Third Consecutive Quarter of Profitability
Net income of $2.3M in Q1 2026 (third consecutive quarter of net income) versus a net loss of $5.7M in Q1 2025; operating income of $3.1M (third consecutive quarter positive).
Beachbody Company
· BODI
May 12th, 2026
Summary
- Earnings Call Date:
- 2026-05-12
- Change Since:
- -25.17%
- Next Earnings Date:
- 2026-08-11
Earnings Call Sentiment
NeutralThe call balanced clear evidence of a successful financial turnaround (third consecutive quarters of net income and operating income, 10th consecutive positive adjusted EBITDA, a net cash position, large retail distribution agreements, and product/technology initiatives) against material near-term transition challenges (25% YoY revenue decline, notable subscription declines, nutrition margin pressures, negative free cash flow this quarter and lower sequential adjusted EBITDA). Management emphasized operating leverage, an omnichannel pivot toward nutrition, and concrete retail partnerships that are near-term catalysts, but execution and planogram/timing risks mean the company remains in a transformation phase with both encouraging operational momentum and meaningful short-term headwinds.
Company Guidance
For Q2 2026 the company guided revenue of $46.0–$51.0 million, net income of negative $3.0 million to breakeven, and adjusted EBITDA of $3.0–$6.0 million; they expect the quarter’s revenue mix to be roughly 60% digital and 40% Nutrition & Other, with digital gross margin targeted at 86%–88%, Nutrition & Other gross margin at 43%–47%, and consolidated gross margin of 69%–72% — management reiterated that Q2 should not be compared to Q2 2025 due to the legacy MLM tail and that Q3 will be the first clean year‑over‑year read.
Sustained Positive Adjusted EBITDA
Adjusted EBITDA of $8.0M in Q1 2026, marking the 10th consecutive quarter of positive adjusted EBITDA and up from $3.7M in the prior year period.
Strong Consolidated Gross Margin
Consolidated gross margin of 71.8% in Q1 2026, within guidance and up 60 basis points year-over-year (despite a sequential decline of 270 bps). Digital gross margin particularly strong at 87.4% (up 10 bps sequential; up 190 bps YoY).
Improved Financial Flexibility / Net Cash Position
Cash balance of $36.6M and outstanding debt principal approx. $25M as of March 31, 2026, resulting in a net cash position of ~$13.0M; cash balance up from $18.1M year-over-year.
Meaningful Operating Leverage Improvement
EBITDA breakeven reduced dramatically from over $900M in 2022 to approximately $180M currently, providing operating leverage to invest in growth initiatives while maintaining profitability.
Retail and Distribution Partnerships Announced
Shakeology secured retail distribution wins: more than 80 Sprouts stores initially, Vitamin Shoppe nationwide across ~640+ stores later this year, and partnership with KaHi (distribution network to ~30,000 grocery/supermarket/online channels).
Product and Channel Innovation
Launched P90X Generation Next and P90X supplement line (pre-workout, hydration, creatine, recovery protein, fast-acting energy) and planning P90X/Insanity energy drink test in Southern California (production ready July; expected on-shelf in Aug). Expanded 10-minute body catalog to 400+ workouts and $10/month subscription offering to broaden addressable market.
E-commerce Platform Migration Improving Conversion
Transition to Shopify (late March) and Shop Pay improved site conversion and checkout ease; management reports better conversion versus competitors and further optimization opportunities to raise AOV and conversion.
Operator
Good afternoon. Thank you for attending today's Beachbody Company, Inc. First Quarter 2026 Earnings Conference Call. My name is Elizabeth, and I will be your moderator for today's call. [Operator Instructions] I would now like to pass the conference over to your host, Bruce Williams, Managing Director of ICR. You may proceed, Bruce.
Bruce Williams
Welcome, everyone, and thank you for joining us for our first quarter earnings call. With me on the call today are Mark Goldston, Executive Chairman of Beachbody Company; Todd 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. Today's call will include references to non-GAAP financial measures such as adjusted EBITDA, net cash and free cash flow and 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.
Mark Goldston
Thanks very much, Bruce, and good afte...
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