May 6th, 2026

The call communicated a mixed picture: meaningful near-term financial headwinds with a 25.2% revenue decline, reduced profitability, and lower cash flow are offset by solid liquidity (no debt and $12.5M cash), active shareholder returns (buybacks and increased dividend), a newly granted patent, strategic acquisition (LoveBiome/P84), investments in Shopify and digital infrastructure, stronger field engagement initiatives (Momentum Academy and VIP program), and the appointment of an experienced incoming CEO. Management acknowledged recent underperformance and outlined concrete initiatives to restore growth and operational improvement.

Company Guidance

Management said it now expects to finish fiscal 2026 with revenue, adjusted EBITDA and adjusted diluted EPS close to the lower end of its previously issued guidance range; Q3 metrics included revenue of $43.7M (down 25.2% YoY), gross profit 79.0% (79.4% adjusted excluding a $183K MINDBODY allowance), adjusted EBITDA $3.2M (7.3% of revenue) versus $6.4M (11%) prior year, GAAP net income $1.4M ($0.11/diluted) and adjusted net income $1.5M ($0.12), commissions and incentive expense expected to be ~42.5% of revenue for the full year, SG&A $13.9M (31.7% of revenue), income tax $0.3M in Q3 with a fiscal 2026 effective tax rate guidance of ~18–20%, cash of $12.5M and no debt, cash from operations $5.5M for the first nine months (about $5M in Q3 and expected to be similar in Q4), capital expenditures $2.5M YTD with roughly $1M in the March quarter and near-term spend tied to the Shopify rollout before declining, $3.7M cash used for the LoveBiome acquisition, 206K shares repurchased for ~$1.0M in the quarter (250K/$1.6M YTD) with $59M remaining on a $60M buyback authorization, and a quarterly cash dividend of $0.05 per share (an 11% increase) payable 06/15/2026 to holders of record 06/01/2026.