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WI

WW INTERNATIONAL, INC. (WW)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 Combined Revenues were $189.2M, down 6% year over year, with Clinical revenue up 55% and Behavioral down 13%; Adjusted gross margin expanded to 75.9% on disciplined costs and mix shift .
  • The company completed its strategic reorganization on June 24, reducing debt by ~$1.15B (>70%), establishing new $465M term loans due 2030, and expects ~$50M annual interest savings to support growth initiatives .
  • FY 2025 guidance introduced: Total Combined Revenues $685–$700M and Adjusted EBITDA $140–$150M; depreciation and amortization expected to be ~$50M in H2 2025 due to fresh start accounting .
  • Results materially beat S&P Global consensus: Q2 revenue $189.2M vs $178.0M*, EPS $0.69 vs -$0.03*, and EBITDA $70.1M vs $29.8M*, driven by clinical momentum and cost discipline; subscriber declines and the GLP‑1 compounding transition remain headwinds .
  • Management emphasized stabilizing Behavioral acquisition, fully transitioning to FDA‑approved medications, and reinvesting in the brand and member experience—key near‑term stock catalysts hinge on H2 marketing ramp and B2B/partner traction .

What Went Well and What Went Wrong

What Went Well

  • Clinical momentum: Combined Clinical Subscription Revenues rose 55% YoY to $30.6M, lifting ARPU and margins .
  • Cost discipline and margin expansion: Adjusted gross margin reached 75.9% (Combined Q2), and Adjusted EBITDA margins remained strong amid reduced marketing during reorganization .
  • Balance sheet reset: Debt cut by ~$1.15B, new term loans due 2030, cash and equivalents of $152M at quarter‑end; ~$50M annual interest savings expected to enable reinvestment .

Management quotes:

  • “This marks the beginning of an exciting new chapter… With greater flexibility to invest, we’re accelerating innovation across our platform…” — CEO Tara Comonte .
  • “With a strengthened capital structure, we are better positioned to invest in growth, support innovation, and scale efficiently…” — CFO Felicia DellaFortuna .

What Went Wrong

  • Behavioral weakness and subscriber declines: Combined End of Period Subscribers fell 17% YoY to 3.167M (Behavioral -19%), reflecting recruitment challenges and reorg headlines .
  • Transition headwinds: From May 22, Clinical subscribers began shifting from compounded semaglutide to FDA‑approved meds, pressuring acquisition versus competitors still offering compounded GLP‑1s .
  • Marketing pullback timing: Intentional Q2 marketing reductions to prioritize efficient spend create lag effects on revenue due to subscription billing dynamics .

Financial Results

MetricQ4 2024Q1 2025Q2 2025 (Combined)
Revenues ($USD Millions)$184.4 $186.6 $189.2
Diluted EPS ($USD)$0.31 -$0.91 $0.69*
Gross Margin % (GAAP)69.7% 71.2% 73.2% (Successor) / 73.7% (Predecessor)
Adjusted Gross Margin %69.1% 71.0% 75.9%
Adjusted EBITDA/EBITDAS ($USD Millions)$50.4 (EBITDAS) $26.9 (EBITDAS) $65–66 Combined: $4.4 (Successor) + $60.8 (Predecessor)
Adjusted EBITDA/EBITDAS Margin %27.4% 14.4% 34.4% (Predecessor) / 36.6% (Successor)

Note: Q2 EPS shown per S&P Global; Successor/Predecessor EPS reported in the 8‑K are $0.13 and $14.67 respectively, which are not directly comparable due to fresh start accounting .
Values with * are retrieved from S&P Global.

Segment breakdown (Q2 2025 Combined):

SegmentQ2 2025 ($USD Millions)
Behavioral Subscription Revenues$157.3
Clinical Subscription Revenues$30.6
Other Revenues$1.3
Total Revenues$189.2

KPIs:

KPIQ4 2024Q1 2025Q2 2025
End of Period Subscribers (Total, Millions)3.336 3.434 3.167
End of Period Behavioral (Millions)3.079 (Digital) + 0.503 (Workshops+Digital) = 3.582; Behavioral total reported separately in Q1/Q23.299 Behavioral 3.040 Behavioral
End of Period Clinical (Thousands)92 135 127
Monthly ARPU (Total, $)$16.99 (Q4) $18.74 (Q1, Constant Currency) $18.97
Monthly ARPU Behavioral ($)$15.66 (Q4) $16.30 (Q1, Constant Currency) $16.54
Monthly ARPU Clinical ($)$78.37 (Q4) $85.01 (YTD; ref. combined) $78.00

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total Combined Revenues ($USD)FY 2025Not provided (Q4’24 and Q1’25) $685–$700M Introduced
Adjusted EBITDA ($USD)FY 2025Not provided (Q4’24 and Q1’25) $140–$150M Introduced
Depreciation & Amortization ($USD)H2 2025N/A~$50M (majority in SG&A) New disclosure

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Clinical GLP‑1 transitionClinical momentum; expansion of telehealth Sequence (Q4) Ceased compounded semaglutide on May 22; pharmacy integrations with LillyDirect/CenterWell; seamless access to FDA‑approved meds Transition compliance; building branded pathways
Member experience & communityBrand revitalization, operational excellence (Q1) Unified, personalized experience; data/AI and wearables; Julie Rice appointed Chief Experience Officer; Peoplehood integration Expanding scope and leadership
Marketing & acquisitionCost savings, efficiency (Q4/Q1) Intentional Q2 reduction; lag effect on revenue; ramp expected H2 Re‑accelerate H2
B2B/partnershipsLimited in prior callsUHC Hub, Florida DOH pilots; UK CheqUp partnership for GLP‑1 Companion Building channel diversification
AI/technologyNot emphasizedAI‑enabled insurance navigation; ML personalization; improved scalability Increasingly core enabler
Regulatory/legalBankruptcy process and plan (May–June) FDA guidance compliance; competitive risks from compounded GLP‑1 offerings by others Compliance maintained; competitive differentiation

Management Commentary

  • Strategic reset and opportunity: “No company is better positioned… grounded in stronger financial footing… accelerating innovation across our platform” — CEO Tara Comonte .
  • Financial discipline: “Immediate priority is stabilizing the business… invest in growth… drive long‑term profitability” — CFO Felicia DellaFortuna .
  • Outlook framing: Reorg complete, $152M cash on hand; focus on stabilization and foundation for long‑term profitable growth .
  • Clinical integrity: Emphasized cessation of compounded semaglutide and partnerships to ensure access to FDA‑approved meds .

Q&A Highlights

  • Competitive dynamics in GLP‑1: Management reiterated full compliance (ending compounded semaglutide) and reliance on pharmacy integrations/insurance navigation to offset near‑term headwinds and drive sustainable outcomes .
  • Member experience reinvention: Discussion of unified, AI‑enhanced product experience and expanded virtual formats; Julie Rice’s role to reimagine community/coaching .
  • Marketing cadence: Clarified Q2 pullback and H2 ramp; lagging revenue response explained by subscription model .
  • B2B pipeline: Updates on UHC and Florida DOH engagements and international partnerships to diversify acquisition channels .

Estimates Context

MetricQ4 2024Q1 2025Q2 2025
Revenue Consensus Mean ($USD)$173.2M*$180.3M*$178.0M*
Revenue Actual ($USD)$184.4M $186.6M $189.2M
Primary EPS Consensus Mean ($USD)N/AN/A-$0.03*
Primary EPS Actual ($USD)$0.31 -$0.91 $0.69*
EBITDA Consensus Mean ($USD)$46.4M*$4.1M*$29.8M*
EBITDA Actual ($USD)$24.7M (EBITDA) $16.5M (EBITDA) $70.1M (EBITDA)

Values with * are retrieved from S&P Global.
Note: Company disclosure for Q4/Q1 frequently uses EBITDAS/Adjusted EBITDAS; S&P EBITDA actuals shown above follow a consistent definition across periods .

Implication: The quarter delivered broad beats versus consensus across revenue, EPS, and EBITDA, aided by clinical growth and cost discipline; estimate revisions are likely to move up for EBITDA and margins, while revenue guidance ($685–$700M) may temper aggressive top‑line assumptions .

Key Takeaways for Investors

  • Balance sheet reset unlocks reinvestment: Debt reduced >70% and ~$50M annual interest savings provide capacity to re‑accelerate marketing and product roadmap; watch H2 acquisition trends and ARPU .
  • Clinical differentiation via compliance and access: Transition off compounded semaglutide and pharmacy integrations create durable, compliant access—key to sustainable growth vs. cash‑pay competitors .
  • Monitor Behavioral acquisition and subscriber trajectory: Combined End of Period Subscribers declined 17% YoY; H2 marketing ramp is critical to stabilize Behavioral base .
  • Margin story intact: Adjusted gross margin expansion to 75.9% reflects strong cost control and mix; sustaining margin while ramping acquisition is the execution swing factor .
  • Guidance introduced: FY 2025 revenue $685–$700M and Adjusted EBITDA $140–$150M frame the stabilization year; depreciation/amortization (~$50M in H2) will affect GAAP optics .
  • Partnerships/B2B optionality: UHC and Florida DOH engagements, UK CheqUp partnership broaden channels; track conversion and retention impact .
  • Near‑term trading setup: The beat vs consensus and guidance initiation are positives; investors should gauge H2 marketing efficacy, clinical transition attrition vs branded access, and subscriber trends for confirmation of stabilization .

Citations:
Press release and 8‑K exhibits: .
Prior quarters: .
Earnings call transcript: .
Reorganization announcements: .

Values retrieved from S&P Global where indicated.