Beachbody Company (BODI) Q2 FY26 earnings call: guidance and Q&A

Is the nutrition segment growth driven by retail rollout or increased marketing? What's the future marketing plan?

The Q2 nutrition traction was organic, driven by increased nutritional marketing spend, not retail, as Sprouts reorders and Vitamin Shoppe launch are Q3 events. Amazon and other marketplaces will become bigger factors going forward, with broader distribution expected in late 2026/early 2027.

“what you're seeing is Q2 organic traction in nutrition and as a result of the pivot that we announced a couple of months ago, where we're putting more of our money into the nutritional marketing.”

asked by Susan Anderson · answered by Mark Goldston

How are 10-Minute BODi programs trending, and what's the digital marketing strategy for new customers?

10-Minute BODi is successful, particularly appealing to GLP-1 users who are underexercising. GLP-1 messaging in advertising benefits both 10-Minute series and the overall catalog, as well as Shakeology. New programs like 30-day Booty Boost and Max Built continue to expand the catalog.

“Our advertising that is putting GLP-1 messaging forward is benefiting both the 10-Minute series plus our catalog overall from a digital perspective. And I'll add, it's also benefiting Shakeology, which is a great nutritional complement to people who are taking a GLP-1.”

asked by Susan Anderson · answered by Carl Daikeler

What are the early indications of sell-through, repeat purchases, and performance relative to expectations at Sprouts, and what has been learned for broader rollout?

Sprouts expanded Shakeology to 131 stores (45% increase from 90), indicating satisfaction. Distributor KeHE reordered due to low stock, suggesting good sell-through. Specific sell-through data will come later, but the expansion and reorders are positive signs.

“We were originally, as you know, in 90 Sprouts stores. Then we got expanded, I think, to 110. Now I think we're up to 131. So they've continued to expand within Sprouts.”

asked by Michael Kupinski · answered by Mark Goldston

Why was free cash flow negative, and when will working capital normalize?

Negative free cash flow was primarily due to increased inventory investments for the nutrition strategy and retail rollout, coupled with a decline in deferred revenue.

“the decline in free cash flow was due to two things. One, primarily an increase in inventory as we shifted the strategy to more nutrition and the retail rollout. We needed to invest a little bit in inventory. And then likewise, as we shifted to inventory, we have a little less deferred revenue.”

asked by Michael Kupinski · answered by Brad Ramberg

Details on the more flexible covenant structure and its impact on growth investment/capital deployment.

The covenant package was renegotiated with lower thresholds. The cash threshold to avoid covenant testing was lowered by almost $7 million to $22.5 million (from $29.6 million), providing more cushion. This reflects lender confidence and gives more operational room for growth initiatives.

“That was going to be about $29.6 million. That has now been lowered by almost $7 million to $22.5 million. So what does that do? It buys us $7-plus million of additional cushion vis-a-vis the hurdle rate that they use to measure the covenants.”

asked by Michael Kupinski · answered by Mark Goldston

What factors determine if Q3 revenue lands at the high or low end of the $44M-$48M range?

Variables include efficiency of media, sell-through at retail, and performance of new launches like Max Built and P90X supplements on Amazon. The company balances these factors cautiously, prioritizing profitable revenue. The revenue mix for Q3 is expected to be legacy, DTC, marketplaces, then retail in order of impact.

“if I had to rank them, I would say it would be legacy, one, DTC, two, marketplaces, three, retail, four. Now we have this discussion in Q1, Q2 of 2027. We'll have a different mix. But for right now, that's what we're looking at.”

asked by Michael Kupinski · answered by Carl Daikeler

What pulled the Vitamin Shoppe launch forward, and how to build towards full chain?

The launch into 481 Vitamin Shoppe stores occurred 2-4 weeks ahead of schedule due to the enthusiasm and support from Vitamin Shoppe partners. The company has a plan for the next several months to support distribution there and expects good results.

“we were able to get in those stores probably 2 to 3, 2 to 4 weeks ahead of when we thought. So the folks at Vitamin Shoppe have been great partners. They're very bullish on the opportunity as are we.”

asked by Alex Hantman · answered by Mark Goldston

How did Shakeology's Amazon experience inform P90X strategy, and what's the roadmap for Amazon launches?

Previous Shakeology sales on Amazon were limited by selling only a large, expensive 30-serve bag ($149-$169) due to MLM pricing constraints. Now, with the 7-serve Shakeology ($34.99) and P90X supplements ($15-$39.95) priced under $40, a much larger opportunity exists, as 25-30% of nutrition companies' revenue comes from Amazon. The goal is wider distribution, regardless of where customers buy.

“we were with one arm behind our back before because of our price points and because of the limitations that the MLM had placed on our pricing, those shackles are now gone.”

asked by Eric Des Lauriers · answered by Mark Goldston