Publicly traded subscription health and wellness company BODi, formerly known as the Beachbody Company, reported fourth quarter 2022 revenue of $148.2 million and full-year revenue of $692.2 million, both of which were decreases from the same periods in 2021.
Fourth quarter revenue was down 31 percent while full-year revenue was down 21 percent.
Fourth Quarter 2022 Results
BODi’s revenue is broken into three categories. Its digital revenue decreased 16 percent to $68.7 million and digital subscriptions decreased 23 percent to 2 million. Nutrition and Other revenue decreased 23 percent to $74.7 million and nutritional subscriptions decreased by 27 percent to 0.22 million. Connected Fitness revenue decreased 87 percent to $4.8 million and approximately 3,700 bikes were delivered in the fourth quarter.
Operating loss improved by $115.7 million to $48.1 million compared to an operating loss of $163.8 in the prior year period. Net loss was $44.9 million compared to a net loss of $146 million in the prior year period. Adjusted EBITDA was $3.5 million compared to ($26.6) million in the prior year period.
Cash used in operating activities was ($10.3) million compared to ($75.9) million in the prior year period, and cash used in investing activities was ($3.3) million compared to ($16.9) million in the prior year period. Total cash used in operating and investing activities was ($13.6) million compared to ($92.8) million in the prior year period.
Full-Year 2022 Results
For full-year 2022, BODi reported that digital revenue decreased 18 percent to $300.7 million. Nutrition and Other revenue decreased 24 percent to $353.3 million. Connected Fitness revenue decreased 11 percent to $38.2 million.
Operating loss improved by $94.1 million to $203.2 million compared to an operating loss of $297.3 million in 2021. Net loss was $194.2 million compared to a net loss of $228.4 million in 2021. Adjusted EBITDA was ($23.3) million compared to ($86.1) million in 2021.
Cash used in operating activities was ($47.2) million compared to ($215.2) million in 2021, and cash used in investing activities was ($26.5) million compared to ($125.2) million in 2021. Total cash used in operating and investing activities was ($73.7) million compared to ($340.4) million in 2021.
Cash and cash equivalents decreased 23 percent to $80.1 million compared to the prior year period.
First Quarter 2023 Outlook
The company did not share a full-year 2023 outlook, but for first quarter 2023, the company expects total revenue of $135 million to $140 million and adjusted EBITDA loss of $3 million to $6 million
On a call with analysts, BODi Co-founder, Chairman and CEO Carl D. Daikeler said that he was confident the company is on the path to consistent adjusted EBITDA profitability by fourth quarter 2023. With a 2022 debt raise, he doesn’t foresee any additional need for capital, he added.
More Insights on 2022 Changes
The company met or exceeded guidance in all four quarters of 2022, and it completed its One Brand strategy announced one year ago.The One Brand strategy involved consolidating the business into one platform to focus capital allocation and centralize all its technology, marketing and content investment, Daikeler said. In July, the company initiated the migration of the Openfit platform, content and subscribers into the Beachbody On Demand platform and began engineering the consolidation of the Beachbody On Demand subscription together with its premium BODi subscription.“I'm proud to report that work was completed on time and under budget just a couple of weeks ago, and we're now launching the world's first complete Health Esteem platform under the BODi brand with the greatest digital fitness catalog in the business and a stream of compelling new content every month, a full nutrition section with two incredibly popular eating programs and over 1,000 healthy recipes, plus a brand-new positive mindset channel to help our subscribers feel great about themselves in all shapes and sizes,” Daikeler said.
The company also reduced costs during the year, “aligning headcount, technology and production spend with the business plan” while reducing its nutrition SKUs and key bundle configurations known as Total-Solution Packs from 190 variances down to five.
The rebranding of the company to BODi came after a year of research on how to fill a void in the industry.
“The majority of consumers are rejecting the premise of the legacy fitness and nutrition business that runs a playbook convincing prospects that they aren't good enough until they lose the weight or get a six pack,” Daikeler said.
The company discovered a gap in the industry when two of its 2022 launches — the Four-Week Gut Protocol and the Fire and Flow program — surpassed expectations. These programs focused on how people felt while doing the programs rather than results achieved at the end, he said.
“It became clear to us that our transformation model of P90X and INSANITY could be significantly complemented by an ongoing plan that focuses on how people feel today, so they stay engaged in the process and appreciate their sense of well-being along the way,” he said. “This represents a significant business opportunity for us because the data is clear that the legacy industry is failing at this.”
He cited research that shows overall happiness has declined over the last 49 years, while obesity rates and lifestyle diseases have increased.
“The legacy industry has concentrated its efforts on convincing prospects of their faults to motivate them to buy, to buy that treadmill, join that gym,” he said. “And it's primarily retraining the same cohort of people who move from one solution to the next over and over, trying to find happiness.”
With this knowledge, the company launched its Health Esteem category, which it noted along with the rebranding.
Other initiatives include consolidating its subscription tiers of BOD and BODi into one bundle called BODi for an annual subscription price of $179 for access to its library of 120 fitness programs or over 8,500 on-demand videos.
The company also launched an ongoing series of four new workout plans each month called BODi Blocks. These are new three-week programs starting the first Monday of every month, serving beginners, general overall fitness, lifting and a specific plan each month for its connected bike subscribers.
The BODi Block is for people looking for an alternative to joining a gym or hiring a personal trainer. Our partners use that monthly cadence of new BODi Blocks to start a new wave of subscribers every month rather than only when a new program is launched, which was the trend of our old model.The company also added positive mindset master classes to its platform, which should help with retention, Daikeler said.
In addition, the company is positioning its shake supplements, Shakeology, as a dessert alternative and offering hundreds of recipes using the product line.
The name change is perhaps the most visible of the rebranding initiatives.
“We feel strongly that the Beachbody name was poorly aligned with our mission and holding them back from expanding their market,” Daikeler said. “I can confidently add that our BODi Partners are extremely enthusiastic about these initiatives, including the name change, the simplicity, the price points and especially the addition of positive mindset content to the platform. They're engaged and have been promoting aggressively since the March 2 launch.”