Aug. 4, 2020
“We ended the quarter with our highest-ever Q2 subscriber base of 5.0 million, driven by a record level of digital subscribers, which were up 23% year-over-year. These milestones combined with the strength in digital revenues and our high margins are all testament to the work of our teams and talent around the world,” said Mindy Grossman, the company’s President and CEO. “The impact of our accelerated digital transformation is evident in our second quarter results and will continue to be a key driver of our future growth and profitability.
WW failed to meet analyst expectations on revenues and earnings. As a result, WW stock was down 7% in after-market trading.
Key Metrics reported for the quarter:
- End of Period Subscribers in Q2 2020 were up 8.6% versus the prior year period, driven by Digital subscriber growth across all major geographic markets. Q2 2020 End of Period Digital Subscribers were up 23.2% and End of Period Studio + Digital Subscribers were down 24.2% versus the prior year period.
- Total Paid Weeks in Q2 2020 were up 5.1% versus the prior year period, driven by Digital growth across all major geographic markets. Q2 2020 Digital Paid Weeks increased 16.8% and Studio + Digital Paid Weeks decreased 19.7% versus the prior year period.
- Revenues in Q2 2020 were $333.6 million. On a constant currency basis, Q2 2020 revenues decreased 8.7% versus the prior year period.
- Service Revenues in Q2 2020 were $293.0 million. On a constant currency basis, these revenues decreased 5.7% versus the prior year period, primarily driven by declines in Studio + Digital Fees as a result of the closure of our studios due to COVID-19.
- Product Sales and Other in Q2 2020 were $40.6 million. On a constant currency basis, these revenues decreased 25.7% versus the prior year period, primarily due to lower in-studio product sales as a result of the closure of our studios due to COVID-19.
- Service Revenues in Q2 2020 were $293.0 million. On a constant currency basis, these revenues decreased 5.7% versus the prior year period, primarily driven by declines in Studio + Digital Fees as a result of the closure of our studios due to COVID-19.
- Gross Profit in Q2 2020 was $194.7 million. Adjusted gross profit in Q2 2020 was $201.2 million, which excluded $6.5 million in charges associated with the Company’s previously disclosed 2020 organizational restructuring plan. On a constant currency basis, adjusted gross profit would have decreased 5.8% versus the prior year period.
- Gross Margin in Q2 2020 was 58.3% and adjusted gross margin was 60.3%. This compares to a gross margin of 58.5% in the prior year period.
The complete Press Release and financial tables can be found here:
https://finance.yahoo.com/news/ww-announces-second-quarter-2020-200100416.html
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