Medifast (MED) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue declined 33.8% year-over-year to $115.7 million, primarily due to a 32.8% drop in active earning OPTAVIA coaches to 25,400, with ongoing challenges in customer acquisition and the impact of GLP-1 medications.

• Net loss was $0.8 million ($0.07 per share), compared to net income of $8.3 million ($0.76 per share) in Q1 2024.

• Gross profit margin remained steady at 72.8% year-over-year despite lower revenue.

• The company is executing a business transformation, launching new nutrition plans and products for GLP-1 users, and focusing on coach empowerment and digital tools.

• Ended Q1 2025 debt-free, holding $164.6 million in cash, cash equivalents, and investments.

Financial highlights

• Q1 2025 revenue was $115.7 million, with gross profit of $84.2 million and gross margin at 72.8%.

• SG&A expense decreased 28.4% year-over-year to $85.5 million, but rose to 73.9% of revenue.

• Loss from operations was $1.3 million (1.1% of revenue), down from $7.9 million operating income in Q1 2024.

• Other income was $1.8 million, mainly from investment gains, down from $3.6 million in Q1 2024.

• Cash and investments totaled $164.6 million as of March 31, 2025.

Outlook and guidance

• Q2 2025 revenue expected between $85 million and $105 million; loss per share projected between $0 and $0.55, excluding LifeMD investment gains/losses.

• Management anticipates improvement in coach productivity in H2 2025 and coach growth in H2 2026 if trends persist.

• Targeting $15–$20 million in additional cost savings for 2025.

• Guidance excludes gains/losses from LifeMD stock price changes.

• The company expects to fund future cash requirements from operating cash flow and financing activities.