Executive Summary

Q4 revenue of $86.4M landed at the high end of guidance, gross margin expanded to 70.5% (highest since 2020), and Adjusted EBITDA of $8.7M beat guidance; GAAP net loss of $(34.6)M included a $20.0M goodwill impairment, implying net loss ex-impairment of $(14.6)M, ahead of the prior loss guide .
2024 marked the fifth straight quarter of positive Adjusted EBITDA and a return to positive operating cash flow, reflecting the pivot to a single-level affiliate model and materially reduced cost structure; FY24 Adjusted EBITDA was $28.3M and cash from operations was $2.6M .
Q1 2025 outlook: revenue $60–$70M and Adjusted EBITDA $(2)$M–$2M; management frames 2025 as a transition year with a new mix (≈60% digital / 40% nutrition) and long-term gross margin targets of ~85% for digital and ~50% for nutrition .
Potential stock reaction catalysts: meaningful EBITDA beat vs guidance and strong consolidated/digital margins vs ongoing headwinds from subscriber declines and an impairment-driven GAAP loss; near-term guide reflects transition and could weigh until omnichannel and retail ramp become evident .

What Went Well and What Went Wrong

What Went Well
- Gross margin strength: consolidated GM reached 70.5% (+830 bps YoY), driven by lower content amortization and depreciation as legacy assets reached end of life; digital GM hit 85.9% in Q4 .
- Profitability progress: Q4 Adjusted EBITDA of $8.7M (vs guide $2–$6M) marked the fifth consecutive positive quarter; FY24 Adjusted EBITDA $28.3M and positive operating cash flow underscore a lower breakeven model .
- Channel expansion and product initiatives: Amazon momentum with subscribe-and-save, Walmart.com launch, HSA/FSA enablement via TruMed/Dr. B, telehealth partnership (Hello Alpha), and new programs including Belle Vitale and GLP‑1 Fitness Formula to broaden reach .
What Went Wrong
- Top-line pressure in transition: Q4 revenue declined 15% QoQ and 27% YoY; nutrition subs fell 29% QoQ and 44% YoY as legacy MLM-dependent activity rolled off faster than affiliate acquisition ramped .
- GAAP net loss driven by non-cash impairment: $(34.6)M included a $20.0M goodwill impairment; excluding the impairment, net loss was $(14.6)M, better than the loss implied by prior guidance but GAAP optics remain negative .
- Connected fitness continued to shrink: revenue of $1.2M with ~2.7k bikes delivered, reflecting the exit from connected fitness inventory and fewer units shipped YoY .

Financial Results

Quarterly P&L summary (oldest → newest)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($M)	$110.2	$102.2	$86.4
Gross Margin %	69.0%	67.0%	70.5%
Operating Expenses ($M)	$85.9	$81.8	$93.8
Operating Income (Loss) ($M)	$(9.5)	$(13.0)	$(32.9)
Net Income (Loss) ($M)	$(10.9)	$(12.0)	$(34.6)
Diluted EPS ($)	$(1.59)	$(1.75)	$(5.04)
Adjusted EBITDA ($M)	$4.9	$10.1	$8.7

Q4 2024 YoY comparison

Metric	Q4 2023	Q4 2024
Revenue ($M)	$119.0	$86.4
Gross Margin %	62.2% approximate (derived from 73.972/119.010)	70.5%
Operating Expenses ($M)	$134.3	$93.8
Operating Income (Loss) ($M)	$(60.4)	$(32.9)
Net Income (Loss) ($M)	$(65.0)	$(34.6)
Adjusted EBITDA ($M)	$2.8	$8.7

Segment revenue (oldest → newest)

Segment ($M)	Q2 2024	Q3 2024	Q4 2024
Digital	$58.8	$53.7	$50.4
Nutrition & Other	$50.1	$47.4	$34.8
Connected Fitness	$1.3	$1.1	$1.2
Total Revenue	$110.2	$102.2	$86.4

Key KPIs (oldest → newest)

KPI	Q2 2024	Q3 2024	Q4 2024
Digital Subscriptions (M)	1.15	1.11	1.07
Nutrition Subscriptions (M)	0.14	0.13	0.09
Total Subscriptions (M)	1.29	1.23	1.16
DAU/MAU (%)	31.9%	31.0%	30.7%
Total Streams (M)	22.7	20.9	18.2
Connected Fitness Units (K)	1.6	1.3	2.7
Digital GM % (quarter)	—	—	85.9%
Nutrition GM % (quarter)	—	—	52.3%

Q4 2024 vs Q4 2024 Prior Guidance (issued 11/12/24)

Metric	Prior Guidance (Q4’24)	Actual Q4’24	Result
Revenue ($M)	$77–$87	$86.4	At high end
Net Loss ($M, GAAP)	$(21)–$(17)	$(34.6)	Below (goodwill impairment)
Net Loss ex Goodwill Impairment ($M)	N/A	$(14.6) (excl. $20M impairment)	Better than prior loss guide
Adjusted EBITDA ($M)	$2–$6	$8.7	Beat

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($M)	Q1 2025	N/A	$60–$70	New outlook
Net Loss ($M, GAAP)	Q1 2025	N/A	$(11)–$(7)	New outlook
Adjusted EBITDA ($M)	Q1 2025	N/A	$(2)–$2	New outlook
Mix (Digital / Nutrition)	Forward model	N/A	≈60% / 40%	Strategic reset
Gross Margin Targets	Forward model	N/A	Digital ~85%, Nutrition ~50%	Target ranges

Earnings Call Themes & Trends

Topic	Q2 2024 (Prior)	Q3 2024 (Prior)	Q4 2024 (Current)	Trend
Business model	Focus on lowering breakeven and nutrition-led growth	Announced pivot from MLM to single-level affiliate, omnichannel strategy	Early-stage execution; 2025 framed as transition year	Transformational shift progressing
Margins	Overall GM 69% (best since 2021)	GM 67%	GM 70.5%; digital GM 85.9%; nutrition GM 52.3%	Improving, mix- and cost-driven
Nutrition expansion	Strategy to recapture nutrition opportunity	Affiliate model to enable more channels	Amazon subscribe-and-save, Walmart.com live, retail roadmap, T90X/Insanity nutrition pipeline	Broadening distribution
Product highlights	N/A	Teased Belle Vitale	Belle Vitale launched, GLP‑1 Fitness Formula introduced; more programs coming	Building portfolio
Partnerships	N/A	N/A	HSA/FSA enablement (TruMed/Dr. B), Hello Alpha telehealth partnership	Expanding ecosystem
Connected fitness	Ongoing decline	Exit signaled via inventory adjustments	Minimal revenue; ceasing connected fitness inventory sales in early 2025	De-emphasized
Operating model	Breakeven lowered materially	OpEx reductions; restructuring underway	Continued cost actions; impairment and accelerated depreciation from Pivot	Leaner, reset cost base

Management Commentary

“2024 was a pivotal year at BODi…rearchitecting the company from a Multi-Level Marketing network to a single level affiliate model…layed the foundation to execute the next phase of our turnaround… and continue to generate positive operating cash flow.” — Carl Daikeler, CEO .
“Adjusted EBITDA of $8.7 million significantly exceeded our guidance range…fifth consecutive quarter of positive adjusted EBITDA…cash flow from operations of $2.6 million for 2024.” — Mark Goldston, Executive Chairman .
“The transition…was primarily driven by the need to reduce the unsustainable overhead costs associated with the operation of an MLM…nutrition revenue decreased 26.6% sequentially…nutrition subscriptions declined 29.2% sequentially.” — Brad Ramberg, Interim CFO .
“We’re seeing continued success with Amazon…launched on walmart.com in February…we believe retail will be a major opportunity in 2025–2026.” — Carl Daikeler & Mark Goldston .
“We expect revenues to approximate 60% digital and 40% nutrition moving forward…digital gross margin ~85% and nutrition ~50%.” — Brad Ramberg .

Q&A Highlights

Affiliate transition: Initial conversion from legacy sellers met expectations, but new affiliate additions slower than desired; initiatives slated for late spring/summer to accelerate, including activating customer base and external affiliates .
Modeling the new P&L: Management emphasized uncertainty in quarterly indexing for 2025 given the new model; reiterated mix (~60/40) and gross margin targets (85%/50%) as anchors .
Sequential step-down into Q1: Primarily attributable to exiting the MLM model and associated seller attrition; DTC, Amazon and eventual retail to become larger contributors over time .
Nutrition trajectory: Early signs of returning and new nutrition subscribers via DTC and marketplaces; retail formulations under P90X/Insanity brands targeted for late 2025/2026 .
Channel synergy and cannibalization: Direct performance marketing is expected to provide “air cover” for affiliates, enabling promo-code activation rather than cannibalizing sales .

Estimates Context

Wall Street consensus (S&P Global) for Q2–Q4 2024 was unavailable for BODI at the time of this analysis; as a result, we benchmarked results primarily versus the company’s previously issued guidance for Q4 2024 and discussed qualitative variance drivers .

Key Takeaways for Investors

Q4 quality beat on profitability: Adjusted EBITDA beat guidance and gross margin hit 70.5%, reflecting structural improvements (lower content amortization/depreciation, disciplined spending) and stronger digital economics .
GAAP optics vs underlying trend: Reported net loss was impacted by a $20M non-cash goodwill impairment; ex-impairment, Q4 net loss improved vs prior guidance, aligning with the EBITDA beat .
Transition headwinds near term: Sequential and YoY declines in revenue and nutrition subs reflect the pivot away from MLM; Q1 guide embeds continued pressure as affiliate and omnichannel ramp takes time .
Medium-term upside from omnichannel: Amazon strength, Walmart.com launch, HSA/FSA enablement, Hello Alpha telehealth, and a retail roadmap under recognized brands (P90X/Insanity) represent incremental demand levers for 2H25/2026 .
Margin framework supports cash generation: Forward mix and margin targets (digital ~85%, nutrition ~50%) plus reduced breakeven underpin continued positive Adjusted EBITDA potential as top-line stabilizes .
Watch KPIs for inflection: Affiliate additions, nutrition subs stabilization, DTC conversion and subscribe-and-save growth, plus DAU/MAU and streaming trends will signal traction in the new model .
Risk factors: Execution risk in affiliate ramp and retail rollout; lingering subscription erosion; sensitivity to media efficiency and competitive pressure in both digital fitness and nutrition .

Additional Data Detail (for reference)

Selected Q4 operating details:

Digital revenue $50.4M (–6.2% QoQ; –21.4% YoY); digital subs 1.07M (–3.4% QoQ; –19.1% YoY); digital GM 85.9% .
Nutrition revenue $34.8M (–26.6% QoQ; –32.8% YoY); nutrition subs 0.09M (–29.2% QoQ; –44.1% YoY); nutrition GM 52.3% .
Connected fitness revenue $1.2M; ~2.7k bikes delivered; early 2025 exit from connected fitness inventory .
Pivot-related costs in Q4 totaled ~$9.3M (accelerated depreciation ~$8.2M; termination/retention ~$1.1M) .

Outlook:

Q1 2025: revenue $60–$70M; net loss $(11)–$(7)M; Adjusted EBITDA $(2)–$2M; mix ~60% digital / 40% nutrition; GM targets ~85%/50% .

All cited figures are from company filings and the Q4 2024 earnings materials as referenced above.

Beachbody Company, Inc. (BODI)·Q4 2024 Earnings Summary