Q2 2026 Beachbody Company, Inc Earnings Call Transcript
Key Points
- The Beachbody Co Inc (BODI) reported its fourth consecutive quarter of positive operating income and net income, with adjusted EBITDA of $6.7 million, exceeding guidance and marking the 11th consecutive quarter of positive adjusted EBITDA.
- The company achieved a fourth consecutive quarter of double-digit adjusted EBITDA margins (13.4%), demonstrating durable operational discipline.
- Retail expansion is gaining momentum, with Shakeology now in 131 Sprouts stores (up from 90) and 481 The Vitamin Shoppe locations, with reorders already occurring at Sprouts.
- The transition to the Shopify e-commerce platform was completed efficiently, providing improved visibility into the sales funnel and enabling faster checkout, better conversion, and flexible bundle/subscribe-and-save offers.
- The company is capitalizing on the GLP-1 trend by promoting 10-Minute BODi microdose workouts and Shakeology to this audience, which is driving demand and lowering customer acquisition costs.
- The P90X supplement line launched on Amazon, opening a new channel for brand awareness and trial, with products priced under $40 to better align with marketplace expectations.
- The company amended its credit agreement with Tiger Finance, reducing covenant restrictions and increasing cash cushion by $7 million, reflecting lender confidence in the turnaround.
- Nutritional subscriptions increased 16.7% sequentially to 70,000, and new digital subscribers increased year-over-year, indicating early traction in the nutrition-first strategy.
- The company is preparing for a Southern California test market for its new energy drink lineup (INSANITY Liquid Shock and P90X energy drink), with production underway and rollout expected in late Q3 or Q4.
- Upcoming product launches, including the INSANITY Unhinged program with Hunter McIntyre and the Max Built lifting program with Shaun T, are expected to drive engagement and sales in Q4 and Q1 2027.
- Total revenue decreased 22.4% year-over-year to $49.6 million, reflecting continued pressure from the transition away from the legacy MLM model.
- Digital subscriptions decreased 6.2% sequentially and 19.1% year-over-year to 760,000, with churn from the legacy customer base still impacting growth.
- Nutrition and other revenue decreased 23.7% year-over-year, and the company expects a shift to a larger percentage of nutrition revenue, which carries lower gross margins (42-45% vs. digital's 86-88%).
- Free cash flow was negative $5.7 million for the first half of 2026, primarily due to increased inventory purchases for retail rollouts and a decline in deferred revenue.
- The company's Q3 2026 guidance projects a potential net loss of up to $3 million, indicating that profitability may not be sustained in the near term.
- Retail expansion is subject to planogram reset timing, which can take 6-12 months, limiting near-term growth and making revenue from this channel unpredictable.
- The company faces execution risks with its new energy drink test market, which is still in early stages and may not yield immediate results.
- Selling and marketing expenses, while improved year-over-year, remain a significant cost, and the company is still optimizing its media allocation to balance efficiency and growth.
- The transition to Shopify, while beneficial, requires ongoing adjustments to landing pages and promotions, which may take time to fully optimize and could impact conversion rates in the short term.
- The company's reliance on the GLP-1 trend and nutrition-first strategy may be vulnerable to market shifts or increased competition in the weight loss and supplement space.
Thank you. Hello everyone. Thank you for joining us and welcome to The Beachbody Company, Inc. second quarter 2026 earnings conference call. (Operator Instructions)
I will now hand the conference over to Bruce Williams, Managing Director of ICR. Bruce, please go ahead.
Welcome everyone and thank you for joining us for our second quarter 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 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
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