Weight Watchers International continued its impressive subscriber growth through the second quarter, growing 27.6%, or 1 million, to 4.5 million over the past year, but revenues were less impressive, climbing just 17.6%, to $409.7m, over a year earlier.

“We have embarked on an exciting journey – from being the global leader in weight management to becoming the world’s partner in wellness,” said Mindy Grossman, its president and chief executive, in a statement after trading closed on Wall Street.

The dieting power house has been growing strongly since Oprah Winfrey bought a 10% stake in 2015. But investors sounded a note of caution after revenue fell short of expectations, and WTW shares dropped from their close at $92.21 to $88.90 in after-hours trading.

Analysts credited the company’s recent success to a strategic shift away from mere weight loss and toward products that target holistic wellness.

“Consumers are looking at healthy lifestyles, mental wellbeing,” Morningstar analyst RJ Hottovy told Investor Business Daily. “Once upon a time, weight management was all about what you ate. Now any activity can be translated into Weight Watchers points.”

While users’ waistlines have been shrinking, the firm has enjoyed accelerating sales growth for the past five quarters, reflecting the involvement of Winfrey and the company’s success in recruiting social media influencers including Hollywood director Kevin Smith and DJ Khaled.

Technology has been key to Weight Watchers’ transformation. Fitness tracking devices now offer members FitPoints for activities such as walking, cleaning or dancing. Those points are then scaled to determine a member’s daily diet allowances.

Kara Anderson, an analyst at B Riley FBR, said Smith’s endorsement of the company soon after suffering a heart attack in February and then chronicling his “wellness journey” and attributing his success to Weight Watchers had been particularly potent.

Despite some disappointment with the latest Weight Watchers results, the company is still far above the record low of $3.75 it reached in July 2015 when Winfrey acquired 6.4m shares and signed on to a five-year deal to be the face of the firm. By October that year, Winfrey’s five-year deal had already netted her $50m in share appreciation.

WTW’s shares are up 170% over the past year.



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