Medifast Reports Second Quarter 2024 Financial Results
Intellectia.AI Updated: 2024-08-06
Medifast Reports Second Quarter 2024 Financial Results
Health and wellness company Medifast (NYSE: MED), known for its OPTAVIA® lifestyle solution, has released its financial results for the second quarter ended June 30, 2024.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | YoY Change | Consensus Estimate |
|---|---|---|---|---|
| Revenue | $168.6 M | $296.2 M | -43.1% | $174.05 M |
| EPS (GAAP) | -$0.75 | $2.77 | ||
| EPS (Non-GAAP Adjusted) | $0.92 | $0.39 | ||
| Net Income (Non-GAAP) | $10.1 M |
Medifast reported a significant year-over-year decline in revenue, falling by 43.1% to $168.6 million for Q2 2024. The company also posted a GAAP net loss per diluted share of $0.75, while the non-GAAP adjusted earnings per share exceeded expectations at $0.92 compared to the consensus estimate of $0.39. The decline in revenue was attributed to a decrease in the number of active earning OPTAVIA Coaches and lower Coach productivity.
Revenue Performance by Segment
| Segment | Revenue Q2 2024 | Comparisons to Previous Guidance |
|---|---|---|
| Total Revenue | $168.6M | Below $174.05M Consensus |
Medifast's revenue performance, segmented into overall revenue, showed a shortfall relative to prior guidance and consensus estimates, primarily due to decreased customer acquisition and reduced Coach productivity.
Key Operational Data
| Operational Metric | Q2 2024 |
|---|---|
| Independent active earning OPTAVIA Coaches | 33,900 |
| Revenue per active earning Coach | $4,972 |
The number of independent active earning OPTAVIA Coaches dropped by 36.2% year-over-year to 33,900, and the average revenue per Coach decreased by 10.9% to $4,972, which significantly impacted overall revenue.
Executive Commentary
Dan Chard, Chairman & CEO of Medifast, remarked, "We are acting decisively to transform our business to position us for long-term growth, with a strong balance sheet free of debt, a clear focus on new customer acquisition, and a broader health and wellness offer to a significantly expanded target market." He emphasized the company's mission to help customers create lifestyle changes and healthy habits.
Forward Guidance
For the third quarter of 2024, Medifast expects revenue to be in the range of $125 million to $145 million, with a diluted loss per share anticipated to be between $0.05 and $0.70.
Stock Price Movement
Following the earnings release, Medifast's stock experienced a decline, with the share price decreasing by 2.84%.
This comprehensive report indicates that Medifast is currently undergoing a challenging period due to decreased productivity and a reduced number of active Coaches, but it is actively strategizing for a turnaround with a focus on new customer acquisition and expanding its market offerings.
