Medifast (MED) investor relations material

Executive summary

• Q1 2026 revenue was $76.0 million, down 34.3% year-over-year, primarily due to a 44.9% decline in active earning coaches and ongoing disruption from GLP-1 medications.

• Net loss widened to $2.1 million ($0.19 per share), compared to $0.8 million ($0.07 per share) a year ago.

• Achieved first sequential quarterly revenue growth in three years, with coach productivity up 19% year-over-year and 16% sequentially, reaching the highest level in years.

• CEO transition announced: Dan Chard stepping down as CEO effective June 1, remaining as Chairman; Nick Johnson to lead next phase.

• Ended Q1 with $168.9 million in cash and investments, no debt, and working capital of $160.4 million.

Financial highlights

• Gross profit fell 38.6% year-over-year to $51.8 million; gross margin declined to 68.1% from 72.8% due to lower sales volume and loss of leverage on fixed costs.

• SG&A expense decreased 35.6% year-over-year to $55.1 million, aided by lower coach compensation, reduced marketing, and a $2.2 million one-time gain from a distribution center sale.

• Loss from operations was $3.3 million (4.3% of revenue), up from $1.3 million loss (1.1% of revenue) in Q1 2025.

• Average revenue per active earning coach rose 19.2% year-over-year to $5,432, the largest quarterly increase in five years.

• Active earning coaches declined to 14,000, mainly due to client acquisition challenges and GLP-1 medication adoption.

Outlook and guidance

• Q2 2026 revenue expected between $60 million and $80 million; loss per share between $0.50 and $1.00.

• Full year 2026 revenue guidance reaffirmed at $270 million–$300 million, with loss per share of $1.55–$2.75.

• Profitability improvements targeted to begin in Q4 2026, driven by new product launches and cost savings, with further gains expected into 2027.

• Management expects further declines in active earning coaches in 2026 as market challenges persist.

• Working capital projected to exceed $140 million by year-end 2026.