Earnings call transcript Q1 2023

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Operator

Good day, and welcome to the WW International Incorporated First Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

I would now like to turn the conference over to Corey Kinger of Investor Relations. ahead. go Please

Corey Kinger

first progress. for some quarter everyone, on provide Eastern Company's today WW financial to well reporting for today, of as The Thank call results, details this conference joining general regarding call. a the first is our release press XXXX issued investors p.m. to XXXX At International's update results. we purpose with you, provide a us quarter further about as Time Company's XX:XX the

The available investor website are Investors of are measures Company's directly is on and press at also located as conference the available disclosed in press also release. measures Presentations website this the most corporate comparable release Events. call Company's GAAP the on non-GAAP the part Reconciliations on corporate.ww.com. financial the materials Supplemental under corporate of section available to

explained statements that These risks let and statements. to forward-looking of begin, various remind refer Investors me differ results that materially from detail be to we statements for aware today. such should more forward-looking filings to are those Before of call any Commission. with in and risks factors risk filings these in the Please discussion detailed discussed a and cause and could the that everyone will Securities the actual here contain forward-looking Company's subject Exchange statements. uncertainties are this uncertainties

otherwise. law, required a or or forward-looking Company of revise statements as as information, statements, and no by forward-looking whether new result future the All obligation are as publicly any made undertakes except of to events update today,

Stark, and CFO. are call CEO; today's Joining Sistani, Heather Sima

Sima. will turn to call I now the over

Sima Sistani

actions year our most for up impact. and be to we a our model, today. member is decisive one importantly, key will Corey. XXXX transformative positively afternoon, financial Watchers, us shape the Thanks, trajectory of joining product operating the Weight our future lives and everyone. experience, where you initiatives pivotal Good Thank for shaping and

of upcoming photos back for crowds I've celebrations the plan Jean of looking and founder, and reflecting upon her started years foundation our movement anniversary strong has longevity. excitement history XXth our been members We incredible at that stemmed ago, at and of been workshops. members, sense XX a of with of and from Madison enter we the Garden prey, Let community As Nidetch Square our a our company the and

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experience immediate It expand together Our and members so members be in-person more. experience, provide digital can much can support members and coaches. and ways, reach connectivity can it with enhance and the and people in better enabling inspiration bring between our new

standard that and best years Watchers and our XX The row. XX a last US gold Weight in one our for the love number ranking a members of experience program is years millions with News that works, World know loss Report, members, and weight diet as of

go. in trust where space earned new and come have We a entrants

solid such that into science-backed including new for building as best-in-class the foundation pathways turning are experiences We clinical. future,

sign our our at This to above approaching year had XXX,XXX the March in from just net slightly additions guidance the step-up a subscribers, XXX,XXX up more additions the first million million quarter. X forecast. quarter-over-quarter the is year-end. nearly of Turning subscribers, This million, X We X.X of subs net we with quarter represents ago than ended first over quarter as of exceeded results. as our

with working first XX% versus less marketing improved our new this we are that efficient approach the accomplished net with demonstrates Importantly, $XX reiterate, year This spend to less acquisition. prior million programs achieved more marketing our was and spend. quarter. To marketing and addition driving

coming revenues results in resulted cost growth and subscriber our operating discipline beating adjusted than in income with in forecast flowed guidance. higher outperformance greater into combined This

digital to business and utilizing improving We This our and the the engagement better results more operate, forecasting. activation throughout culture making product company ways aorta CAC data we more data-informed agile are is from predictable. to from financial LTV

activation a their progress trending program far defined the member's X% between has month first Our on rate, and in been XXXX. by engagement to so up X% during year-over-year

over turn matters because of and reminder, non-activated a As on member a is Weight a rate more activation roughly rate at Watchers activated half successful the members long-term. are that

this a key is organization. metric focus upward across our So, driving entire

holding programs in sustainability our to rate improvement year-over-year the working. we changes The made product this of are the and have activation demonstrates that

activation our turned month, entire that has positive in In trending been measured X% rate, our addition X% our year-over-year, has is indication only engagement are is members. rate, measured which membership base, between and first which further our to our up updates a to working for member's product across

a current first-month member's roadmap our member on and retention resultingly product as discussed, decisions digital food community success. and As activation is and focused creating by subscriber measured enabling

One has the rollout of expanding Chat recently beta, we in in iterating, forward features, and look key ahead. and learning, launched the Member months its to

your will them wish bring relationships allowing network, members, they enriching if groups, to coaches about, excited believe foundational existing your to members for Chat are along create workshop members other, with with journey. We be our you community, even people each digital in

app, management better and their will including in between activity which members like will core to tab as see be XXXX food, connection to tracking dedicated members' behaviors trends, allowing support space and and streamlined a relates progress in help weight progress. to Eat eating What coming and weight our the to Also spaces new decisions it

experience, coach better our life digitally. them members with improve as well as for help to engage will platform that in we our new coaches real a launch plan to And

has science-backed Weight waste global of our brand maintain Watchers innovation sustainable the to as The because of longevity sustained leader management. in ongoing position

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that reframed Sigma their coining space. the Health a be Health new Health With and Weight conditions, should our around standards improved the or reduced we mind, in Mental and of accessibility Similar Weight of future Health. conversation to believe Heart are term, we care, how chronic

this stigmatizing focused on to accessible obesity achievable and weight leading solutions and are change and in demystifying making the need. We and management more evidence-based those

genetic, the beating. behavioral environmental degree Health well an cardiovascular individual. ultimate health, the is factors goal high hormonal, impacted the affects from well-being quality living and unique biologicals, metabolic result Wealth and chronic to Weight of aims to of Health individual's with weight which that Weight by is each to life. body Type cholesterol, fat, disease and health better the improving and prevent excess including diseases manage X and diabetes, healthy

be Health about an Sequence. acquisition with to impact captured pillars attention excitement doing with through Weight and as of synonymous opportunity outcomes. to our health Watchers ahead significant intervention, coaching, improved delivering Health generated that business accountability our of community Weekend the of through Weight This will brings we lives me which share and many evidence-based announcement excitement, lot a more

ongoing online and platform our and to management space. Sequence prescription technology offering integrates clinical with clinician access patient providing into experience, is jump-starting clinical members entry digital to for clinical care medication access Sequence’s eligible a the medication, weight product platform weight subscription health management.

carefully driving business, momentum for satisfaction continue expectations year, experience scaling we exceeds high-quality taking high opportunity the is believe to we with approach the growth integration importantly, ensure differentiated and a this significant. both of balancing this Sequence to that deliver acquisition. But a are strong strongly We and continued efficient growth thoughtful while to member stickiness multiyear

Watchers is market been the to the into month, those survey positively. Conversation around we GLP-Xs Weight research In this customer widespread, scientific our build has is And Weight acquisition an and Encouragingly, clinical sense news conducted a now demographic positively XX% Health. Watchers of last Weight them believe more have position think our we surveys keeping and up with with the made entrance of core latest in upon Watchers. announcement. viewing XX% our opportunity about Weight

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Our communication critical. is

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medication, Their are to insurance coordination our clinical access on for program GLP-X and these medications. a people expectations living designed top three for programs

differentiated delivering needs We a across each. expand experience are to and on more focused these on

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-- insurance are people. Second, medical and for covered a expensive therefore, is coordination that not prevailing about widely by they concern are insurance most GLP-X prohibitively

on previously to in pre-authorization pain for are increasingly actively arrow prone health those professionals. and point all a at covered known slow, and covered highly who medical not While plans, are insurance who some and they process a and The change participating program. have behavior qualified manual, medically be level for is frequent patients

this of approvals. adding on designed nutrition, an insurance and thoroughness these process, insurance put specifically of coaching, third, and to people much fitness accuracy, streamline lifestyle living And on medications. tech has Sequence a speed program encompassing process rails for

vertical, we distinct this change for and As behavior build be program creating out we learning member a and integrate this journey. will

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support key From sustainable against can food journeys loss, a there Watchers to areas healthy, done are where several provide muscle prioritizing and Weight members nutrient are in to loss guidance way. weight dense ensure managing

experience those a will add believe these well-designed value we to taking Finally, community medications.

clinical top appreciate they of to interviews compare from community to for While the know people of notes. members up a weight medications learn driver we and isn't would using that people -- from for community solution management sign a

a principal forward our community we for our for in people creating for robust members. what we experience they and all stay community, look to loss, program, to come but see Similar weight

We platform create science with a on come will more nutrition pairing in behavioral solution, develop they as the plans and ahead. to expertise and our comprehensive the community be Weight Watchers, to sequence quarters

I in my further by confidence we underway our that increases am are XXXX, working. only the have which initiatives early encouraged results

strong exercising on returning of to into which -- discipline member management. year, clinical the half the trends executing drive We a entrance be gains our list and interventions improving and sign-up retention, activation, of on year-over-year for continue narrow of focused improving our to objectives, cost second waste the sign for growth, throughout and organization, would including

am to to me the the team. organization. continuing I Chief look Her Before of Watchers Since appointed December, our operational, been forecasting, leadership update, been at Stark incredible taking has her position. elevated in role change been navigating announce finance, asset with and have partner in forward I Weight that Weight Heather financial years to an XX on work has including this Financial a teams to Watchers. tremendous Heather in experience, this managing pleased Officer and entire interim to

over will strategic then will to I the our now further Heather priorities discuss call come and back XXXX. for to turn

Heather Stark

at on a taking of company Weight the of of the part in at Thanks, Chief impacts Financial rest leadership of the be Sima Sima. Watchers. to the millions I with team our role being lives It's positively work stage way. this Officer a rare look work such I'm continuing to important that to personal to company's transformation. and and next forward honored and

with cancel our results. the and We QX outperforming in forecast slightly subscribers ended four to our Turning million quarter quarter. with first sign-ups both

ago nearly step-up As is XXX,XXX in Sima a first quarter-over-quarter year of the nearly step-up $XXX,XXX which is this the subscribers, $XXX,XXX than of quarter. approximately increase mentioned, of a more

on our XX% slightly versus to $XXX of million, but as the primarily which due currency constant a well the levels as XX% year-over-year down subscriber totaled products our is down basis forecast, Revenue the the year, period, prior entering business. consumer year or planned above lower scale

mix overdrive business, for gross year, digital to quarter. beat down our the versus of from our resulting with margin revenue deleverage, higher was for a shift savings, was Adjusted year-over-year decline cost the primarily The consumer as XX.X% prior guidance. quarter points basis and as product bundles in from XXX due a promotional accounting the well on in subscription the margin

advertising TV to to performance were lower spend value million year-over-year, $XX we approach of down LTV and expenses member cost reflecting our with efficiency. customer lower strong drive nonworking subscription CAC, and acquisition optimize acquisition on as Marketing lifetime XX% spends marketing

of discipline, our the in million G&A versus an by and adjusted costs from $XX actions XX% partially our loss quarter, had savings down Adjusted restructuring operating million Sequence offset $X the year, related million to prior was reflecting first in beating acquisition. the overall expense expectations. of $X We

$XX totaled in quarter. charges Restructuring million the

we announced, our are lines the organizational structure, further our and rationalizing portfolio. estate non-strategic certain continuing in XXXX, As centralizing previously and rebalancing streamlining of real business

the tax expense XXXX items high and and rate the impacting per valuation negative in which share year including the reflected reflected was tax the $X.XX, Income impact effective restructuring of small driven of negative million, pre-tax allowance. were unusually net company's full a loss by in $XX fiscal net charges valuation of $X.XX QX comparability, incorporates GAAP which annual guidance. XXXX an loss impact allowance

Sequence. to Turning

As Sequence’s be quarter's acquisition our of the announcement grown reflected serve results next platform in XXXX, since late its April company effectively mouth. scaling of word it through on US We so launched March, closed XX, has thousands in to across at will technology discussed the by report. quickly of the our in the early time earnings we members starting

At as closing, they $XX pay consultation initially $XX they approximately are subscribe plan thereafter. subscriber. this members. time, begin a month Only Sequence monthly new XX,XXX should per counted they after members Sequence And a qualify fee. $XX treatment, At accept the and for to had

opportunity of greater a bit scale. business. our operating so annualized income north on workshops basis, than are modestly revenue XX%, significant is levels, but the better Sequence upside an per business upon in current margins those Gross at And achieving profitable has

are After by accretive per is expenses quarter. acquisition earnings the to behind fourth WW's transaction us, share expected the to be

the integrate its truly significant. growth continue will up to trajectory scale expected and offering. we believe is multiyear XXXX, Sequence to That opportunity in said, is take this it While growth time strongly

We expect operating streamlined acquisition, we member upcoming and principal to from year business performance deliver following Watchers enhanced experience, on Weight trends our the our an through improve product launches in approach operations our benefit to as we our road from member to data-informed as increased efficiency map.

acquisition Sequence starting will in reflected QX. In our addition, the be results in

driving LTV to redeploy plan better savings, QX, for CAC efficiency, our more spend. primarily year-over-year sign-ups We QX can to marketing dollar maximize into where essentially we

timing year-over-year help shifting sign-ups in We of QX. the are will confident that this investment drive

expect including For subscribers, approach end for with flat XXXX. flat year ended to last the year, we or year we subscribers the expected the subscribers, The year-over-year are Weight subscribers X.X with Watchers Sequence subscribers, full excluding roughly Sequence to higher was to million. XXXX, total year-end time clinical

a and and be achievement our So experience this the delivering product our work will testament in notable to channels. are acquisition teams a

of a QX reminder, and XX% decline with peak is subscribers, QX sloping our over a past As average years. an five traditionally annual to end-of-period the trough

to QX represents with from decline of of a XX% QX a ending decline in subscribers, XX%, significantly X.X improved year XXXX. of outlook million the Our only

is in $XXX year. revenue to the in a treatment through period of resulting on of be XX% million long-term expected in week are currently but reduced rate of in XX the subscription reflecting average to LTV. joining subscribers declines million, subscribers ranges from $XXX per reducing year for membership, our revenue Approximately year-over-year which one longer months the we as lock anywhere range offers the Full higher their in offer. the paid to These depending duration, move

nine-month product Consumer previous our revenues XX% year plan, up and XXXX. other expect total only XX% best-selling off ago, longer or for In sign-ups now a million XX% up notably, and sign-ups and most our during are than lower plan, in which to approximately from as a longer simplify chose year We $XX contribute consumer And QX, of ago. a on focus is business six-month from about Products global our a estimates, we approximately or XX% offerings SKUs. our

year, are reduce contribute XX% million Sequence from expected from to be to Revenues of base. aggregate. in in gross $XX we the the margin to to is full Adjusted fixed range cost as QX continue expected for QX our XX% currently to

cost Our on million reduce in-year the expected organization. $XX our worktop million reinvestments approximately of approximately basis, in savings, is by with structure restructuring to annualized $XX excluding an

recorded million be including with $XX We marketing expected also in expect at the million. year. the related is XXXX be This up to be we year $XXX plus the full the restructuring Therefore, expense charges estimate full that will to $XX $XXX in adjusted expect the to in year costs, G&A spend range million approximately flat we operating $X $XX G&A for remaining XXXX to approximately approximately includes to $X plan $XX million XXXX. of income million million QX. sequence million. million the transaction for We in

of tax For to approximately year, of by $XX be restructuring, loans the full excluding full million, we income discussed the impact expect impact expense the to earlier. largely year valuation $XX driven million

tax business, seasonal QX reverse pre-tax to the XXXX nature expect income. fiscal we expense expected is when of of to in the our principal quarters income earn Given our largely remaining

the impact benefit the an to excluding tax allowance full million we expect for of So income of would valuation year. restructuring, up $X the and

significant pre-tax small or the impact to full XXXX expected any income expense pre-tax reflected in quarterly the fiscal guidance, income the results. loss loss can updates company's year tax tax in result Given in

assumption Sequence and Turning of liquidity cash facility, in cash use our position cash and flows. operations our more a modest QX, will credit approximately the actions, $XX our to and approximately related cash needs, from to restructuring debt our capital servicing our of purchase cash cash our with million including $XXX the year. reflecting revolving with We in-year that an revolver working for be plus cash for in sufficient ended outlays million have for our of capital we QX structure undrawn plus than

times At the XXXX. to quarter X.X leverage times, end, up net end our ratio EBITDA six was from of debt adjusted at

our trailing expected to expect to options interest due be and term are rate. to lower protect leverage $XXX At and XX% million loan our through full EBITDA swaps. rising is $XXX our are through is fixed levels notes have we approximately and variable on ratio in only expense year debt this a time, Therefore, million to Note the XX-month currently of our XXXX hedge XXXX starting year. most $XX exploring of we million $XXX We of further rates QX floating, increase against total million. that for interest forward rate

in milestones is due depreciation road forward which our range primarily entry both growth. operating year cost our profile expected following looking amortization to return profitability our CapEx, for the we $XX execution our With a organization, XXXX. base, the product and software improving to improve are and stabilizing positioning upcoming well well to as our full capitalized into In us we key summary, as business, our map and greater on million agility the model, our flexibility increased be have clinical. are in in lower to to and

Sima turn I'll the call back now to

Sima Sistani

Thanks, Heather.

for the deliver opportunities priorities engagement will Watchers we a our focused on achieved key on of for expanding workshop narrow the more for our the growth. to digital on Across are our significant initiatives members reach and are our best alike. impact. which efficient business that member through that, have areas: acquisition and end-of-period targets greatest will execute and increased We organization, be To year, both focused hitting in and reinvigorating order we subscriber one, principal four funnel achieve the returning Weight to list

leveraging delivering employers enhancing to efficient of to our behavioral will by of acquisition increasing life retention; engagement clinical be both clinical increase start weight clinical payers our health community and expertise continuing and and awareness to choice brand that new capabilities our compounding in self-insured both member expanding our in partner for setting And pathways. system space head real digital and and broaden and in a the building sequence Two, end-to-end four three, the in drive member and this reach, care behavioral management solutions for satisfaction standard in space. experiences,

to innovative with improving leaner, work, getting are thinking strong on the and agile off In and am growth summary, trajectory organization, Weight our team's we we a execution I a more our are confident paying that corner profitable drive operating and model Watchers is growth. turning hard back

and questions. Thanks today, for are to us your joining we happy now take

Operator

comes now question [Operator the question-and-answer will first Jason Sachs. from go English begin Please session ahead. Our Instructions] Goldman We from

Jason English

people subscriber folks. afternoon, in us an questions. for update, have gave whether your paid Good you stability entered base already there Thanks or core it. couple stand on come and expect minus. to time you in about have people today, at were congrats and do finding Sequence, on subs Last XX just the who A be the Where On X,XXX some XXX,XXX have that we guidance year-end implies of program. swipe who me on BXC. the

What that to And we or gives confidence you on-ramp try build the start to see the promoting marketing to XXX? should see to campaign start this activate the of you going. cadence what's can and bring get and you that expect to activation? When

Heather Stark

thanks and through Yes, Sequence. question. for up This Jason, is year. Heather. the Hi, ramping your

So in the we acquisition with as XX,XXX we subscribers. closed active the comments, said

a one. sign-up subscriber Weight We rate different day on active where are subscriber you as subscribers are and pace than an Watcher a measuring typical

for are month subscription XX,XXX the into qualified and come monthly and those have in moved people So treatment treatment plan. $XX who and a accepted

I a of is enters as actually there's sign-up So little flow a lag between when said. and a someone which different, subscriber the there bit a becomes

of terms will of growth, base that there's business that hit scaling, good space that and in we expect confident scalable us the the we in XXXX in that we're land expectations to and this So a subscriber recognize targeting. that we're have range

Sima Sistani

to wanted to just I that Sima. regarding add activation. marketing it's hey, Jason, And

know, to then, that that the we continuing they subscription tap And to that, up promote. of And their Weight channel. membership on mouth. built of into you lapse base top seeing has word through base really the to cross scale primarily are as have Sequence on So opportunity Watchers we're

appropriate. medically it's where obviously, those, For

second that the And And marketing year. top be thesis we be of driving our push will that we was believe businesses there There our of would of as the budget -- one here said, to we're across going whole. are efficiencies. being a true. And TAC to be funnel that that half the did

the going we're at pathway. where we to looking through most our whether be behavioral leverage, so, it's or And clinical have

Jason English

then on, question, although pass more realize I'll with it cheated One I I question. a front Okay. three-part up

covered So be you the of current had when make that's some on put wondering would of I interesting insurance with if of to in And what even just how blanche carte users percentage have it caveats. coverage. you modification that sense bring comments a around must no percentage some on Like, of the behavioral population this you program, any then, does that. pro we change numbers was can sort be caveat company your lapsed better? Are

Sima Sistani

coverage we that members they and typically insurance something but really above-average our we So isn't have pulled know regarding previously income. household spend to

do insurance an most health employer. have through So

that makes of And Sequence that's the is that much the think process on rail it helps assumption. put they such the insurance benefit which with easier, so here navigating a obviously. access, tech fair I process preauthorization

interested in step the provide medications of we're who enough process, looking figure need they're be how employers to hearing just have not top opportunity -- And we're think critical insurance are population. these from who help And also therapy indispensable an only to their I members on to plans. but population to that our partner that, BXB an out to navigating

And and to that. that's through. think an we're that come on navigating engagement more so And I model designing

Jason English

sense. it Yes, Exciting stuff. makes I'll pass on.

Sima Sistani

you. Thank

Operator

Linda from next Davidson. The Please, D.A. go question Bolton-Weiser ahead. from comes

Linda Bolton-Weiser

Hi. Yes.

of that to on the year. versus two So the there point, separate towards much integrated, based comments, this Weight of in endeavors. right? any the to former quantify So by they're your like be members Is would budget at second you're cross-promotional how because start this still it's tapping sounds way going put it into the advertising, Watchers opportunity marketing half your not

any is would there the the to way spending towards So sequence side? you put quantify

Sima Sistani

on. going eye CAC be what are keeping The efficiencies an to we're

to driven opportunity really the have is be and by going leverage. product So the we here where

really So apart. seeing options, go where us of to being with is to we sets LTV portfolio will we're And what that's spend. a tax, think efficient I and us market where able differentiates

any we're around is budget. earmarked about feel specifying So year the near have $XXX not drive no our are top the we out million to of other still the what a to that But in such specific ability confident terms in for rest part of I and companies to to us And DXC of funnel. go really ours. of be the space going speak our as platform

Linda Bolton-Weiser

rough some platforms and with Right. And to Is work kind message you that take a is rough from it two come integrated now, the that? can or give estimation any like long to as that how through. your may integrate up then frame marketing us time and there for of year

Sima Sistani

more just Linda. weeks to time need I couple co-create Yes. I ago, too We're new we not we given really closed want of our point, mean we be and this to -- thoughtful ready advantage to talk much of company of as about quickly. the how have at clinical colleagues with that of do for that start do phase. the But well in objectives on how here we -- taking the focus is head we I this one we and our this a noticed, core

priority you So imagine in well add absolutely top that is terms I us. we that thing that And can it very is will and of complement the the we of just nice a for things there is mind to and the sharing I more and next a really forward really good look that there is new well about talking up that sequence calls? There we really doing are think match the well. are in doing things

Linda Bolton-Weiser

that what Contrave, why know was some any historically, drug of partnership it Yes. context offering have the that any wasn't or that that final I question. That there don't great. do don't did was too sounds one Weight I called with just was big I And think and drug Watchers the that, you offering? with know never on and history deal know that successful, I why that's

Sima Sistani

we to can really I'm front. on you have these share are what there context unlike with I the before much medications can it, But don't and I all think landscape new going Linda, has have honest. that come that notice, too anything that be to that next-generation agree I shifted.

Linda Bolton-Weiser

I appreciate Thank Yes. you. really it.

Sima Sistani

you. Thank

Operator

question UBS. ahead. Please Michael go comes next Our Lasser from from

Henry Carr

Carr find stopping Hi. what helps other on when primary taking their us behalf tonight. of to Michael In Henry care why Lasser. This provider. lot and solution, our them from is taking an I GLP-X that found. is what's Thanks stick questions around If a for solution a words, drive affordable sequence

Sima Sistani

Henry. Thanks,

it these it. team weight So the takes that chronic high share medications is loss around process -- with a weight a support

your dosages titrate weight can get an need than, for along in medication your away that's you loss really the that and walk journey. You different to getting EV from. script instance, And

So support types is that level medication. that other of different needed a there is is of than

to actually clearly Also you're insurance. when time during need dosages preauthorization these in changed Mounjaro fascinating titrate. value are continue process throughout is journey the and finding as the that What's was saw highest to were we coupon that most. not the the the just going People the retention in program,

Henry Carr

they're to come years of subscriber really if these as follow-up, become Thank come value drugs look Does would subscription? Sequence’s to the accessible. drugs and the two that helpful. the the FDA Sequence short if you. to as more by you and when other market, more up, versions and these just three proposition how And That's accessible a list words, in protect cheaper In base? erode generic

Sima Sistani

as into up can these get same because when not weeds scientist, I'm to that sort that the point generics. the brought discounting want I and it comes to tell not It's a I are biologics, you but an of here you interesting too

consumer we've coaching that's its business, even and we but not medications able get Car-T through order such so the that, model, be only that able medically alongside going to heard business, is messaging acquire to have But said, the are a apps. by to appropriate, where and what in Sequence going to, in same we medication be to that in, that instance, and able word be -- of NPS are of has in telehealth the to the to the business, not you nutrition, what to been mouth, subscription platform the UX find offering simple then able that being the of might prescription type alongside high the they're when these for business build fitness, they're

which being development. the healthy habits And where then want build that so and medications. is think too, it's I take in to able drugs worth business, makes is acquiring thesis to the obviously, above us this new are much and And sense beyond there you ongoing for noting, this

is this all now, see say, there's injectables. already of where start pill you the in the Right medications coming these starting talk about, they're we're around So what form. medications to

lot very of a still it's market, to come. a and evolution there's So, nascent

Henry Carr

Super helpful. so you Thank much.

Operator

next from Schenk Morgan comes go Our from question Please Stanley. ahead. Lauren

Nathan Feather

of to dig that for learning media can to year? the talk early sure on you translates to if you is I certainly a Feather Exciting the you. can in believe a despite sequence working attention. it on Lauren. step Thank Nathan the how leverage bit It's and get year-over-year. to I marketing can guess lot the Hey. adds in any in trends side, see a through the And on lower you that mean marketing seems finance. up net not what one, I'm in you acquisition? then more second

Heather Stark

spent heard So well. terms in in I year-over-year, in so our we In year, less the QX than marketing, improved less, million XX%. about CAC of QX, terms by working what's XX% LTV prior if question your and of $XX correctly,

from the our quarter space, see QX can the I into clearly read step-up performance in our through this see and And first we we Sima trends. end. call, active in both referenced as So in our

of If saw spend. versus on end-of-period we of step-up prior our QX marketing XXXX less And year. in you subs $XX million QX in did the a that X% we XXXX ending go into XX% from subscribers,

of to through terms question, reading second in your to working And going second your I Nathan, you're mean, have we it's didn't heard it. So repeat question,

Nathan Feather

interest. any the lot you of Can talk with to in if kind since get trends media, and wondering It seemed to early of initial certainly attention the acquisition? translated just a sign-ups but just Sequence to that

Sima Sistani

Definitely.

specifically interest announcement. the or of at the step-up isolation the did huge from in to But step Sequence volume in to their And change point speaking, announcing point we a point. of not at an rate sign-ups in see acquisition. Sequence in actual that we're subscriber a So – this

subscriber in interest definitely yes, increased increased interest So activation. and

Nathan Feather

Great. Thank you.

Sima Sistani

is for putting that real about just building media, buying consideration -- that quick are brand which key to the immediate response in going accretive back it's a with to I were so are noting want more we think able back that driving about that I point, many. the the ways into really on we're valuing marketing we and and data is deploying, set culture it's less informed though, us and then and add worth really that and to it's which moments, couple

also recognizing market. viewed around has I positively chronic attention been on initial -- Weight Watchers, So would that and the living and the with by and the obesity overweight acquisition add the condition

impacting Sequence business but So also core sign-ups, not our it as is well. only

helping So is around Sequence important, to still and really the help brand to did brand, association parentage – brand Weight awareness, or clinical trust very that's well. nascent XX provide why Health, as And trust to years is see. pathway the the for a also but it with continue boost conversation a this to to Weight the we is Sequence drive nice of drive Watchers,

Operator

last comes go question Alex from Craig-Hallum. Fuhrman from Please Our ahead.

Alex Fuhrman

acquisition Sequence guys. taking for closing congratulations on space. Thanks ask the I and much question acquisition. my very customer the to and about advertising in wanted telehealth Hey,

Weight in I great think has of a Watchers, reputation course, category. the

I advertising little But a a competitors You would. you're aggressively get that through marketing in to seeing. of on in way bit of never to ecosystem in it's of in but GLP-X, space how side really days, of telehealth customer imagine about the lot there know have of you very of curious can Watchers a about members costs are kind terms members in customers? former Weight of it I the terms own talk that able your what the mostly people sequence kind acquisition you're and early and business? Is the

Sima Sistani

Alex. Thanks,

equity that our tech by drive and is and and we So know We're efficiencies play. trust recognized. brand in LTV talking years can XX this comes locking about when people to the of on a that brand

efficiently. think our our as right. we And you're across think I database And retarget yes, to ability this so synergies members. also to are there as well that do We could former and more

a that and ultimately, because for NPS, important needs which are business, both our about before are consumers said telling demand the experience. business side seeing product that what our change it insurance easy great when product of on behavior the that your to that bringing that other core remember, clinicians And high to here has best-in-class a very a for have I'm pocket, we are market real I to the sequence for process this that market, we makes with going in both top the offering, people people is program differentiated what product that, carotene of And to like the supply tunnels. and thing the applies it's is that bullish telehealth top the same the drive a anticipate that and means and on to is itself. incredibly we're ability combine And that we

Alex Fuhrman

you. That's Appreciate Thank Okay. that. helpful. very

Sima Sistani

Thanks.

Operator

to question-and-answer for closing concludes Sistani any Sima over like to would conference back I our This session. turn remarks. the

Sima Sistani

return point so to confident that we XXXX. am I an our Al. Thanks, in company in business the growth will approaching trajectory a inflection are we

our the experience, our the lives actions earlier, and and initiatives we operating positively of said our shaping I decisive future are key model product trajectory impact. financial As

I'm Thank at updated have today. and speaking the Staples you conferences, underway. Conference to with BofA Goldman we you Healthcare Sachs looking Consumer on of for many joining you initiatives upcoming and forward the including us Conference keeping

Operator

presentation. has now Thank for conference concluded. today's you attending The

You may disconnect. now

WW International (WW) 4 May 232023 Q1 Earnings call transcript