Q3 2025 Beachbody Co Inc Earnings Call

November 10, 2025

Operator: Good afternoon. Thank you for attending today's The Beachbody Company Inc. Q3 2025 Earnings Conference Call. My name is Jayla, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. I'll now pass the conference over to our host, Bruce Williams, the Managing Director of ICR. You may proceed, Bruce.

Speaker #1: Good afternoon. Thank you for attending today's Beachbody Company, Inc. Q3 2025 earnings conference call. My name is Jayla, and I will be your moderator for today's call.

Speaker #1: All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. I'll now pass the conference over to our host, Bruce Williams, the Managing Director of ICR.

Speaker #1: You may proceed, Bruce.

Bruce Williams: Welcome, everyone. Thank you for joining us for our Q3 earnings call. With me on the call today are Mark Goldston, Executive Chairman of The Beachbody Company, Carl Daikeler, Co-founder and Chief Executive Officer, and Brad Ramberg, Interim Chief Financial Officer. Following the prepared remarks, we'll open the call up for questions. Before we get started, I would like to remind you of the company's safe harbor language. Statements contained in this conference call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested by such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release.

Speaker #2: Welcome, everyone, and thank you for joining us for our third quarter earnings call. With me on the call today are Mark Goldstein, Executive Chairman of the Beachbody Company; Carl Deichler, Co-Founder and Chief Executive Officer; and Brad Ramberg, Interim Chief Financial Officer.

Speaker #2: Following the prepared remarks, we'll open the call up for questions. Before we get started, I would like to remind you of the company's safe harbor language.

Speaker #2: Statements contained in this conference call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the privacy securities litigation reform Act of 1995.

Bruce Williams: Actual future results may differ materially from those suggested by such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release. Today's call will include references to non-GAAP financial measures such as adjusted EBITDA, net cash, and free cash flow. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is available within the earnings release, which can be found on our website. Now, I would like to turn the call over to Mark.

Speaker #2: Actual future results may differ materially from those suggested by such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release.

Speaker #2: Today's call will include references to nine GAAP financial measures, such as adjusted EBITDA, net cash, and free cash flow. A reconciliation of these nine GAAP financial measures to the most comparable GAAP financial measures is available within the earnings release, which can be found on our website.

Bruce Williams: Today's call will include references to non-GAAP financial measures such as adjusted EBITDA, net cash, and free cash flow. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is available within the earnings release, which can be found on our website. Now, I would like to turn the call over to Mark.

Speaker #2: Now, I would like to turn the call over to Mark.

Speaker #3: Thank you. And good afternoon, everyone. I'd like to welcome you to Body's third quarter 2025 earnings call. We're pleased with our outstanding third quarter results and the progress and speed of our turnaround that's far exceeded our expectations.

Mark Goldston: Thank you. Good afternoon, everyone. I'd like to welcome you to BODi's Q3 2025 earnings call. We're pleased with our outstanding Q3 results and the progress and speed of our turnaround that's far exceeded our expectations. Let me put this achievement in perspective. We've now delivered 8 consecutive quarters of positive adjusted EBITDA. Our free cash flow performance has been equally strong. We've generated $13.1 million in free cash flow through 9 months, with Q3 alone contributing $9 million of free cash flow. Perhaps most significantly, we generated net income this quarter, a seminal milestone that we identified years ago as the ultimate marker of our turnaround effort. Our cash position of $33.9 million substantially exceeds our outstanding debt principal of $25 million, providing us with financial flexibility.

Speaker #3: Let me put this achievement in perspective. We've now delivered eight consecutive quarters of positive adjusted EBITDA. Our free cash flow performance has been equally strong.

Speaker #3: We've generated $13.1 million in free cash flow through nine months, with Q3 alone contributing $9 million of free cash flow. Perhaps most significantly, we generated net income this quarter a seminal milestone that we identified years ago as the ultimate marker of our turnaround effort.

Mark Goldston: Perhaps most significantly, we generated net income this quarter, a seminal milestone that we identified years ago as the ultimate marker of our turnaround effort. Our cash position of $33.9 million substantially exceeds our outstanding debt principal of $25 million, providing us with financial flexibility.

Speaker #3: Our cash position of $33.9 million substantially exceeds our outstanding debt principle of $25 million. Providing us with financial flexibility. Our operational metrics continue to demonstrate the structural improvements we've made.

Mark Goldston: Our operational metrics continue to demonstrate the structural improvements we've made. We've maintained strong gross margins while significantly reducing our revenue break-even point from approximately $900 million in 2022 down to $180 million today, a $720 million lowering of the break-even that positions us to generate operating leverage at a much lower revenue level. Looking ahead, we're focused on our growth strategy in 2026. This upcoming year will mark our transition from a financial restructuring to capitalizing on new revenue opportunities from our innovation pipeline and from market expansion. We're launching a comprehensive retail initiative that will leverage our portfolio of billion-dollar brands in entirely new channels. In 2026, we'll introduce Shakeology to retail for the first time in our company's history.

Speaker #3: We've maintained strong gross margins while significantly reducing our revenue break-even point from approximately $900 million in 2022 down to $180 million today. A $720 million lowering of the break-even that positions us to generate operating leverage at a much lower revenue level.

Speaker #3: Looking ahead, we're focused on our growth strategy in 2026. This upcoming year, we'll mark our transition from a financial restructuring to capitalizing on new revenue opportunities from our innovation pipeline and from market expansion.

Mark Goldston: Looking ahead, we're focused on our growth strategy in 2026. This upcoming year will mark our transition from a financial restructuring to capitalizing on new revenue opportunities from our innovation pipeline and from market expansion. We're launching a comprehensive retail initiative that will leverage our portfolio of billion-dollar brands in entirely new channels. In 2026, we'll introduce Shakeology to retail for the first time in our company's history.

Speaker #3: We're launching a comprehensive retail initiative that will leverage our portfolio of billion-dollar brands in entirely new channels. In 2026, we'll introduce Sheikhology to retail for the first time in our company's history.

Speaker #3: That will be followed by our brand-new P90X nutritional supplements line and Insanity-branded supplements later in 2026. These products will be distributed in different form factors and at different price points, made possible by our new business model.

Mark Goldston: That will be followed by our brand new P90X nutritional supplements line and INSANITY-branded supplements later in 2026. These products will be distributed in different form factors and different price points made possible by our new business model. Complementing our retail expansion, we will be launching a brand new P90X fitness program, the first in over a decade, which will create powerful cross-marketing opportunities between our digital content and our retail nutrition products. Going forward, we see a substantial opportunity to expand our TAM by developing innovative approaches, including a focus on health span and a shorter, easier to perform workout program to reach underserved segments, including the 185 million overweight Americans who don't currently engage in regular fitness routines. In our current business model, our revenues are generated via multiple channels, what we like to call the omni-channel opportunity.

Speaker #3: Complementing our retail expansion, we will be launching a brand-new P90X fitness program, the first in over a decade, which will create powerful cross-marketing opportunities between our digital content and our retail nutrition products.

Speaker #3: So going forward, we see a substantial opportunity to expand our TAM by developing innovative approaches, including a focus on health span, and a shorter easier-to-perform workout program to reach underserved segments, including the 185 million overweight Americans who don't currently engage in regular fitness routines.

Mark Goldston: Going forward, we see a substantial opportunity to expand our TAM by developing innovative approaches, including a focus on health span and a shorter, easier to perform workout program to reach underserved segments, including the 185 million overweight Americans who don't currently engage in regular fitness routines. In our current business model, our revenues are generated via multiple channels, what we like to call the omni-channel opportunity.

Speaker #3: In our current business model, our revenues are generated via multiple channels. What we like to call the omni-channel opportunity. One of the smaller elements within the omni-channel opportunity is our affiliate program.

Mark Goldston: One of the smaller elements within the omni-channel opportunity is our affiliate program. Why do I say that? Because on a go-forward basis, the affiliate program will be a smaller portion of our total revenue mix, given our heavy focus on the maximization of both our direct-to-consumer channels. Our upcoming brick-and-mortar retail initiative. This strategic shift reflects our evolution from what was previously an MLM-dependent model in 2024 to a now diversified omni-channel approach in 2025 and beyond. The transformation we've achieved positions BODi as a fundamentally different company than it was just two years ago. We've proven our ability to generate consistent positive adjusted EBITDA over the last eight quarters. We've generated positive cash flow through 2025 year to date, and we finally achieved a positive net income quarter in Q3 of 2025.

Speaker #3: Why do I say that? Because on a go-forward basis, the affiliate program will be a smaller portion of our total revenue mix, given our heavy focus on the maximization of both our direct-to-consumer channels and our upcoming brick-and-mortar retail initiative.

Speaker #3: This strategic shift reflects our evolution from what was previously an MLM-dependent model in 2024 to a now diversified omni-channel approach in 2025 and beyond.

Speaker #3: The transformation we've achieved positions Body as a fundamentally different company than it was just two years ago. We've proven our ability to generate consistent, positive adjusted EBITDA over the last eight quarters.

Mark Goldston: The transformation we've achieved positions BODi as a fundamentally different company than it was just two years ago. We've proven our ability to generate consistent positive adjusted EBITDA over the last eight quarters. We've generated positive cash flow through 2025 year to date, and we finally achieved a positive net income quarter in Q3 of 2025.

Speaker #3: We've generated positive cash flow through 2025 year to date, and we finally achieved a positive net income quarter in Q3 of 2025. During the two-year turnaround effort, which began when I joined back in June of 2023, we've eliminated the huge structural inefficiencies that previously required a massive $900 million revenue level just to break even on a cash basis, and we've reduced that cash break-even by 80% and brought it down to an incredibly low $180 million break-even through a complete re-architecture of the company and the way we operate.

Mark Goldston: During the two-year turnaround effort, which began when I joined back in June of 2023, we've eliminated the huge structural inefficiencies that previously required a massive $900 million revenue level just to break even on a cash basis, and we've reduced that cash break even by 80% and brought it down to an incredibly low $180 million break even through a complete rearchitecture of the company and the way we operate. The efficiencies we've built into the company have allowed us to construct a powerful and nimble operating model that will allow future revenue growth to drive significant operating leverage and increase EBITDA.

Speaker #3: The efficiencies we've built into the company have allowed us to construct a powerful and nimble operating model. That will allow future revenue growth to drive significant operating leverage and increased EBITDA.

Speaker #3: The headline for Q3 2025 is that Body has completely reinvented itself over the last two-plus years and with the benefits of the financial restructuring, the elimination of the MLM model, massive improvement in profitability, and increase in direct-to-consumer focus, a significant improvement in gross margins, and a more efficient sales and marketing spend.

Mark Goldston: The headline for Q3 2025 is that BODi has completely reinvented itself over the last 2+ years, with the benefits of the financial restructuring, the elimination of the MLM model, massive improvement in profitability, an increase in direct-to-consumer focus, a significant improvement in gross margin, and a more efficient sales and marketing spend. As a result of accomplishing all of the financial turnaround goals, BODi is now poised to open the hatch of the innovation pipeline for 2026 and roll out a slew of new innovations in both digital fitness and nutrition that'll not only fortify our DTC business, but it will also open up a whole new arm of our omni-channel strategy with brick-and-mortar retail and an expanded Amazon presence featuring popularly priced P90X and INSANITY nutritional supplements and a new lower price, smaller serving size Shakeology lineup. We've revolutionized and significantly improved our financial foundation.

Speaker #3: As a result of accomplishing all of the financial turnaround goals, Body is now poised to open the hatch of the innovation pipeline for 2026 and roll out a slew of new innovations in both digital fitness and nutrition that will not only fortify our DTC business but will also open up a whole new arm of our omni-channel strategy with brick-and-mortar retail and an expanded Amazon presence. This will feature popularly priced P90X and Insanity nutritional supplements, as well as a new, lower-priced, smaller serving size Shakeology lineup.

Mark Goldston: As a result of accomplishing all of the financial turnaround goals, BODi is now poised to open the hatch of the innovation pipeline for 2026 and roll out a slew of new innovations in both digital fitness and nutrition that'll not only fortify our DTC business, but it will also open up a whole new arm of our omni-channel strategy with brick-and-mortar retail and an expanded Amazon presence featuring popularly priced P90X and INSANITY nutritional supplements and a new lower price, smaller serving size Shakeology lineup.

Speaker #3: We've revolutionized and significantly improved our financial foundation. We've filled the innovation pipeline and those initiatives that are set to be in motion in 2026.

Mark Goldston: We've revolutionized and significantly improved our financial foundation. We've filled the innovation pipeline, and those initiatives are set to be in motion in 2026, and the market opportunities and huge increase in TAM are substantial. We could not be happier with the progress that we've made, the speed with which the turnaround has been performed, and the exciting and modernized future we see for BODi. With that, I'll turn the call over to our CEO, Carl Daikeler, to discuss the operational detail. Carl?

Mark Goldston: We've filled the innovation pipeline, and those initiatives are set to be in motion in 2026, and the market opportunities and huge increase in TAM are substantial. We could not be happier with the progress that we've made, the speed with which the turnaround has been performed, and the exciting and modernized future we see for BODi. With that, I'll turn the call over to our CEO, Carl Daikeler, to discuss the operational detail. Carl?

Speaker #3: And the market opportunities and huge increase in TAM are substantial. We could not be happier with the progress that we've made, the speed with which the turnaround has been performed, and the exciting and modernized future we see for Body.

Speaker #3: With that, I'll turn the call over to our CEO, Carl Deichler, to discuss the operational details. Carl?

Speaker #2: Thanks, Mark. And thanks to everyone for joining us today. I'm excited to share our Q3 results, which I believe demonstrate the meaningful progress we're making in executing our long-term strategy.

Carl Daikeler: Thanks, Mark, and thanks to everyone for joining us today. I'm excited to share our Q3 results, which I believe demonstrate the meaningful progress we're making in executing our long-term strategy. The results that Mark described and that Brad will outline in detail in a moment really tell the story of a company hitting its stride. The vision we've had for over two decades is finally getting a chance to come to fruition. We're executing with more efficiency, thanks to our expanded sales channels and an aggressive approach to tailoring our marketing for an environment that is definitely showing signs of improved demand as longevity and health span have entered the mainstream.

Speaker #2: The results that Mark described and that Brad will outline in detail in a moment really tell the story of a company hitting its stride.

Speaker #2: The vision we've had for over two decades is finally getting a chance to come to fruition. We're executing with more efficiency thanks to our expanded sales channels, and an aggressive approach to tailoring our marketing for an environment that is definitely showing signs of improved demand.

Carl Daikeler: The vision we've had for over two decades is finally getting a chance to come to fruition. We're executing with more efficiency, thanks to our expanded sales channels and an aggressive approach to tailoring our marketing for an environment that is definitely showing signs of improved demand as longevity and health span have entered the mainstream.

Speaker #2: As longevity and health span have entered the mainstream, we've got the library of proven content that's getting deeper every quarter, and new content coming online by the end of the year that's going to open up the TAM to the real holy grail of helping the more than 185 million non-exercisers in the US who are just looking for an easy way to get the benefits of lifestyle change without devoting thousands of dollars to equipment or hours in the gym.

Carl Daikeler: We've got the library of proven content that's getting deeper every quarter and new content coming online by the end of the year that's gonna open up the TAM to the real holy grail of helping the more than 185 million non-exercisers in the US who are just looking for an easy way to get the benefits of lifestyle change without devoting thousands of dollars to equipment or hours in the gym. In the near term, there's some very exciting launches going into Black Friday and Cyber Monday, the holidays, and Q1.

Speaker #2: In the near term, there's some very exciting launches going into Black Friday and Cyber Monday, the holidays, and the first quarter. We launched a compelling $19 per month offer in Q3, which we're starting to build momentum around, especially in conjunction with the launch of two brand new alternative subscriptions.

Carl Daikeler: We launched a compelling $19 per month offer in Q3, which we're starting to build momentum around, especially in conjunction with the launch of two brand-new alternative subscriptions, what we call a Super Trainer Subscription, where people can subscribe to just the content from one Super Trainer for just $9.99 a month. These are essentially curated capsule collections from our world-class trainers. We launched this test with both the Autumn Calabrese collection and the Shaun T collection and are encouraged by the initial response. As you might recall, we said we'd be launching new content in Q3 that included a line extension to BODi LAVA called Slow Burn Yoga. We also launched Autumn Calabrese's Track Pilates, an innovative at-home Pilates program that drove strong demand in Q3, thanks to the overall strength in the Pilates category right now.

Speaker #2: What we call a super trainer subscription, where people can subscribe to just the content from one super trainer for just $9.99 a month. These are essentially curated capsule collections from our world-class trainers.

Speaker #2: We launched this test with both the Autumn Calibres collection and the Sean T. collection, and are encouraged by the initial response. As you might recall, we said we'd be launching new content in Q3 that included a line extension to Body Lava called Slow Burn Yoga.

Carl Daikeler: As you might recall, we said we'd be launching new content in Q3 that included a line extension to BODi LAVA called Slow Burn Yoga. We also launched Autumn Calabrese's Track Pilates, an innovative at-home Pilates program that drove strong demand in Q3, thanks to the overall strength in the Pilates category right now.

Speaker #2: We also launched Autumn Calabrese's Track Pilates and an innovative at-home Pilates program that drove strong demand in the third quarter, thanks to the overall strength in the Pilates category right now.

Speaker #2: So far, in the fourth quarter, we've added the appropriately named Power of Four, a program from the original P90X super trainer Tony Horton. And we've just started to promote the Black Friday launch of a new program from Sean T.

Carl Daikeler: In Q4, we've added the appropriately named The Power of 4, a program from the original P90X Super Trainer, Tony Horton. We've just started to promote the Black Friday launch of a new program from Shaun T that's a hybrid of his popular weightlifting program, DIG DEEPER, with low-impact INSANITY Cardio, which our subscribers are lining up to start on 1 December in what's going to be the largest test group in our company's history.

Speaker #2: that's a hybrid of his popular weightlifting program, Dig Deeper, with low-impact Insanity cardio, which our subscribers are lining up to start on December 1st in what's going to be the largest test group in our company's history.

Speaker #2: As Mark mentioned, we started teasing the launch of P90X Generation Next, a new addition to the P90X portfolio for the first time in over 10 years, leveraging the most recognizable brand in extreme home fitness.

Carl Daikeler: As Mark mentioned, we started teasing the launch of P90X Generation Next, a new addition to the P90X portfolio for the first time in over 10 years, leveraging the most recognizable brand in Extreme Home Fitness. Last week, we announced that renowned British trainer Waz Ashayer is leading that program, and the response to the first peek at the teasers for the program was more enthusiastic and productive at attracting subscribers than we could have imagined. This new trainer is going to be a superstar. He's the new James Bond of the P90X franchise, if you will. The user results we've seen in our initial testing of the program confirm that his new P90X format is going to introduce the greatest Extreme Home Fitness program of all time to a new generation of users with stunning transformations.

Speaker #2: Last week, we announced that renowned British trainer Waz Asher is leading that program and the response to the first peak at the teasers for the program was more enthusiastic and productive at attracting subscribers than we could have imagined.

Speaker #2: This new trainer is going to be a superstar. He's the new James Bond of the P90X franchise, if you will. And the user results we've seen in our initial testing of the program format is going to introduce the greatest extreme home fitness program of all time, to a new generation of users with stunning transformations.

Carl Daikeler: This new trainer is going to be a superstar. He's the new James Bond of the P90X franchise, if you will. The user results we've seen in our initial testing of the program confirm that his new P90X format is going to introduce the greatest Extreme Home Fitness program of all time to a new generation of users with stunning transformations.

Speaker #2: The retail opportunity will be particularly meaningful, both for leveraging the existing awareness of P90X, plus Insanity, and Sheikhology on store shelves. But using that visibility to achieve massive exposure of the Body brand by giving retail buyers a first-of-its-kind value add of rewarding them with access to our digital content, which will support our digital subscriber growth objectives.

Carl Daikeler: The retail opportunity will be particularly meaningful, both for leveraging the existing awareness of P90X, plus INSANITY and Shakeology on store shelves. Using that visibility to achieve massive exposure of the BODi brand by giving retail buyers a first-of-its-kind value add of rewarding them with access to our digital content, which will support our digital subscriber growth objectives. I'm really excited for the new supplements coming under the P90X and INSANITY brands because we're actually under-penetrated in selling nutrition to our digital fitness subscribers, largely because our prices were set at a premium level, largely due to the requirements of the MLM model. That means in 2026, we're gonna be adding more new supplements to the catalog at more affordable prices than we ever have in our 26 years. A significant opportunity for us to increase LTV and to acquire new nutrition customers.

Speaker #2: I'm really excited for the new supplements coming under the P90X and Insanity brands because we're actually underpenetrated in selling nutrition to our digital fitness subscribers.

Speaker #2: Largely because our prices were set at a premium level largely due to the requirements of the MLM model. That means in 2026, we're going to be adding more new supplements to the catalog at more affordable prices than we ever have in our 26 years.

Carl Daikeler: That means in 2026, we're gonna be adding more new supplements to the catalog at more affordable prices than we ever have in our 26 years. A significant opportunity for us to increase LTV and to acquire new nutrition customers. 2026 marks our commitment to expand into nutrition in a very significant way, both at retail and direct-to-consumer.

Speaker #2: A significant opportunity for us to increase LTV and to acquire new nutrition customers. 2026 marks our commitment to expand into nutrition in a very significant way, both at retail and direct-to-consumer.

Carl Daikeler: 2026 marks our commitment to expand into nutrition in a very significant way, both at retail and direct-to-consumer. All of this is the innovation pipeline Mark and I have been talking about for two years. The opportunity to reach this massive TAM of over 185 million adults in the US alone who are overweight or obese. Now with the progress and speed of our financial turnaround exceeding projections, this vision can start to materialize in 2026 and really hit full stride in 2027. As I mentioned last quarter, all of this will be supported by our transition to Shopify Plus and its robust set of AI features in March 2026, which we believe will benefit order conversion and average order value at checkout.

Speaker #2: All of this is the innovation pipeline Mark and I have been talking about for two years. The opportunity to reach this massive TAM of over 185 million adults in the US alone who are overweight or obese, and now with the progress and speed of our financial turnaround exceeding projections, this vision can start to materialize in 2026 and really hit full stride in 2027.

Carl Daikeler: All of this is the innovation pipeline Mark and I have been talking about for two years. The opportunity to reach this massive TAM of over 185 million adults in the US alone who are overweight or obese. Now with the progress and speed of our financial turnaround exceeding projections, this vision can start to materialize in 2026 and really hit full stride in 2027. As I mentioned last quarter, all of this will be supported by our transition to Shopify Plus and its robust set of AI features in March 2026, which we believe will benefit order conversion and average order value at checkout.

Speaker #2: As I mentioned last quarter, all of this will be supported by our transition to Shopify Plus and its robust set of AI features in March 2026.

Speaker #2: Which we believe will benefit order conversion and average order value at checkout. And speaking of AI, I'm also excited to add that following ChatGPT's announcement of their app development toolkit and the upcoming ChatGPT App Store, our team is quickly developing the tech to be among the first fitness apps on ChatGPT in Q1 2026.

Carl Daikeler: Speaking of AI, I'm also excited to add that following ChatGPT's announcement of their app development toolkit and the upcoming ChatGPT App Store, our team is quickly developing the tech to be among the first fitness apps on ChatGPT in Q1 2026, making our programs discoverable and actionable within ChatGPT. We're initially focused on personalized fitness recommendations with the goal of driving acquisition, leveraging our most recognizable brand. We view this most as an evolving opportunity to learn how conversational AI can enhance discovery with a more personalized recommendation engine to ultimately create a more intelligent, connected experience for our members at mass scale.

Speaker #2: Making our programs discoverable and actionable within ChatGPT. We're initially focused on personalized fitness recommendations with the goal of driving acquisition. Leveraging our most recognizable brand.

Speaker #2: But we view this most as an evolving opportunity to learn how conversational AI can enhance discovery with a more personalized recommendation engine to ultimately create a more intelligent, connected experience for our members, at mass scale.

Speaker #2: We've been the one company focused on the mass market of health and fitness for over 26 years. Now, with eight quarters of positive adjusted EBITDA and our first quarter of positive net income since we went public in 2021, we can see that the never-quit attitude of this team is really paying off.

Carl Daikeler: We've been the one company focused on the mass market of health and fitness for over 26 years, and now with 8 quarters of positive adjusted EBITDA and our first quarter of positive net income since we went public in 2021, we can see that the never quit attitude of this team is really paying off. It's incredibly impressive how our staff, trainers, affiliates, and even our subscribers believe so passionately in what we do. I'm excited for Q4, especially as we head into Black Friday and Cyber Monday and our aggressive marketing initiatives heading into Q1. Now, let me turn the call over to our Interim CFO, Brad Ramberg, to walk through the specifics of our Q3 results. Brad?

Speaker #2: And it's incredibly impressive how our staff, trainers, affiliates, and even our subscribers believe so passionately in what we do. I'm excited for the fourth quarter, especially as we head into Black Friday and Cyber Monday.

Speaker #2: And our aggressive marketing initiatives heading into Q1. Now, let me turn the call over to our interim CFO, Brad Ramberg, to walk through the specifics of our Q3 results.

Speaker #2: Brad: Thank you, Carl. And thank you, everyone, for joining the call today. I will review our Q3 results and provide our outlook for the fourth quarter.

Brad Ramberg: Thank you, Carl, and thank you everyone for joining the call today. I will review our Q3 results and provide our outlook for the Q4. We produced major milestones this quarter. We exceeded our guidance for revenue, adjusted EBITDA, and net income. We generated our eighth consecutive quarter of positive adjusted EBITDA and had net income for the first time since going public in 2021. We are on track for positive free cash flow for the full year. Now, I'd like to provide more details about the quarter. Total revenues of $59.9 million declined 6.3% sequentially and declined 41.4% year-over-year in line with our expectations as we continue our strategic transition. Revenues continued to be impacted in the near term by the shift away from a multi-level marketing platform to an omni-channel model.

Speaker #2: We produced major milestones this quarter. We exceeded our guidance for revenue, adjusted EBITDA, and net income. We generated our eighth consecutive quarter of positive adjusted EBITDA, and had net income for the first time since going public in 2021.

Speaker #2: We're on track for positive free cash flow for the full year. Now, I'd like to provide more details about the quarter. Total revenues of $59.9 million declined 6.3% sequentially and declined 41.4% year over year, in line with our expectations as we continue our strategic transition.

Brad Ramberg: Now, I'd like to provide more details about the quarter. Total revenues of $59.9 million declined 6.3% sequentially and declined 41.4% year-over-year in line with our expectations as we continue our strategic transition. Revenues continued to be impacted in the near term by the shift away from a multi-level marketing platform to an omni-channel model.

Speaker #2: Revenues continue to be impacted in the near term by the shift away from a multi-level marketing platform to an omnichannel model. Consolidated Q3 gross margins were 74.6%, representing an increase of 230 basis points over the prior quarter, and an increase of 730 basis points compared to the prior year.

Brad Ramberg: Consolidated Q3 growth margins were 74.6%, representing an increase of 230 basis points over the prior quarter and an increase of 730 basis points compared to the prior year. We're pleased to report the consolidated growth margin was at the high end of our long-term target of 70% to 75%, underscoring the strength of our operational execution. Moving to digital and nutrition and other revenues. Digital revenue decreased 8.3% from the prior quarter to $36.4 million and decreased 32.2% year-over-year. Revenues were impacted by continued pressure on our digital subscription counts, which decreased 4.3% sequentially to approximately 900,000 and declined 18.9% compared to the same period a year ago.

Speaker #2: We're pleased to report the consolidated gross margin was at the high end of our long-term target of 70 to 75%, underscoring the strength of our operational execution.

Speaker #2: Moving to digital and nutrition and other revenues, digital revenue decreased 8.3% from the prior quarter to $36.4 million and decreased 32.2% year over year.

Brad Ramberg: Digital revenue decreased 8.3% from the prior quarter to $36.4 million and decreased 32.2% year-over-year. Revenues were impacted by continued pressure on our digital subscription counts, which decreased 4.3% sequentially to approximately 900,000 and declined 18.9% compared to the same period a year ago.

Speaker #2: Revenues were impacted by continued pressure on our digital subscription counts, which decreased 4.3% sequentially to approximately 900,000, and declined 18.9% compared to the same period a year ago.

Speaker #2: We continue to experience the impact from our transition away from the MLM, which has had an outsized impact on nutrition subscriptions, as our nutrition products were almost sold exclusively through our MLM network.

Brad Ramberg: We continue to experience the impact from our transition away from the MLM, which has had an outsized impact to nutrition subscriptions as our nutrition products were almost sold exclusively through our MLM network. Nutrition and other revenue decreased 2.8% from the prior quarter to $23.5 million and decreased 50.4% year-over-year. Nutrition subscriptions stayed essentially flat sequentially at approximately 70,000 and fell 46.2% year-over-year. Digital growth margin was 88.1% for the quarter, increasing 40 basis points from the prior quarter and representing an 810 basis point improvement from the prior year. Our digital growth margin was in line with our previous long-term target of 86% to 89%.

Speaker #2: Nutrition and other revenues decreased 2.8% from the prior quarter to 23.5 million, and decreased 50.4% year over year. Nutrition subscriptions stayed essentially flat sequentially at approximately 70,000, and fell 46.2% year over year.

Brad Ramberg: Nutrition subscriptions stayed essentially flat sequentially at approximately 70,000 and fell 46.2% year-over-year. Digital growth margin was 88.1% for the quarter, increasing 40 basis points from the prior quarter and representing an 810 basis point improvement from the prior year. Our digital growth margin was in line with our previous long-term target of 86% to 89%.

Speaker #2: Digital growth margin was 88.1% for the quarter, increasing 40 basis points from the prior quarter, and representing an 810 basis point improvement from the prior year.

Speaker #2: Our digital growth margin was in line with our previous long-term target of 86 to 89%. They continued strength in year over year gross margin, with primarily due to a decrease in digital content amortization and depreciation, as a result of a more disciplined production and fixed asset spend.

Brad Ramberg: The continued strength in year-over-year gross margin was primarily due to a decrease in digital content amortization and depreciation as a result of a more disciplined production and fixed asset spend. Nutrition and other gross margin was 53.7%, representing a 230 basis point increase from the prior quarter and a 490 basis point decline year-over-year. Nutrition gross margins exceeded our long-term target of 46% to 52%. The increase from the prior quarter was primarily due to one-time lower shipping and fulfillment costs, while the decline from the prior year quarter was primarily due to the discontinuation of preferred customer fees on 1 November 2024, which were part of our old business model, where customers paid a monthly fee to purchase products at a discount, as well as some higher level of promotional activities in the current period.

Speaker #2: Nutrition and other gross margin was 53.7%, representing a 230 basis point increase from the prior quarter and a 490 basis point decline year over year.

Speaker #2: Nutrition gross margins exceeded our long-term target of 46 to 52%. The increase from the prior quarter was primarily due to one-time lower shipping and fulfillment costs, while the decline from the prior year quarter was primarily due to the discontinuation of preferred customer fees on November 1, 2024, which were part of our old business model where customers paid a monthly fee to purchase products at a discount, as well as from higher level of promotional activities in the current period.

Brad Ramberg: The increase from the prior quarter was primarily due to one-time lower shipping and fulfillment costs, while the decline from the prior year quarter was primarily due to the discontinuation of preferred customer fees on 1 November 2024, which were part of our old business model, where customers paid a monthly fee to purchase products at a discount, as well as some higher level of promotional activities in the current period.

Speaker #2: Operating expenses for the quarter declined 21% sequentially and declined 51.5% year over year to 39.7 million. Selling and marketing expense, as the percent of revenue decreased 800 basis points in the prior quarter, and declined 1,270 basis points over the prior year to 31.9%.

Brad Ramberg: Operating expenses for the quarter declined 21% sequentially and declined 51.5% year-over-year to $39.7 million. Selling and marketing expense as a percent of revenue decreased 800 basis points in the prior quarter and declined 1,270 basis points over the prior year to 31.9%. This significant improvement over the prior periods was primarily driven by the pivot away from the multi-level marketing channel as we no longer have partner compensation on our new sales after 1 November 2024. Enterprise technology and development expense as a percent of revenue increased 80 basis points from the prior quarter and decreased 160 basis points year-over-year to 17.4% of revenue.

Speaker #2: This significant improvement over the prior periods was primarily driven by the pivot away from the multi-level marketing channel, as we no longer have partner compensation on our new sales after November 1, 2024.

Speaker #2: Enterprise technology and development expense, as the percent of revenue increased 80 basis points from the prior quarter, and decreased 160 basis points year over year to 17.4% of revenue.

Speaker #2: The improvement as compared to the prior year was primarily due to a decrease in depreciation expense due to lower technology spend. The increase as the percent of revenue compared to the prior quarter was due to revenue deleverage.

Brad Ramberg: The improvement as compared to the prior year was primarily due to a decrease in depreciation expense due to lower technology spend. The increase as a percent of revenue compared to the prior quarter was due to revenue deleverage. G&A was 16.9% of revenue, a decrease of 120 basis points sequentially and an increase of 540 basis points from the prior year. The improvement as compared to the prior quarter was primarily due to a decrease in equity-based compensation from the headcount reduction over the past year due to restructurings and a decrease in outside professional fees. The increase as a percent of revenue as compared to the prior year was due to revenue deleverage.

Speaker #2: G&A was 16.9% of revenue, a decrease of 120 basis points sequentially and an increase of 540 basis points from the prior year. The improvement as compared to the prior quarter was primarily due to a decrease in equity-based compensation from the headcount reduction over the past year due to the restructurings, and a decrease in outside professional fees.

Speaker #2: The increase as the percent of revenue as compared to the prior year was due to revenue deleverage. The Q3 2025 net income of 3.6 million dollars our first net income since we went public in 2021, compared to a net loss of 12 million from the prior year.

Brad Ramberg: The Q3 2025 net income of $3.6 million, our first net income since we went public in 2021, compared to a net loss of $12 million from the prior year. Adjusted EBITDA was $9.5 million compared to $4.6 million in the prior quarter and $10.1 million in the prior year. Notably, this quarter marks our eighth consecutive quarter of positive adjusted EBITDA. Now I'd like to move on to the balance sheet and cash flows. As we discussed on our last call, in May, we entered into a new lending agreement with Tiger Finance and SG Credit Partners for a $25 million three-year loan facility that allowed us to retire the $17.3 million of outstanding debt ahead of its February 2026 maturity date.

Speaker #2: Adjusted EBITDA was 9.5 million, compared to 4.6 million in the prior quarter, and 10.1 million in the prior year. Notably, this quarter marks our eighth consecutive quarter of positive adjusted EBITDA.

Speaker #2: to move on to the balance sheet and cash flows. As we discussed on our last call, in May we entered into a new lending agreement with Tiger Finance and SB Capital Partners for a $25 million three-year loan facility that allowed us to retire the 17.3 million of outstanding debt ahead of its February 2026 maturity Now I'd like date.

Speaker #2: This refinancing provided us with approximately $5 million of additional capital on the balance sheet. The effective interest rate on this new facility is approximately 15.2% compared to the approximately 28% in the prior facility.

Brad Ramberg: This refinancing provided us with approximately $5 million of additional capital on the balance sheet. The effective interest rate on this new facility is approximately 15.2% compared to the approximately 28% in the prior facility. Our cash balance is $33.9 million, compared to $25.6 million in the prior quarter. Our cash generated from operations for the quarter was $10.2 million. Our year-to-date free cash flow is $13.1 million, of which $9 million was generated this quarter. Q3 had a $2 million dollar benefit from the timing of payroll, which was accrued in Q3 but paid in Q4. Turning to our Q4 guidance. While we are pleased with the execution of our transformation, I want to reiterate that we're still in the first year of the company's new business model.

Speaker #2: Our cash balance is 33.9 million, compared to 25.6 million in the prior quarter. Our cash generated from operations for the quarter was 10.2 million.

Speaker #2: Our year-to-date free cash flow is $13.1 million, of which $9 million was generated this quarter. Q3 had a $2 million benefit from the timing of payroll, which was acute in Q3 but paid in Q4.

Brad Ramberg: Turning to our Q4 guidance. While we are pleased with the execution of our transformation, I want to reiterate that we're still in the first year of the company's new business model. As discussed, we significantly lowered expenses and our revenue break-even point when we strategically pivoted away from the MLM model to our omni-channel marketing and distribution model. This shift has opened new growth channels that we could not previously access, and we're very excited about the opportunities ahead. We now have a stronger balance sheet and a more viable long-term business model. As with companies that are undergoing a transformation, it will take time to develop traction in these new lines of business.

Speaker #2: Turning to our fourth quarter guidance, where we are pleased with the execution of our transformation, I want to reiterate that we're still in the first year of the company's new business model.

Speaker #2: As discussed, we significantly lowered expenses and our revenue break-even point when we strategically pivoted away from the MLM model to our omnichannel marketing and distribution model.

Brad Ramberg: As discussed, we significantly lowered expenses and our revenue break-even point when we strategically pivoted away from the MLM model to our omni-channel marketing and distribution model. This shift has opened new growth channels that we could not previously access, and we're very excited about the opportunities ahead. We now have a stronger balance sheet and a more viable long-term business model. As with companies that are undergoing a transformation, it will take time to develop traction in these new lines of business.

Speaker #2: This shift has opened new growth channels that we could not previously access, and we're very excited about the opportunities ahead. We now have a stronger balance sheet and a more viable long-term business model.

Speaker #2: But as with companies that are undergoing a transformation, it will take time to develop traction in these new lines of business. We expect fourth quarter revenues to be in the range of $50 million to $57 million, net income in the range of negative $1 million to positive $3 million, and adjusted EBITDA to be in the range of $5 million to $9 million.

Brad Ramberg: We expect Q4 revenues to be in the range of $50 to 57 million, net income in the range of negative $1 to positive 3 million, and adjusted EBITDA to be in the range of $5 to 9 million. As we continue the transition to our new business model, we want to provide additional updates to help you contextualize changes in our new financial model. As of today, we anticipate revenues to approximate 61% digital and 39% nutrition. Our long-term digital growth margin target is 87% to 89%. Our long-term nutrition and other growth margin is in the range of 46% to 52%, which is in line with our volume expectations and certain promotional activities planned. Our long-term total growth margin target is from 70% to 75%. Over the last two years, we've made considerable progress against our business transformation.

Speaker #2: As we continue the transition to our new business model, we want to provide additional updates to help you contextualize changes in our new financial model.

Speaker #2: As of today, we anticipate revenues to approximate $61% digital, and $39% nutrition. Our long-term digital growth margin target is 87 to 89%. Our long-term nutrition and other growth margin is in the range of 46 to 52%, which is in line with our volume expectations and certain promotional activities planned.

Brad Ramberg: Our long-term nutrition and other growth margin is in the range of 46% to 52%, which is in line with our volume expectations and certain promotional activities planned. Our long-term total growth margin target is from 70% to 75%. Over the last two years, we've made considerable progress against our business transformation.

Speaker #2: Our long-term total growth margin target is from 70 to 75%. Over the last two years, we've made considerable progress against our business transformation. We've significantly lowered our break-even point and strengthened our financial position, putting us on a solid foundation to execute against our growth initiatives that will drive long-term shareholder value.

Brad Ramberg: We've significantly lowered our break-even point and strengthened our financial position, putting us on a solid foundation to execute against our growth initiatives that will drive long-term shareholder value. I look forward to updating you on our progress on our next earnings call. I'll now turn it back over to Mark for closing remarks.

Speaker #2: I look forward to updating you on our progress on our next earnings call. I'll now turn it back over to Mark for closing remarks.

Speaker #2: Thank you, Brad. Operator, Chala, could you please open it up to questions?

Mark Goldston: Thank you, Brad. Operator, Jayla, could you please open it up to questions?

Speaker #3: Absolutely. At this time, if you would like to ask a question, it is star followed by one on your telephone keypad. If for any reason you would like to remove that question, it is star followed by two.

Operator: Absolutely. At this time, if you would like to ask a question, it is star followed by 1 on your telephone keypad. If for any reason you would like to remove that question, it is star followed by 2. Again, to ask a question, it is star 1. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking a question. I'll pause briefly here as questions are registered. Our first question comes from Susan Anderson with the company Canaccord Genuity. Susan, your line is now open.

Speaker #3: Again, to ask a question, it is *star one*. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking a question.

Speaker #3: I'll pause briefly here as questions are registered. Our first question comes from Suzanne Anderson with the company Canaccord Annuity. Suzanne, your line is now open.

Susan Anderson: Hi, good evening. Thanks for taking my question. Nice job on the quarter. I guess maybe if you could.

Speaker #4: Hi, good evening. Thanks for taking my question. Nice job on the quarter. I guess maybe if you could talk about, I'm curious, just the customer base, if you're seeing any big change with the new business model. And then maybe if you could share any details on what type of customers are signing up for the unbundled Super Trainer subscription?

Mark Goldston: Thank you.

Susan Anderson: I'm curious, just the customer base, if you're seeing any big change with the new business model, and then maybe if you could share any details on what type of customers are signing up for the unbundled Super Trainer Subscription. Are these new customers, a BODi that maybe, you know, will kind of tack on more subscriptions down the road, or are they existing customers? Thanks.

Speaker #4: Are these new customers of body that maybe will kind of tack on more subscriptions down the road, or were they existing customers? Thanks.

Mark Goldston: Well, thanks, Susan. Nice to hear from you. We're really dealing with the same type of customer that we've dealt with for 26 years, quite honestly, the people who are too busy to go for a gym membership. They want the convenience of doing things at home, and they want it, somewhere between 20 to 45 minutes per workout. In general, we're seeing the demographics be similar. In terms of the specific subscriptions, the Autumn Calabrese collection or the Shaun T collection, those are doing both a great job of winning back customers who are really just interested in the affinity with their particular trainer. We are seeing a nice percentage of those people upgrade to the full subscription.

Carl Daikeler: Well, thanks, Susan. Nice to hear from you. We're really dealing with the same type of customer that we've dealt with for 26 years, quite honestly, the people who are too busy to go for a gym membership. They want the convenience of doing things at home, and they want it, somewhere between 20 to 45 minutes per workout. In general, we're seeing the demographics be similar. In terms of the specific subscriptions, the Autumn Calabrese collection or the Shaun T collection, those are doing both a great job of winning back customers who are really just interested in the affinity with their particular trainer. We are seeing a nice percentage of those people upgrade to the full subscription.

Speaker #5: Well, thanks, Susan. Nice to hear from you. We're really dealing with the same type of customer that we've dealt with for 26 years, quite honestly.

Speaker #5: The people who are too busy to go for a gym membership, they want the convenience of doing things at home, and they want it somewhere between 20 to 45 minutes per workout.

Speaker #5: So in general, we're seeing the demographic be similar. In terms of the specific subscriptions, the Autumn Calibres collection and the Shawntee collection, those are doing both a great job of winning back customers who are really just interested in the affinity with their particular trainer, but we are seeing a nice percentage of those people upgrade to the full subscription.

Speaker #5: So, it's doing the job of what you might see from a high-volume, low-price gym, where people are attracted to the $9.99 per month, but then see the value of the full monthly or annual price.

Mark Goldston: It's doing the job of what you might see from a high volume, low price gym, where people are attracted to the $9.99 per month, but then seeing the value of the overall subscription and upgrading to the full, the full monthly or annual price. In terms of new customer acquisition, we're seeing that come from really the more broad advertising of, you know, helping people get healthy, helping people improve their overall well-being, and that is sort of business as usual as we go into Q4. We're very excited by the prospect of bringing in new customers with the launch of Shaun T's DIG IN program and the promise of the largest test group that we've ever run as a company.

Carl Daikeler: It's doing the job of what you might see from a high volume, low price gym, where people are attracted to the $9.99 per month, but then seeing the value of the overall subscription and upgrading to the full, the full monthly or annual price. In terms of new customer acquisition, we're seeing that come from really the more broad advertising of, you know, helping people get healthy, helping people improve their overall well-being, and that is sort of business as usual as we go into Q4. We're very excited by the prospect of bringing in new customers with the launch of Shaun T's DIG IN program and the promise of the largest test group that we've ever run as a company.

Speaker #5: So in terms of new customer acquisition, we're seeing that come from really the more broad advertising of helping people get healthy, helping people improve their overall well-being, and that has sort of business as usual as we go into the fourth quarter.

Speaker #5: And we're very excited by the prospect of bringing in new customers with the launch of Shawntee's Dig-In program and the promise of the largest test group that we've ever run as a company.

Speaker #4: Okay, great. And then maybe if you can give some more color just on your new product pipeline, it sounds like you have a number of things lined up through holiday and then maybe into next year.

Susan Anderson: Okay, great. Maybe if you can give some more color just on your new product pipeline. It sounds like you have a number of things lined up through holiday and then maybe into next year. Maybe if you could just talk about timing of the rollouts and any color you could give maybe around the new P90X product and then also, other products that are gonna roll out, whether they're in digital or the nutrition segment. Oh, also I was wondering-

Speaker #4: Maybe if you could just talk about timing of the rollouts and any color you could give, maybe around the new P90X product and then also other products that are going to roll out, whether they're in digital or the nutrition segment.

Speaker #4: Oh, and then also I was.

Mark Goldston: Yeah, well.

Carl Daikeler: Yeah, well.

Speaker #5: Yeah, well, I.

Susan Anderson: Sorry, go ahead, and then I have one follow-up.

Speaker #4: Sorry, go ahead and then have a follow-up.

Speaker #5: Okay. So just real quick, as we mentioned, we're very excited by the number of products that we're launching into the catalog nutrition products in 2026.

Mark Goldston: Okay. Just real quick, as we mentioned, we're very excited by the number of products that we're launching into the catalog, nutrition products in 2026. We haven't launched this many new products, particularly at a price point that's much more affordable to our database, to our current subscribers, and to new prospective customers since we launched the MLM. Obviously, we had to support the compensation plan for the MLM when that was such a big part of the business model. Now that we don't have the MLM, we can be far more competitive in the nutrition segment with our pricing and with our unit economics, both a form factor in the 7 to 14 servings versus everything being in a monthly unit.

Carl Daikeler: Okay. Just real quick, as we mentioned, we're very excited by the number of products that we're launching into the catalog, nutrition products in 2026. We haven't launched this many new products, particularly at a price point that's much more affordable to our database, to our current subscribers, and to new prospective customers since we launched the MLM.

Speaker #5: We haven't launched this many new products, particularly at a price point that's much more affordable to our database, to our current subscribers, and customers since we launched the MLM.

Speaker #5: Obviously, we had to support the compensation plan for the MLM when that was such a big part of the business model. Now that we don't have the MLM, we can be far more competitive in the nutrition segment with our pricing and with our unit economics, both a form factor in the 7 to 14 servings versus everything being in a monthly unit.

Carl Daikeler: Obviously, we had to support the compensation plan for the MLM when that was such a big part of the business model. Now that we don't have the MLM, we can be far more competitive in the nutrition segment with our pricing and with our unit economics, both a form factor in the 7 to 14 servings versus everything being in a monthly unit.

Speaker #5: So, we've got the P90X line of supplements, the Insanity line of supplements, and we have an expansion of Shakeology as we take that out into retail.

Mark Goldston: We've got the P90X line of supplements, and we have Insanity line of supplements, and we have expansion of Shakeology as we take that out into retail. Nutrition is largely expanding in 2026. For the balance of 2025, we have the, as I mentioned on the call, we just launched Tony Horton's Power of Four program, which we licensed from him. We just launched a series of new bike programs called Chasing the West, which has gotten great response from our subscribers. We're launching, Shaun T's Dig In program, which is a hybrid between a low-impact Insanity program, plus his very popular Dig Deeper weightlifting program. I'll also say we're launching something at the end of the year.

Carl Daikeler: We've got the P90X line of supplements, and we have Insanity line of supplements, and we have expansion of Shakeology as we take that out into retail. Nutrition is largely expanding in 2026. For the balance of 2025, we have the, as I mentioned on the call, we just launched Tony Horton's Power of Four program, which we licensed from him. We just launched a series of new bike programs called Chasing the West, which has gotten great response from our subscribers. We're launching, Shaun T's Dig In program, which is a hybrid between a low-impact Insanity program, plus his very popular Dig Deeper weightlifting program. I'll also say we're launching something at the end of the year.

Speaker #5: So nutrition is largely expanding in 2026. For the balance of 2025, we have the, as I mentioned, on the call, we just launched Tony Horton's Power of Four program, which we licensed from him.

Speaker #5: We just launched a series of new bike programs, called Chasing the West, which have gotten great response from our subscribers. We're launching Shawntee's dig-in program, which is a hybrid between a low-impact Insanity program plus a very popular dig deeper weightlifting program.

Speaker #5: I'll also say we're launching something at the end of the year. I can't go into too much detail right now, but I happen to—I want to say to you particularly, it was inspired by a conversation that you and I had because you love running so much, but I know you want to keep doing your resistance training to help your bone density and your overall muscle tone.

Mark Goldston: I can't go into too much detail right now, but I wanna say to you particularly, it was inspired by a conversation that you and I had 'cause you love running so much, but I know you wanna keep doing your resistance training to help your bone density and your overall muscle tone, and I think you're gonna love what we're coming out with at the end of December. P90X Generation Next just started to get teased last week, the response to that just blew us away, both in terms of attracting new subscribers and in terms of the current subscribers being excited for that program, that launches on 3 February. That's the extent of what we've announced so far, I think it's frankly, 2025 was such a transition year for us.

Carl Daikeler: I can't go into too much detail right now, but I wanna say to you particularly, it was inspired by a conversation that you and I had 'cause you love running so much, but I know you wanna keep doing your resistance training to help your bone density and your overall muscle tone, and I think you're gonna love what we're coming out with at the end of December.

Speaker #5: And I think you're going to love what we're coming out with at the end of December: P90X Generation Next. We just started to get teased last week, and the response to that just blew us away, both in terms of attracting new subscribers and in terms of the current subscribers being excited for that program.

Carl Daikeler: P90X Generation Next just started to get teased last week, the response to that just blew us away, both in terms of attracting new subscribers and in terms of the current subscribers being excited for that program, that launches on 3 February. That's the extent of what we've announced so far, I think it's frankly, 2025 was such a transition year for us. We didn't put that much new content into the pipeline. I think between now and the end of 2026, our subscribers and prospective subscribers are gonna be very impressed with what the platform offers.

Speaker #5: And that launches on February 3rd. That's the extent of what we've announced so far, and I think it's, frankly, 2025 was such a transition year for us.

Speaker #5: We didn't put that much new content into the pipeline. I think between now and the end of 2026, our subscribers and prospective subscribers are going to be very impressed with what the platform offers.

Mark Goldston: We didn't put that much new content into the pipeline. I think between now and the end of 2026, our subscribers and prospective subscribers are gonna be very impressed with what the platform offers.

Speaker #4: Okay, great. That sounds exciting. I'm excited to see the new products. Maybe if you could talk about—I was just curious too, should we think about any increase in investment in the new products?

Susan Anderson: Okay, great. That sounds exciting. I'm excited to see the new products. Maybe if you could talk about... I was just curious too, should we think about any increase, the increase in investment in the new products? Should that impact the P&L at all in the OpEx, or have you guys already kind of planned for that? Thanks. That's all.

Speaker #4: Should that impact the P&L at all in the op expense, or have you guys already kind of planned for that? Thanks, and that's all.

Mark Goldston: It's all in line with the economics that we've been running for the business. I'll let Brad speak to any specifics, but we're really running the business in a responsible way that takes advantage and maintains the advantage of the operational leverage that we've built into the business over the last two years. The company's just done such an incredible job of being both disciplined, but maintaining our product quality and the innovation pipeline, which resulted in, you know, we're so excited by having an in-home Pilates program. You know, the whole fitness industry is aware of how big Pilates has gotten, and the fact that we have a Track Pilates program that people can do for $100 of equipment is just an exciting asset for us to take into 2026.

Speaker #5: It's all in line with the economics that we've been running for the business. I'll let Brad speak to any specifics, but we're really running the business in a responsible way that takes advantage of and maintains the advantage of the operational leverage that we've built into the business over the last two years.

Carl Daikeler: It's all in line with the economics that we've been running for the business. I'll let Brad speak to any specifics, but we're really running the business in a responsible way that takes advantage and maintains the advantage of the operational leverage that we've built into the business over the last two years. The company's just done such an incredible job of being both disciplined, but maintaining our product quality and the innovation pipeline, which resulted in, you know, we're so excited by having an in-home Pilates program.

Speaker #5: The company has done an incredible job of being both disciplined while maintaining our product quality and the innovation pipeline, which has resulted in our excitement about having an in-home Pilates program.

Carl Daikeler: You know, the whole fitness industry is aware of how big Pilates has gotten, and the fact that we have a Track Pilates program that people can do for $100 of equipment is just an exciting asset for us to take into 2026. Bottom line is we're gonna maintain our economics, and we feel very good about the base of assets that we have to work with.

Speaker #5: The whole fitness industry is aware of how big Pilates has gotten and the fact that we have a track Pilates program that people can do for 100 bucks of equipment is just an exciting asset for us to take into 2026.

Speaker #5: So, bottom line is we're going to maintain our economics, and we feel very good about the base of assets that we have to work with.

Mark Goldston: Bottom line is we're gonna maintain our economics, and we feel very good about the base of assets that we have to work with.

Brad Ramberg: Hi, Susan. This is Brad. Nice to hear from you. No, we are very disciplined with our spend. We are excited about our spend, and the numbers are baked into our guidance for Q4.

Speaker #6: Hi, Susan. This is Brad. Nice to hear from you. We are very disciplined with our spend. We are excited about our spend and the numbers are baked into our guidance for the fourth quarter.

Speaker #4: Great. Thanks so much. Good luck the rest of the year.

Susan Anderson: Great. Thanks so much. Good luck the rest of the year.

Speaker #6: Thank you.

Brad Ramberg: Thank you.

Speaker #7: Thank you, Susan.

Mark Goldston: Thank you, Susan.

Speaker #1: Our next question comes from JP Wallam with the company Ross Capital Partners. JP, your line is now open.

Operator: Our next question comes from John-Paul Wollam with the company Ross Capital Partners. JP, your line is now open.

Speaker #8: Great. Good afternoon, guys. Appreciate you taking my questions here. If we could just maybe start on the nutrition side. So it looks like that kind of sequential decline there was actually pretty minimal, maybe given some expectations out there.

John-Paul Wollam: Great. Good afternoon, guys. Appreciate you taking my questions here. If we could just maybe start on the nutrition side. It looks like, you know, that kind of sequential decline there was actually pretty minimal, maybe given some expectations out there. Just wondering if there's any more detail you can share on kind of what drove that? I think there might have been some mention of promotional activity, so if there's anything specific to call out in terms of promotions that worked well, that'd be helpful.

JP Wollam: Great. Good afternoon, guys. Appreciate you taking my questions here. If we could just maybe start on the nutrition side. It looks like, you know, that kind of sequential decline there was actually pretty minimal, maybe given some expectations out there. Just wondering if there's any more detail you can share on kind of what drove that? I think there might have been some mention of promotional activity, so if there's anything specific to call out in terms of promotions that worked well, that'd be helpful.

Speaker #8: But just wondering if there's any more detail you can share on kind of what drove that. I think there might have been some mention of promotional activity.

Speaker #8: So if there's anything specific to call out in terms of promotions that worked well, that'd be helpful.

Speaker #6: Hi, JP. This is Brad. Nice to talk to you. Thanks for asking the question. Before the strategic transition, we were selling an MLM-based product.

Brad Ramberg: Hi, J.P. This is Brad. Nice to talk to you. Thanks for asking the question. You know, before the strategic transition, we were selling an MLM-based product. Our hero product was Shakeology at $130 a month. As we've moved away from that, we are doing more price testing. We are coming up with lower price SKUs, as Carl and Mark said. We'll be introducing a new Shakeology at a smaller form factor, lower servings, lower price. We've been doing more bundle activities and more price testing, and we are seeing good demand at these new price points. We're able to maintain the number of subs, and we're able to do that at a lower price point, which makes sense given the transition away from the MLM to the new omni-channel model.

Speaker #6: Our hero product was Shakeology, 130 dollars a month. So as we've moved away from that, we are doing more price testing; we are coming up with lower-priced cues.

Speaker #6: As Karl and Mark said, we're introducing a new Shakeology at a smaller form factor, lower servings, lower price. We've been doing more bundle activities and more price testing, and we are seeing good demand at these new price points.

Speaker #6: So we're able to maintain the number of subs and we're able to do that at a lower price point, which makes sense given the transition away from the MLM to the new omnichannel model.

Speaker #8: Perfect. And then maybe just as we kind of—oh, go ahead.

John-Paul Wollam: Perfect.

JP Wollam: Perfect.

Brad Ramberg: Yeah.

John-Paul Wollam: Maybe just as we kind of... Oh, go ahead.

JP Wollam: Maybe just as we kind of... Oh, go ahead.

Speaker #6: No, I was saying, JP, and this is Mark. And just on a go-forward basis, because remember, we started basically a new company on January 1st.

Mark Goldston: No, I say, J.P., this is Mark. Just on a go-forward basis, because remember, we started basically a new company 1 January. There's really no year-over-year comparisons because we dismantled the MLM, as you know, at the end of last year. Going forward, these new nutrition products that we're bringing out under the P90X brand name, which will range in price from, you know, probably $15 to $39, and the new smaller form factor, lower price Shakeology, and then INSANITY, these are price points that the company's, like, never offered before and certainly never offered in the retail market.

Speaker #6: So there's really no year-over-year comparisons because we dismantled the MLM, as you know, at the end of last year. But going forward, these new nutrition products that we're bringing out under the P90X brand name, which will range in price from probably 15 to 39 dollars, and the new smaller form factor, lower-priced Shakeology, and then Insanity, these are price points that the companies, like, never offered before.

Speaker #6: And certainly never offered in the retail market. So we're not only excited about the potential in a brick-and-mortar store, but from a direct-to-consumer standpoint, between our Amazon channel and our body website, and our affiliates, you've now got something in the arsenal that we just haven't had before.

Mark Goldston: We're not only excited about the potential in a brick-and-mortar store, but from a direct-to-consumer standpoint, between our Amazon channel and our BODi website and our affiliates, you've now got something in the arsenal that we just haven't had before, which is these monster brand name products under P90X, INSANITY, and now Shakeology at much more affordable price points because we were hamstrung in the previous model by the costs and the compensation costs related to the MLM, which no longer exists. Going forward into the back half of 2026 and into 2027, I think you're gonna see, you know, nutritional business with much different character in terms of its composition because of our ability to sell a lower price, broader appealing product line.

Speaker #6: Which of these monster brand name products under P90X, Insanity, and now Shakeology, are available at much more affordable price points? We were hamstrung in the previous model by the costs and the compensation costs related to the MLM, which no longer exists.

Speaker #6: So going forward into the back half of '26 and into '27, I think you're going to see nutritional business with much different character in terms of its composition because of our ability to sell a lower-priced, broader-appealing product line.

John-Paul Wollam: Perfect. Then, you know, I think on the last call, we were talking about you guys being sort of in the early stages still of working with a broker in terms of getting some wins in terms of retail. I'm just wondering if there's anything you can update us on in terms of visibility for that retail launch coming up next year?

JP Wollam: Perfect. Then, you know, I think on the last call, we were talking about you guys being sort of in the early stages still of working with a broker in terms of getting some wins in terms of retail. I'm just wondering if there's anything you can update us on in terms of visibility for that retail launch coming up next year?

Speaker #8: Perfect. And then I think on the last call, we were talking about you guys being sort of in the early stages still of working with a broker in terms of getting some wins in terms of retail.

Speaker #8: And I'm just wondering if there's anything you can update us on in terms of visibility for that retail launch coming up next year.

Speaker #6: Yeah. Great question. So, as you know, or maybe you don't, in the retail marketplace, most of the major retailers work on something called a planogram, which is the shelf set that you see when you walk into a store.

Brad Ramberg: Yeah. Great question. As you know, or maybe you don't, in the retail marketplace, most of the major retailers work on something called a planogram, which is the shelf set that you see when you walk in a store. They usually have planogram revision dates that are either one time or two times a year. Our broker partner is coordinating our sell-in meetings based on the calendars of these new planogram reset dates. Typically, when you go to an account, a major retailer, and they say, "Yes, I'd love to add this product, I'm going to put it into my new planogram shelf set," it's usually about 5 to 6 months from that day when you're accepted until you actually physically appear on the retail shelf. Our teams are out there right now selling in the product, making presentations.

Mark Goldston: Yeah. Great question. As you know, or maybe you don't, in the retail marketplace, most of the major retailers work on something called a planogram, which is the shelf set that you see when you walk in a store. They usually have planogram revision dates that are either one time or two times a year. Our broker partner is coordinating our sell-in meetings based on the calendars of these new planogram reset dates.

Speaker #6: And they usually have planogram revision dates that are either one time or two times a year. So our broker partner is coordinating our sell-in meetings based on the calendars of these new planogram reset dates.

Speaker #6: And typically, when you go to an account, a major retailer, and they say, "Yes, I'd love to add this product," I'm going to put it into my new planogram shelf set.

Mark Goldston: Typically, when you go to an account, a major retailer, and they say, "Yes, I'd love to add this product, I'm going to put it into my new planogram shelf set," it's usually about 5 to 6 months from that day when you're accepted until you actually physically appear on the retail shelf. Our teams are out there right now selling in the product, making presentations.

Speaker #6: It's usually about five to six months from that day when you're accepted until you actually physically appear on the retail shelf. So our teams are out there right now selling in the product, making presentations.

Speaker #6: We're expecting to get answers on how that's going in the next four to six weeks. Assuming it goes the way we all expect and hope it will, we should start appearing on the shelf in some of these places late in Q1, and most of them into Q2.

Brad Ramberg: We're expecting to get answers on how that's going in the next four to six weeks. Assuming it goes the way we all expect and hope it will, we should start appearing on the shelf in some of these places late part of Q1, most of them into Q2. The majority of that revenue will start to materialize Q2 and then into Q3 and Q4. As you know, it's a rollout. Essentially, first you got to get it sold in, then they have to reset the section, then you launch, and then you grow after that. All according to how our plan was expected to go. Now, that does not apply to the DTC business. When we launch these brand-new products starting in January, we will be able to immediately start making them available on a DTC basis and on an Amazon basis.

Mark Goldston: We're expecting to get answers on how that's going in the next four to six weeks. Assuming it goes the way we all expect and hope it will, we should start appearing on the shelf in some of these places late part of Q1, most of them into Q2. The majority of that revenue will start to materialize Q2 and then into Q3 and Q4. As you know, it's a rollout.

Speaker #6: So the majority of that revenue will start to materialize Q2 and then into Q3 and Q4. But as you know, it's a rollout. And so essentially, first you got to get it sold in, then they have to reset the section, then you launch and then you grow after that.

Mark Goldston: Essentially, first you got to get it sold in, then they have to reset the section, then you launch, and then you grow after that. All according to how our plan was expected to go. Now, that does not apply to the DTC business. When we launch these brand-new products starting in January, we will be able to immediately start making them available on a DTC basis and on an Amazon basis. For brick-and-mortar, we have to run the offense, which is the planogram date, acceptance, reset of the shelf, and you show up probably five to six months later.

Speaker #6: So all according to how our plan was expected to go. Now that does not apply to the DTC business. So when we launch these brand new products starting in January, we will be able to immediately start making them available on a DTC basis and on an Amazon basis.

Speaker #6: But for brick-and-mortar, we have to run the offense, which is the planogram date, acceptance, and reset of the shelf. You show up probably five to six months later.

Brad Ramberg: For brick-and-mortar, we have to run the offense, which is the planogram date, acceptance, reset of the shelf, and you show up probably five to six months later.

John-Paul Wollam: Understood. Appreciate that color. If I could just slide one more in quickly here, as we look at the selling and marketing line, obviously some a great sequential step down there, in terms of managing costs. Wondering if you could, one, just kind of provide a bridge from Q2 to Q3. I think there's a little bit of an advertising reduction and maybe a reduction in kind of some deferred commissions. One, if you could provide that bridge at all. Two, just, you know, now being sort of 32% of sales, like, how are you feeling about that line item and whether there's more cost to come out there?

JP Wollam: Understood. Appreciate that color. If I could just slide one more in quickly here, as we look at the selling and marketing line, obviously some a great sequential step down there, in terms of managing costs. Wondering if you could, one, just kind of provide a bridge from Q2 to Q3. I think there's a little bit of an advertising reduction and maybe a reduction in kind of some deferred commissions. One, if you could provide that bridge at all. Two, just, you know, now being sort of 32% of sales, like, how are you feeling about that line item and whether there's more cost to come out there?

Speaker #8: Understood. I appreciate that, Keller. If I could just slide one more in quickly here. As we look at the selling and marketing line, obviously there was a great sequential step down in terms of managing costs.

Speaker #8: But I’m wondering if you could, one, just kind of provide a bridge from Q2 to Q3. I think there’s a little bit of an advertising reduction and maybe a reduction in some deferred commissions.

Speaker #8: But I wonder if you could provide that bridge at all. And two, just now being sort of 32% of sales, how are you feeling about that line item and whether there's more cost to come out there?

Speaker #6: Sure, JP, this is Brad. I'll take that question. One, if you look back at the end of last year, while we were still in the MLM model, we had upwards of $25 million to $26 million of deferred partner costs on the books.

Brad Ramberg: Sure, J.P. This is Brad.

John-Paul Wollam: Brad.

Mark Goldston: Brad.

Brad Ramberg: I'll take that question. One, if you look back at the end of last year while we were still in the MLM model, we had upwards of $25 million to $26 million of deferred partner costs on the books. We've been expensing that over the course of the year, and we're now down to about $3 million to $3.5 million of deferred partner costs. That's all costs related to the legacy business. As that has declined over time, we're really looking at the advertising and marketing rates on the new business. We're at about 31.9% for Q3. I would expect going forward it to be in the mid-thirties-ish with some variation of seasonality. The sequential decline really is driven by the transition away from the MLM business.

Speaker #6: We've been expensing that over the course of the year, and we're now down to about $3.5 million of deferred partner costs.

Speaker #6: So that's all cost-related to the legacy business. As that has declined over time, we're really looking at the advertising and marketing rates on the new business.

Speaker #6: And so we're at about 31.9% for Q3. I would expect going forward it to be in the mid-30s-ish with some variation of seasonality. But the sequential decline really is driven by the transitional way from the MLM business.

Brad Ramberg: JP, just to provide additional color on that. There are seasonal fluctuations, you know, between the quarters because Q1 is always your highest marketing spend quarter. What's important is that that sales and marketing line, which was reduced from the $25.5 million in Q2 down to $19.1 million in Q3, really was not a result of spending less money on actual advertising and marketing. It was a lot of it was the costs that Brad just alluded to, which were associated with the former MLM, which are now sort of burning off. We've not reduced our spend to the consumer. We did not cut the media budget. We just shed all those legacy marketing costs that were affiliated with the MLM.

Speaker #1: And And JP, just to provide additional color on that. So there are seasonal fluctuations between the quarters because Q1 is always your highest marketing spend quarter.

Mark Goldston: JP, just to provide additional color on that. There are seasonal fluctuations, you know, between the quarters because Q1 is always your highest marketing spend quarter. What's important is that that sales and marketing line, which was reduced from the $25.5 million in Q2 down to $19.1 million in Q3, really was not a result of spending less money on actual advertising and marketing. It was a lot of it was the costs that Brad just alluded to, which were associated with the former MLM, which are now sort of burning off. We've not reduced our spend to the consumer.

Speaker #1: But what's important is that that sales and marketing line, which was reduced, from the 25.5 million in Q2 down to 19.1 in Q3, really was not a result of spending less money on actual advertising and marketing.

Speaker #1: It was a lot of that was the cost of bread just alluded to, which we're associated with the former MLM, which are now sort of burning off.

Speaker #1: So we've not reduced our spend to the consumer. We did not cut the media budget. We just shed all those legacy marketing costs that were affiliated with the MLM.

Mark Goldston: We did not cut the media budget. We just shed all those legacy marketing costs that were affiliated with the MLM. You will not see that similar type of decline, obviously, in Q1 because Q1 will be your higher spending quarter. I just want to put color around that because when you look at the sales and marketing line, your first inclination is to say, The company cut its marketing spend level to the consumer. The answer to that is an emphatic no, we did not.

Speaker #1: You will not see that similar type of decline, obviously, in Q1 because Q1 will be your higher spending quarter. But I just want to put color around that because when you look at the sales and marketing line, your first inclination is to say the company cut its marketing spend level to the consumer.

Brad Ramberg: You will not see that similar type of decline, obviously, in Q1 because Q1 will be your higher spending quarter. I just want to put color around that because when you look at the sales and marketing line, your first inclination is to say, The company cut its marketing spend level to the consumer. The answer to that is an emphatic no, we did not.

Speaker #1: And the answer to that is an emphatic no, we did not.

Speaker #8: Perfect. Appreciate the detail and best of luck going forward, guys.

John-Paul Wollam: Perfect. Appreciate the detail and best of luck going forward, guys.

JP Wollam: Perfect. Appreciate the detail and best of luck going forward, guys.

Speaker #1: Thank you, JP.

Brad Ramberg: Thank you, JP.

Speaker #9: A next question comes from Michael Lipinski with the company Noble Capital Markets. Michael, your line is now open.

Operator: Our next question comes from Michael Kupinski with the company Noble Capital Markets. Michael, your line is now open.

Speaker #8: Thank you. And thanks for taking my questions and congratulations on a stellar quarter. And reaching your profit milestones. Last

Michael Kupinski: Thank you. Thanks for taking my questions. Congratulations on a stellar quarter and reaching your profit milestones.

Speaker #1: Thank you.

Brad Ramberg: Thank you.

Michael Kupinski: A couple questions. I believe that in Q3, you kinda indicated that you felt like most of your restructuring of your sales force was gonna be complete. I was just wondering, has that now all been completed?

Speaker #8: Last question. I believe that in Q3, you kind of indicated that you felt like most of your restructuring of your sales force was going to be complete.

Speaker #8: I was just wondering, has that all been completed?

Brad Ramberg: Brad?

Speaker #1: Brad?

John-Paul Wollam: Yeah.

JP Wollam: Yeah.

Speaker #3: Yeah. Generally, the reorganization has taken place and we're now multi-channel with, as Mark mentioned, the performance marketing or direct-to-consumer business. We've got the Amazon business.

Michael Kupinski: Go to Ben Moore.

John-Paul Wollam: ... the reorganization has taken place, and we're now multi-channel with, as Mark mentioned, the performance marketing or direct-to-consumer business. We've got the Amazon business. We've got a small contribution from affiliate and obviously CRM, and we're excited to launch into retail next year.

JP Wollam: ... the reorganization has taken place, and we're now multi-channel with, as Mark mentioned, the performance marketing or direct-to-consumer business. We've got the Amazon business. We've got a small contribution from affiliate and obviously CRM, and we're excited to launch into retail next year.

Speaker #3: We've got small contribution from affiliate and obviously CRM. And we're excited to launch into retail next year.

Speaker #1: And Mike, this is Brad. I'll say we're always looking for cost. We're always looking for cost efficiencies and we'll continue to do so. But the financial restructuring is for the most part complete.

Michael Kupinski: Okay.

Brad Ramberg: Mike, this is Brad. I'll say we're always looking for cost-.

Michael Kupinski: Yeah.

Brad Ramberg: We're always looking for cost efficiencies. We'll continue to do so. The financial restructuring is for the most part complete. Now we're really looking at growth mode, beginning now and into 2026.

Speaker #1: Now we're really looking at growth mode in beginning now in 26.

Speaker #8: Okay, perfect. I was wondering, in terms of margin, with all these distribution retail rollouts and also with the new products that you're talking about, I was just wondering if you could talk a little bit about margin.

Michael Kupinski: Okay, perfect. I was wondering in terms of margin, you know, with all these retail distribution rollouts and also with the new products that you're talking about, I was just wondering if you can just talk a little bit about margin. Are you anticipating giving up any margin? You know, obviously with some of the lower price points that you're talking about with some of your products, if you could just add a little color on that.

Speaker #8: Are you anticipating giving up any margin? If you could just add a little color on that, especially with some of the lower price points that you're talking about with some of your products.

Speaker #1: Sure. It is on that. So I'll tell you. So in Q3, we hit nutrition margin of about 53%. And right now with a lower price point and more promotional activities, we are guiding to a lower nutrition margin for guiding to kind of a steady state in between 46 and 52 percent.

Brad Ramberg: Sure. Yeah. Well, the good news is on that. I'll tell you. In Q3 we hit a nutrition margin of about 53%. Right now with a lower price point and more promotional activities, we are guiding to a lower nutrition margin. We're guiding to a kind of a steady state in between 46% and 52%. Retail in 2026 is not a significant driver of revenue, at least in Q1, but at least in Q, certainly not in Q4. We'll continue to adjust our margin as we gain more experience in retail. Right now we are looking to a little bit of a decline in the nutrition margin as we're looking to a pickup in the number of units and subscribers.

Speaker #1: So, retail in Q2 is not a significant driver of revenue, at least in Q1. Certainly not in Q4. So, we'll continue to adjust our margin as we gain more experience in retail.

Speaker #1: But right now we are looking to a little bit of a decline in the nutrition margin. As we're looking to a pickup in the number of units and subscribers.

Speaker #1: At the end of the day, it really is about generating dollars and it's about generating the most number of subscribers.

Brad Ramberg: At the end of the day, it really is about generating dollars and it's about generating the most number of subscribers.

Speaker #8: Gotcha. I assume

Michael Kupinski: Got it.

Brad Ramberg: We're also, you know.

Speaker #1: And we're also in.

Michael Kupinski: I assume that.

Speaker #8: that.

Brad Ramberg: The margin is also reflective of our increased focus on selling one-time purchases versus just selling subscriptions. Because we're actually expanding the audience, those people will ultimately end up subscribing.

Speaker #1: And the margins also reflected of our increased focus on selling one-time purchases versus just selling subscriptions. So because we're actually expanding the audience, those people will ultimately end up subscribing.

Speaker #8: Yeah. And I was just wondering, do you guys frame for us the anticipated marketing spend around the retail rollout of P90X release?

Michael Kupinski: Yeah. I was just wondering, do you guys frame for us like the anticipated marketing spend around the retail rollout of P90X release?

Speaker #1: I'm sorry, say that again.

Brad Ramberg: I'm sorry, say that again.

Michael Kupinski: Can you just kind of frame maybe the anticipated marketing spend around the retail rollout for your P90X release?

Speaker #8: Can Can you just kind of frame maybe the anticipated marketing spend around the retail rollout for your P90X release? And maybe just give us a

Brad Ramberg: Yeah.

Speaker #1: Yeah. Yeah.

Michael Kupinski: Maybe just give us a timeline for the new P90X exercise program.

Speaker #8: timeline for the P90X exercise program.

Speaker #1: Yeah. Well, the new P90X exercise program is a Q1 program, and that will certainly be part of our overall marketing spend because of its high profile and ability to attract people into the franchise.

Brad Ramberg: Well, the new P90X exercise program is a Q1 program, and that will certainly be part of our overall marketing spend because of its high profile and ability to attract people into the franchise. In terms of the actual retail products, the marketing spend will be in line with what we end up getting in terms of wholesale orders and what that revenue line will look like. We do not have that number right now, but it will be on a normalized advertising to sales ratio based on the wholesale volume that we generate. That's all going to be baked into our numbers.

Speaker #1: In terms of the actual retail products, the marketing spend will be in line with what we end up getting in terms of wholesale orders.

Speaker #1: And what that revenue line will look like. So we do not have that number right now, but it will be on a normalized advertising to sales ratio based on the wholesale volume that we generate and that's all going to be baked into our numbers.

Michael Kupinski: Gotcha. That's all I have. Congratulations again.

Speaker #8: Gotcha. That's all I have. Congratulations again.

Speaker #1: Great. Thank you very much. I appreciate it.

Brad Ramberg: Great. Thank you very much. Appreciate it. Thanks, Michael.

Speaker #3: Thanks, Michael.

Operator: At this time, there are no more questions registered in the queue. Again, if you'd like to ask a question, it is star followed by one on your telephone keypad. There are no more questions registered in the queue at this time. I would like to pass the conference back over to our hosting team for closing remarks.

Speaker #9: At this time, there are no more questions regarding Q. Again, if you would like to ask a question, it is staff followed by one or your telephone keypad.

Speaker #9: There are no more questions regarding Q. At this time, I'd like to pass the conference back over to our hosting team for closing remarks.

Speaker #1: Thank you, Jayla. And thanks, everybody, for attending today. I just want to say in closing, again, this was not only an outstanding and seminal milestone quarter for us.

Brad Ramberg: Thank you, Jayla. And thanks everybody for attending today. I just want to say in closing, you know, again, this was not only an outstanding and a seminal milestone quarter for us, achieving net income positivity, but the fact that in our opinion, the financial turnaround is largely been completed well ahead of schedule, almost 12 months ahead of schedule. The headline is, you know, great new operating structure, much reduced break-even level down to the $180 million level. Now we're at the point where instead of waiting till the back half of 2026, we can actually open up this innovation pipeline starting in the beginning of 2026.

Mark Goldston: Thank you, Jayla. And thanks everybody for attending today. I just want to say in closing, you know, again, this was not only an outstanding and a seminal milestone quarter for us, achieving net income positivity, but the fact that in our opinion, the financial turnaround is largely been completed well ahead of schedule, almost 12 months ahead of schedule. The headline is, you know, great new operating structure, much reduced break-even level down to the $180 million level. Now we're at the point where instead of waiting till the back half of 2026, we can actually open up this innovation pipeline starting in the beginning of 2026.

Speaker #1: Achieving that income positivity but the fact that in our opinion, the financial turnaround is largely been completed. Well ahead of schedule, almost I would say almost 12 months ahead of schedule.

Speaker #1: So the headline is great new operating structure, much reduced break-even level down to the 180 million dollar level. And now we're at the point where instead of waiting till the back half of '26, we can actually open up this innovation pipeline, starting at the beginning of '26.

Speaker #1: And you'll see a lot of new, exciting programs that will expand this franchise and take advantage of the operating leverage that's now been built into this P&L.

Brad Ramberg: You'll see a lot of new exciting programs which will expand this franchise, take advantage of the operating leverage that's now been built into this P&L, and give us the opportunity to achieve all of the goals that Carl's been articulating for years about not trying to reach just the serious exerciser and the serious nutrition consumer, but to go out to the broader audience and that huge TAM of the 185 million Americans who do not currently exercise on a regular basis and who, you know, are taking nutritional supplement products, and we want to drive them to our franchise. Thanks, everybody. We look forward to talking to you on the next quarter's earnings call.

Mark Goldston: You'll see a lot of new exciting programs which will expand this franchise, take advantage of the operating leverage that's now been built into this P&L, and give us the opportunity to achieve all of the goals that Carl's been articulating for years about not trying to reach just the serious exerciser and the serious nutrition consumer, but to go out to the broader audience and that huge TAM of the 185 million Americans who do not currently exercise on a regular basis and who, you know, are taking nutritional supplement products, and we want to drive them to our franchise. Thanks, everybody. We look forward to talking to you on the next quarter's earnings call.

Speaker #1: And give us the opportunity to achieve all of the goals that Carl's been articulating for years about not trying to reach just the serious exerciser and the serious nutrition consumer, but to go out to the broader audience and that huge TAM of the 185 million Americans who do not currently exercise on a regular basis and who are taking nutritional supplement products. We want to drive them to our franchise.

Speaker #1: So thanks, everybody. We look forward to talking to you on the next quarter's earnings call.

Operator: That concludes today's call. Thank you for your participation and enjoy the rest of your day.

Speaker #9: That concludes today's call. Thank you for your participation, and enjoy the rest of your day.

Brad Ramberg: Thank you.

Mark Goldston: Thank you.

Q3 2025 Beachbody Co Inc Earnings Call

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