Beachbody Co. Inc. enjoyed a temporary spike in its share price after announcing a new executive chair of the board.
In this newly formed role, Mark Goldston will be instrumental in partnering with the company’s co-founder and chief executive, Carl Daikeler, in guiding the company’s transformation, driving profitability, and leveraging its assets to unlock opportunities for growth, the company said.
The announcement of Goldston’s appointment was made on June 15; the share price closed at 44 cents on that day. On June 16 the shares closed at 53 cents, an increase of about 21%.
Goldston serves as chief executive of The Goldston Group, a Century City-based firm specializing in strategic advisory services, venture capital, and investments in emerging growth companies. He is also a general partner in Athletic Propulsion Labs, an athletic footwear company based in Beverly Hills that he founded in 2009 with his twin sons, Adam and Ryan Goldston. Prior to that, Goldston had been chief executive of United Online Inc., a publicly traded internet and consumer services company that was based in Woodland Hills.
Beachbody’s stock closed at 43 cents on June 26, a price that marked a roughly 19% decrease from June 16’s closing price.
A month earlier, Beachbody’s stock went up slightly following the release of the company’s first-quarter earnings.
On May 5, shares in the company closed at 45 cents; on May 8, shares ended trading at 48 cents. On the following day the price dropped by 2% to close at 47 cents.
The company reported on May 8 a net loss of $29.2 million (-9 cents a share) for the quarter ending March 31, compared with a net loss of $73.5 million (-24 cents) in the same period a year earlier. Revenue decreased by 27 percent from the first quarter of the prior year to $145 million.
In late May, Linda Bolton Weiser, a senior equity analyst with D.A. Davidson & Co., said in a research report on Beachbody that the company in March had transitioned to a new subscriber service called BODi, which stands for Beachbody On Demand interactive.
“BODi subscribers were (greater than) 500,000 as of April 30,” Weiser wrote in the report. “Overall digital LTV (lifetime value
per customer) was 13%-plus in March versus February.”
Jonathan Komp, a senior research analyst at Baird, also noted the increase in BODi subscriptions and said that “achieving annual renewals at the higher rate ($179 versus the prior $119 per-year base subscription) have tracked in line with historical norms (positive initial sign, though ongoing churn will be important to monitor) and driving engagement across new fitness, nutrition and mindfulness content is healthy.”
Despite these positive signs, overall digital Beachbody subscriptions fell by 200,000 during the quarter to 1.75 million, which Komp said was well below the typical flat-to-200,000 sequential increase from Q4 to Q1 observed since 2019 “due to lower new customer acquisition at the higher $179/year rate which management hopes to improve upon with better training/targeting activities with the coaching/partner network.”
Komp rated the stock as neutral or hold, while Weiser rated it as a buy.
