The Joint (JYNT) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue increased 3.3% year-over-year to $30.3 million, driven by franchise expansion, with same-store comps up 2% and adjusted EBITDA at $2.1 million, down from $3.2 million in Q2 2023.

• Net loss widened to $3.6 million, impacted by $1.5 million in litigation expense and $1.4 million in loss on disposition or impairment, compared to $0.3 million net loss in Q2 2023.

• The network reached 960 clinics as of June 30, 2024, with 86% franchised and 158 in active development; 1,270 franchise licenses sold cumulatively.

• Strategic focus remains on refranchising corporate clinics, improving unit economics, and deploying innovations such as modular Clinic-in-a-Box, enhanced digital intake, and new patient booking systems.

• Ongoing innovation and refranchising efforts are expected to drive future profitability and capital allocation opportunities.

Financial highlights

• System-wide sales for all clinics rose 8% to $129.6 million; system-wide comp sales for clinics open 13+ months increased 2%.

• Revenue from franchised operations grew 10% to $12.6 million, while company-owned clinic revenue decreased 1% to $17.7 million.

• Net loss was $3.6 million (EPS: $(0.24)), including $1.5 million in litigation expense and $1.4 million in loss on disposition or impairment.

• Adjusted EBITDA was $2.1 million, down from $3.2 million in Q2 2023; YTD Adjusted EBITDA was $5.6 million.

• For the six months ended June 30, 2024, revenue was $60 million (up 4%), with a net loss of $2.6 million.

Outlook and guidance

• 2024 system-wide sales expected between $530 million and $545 million, up from $488 million in 2023; system-wide comp sales for clinics open 13+ months projected to increase mid-single digits.

• New franchise clinic openings (excluding refranchised clinics) expected between 60 and 75, down from 104 in 2023 due to refranchising.

• Management anticipates a volatile macroeconomic environment for the remainder of 2024, with ongoing inflation and labor shortages impacting costs.

• Company reiterates all elements of its 2024 guidance and plans to redeploy cash to support operations and capital allocation initiatives.