of $10.7 million in the prior year period.
WW withdrew its previously provided full year fiscal 2020 guidance due to uncertainty related to the COVID-19 pandemic.
“Our business had a very strong start to the year, driven by the successful launch and marketing of our new myWW program and increased awareness from the WW Presents: Oprah’s 2020 Vision tour,” said Mindy Grossman, the Company’s President and CEO... We took quick global coordinated action and pivoted to move all of our in-person group workshops, which serve about a quarter of our members, to a virtual platform, keeping the WW community connected no matter where they are. We are accelerating our digital transformation, focusing our strategy and resources to enhance the member experience and engagement by delivering a connected, digital, and deeply-human experience."
“WW ended the first quarter with 5.0 million subscribers, reflecting a new Q1 quarter-end record and a 9% increase versus the prior year period,” said Nick Hotchkin, the Company’s CFO and Operating Officer. “Beginning in mid-March, the crisis started to negatively impact our recruitment and resulted in Studio closures. While we have seen some recovery, given the uncertainty around 2020 revenue levels, we are withdrawing our full year 2020 financial guidance. We have strong liquidity and a highly cash generative business model. To further bolster our financial flexibility, we are implementing a $100 million cost-savings initiative."
The complete Press Release and financial tables can be found here:
Conference Call Information:
Management reported that it will launch sleep tracking in May, as this has become a bigger issue during the Covid-19 crisis. They also mentioned a new in-house fitness video app to be launched soon. It was also stated that WW will have a smaller geographic footprint in 2021. Management is planning a staggered re-opening of studios starting the end of May.