WW International (WW) 6 May 212021 Q1 Earnings call transcript

Good afternoon, and welcome to the WW International First Quarter 2021 Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Corey Kinger, VP, Investor Relations. Please go ahead.

Thank you to everyone for joining us today for WW International's First Quarter 2021 Conference Call. p.m. X:XX about At we results. press today, first reporting quarter XXXX issued Time release a our Eastern of call results purpose the details to The this a company's regarding some investors provide the further progress. with company's update financial general as as is well on to provide corporate.ww.com. The release at on corporate website the press company's available located is Supplemental investor Investors on under & Presentations available section corporate company's materials the are Events. also the website in also GAAP available conference this part Reconciliations of financial to most release. measures directly disclosed are press non-GAAP the call comparable as the of on measures

Before more will in here we actual cause statements and should These today. in that begin, this let risks detail me remind are company's filings discussed the could forward-looking contain the be Securities results risk undertakes everyone statements. any factors of that future of statements with to except any are call whether refer to for statements, discussion of today. company by forward-looking to various as that the such Investors or subject differ to update publicly forward-looking result materially of obligation and detailed forward-looking Commission. explained as statements. uncertainties those uncertainties And events required and new a aware Exchange from law, statements or All made otherwise. a and as the filings these no information, are Please revise forward-looking risks

and Nick turn COO; Hotchkin, CEO; President and CFO. Grossman, Mindy over call the now are to I O'Keefe, call will today's Mindy. Joining Amy

multiple to experience, operations, concentrated marketing strategies sustainable and of world's efforts and momentum, with the are Thanks, power business WW business the our digital to by verticals Today, the build in for streams, creating our us more weight organization continued digital Corey. joining today. XXXX ecosystem. Good deliver in afternoon, profitable and driven more we healthier, the a subscription revenue maximize optimize has leading streamline loss the platform strong our and collective membership wellness diverse everyone, efforts you across all member and thank points and on on our touch the model. across growth community

a expectations digital our Our our our membership to performance of subscriber, first over driving revenue XXXX. positioning above with balance profit for company growth us transformation growth high-margin was continued evident and technology digital personalized quarter in and clearly results the experience

clearly new our at U.S. are up to DXXX quarter. the the in new with engagement new the XXX,XXX Member expansion demonstrating DXXX this driver opportunity the starting Let quarter an our me evident the in completely unique for Digital the the XX% vertical, our a This platform levels of highlight achieved all-time U.K., of XX% And with myWW+, marketing following recent ended delivered the globally. be the all-time is membership subscribers adding loss the COVID digital the that To level, tour end-of-period didn't Presents: retention as WW January. demand experience over innovation, model X Digital mid-tier Oprah's we high million is subscribers nonfood in the consecutive We that Digital you, XXXX, now will are To tier our fully months. efforts both our true This QX, QX just our high subscriber at new given And and new impressive XXXX and is matched are built by in else over sold-out of myWW innovation. ramp Digital the of retention reaching year-over-year countries, growth subscriber seeing until X.X high on the a with of of it Recall just teams achievements as launch is million, positive that food subscriber weight growth WW and returning at of we demonstrates is to results. ever. membership to for QX appealing are anything WW level now top than has business expansion comping growth XX% in addressable as Developed which market cohort, to as on our this a resilience further new coaching and large and end-of-period work with a and achieved We and focus well continues is the double-digit of workshops. provides when need younger offering diverse way and of driven is subscribers reach testament our that wellness remind on digital in strong and reached a partner levels members our new this growth. the myWW+ the been XXXX, we who modern members continued extending base, environment of further the people QX XX and Digital our digital time like new in strong. the we more in is as members still to the one-to-many market. with a the while of seeing Adoption subscribers content of for seventh experience QX by offerings. appeal Digital operating wholly a launch to of vertical. first we member Vision strength record more the significant experience upgrading future. success watermark XXX a WW well in digital this and

been last younger. France what XX% engagement the early members DXXX a Canada. the them in experiences DXXX the enable real-time are And DXXX to In has Germany, or In with valuable will greater and members, strong. response interactions coach of introduced fact, what has been and among sign-ups and Measuring first-time who to resonating see have we are the few and success. weeks, almost opportunity millennials is

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all an while enhanced in being most with deliver while optimize drove communities. margins. we combined margins Workshops of expand team efforts with our of company This or international margins builds the member our Digital structure realign business, restrictions our were of XX%, to to of and QX, Our margins gross ahead adjusted our our of business total expand is able workshop initiatives strong for gross in-person of improvement, to underway expectations community most and targeted and demonstrating are still to capacity this the all that has eager exceeding cost and members are continuing business further many operating to U.S., significant as in markets evolves. craving of to the the experience Even the increased our and model. flexibility in-person environment that workshops clear business is return lockdown It

fact, participation, our over workshop our year. in-person in weekly first the workshop the U.S. In last a weeks, time virtual attendance surpassed for X

January, where will them members So they has we that all have enable our to our over growth greatest more with detail newest the global strong announced In Corden. year-over-year. James e-commerce are the meeting e-commerce and continued provide support increasing Nick sales with providing are QX XXX% growth products truly them consumer success. and strategies. in on its our we ambassador, momentum will

fun Presents The partner, the incredible James its sharing and and program, campaigns. his Webby James and to story start turn Oprah that and only lighthearted the for has Life our I in up You the incredible discuss first been Oprah's with the XX-pound X driving weight operating significant milestones. commercials, our loss an social it experience, speak WW Awards February both sharing Focus: plans, again, in his expectations performance the to to million detail. is and for Be finalist of the first garnered to addition wrap livability James we'll over WW series In year, prestigious April, a media accomplishments, And of go-forward to But Need, a our during in once our his app WW In can. of coverage more Love speaking virtual our media at TV about in Nick journey way upcoming nearly WW more live which events views. will appeared

double-digit Mindy. end-of-period each you, continued subscriber like I'd additional with in of on strong Digital The the performance Thank to color markets. growth share major our QX in to markets. our of be some business global

of DXXX milestone still the and local as on behind virtual COVID in worldwide. given this would and new, particularly month tour. tech-enabled mid-tier trends production has Workshop Canada, Germany, With modern Each the our experiences relatively we with trending of serve market in team members positively Digital incremental you sign-ups. coaching countries. challenged, its is to low pricing, to bringing experience an last workshop against now expect, content important XXX The internal member trends several in year. and working last launch a As was DXXX onset sold-out Oprah's arena same sign-up centralized team, year's year-over-year creation in more QX cost were are cycle France last lockdowns

we plus can a So believe XX% scale, business. it margin gross at that be

subscription paid week on engagement, value. revenue drives DXXX per are focused strong We ensuring higher higher efficacy, and lifetime

Workshops. to Turning

structure done adjust of has a QX, in to studio Workshops job as in QX team incredible achieved business the cost our adjusted from progress footprint margin make our rightsizing and market continued gross levels margin we to XXXX. trough the fixed to current XX% the Our realities. In staffing an XX%

the margin able have Importantly, are to social COVID a Once the once of to double return workshop the workshop. measures, current level. serve single in-person adding environment we reduce business aiming are before we attendees is the number capacity approximately gross XX% we to us, an to distancing behind safely

month-to-month cases, significantly about the our XXXX, WW-branded studio of favorable last In including arrangements. we renegotiate end to from have able of on XXX. XXX at prior in expectation which discussed were expect As to footprint. we the terms, call, our approximately U.S. some reduced now we've up studios Therefore, is our

cost-effective our workshops the We venues distancing capacity in social and are environment with for current for significant future implementing third-party for expansion. both

space. For in-person To and at workshops our a Manhattan population. note restructuring, of Manhattan, permanent Beacon all illustrate remaining portfolio access fixed of reasonable the that of closed provide example, to estate a workshop the our are portion office a within our opening our have U.S. XX% locations and hotel distance scale major real studios in the over of Theatre, we U.S.

apps In demand XXXX. on costs rent are have an for addition, provide market in-person to third-party saved since basis realignment, studio returns. million run footprint broader annual Through workshops utilizing in and we we our flexible coverage $XX cost-effective as about rate

continue we and Our have further studios months, to have an of remaining lease life network. our opportunities average to XX optimize

we growth on The will highlighted for we in for our our strategic and care on referral call, Solutions believe business growth lever Health over in our track physician long growth aggregator double-digit February health revenue we is As with business key initiative. a be up and accelerated XXXX as ramp is positioned our XXXX partners term. the

In and have underway our we offering people with developing team is that for specifically diabetes diabetes, trial clinical X a plan addition, during XXXX. with consumer type to people launch designed dedicated we for a

Finally, our products business. consumer

platforms marketing shopped in XXXX, opportunity XX% growth via our Digital have workshop of are our product members. platform, XXXX, to e-commerce. in-studio expect QX are long-term revenue Encouragingly, on changes for sales in online. being growth purchases million about demonstrating revenue in-app sales our our our be product Over products our to shift of back XX% this XX% we've also all our XXX% members about currently to by made reflects XX% drive e-commerce we members. and X.X business, over product member by Looking members e-commerce the in assortment since approximately XXXX, of our only of fueling And were rapid about and WW globally markets. this already these integration, geographic of made e-commerce purchasing the In to

on brands adding WW product the are assortment also the new We now Shop of to availability partner marketplace. our

on short, uncertain expanding through products of of business. executing business focused In also improvements, in an chain capabilities and including an operational consumer what our for supply to addition are well increasingly be drop-ship optimizing the is environment. WW We our continues margins the e-commerce-focused

outlook. cost structure nimbly investments I'll transformation. discuss advance to over managing to digital financial And now are making our it our Amy and turn performance while We our to

you, Thank Nick.

of saving providing Before I significantly successful the our I an continued our in XX, financials, like has resulting our with discuss refinancing highlight rates, structure. even the support. was flexibility This completed rates, for first our $XX capital greater million would maturities, of debt the nearly prior in quarter annualized to lender refinancing interest community on which and lowered their to compared April us thank

the Now first to turning quarter.

had the in XXXX Mindy tour. XXXX, had XXXX by a minimal mentioned, performance and QX impact the only fueled by innovation exceptional QX As year amplified the mid-March ago myWW COVID further so Vision food escalated on results. our it

As a QX had year-over-year in, comparison. very of result, a going XXXX tough

week In January on that addition, a ended XXXX XXXX. had XXrd X,

calendar XX% with years, year points basis, to quarter. growth QX. ended was the is So end of COVID of currency our increased subscription year-over-year, from $XX sales member was the million reductions decline an primarily looking Adjusted the COVID due year-over-year of in XX environment expectations workshop now up QX QX in in XX% prior million XX% on X in Vision subscribers, which the growth double We increasingly up comparable XXXX, digital-first addition in to gross basis XXXX. over is revenue in productivity consistent includes offset reflecting ago. XXX in subscribers. than X weeks a This significantly lower which XX%, Digital and digits subscribers on were with the the continuing subscription members growth and and top in approximately million, business. QX At year from year-over-year down year-over-year basis cost year-over-year to our revenues. line Digital by XX% the at up QX $XX shift recruitment, on product strong more DXXX, a from the the in pressures was the a end, Digital workshop significant our with in XX% revenue, business. the first revenue total constant partially subscription Workshops offset revenue revenue the growth in-studio end-of-period Digital The environment. XX% of to of tour Total Digital The mix largely $XXX year continued substantial constant ago margin and Digital million due currency better-than-expected in was

better. to margin margin. gross In gross of we where consecutive delivered Digital subscriber have shift adjusted This the addition, an the larger fourth benefited approximately quarter a is mix or XX%

the in lease now year, fewer expenses other a of to and of from down Nick As the million. our restructuring the fixed due footprint million reduced negative restructuring total $XX costs was charge to of part impact and $XX prior QX we restructuring discussed, million $XX studio our $X.XX. workshop first a onetime resulting EBITDA expectation in was in GAAP QX, better-than-expected Adjusted $X.XX $X in million. further the And exit quarter, items, We EPS project closure from in incorporating loss locations.

we outlook. continued to our adjusted the Despite to year expect revenue XXXX exceed now global now uncertainty XXXX, income. economic and operating Turning for full

us Our on objective. QX that have deliver results track to on

that refinancing year. full EPS our for expect benefit addition, we In successful the by $X.XX will

return to aggregate, we sequentially year of the For improve year. earnings and trend continue the of to the a in growth to revenue the balance with X year-over-year months year-over-year remaining over expect to

expect consumer sentiment compared We into the of sequentially growth We a by historical trends end-of-period recruitment the spring anticipated subscribers total with rate will head year as will slightly into QX its end-of-period for will major seasonality DXXX ending mix in is summer increase trajectory myWW+. of shift in take European that of launch different the the to innovation. success food year-end to QX XXXX campaign, Digital the and exceed in and by subscribers At rebounding the member the that late year-over-year our is patterns. digital the the core of months, improve driven our balance The membership change shape plans further all from and expect markets, that early of strong the level. the driven in subscribers the platform we and of support launch personalized our retention the further in

We expected significant revenues up for revenues. than teens DXXX, workshop the at including XXXX. offsetting decline the XX% XX% subscribers a year, to of and XXXX full constant of be expect shift with a currency are to at on from end to in the XXXX mid- end Digital basis more the in digital, high of our being end XX% the

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XXXX where Digital in growth particularly the of are revenue business. expected we with improvement offset on quarter. Strong the year, line consumer to accelerating addition, technology and reminder resources which QX, workshop-driven continued in is that expected significant plus expenses, product approximately with QX growth. to the by workshop is from assist decline impact QX. a double-digit growth modeling investment cost is in an in had prior In the To fuel your million initiatives a pressure revenue reduced to marketing, in savings be $XX digital in product we in spend in XXXX, the And sales revenue company's

capturing QX maintaining into cost. expect be of heading customer We as of XXXX while benefit acquisition on approximately sentiment marketing $XX consumer the million in will that summer focus rebounding we efficient an

the cash We ago ended of balance QX a structure we draw interest year $XXX revolver priorities. Xx. our approximately refinancing. full cash the on million, $XX debt to Recall new net prior full reduction our rates million. due million our undrawn included an from the debt-to-EBITDA to in cash At expected leverage debt, expense million $XX be with quarter ratio interest a of and is now capital Reflecting and million our had year a to of $XXX Turning that the end, revolver. outlook $XXX

million. our tax $XX to primarily capitalized to the in spend rate we to And restructuring assumes XXXX. be expected of to CapEx, the anticipated $XX be expect and year now on now current charges by is driven tech rates. XX%, in P&L, range Excluding changes our full statutory the is million be impact software, approximately which D&A no

product business, continue companies. addition In Digital will evaluate of acquisitions technology future investing we tuck-in fuel to potential of the and to growth in the which and resources talent, technology

We are and also in million. And QX, Michigan franchise, above for territories. opportunities and Ontario seeing the was in back plan our acquired I and remaining franchise the years Mindy. and executed summary, now In acquiring confident we our QX will franchise and for initiatives drive in call which to our largest value performance are turn XXXX strategies we in $XX shareholder to ahead.

Thanks, Amy.

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[Operator Glen of Santangelo question The Guggenheim. from Instructions] first is

shift talked on remarks, Mindy, impact maybe bit to your talk I a more detail talk your you the to you rates? the impact more. changing XXX. But bit having you that address that of your marketing prepared this Could this bit this little a in about in wanted little customer about on how it a little bit demographics digital retention Digital and you In may be if little strategy. may could shift a maybe about towards

Sure.

you obviously community, the XX% growth of the now, of XXX our Digital if physical. core look members it's still greater So And at Digital benefit as see, plus assets Digital of whether about is a member every our has business, our so at or much can you of myWW+. want the percentage. right But virtual

course our addressing balance being with with has heard efforts of will across assets you our to we us people the have new to really members now just digital, that, of give you been seeing on that And at younger. tour a have you marketing kind or of younger, your membership the that's if whole perspective, are opportunity the then is launching Obviously, base, and to creatives on now. quarter feeling see increase. amount to of new on diverse. what our we Sunday. of have seeing, that seeing our virtual right in significant marketing a us And And and of we you see diverse obviously suite But assets opportunity marketing benefits And a certainly why we're new for we've And point, Saturday. next strategic example, DXXX, being for focus trend say the over of XX% that been the Now look millennial cohorts. what really we diversification more we're time. within really

with high staying a XX in, we're quarter story quarter Glen, it's too. add digital We're subscribers. levels here. fantastic that to out still double-digit all-time Digital member I retention of fact that see in the Obviously, you driving Digital shift growth just want to Digital retention. But months, powerful over are the part retention on members mix shows rapid months the XX another at over because

Yes. we've And all a obviously, work full a the that of framework, capabilities. of experiences coaching of along heightened with is result that the within because engagement that Digital creating done, ecosystem

that half accelerates And Nick, Health XXXX. first follow-up Solutions it clear maybe in why growth the to could that you quick think XXXX. of expect on wasn't And we're to a but you revenue still ask you business. the me as to given double-digit into if inflection said XXXX, next in just think I Nick I year, that

if be elaborate So that bit, you would helpful. could just little that a on

Okay.

sales referral. for about particularly physician next excited Solutions probably of too. strategies people dedicated in those part was will, the scale. people in than post-pandemic little needing have think specific it is partners, of care I'm of ramp-up, some a be Health you to offering the longer with it launching I economy, applies the health diabetes a designed in WW time aggregators our That Part a And thing specifically is to the 'XX. corporate if takes of we'll most initiatives and ever. more that consumer fully then and program a that launch for bit year, It of

I think that's us. unlock an for

is The from Barbero question of next Sebastian Jefferies.

you bit end expect is of a early Should the to of one expectations XXXX? inflected for The end more if you the your full workshop QX. could we 'XX the than that by wondering little at higher be end-of-period subscriber year. first in subscribers growth mentioned was talk I of

workshop COVID. we financial recruitment that as Just QX metrics has year-over-year on get will in year. workshop, clarify, including the the positive positive now we've anniversary revenue, to trends, started turned better that throughout Amy Based said other mentioned to those for recruitment

is I The had of of XXXX. would the only Yes. workshop end subscribers thing to at add that we QX peak end-of-period

subscriber, end-of-period close in that course and the comping XXXX, of decline be sequential the still we'll the gap year. over will so And

it. Got

are is close one to it at that the over of that how you XX on what's can then to Okay. a a months And retention. level? take help been going for me And for just to more? years understand or now. jump we second We've XX follow-up my But couple trending to months

you Yes. the through over months under power continue say XX retention you've we're right to pressure. strategy. times the many Look, imagine -- want XX of was you've push long-term fact business think fact months. retention, And we've we've also, our it over strategies COVID I we be can I that gotten engagement got retention workshop our about talking to heard think well, numbers, seen that and being in retention. strength the the The the us of shows the before, in to the Digital And

Capital next Group. is of The Craig-Hallum Alex question from Fuhrman

area that a online it I be of lot about for the It there's a for like and to platform marketplace. WW, new wanted like expanded. seems seems very still room ask to

of and could about love think how in expect many with to I how both partners little you see products year? And might would you're the us partnering it to more tell you that as as partners adding the So new a bring. capabilities this if about the terms you add bit we well these marketplace, brands brands that

marketplace, Alex, our products strongly both feel I we and WW with a know, co-branded that out and you in our nonmember a opportunity even an an our building products, products, and wellness Sure. member presents opportunity have as benefit.

a our represent across progression, that XXX% talent, our launched that in is, We last redo if Phase and entire products infrastructure living what was app. brand our technology March the did supply XX chain to be and digital our that ecosystem launched So e-commerce categories at look year. accommodate of hire Phase you X was and the XXXX. all within to able X we new healthy

we're impact our Phase expanded really X drop-ship well enhanced all categories, of assortment. and moving had. across as able as capabilities the that So be numbers really assortments has today now those which that, we're to capabilities to forward, is X the quoting starting have launching expand all is you'll see what is

We and have week a help in and way. Where build significant and the member base number shopping million ecosystem of able new of building partners opportunity big that more the all those we'll is to But out our that our profitable have the marketplace. be be is, within even launching of efficient out next ultimately more over to capabilities. more beyond a the X app yes, to even ecosystem second have course, because

So look you we we new really was think this has launched. before And last capabilities benefits in and with any just that that these quarter grow. the increase at will XXX% continue that of e-commerce, if to

wonderful profit XXs revenue of add, delivering it line contributor to see here, you margins a great, within And mix. driver. that within e-commerce in good It's the quarter within just the look, gross gross our economics top fantastic after Alex, that, are plus growth. And a also. margins, again, XX% It's quarter business dollar an

just Yes. more comment. one And make I'll

WW-branded still that We future certain we are in as well categories. for licensing develop of expansion both products products, as our own discussions

is Research. The Greg next from Badishkanian of question Wolfe

is Spencer Greg. This on Hanus for

are trending And I how are mentioned trending versus XXXX? could guys quarter-to-date? pure subscriber workshop. think for you how But the year they're versus you now that then trends about positively membership trending last talk growth Digital

that. So a let's on kind of give perspective

double in membership as we momentum. continues the it digits. trends, have build consistently trends And Digital So membership to been said,

attendance QX do sign-ups. we a more more the our said, we're incurring XXXX. we costs. we're the side, But seeing have comparison to, engagement lapping we're certainly kind to as to double in in saying and But is able flexibility On what studio of without more membership studios not be

given flexibility So we we've last certainly, be come up see as the will we in. demand able over scale to year, that created the

And really how at so that's we're looking it.

there of capacity thing at be reduced only that all. workshops around The world, at is operating or workshop open of mindful I side would the many business, add on the our are Yes. the not

for XXXX still be comparison to plus going And point. so to a at this us the is

on the Got helpful. it. and be are the in just level seeing update And in helpful. from spend marketing environment $XX in support membership? we think what of the about the million mentioned how spend, out to And new should XQ. half That's on then But there competitive any then guys momentum would you marketing unseasonal you back bump

in. my really marketing initiatives savings starting team kicked really cost From Yes. marketing on in perspective, aggressive the a remarks the in I mentioned And that stepped QX, expenses.

that compared impact the So to expect was marketing in QX million. we $XX plan -- and original

In mentioned rebounds addition, campaign lean as over to expect we consumer that summer. marketing into our sentiment the Mindy's

in in will the back through $XX levels read XXXX. so that with I I And And on fairly be QX. full expect year. at be line up million, to half expect that to

Look, a our they we right at more on emphasis the as consumer as the you but significant. just competitive is focused health And evaluating And give a mindset consumer across just landscape but times. from in to is and a mindset, wellness maniacally all sense, lot want. now, of business competitive also certainly are there well what certainly environment

providing, And do what we're -- community. and we're on that between we focused so of and the science science what the our is efficacy behavioral of power differentiation, what and what the behind

to point, Amy's we're is our and differentiation. time we that, it what behind on to of have into provide they really when advantage the at leaning it taking want certainly but So marketing to a really the focus customer

is Nagel question with from next Brian The Oppenheimer.

of to to wanted regard subscribers. couple I a ask questions So with

I But just The you talked probably first different you Amy, one, -- outlined trajectory what a The be that. I to had reasons about guess, in I the subscribers, you you're behind XXXX you here think, question past given expect a XXXX? this. I But is circumstances persist expect dynamic of and longer-term given it to is guidance. have we haven't year? this this unique should unique year is -- Or the recognize that the to

prior And actually had just COVID slope. So let that had been we Brian, the to an objective say to even improvements. out seeing so me we

an impact. even into So if COVID you obviously, had XXXX, XXXX, look at

stated this So look is different. obviously, But the XXXX. to even year, goal a our to starting in look if very goal seasonality, curve was you it's that out at going and the

be certainly our able goal. that's loss to what that. So in wellness And factor big in yes, that's building terms always healthy ecosystem really to is be our on and a offer. focus advocating But to articulate to not of going around weight was our being able that forward, more of year-round leadership fulsome but a much have we

I'd have, this if -- talked this subscribers say, I second the the question about them -- a That's between and, I helpful. And you digital splitting we lot and Got non-digital. it. guess really

the period at some So there mean, have if trend waiting are there? to and with almost through the become numbers, dynamic reopen out non-Digital closer simply the for this seen where say, that studios the Or those of go you look closed -- members a I of non-Digital a group subscribers we members? is members studios the shadow Digital COVID have potentially like your,

Okay.

me let that. talk So to

Digital were retained workshops. obviously able when workshop One significantly, all things to that COVID has the to our shift virtual our we members remember, of members hit, if you

back again, that. What certainly our members digital. opportunity of obviously impact new we of to more workshop Digital seeing members have for are taken see, members as an in DXXX the our we It's in members sign-ups. former memberships Digital. all What some studio cases, are also also those seeing going upgrading an to -- new we some advantage things But had members our reopen, to business. So choose It's are and, workshops. a are existing just subset go to of members

our to to agnostic member have digital based greatest behavior, and diversifying wants about will how membership a scale rate. unquestionably, just just their significantly going is grow base our us success. somebody consumer at we're So on faster But

The from Edward Yruma next Capital Markets. question KeyBanc is with

Obviously, some customer maybe a of engaging you're options provide when of Any maybe the how retention, improves? with tweaks can of platform, is lots And coaching. any a really you to DXXX. reduce friction? the there's the on their of A more satisfaction kind making to initial metrics that member platform to lot of question interactivity, kind thinking

integration big the appeal was built for The And of audience, really obviously say part coaching, younger content audience. millennial genesis We community. a millennials, audience, was DXXX that millennials. and to of by of new Sure. whole to

the as content the the always working that team team coaching content create because retain closely So a external-facing also build community been Oprah have will recruit the to develop these and only to will tech tours, with an well. coaches and that but virtual built on-demand -- and product our out original are tour, actually very that capability not physical team

that's to your we're So what point. seeing right Obviously, new, it's now.

the refine greater with seeing every future. date to we're new to opportunity and engagement, what it we're at looking are support. and create But as we create markets pleased the into for experience, So we very go means greater to what

is question UBS. Lasser of Michael from next The

wanted of previously you But I -- so -- how the for now clarify comments who many that those flat? subscriber. would some subscribers your overall up such business, digital you the -- business digital are Mindy, for studio signed about subscriber up to have business can So who every for signing would up studio is of have simply a are digital are Does up that for simply signed now make signing the the sense?

There let new obviously, that So sense. is, has that and some put sign-ups, time. me capacity just right, for again. makes it the affected That very limited are fact quite studio or studios closed

yes, to new both Digital Where It's cohort, upgrade and is Digital cohort. than former some do we're a And our seeing the customers members traditional significant So portion in Digital of in. from are sign-ups, But right, come to a we in interim. big, DXXX. them who've have have digital signed of clearly, Digital sign-ups lapsed up upgrading studio the the XXX. different

more of we driver seen quarter switching we have very strong subscription growth It's Of activity toward during come pandemic, Yes. about have. members subscription I the quarter whether the talking a to double-digit back, so -- quarter-on-quarter a fantastic mean, for digital? in of in, to small digital workshops choosing we've course, out been studio bit Digital Like in-person a those Digital are regardless are growth waiting story. from meantime, story, instead. the little

driver coming Yes. from. That's the growth not where is

And subscriber, on per despite of strong growth my or very is Digital growth. gross which Digital strong dollars still maybe question follow-up very is because down

number? do So to you're think see you per dollars gross inflection when in that going subscriber

gross has I've on revenue, right, week. mix the to sequential subscriber dollars basis, like workshop a the in think revenue significant on I Candidly, the shifting week. So given with environment. the you're paid very revenue per on pleased per shift, week subscriber Digital, been just paid our impact impact gross And the a from -- per paid or revenue per

Digital, that the continue see DXXX the mix per be that believe I Digital the so paid you'll decline the per And revenue paid with slightly. to in we to price of shift able continue But revenue at as week. total week launch to point, to expect mid-tier increase see we

The other very more is signing are that's well. positive much thing up that for we important people and seeing plans, been and longer-term as

mix core but mind terms bear Yes. number, an of held profit in standpoint, the the of has during economic -- the pretty LTV in XX% drivers LTV that steady. LTV, of the shift gross Digital like the this given Look, from business,

Makes sense.

last total sense as a could question. be? Do you quick subscribers what a a percentage DXXX eventually have subscribers of Just Digital of

a greater Clearly, We're real even launched the the in we're it Yes. January. percentage just January. certainly It's of business in launched We in interesting. we seeing we now, think that could markets pleased. that be

our have Digital now, number We But is than right don't an have certainly but not We're I we're much goal done have focused of significant marketing. it ecosystem We're refining. to part launching. it is now. on exact be our a higher it.

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

being today. for Thanks, everyone, here

the focus creativity, I science-based, our subscriber accelerating the around because which core success member thank innovation really really that's and just but and expansion been community, year. reinforce, of revenue of and profit teams advantage. we've digital balance continued to So exceptional We're coaching I innovation the transformation. deliver And into are in that's the around wellness the in around truly to positioned the our strong the sustainable work our this on because of is essential around full for over foundation efficacy Also, loss and well to and growth weight want momentum. world focus competitive at of to and heightened want our a closing, the

the well, and worldwide and moment, their which we market people the seen the WW ready reopens, their world think because starting the journey. as glimmers we're as you've focused I are to inspiring for see wellness partner is So is of, in motivating as on this and

keeping to year. the throughout much for you you we thank updated and again, us forward very So look today, joining

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

now You may disconnect.