BowFlex Inc (BFX) 2024 Q2 法說會逐字稿

Good day and welcome to the BowFlex fiscal second quarter 2024 earnings results conference call. (Operator Instructions) Please note this event is being recorded. I would now like to turn the conference over to your host, John Mills with ICR. Please go ahead, sir.

美好的一天，歡迎參加 BowFlex 2024 年第二季財報電話會議。 （操作員說明）請注意此事件正在被記錄。現在我想將會議交給主持人 ICR 的約翰·米爾斯 (John Mills)。請繼續，先生。

Thank you. Good afternoon, everyone. Welcome to BowFlex fiscal 2024 second quarter ended September 30 conference call. For participants on the call today from BowFlex are Jim Barr, Chief Executive Officer; and Aina Konold, Chief Financial Officer.

謝謝。大家下午好。歡迎參加截至 9 月 30 日的 BowFlex 2024 財年第二季電話會議。今天參加 BowFlex 電話會議的有執行長 Jim Barr；和財務長艾娜·科諾德。

Please note this call is being webcast and will be available for replay for the next 14 days. We'll be happy to take your questions at the conclusion of our prepared remarks. Our earnings press release was issued today at 1:05 PM Pacific time and may be downloaded from our website at corporate.bowflex.com on the Investor Relations page.

請注意，本次電話會議正在網路直播，並將在未來 14 天內重播。在我們準備好的發言結束後，我們很樂意回答您的問題。我們的收益新聞稿於太平洋時間今天下午 1:05 發布，可從我們的網站 Corporate.bowflex.com 的投資者關係頁面下載。

The earnings release, including a reconciliation of the non-GAAP financial measures mentioned in today's call to the most directly comparable GAAP measures. For today's call, we have a presentation that management will refer to during their prepared remarks. On slide 2 is our full Safe Harbor statement, which we ask everyone to read. You can access the presentation by going to the Investors page on our website and clicking on Events and Webcasts.

收益發布，包括今天電話會議中提到的非公認會計原則財務指標與最直接可比較的公認會計原則指標的調節。對於今天的電話會議，我們有一個演示文稿，管理層將在準備好的發言中參考。第 2 張投影片是我們完整的安全港聲明，我們要求每個人都閱讀該聲明。您可以透過造訪我們網站上的投資者頁面並​​點擊活動和網路廣播來存取簡報。

I'd like to remind everyone that during the conference call, BowFlex management will make certain forward-looking statements. These forward-looking statements are based on the beliefs of management and information currently available to us as of today. Such forward-looking statements are not guarantees of future performance and therefore, one should not place undue reliance on them.

我想提醒大家，在電話會議期間，BowFlex 管理階層將做出某些前瞻性陳述。這些前瞻性陳述是基於管理階層的信念和我們目前所掌握的資訊。此類前瞻性陳述並不能保證未來業績，因此，不應過度依賴它們。

Our actual results may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control and ability to predict. For additional information concerning these factors, please refer to the Safe Harbor statement and to our SEC filings, which can be found in the Investor Relations section of our website.

我們的實際結果可能會受到已知和未知的風險、趨勢、不確定性以及超出我們控制和預測能力的因素的影響。有關這些因素的更多信息，請參閱安全港聲明和我們向 SEC 提交的文件，這些文件可以在我們網站的投資者關係部分找到。

With that, it is my pleasure to turn the call over to BowFlex CEO, Mr. Jim Barr.

至此，我很高興將電話轉給 BowFlex 執行長 Jim Barr 先生。

Thank you, John. And thank you all for joining us on our first earnings call as BowFlex Inc., following our comprehensive company re-brand. BowFlex is a globally renowned name known as a beacon of fitness excellence. Our new corporate identity mirrors our number one brand and exceptional standing in the connected home at home fitness equipment market and reinforces our unyielding commitment to our strongest brands.

謝謝你，約翰。感謝大家在公司全面品牌重塑後參加我們以 BowFlex Inc. 為名召開的首次財報電話會議。 BowFlex 是全球知名品牌，被譽為卓越健身的燈塔。我們的新企業形象反映了我們的第一品牌和在互聯家居健身器材市場的卓越地位，並強化了我們對最強品牌的堅定承諾。

Before we dig into results for the quarter, I'd like to first touch on what we're seeing in the industry, as we move through Q2 and into Q3, we continue to face a challenging operating environment. The macro economic backdrop remains uncertain weighing on the consumer. Retailers continue to maintain a highly conservative approach to inventory. This market uncertainty is driving an increasingly promotional environment as we head into fitness season.

在我們深入研究本季的業績之前，我想先談談我們在業界看到的情況，隨著我們進入第二季和第三季度，我們仍然面臨著充滿挑戰的營運環境。宏觀經濟背景仍不確定，給消費者帶來壓力。零售商繼續對庫存保持高度保守的態度。隨著我們進入健身季節，這種市場的不確定性正在推動促銷環境的不斷發展。

With that being said, it is important to highlight that we are successfully executing on the things we can control, including reducing our cost structure and improving our inventory position, which is enabling us to manage through this near-term environment. At the same time, we are ensuring that we are well positioned to capitalize on the long term shift to connected at-home fitness when consumer demand stabilizes.

話雖如此，重要的是要強調，我們正在成功執行我們可以控制的事情，包括降低成本結構和改善庫存狀況，這使我們能夠應對當前的短期環境。同時，我們確保當消費者需求穩定時，我們能夠充分利用向連網家庭健身的長期轉變。

Turning to our second quarter results. We delivered net sales of $49 million during the quarter with direct sales of $21 million. While the direct segment was down year-over-year, we were encouraged by the positive 15% comp we delivered in strength equipment. We believe these positive results are a testament to the deliberate product enhancements we've made in this area.

轉向我們第二季的業績。本季我們的淨銷售額為 4,900 萬美元，其中直接銷售額為 2,100 萬美元。雖然直接業務同比下降，但我們在力量器材領域實現的 15% 的正收益令我們感到鼓舞。我們相信這些正面的結果證明了我們在這一領域刻意改進的產品。

Similarly, though not a big part of our business, we also returned to growth in our international business reported under our retail segment. Together we hope that these two bright spots are an indicator that we are nearing a return to broader enterprise growth.

同樣，雖然不是我們業務的重要組成部分，但我們零售部門報告的國際業務也恢復了成長。我們希望這兩個亮點共同表明我們即將恢復更廣泛的企業成長。

On the other hand, domestic retail continued to face softness and overall retail segment net sales were down 30% year-over-year. Although retailer inventory of our products is down 50% year-over-year as of October showing significant progress in rightsizing their inventory positions. Retailers are still maintaining their conservative approach to reorders, and we believe it has it is a prudent to plan for this to continue as we enter the peak fitness season.

另一方面，國內零售業持續疲軟，整體零售業淨銷售額年減30%。儘管截至 10 月份，我們產品的零售商庫存年減了 50%，這表明在調整庫存部位方面取得了重大進展。零售商仍然保持保守的重新訂購方式，我們相信，隨著我們進入健身高峰季節，繼續這種計劃是謹慎的做法。

Importantly, over the last several quarters, we have deliberately rightsized our own inventory. This strategic move places us in a favorable position to better maintain our price discipline in an increasingly promotional environment. We continue to offset the top line softness with diligent cost management and operational excellence efforts underpinned by our supply chain initiatives, which have led to delivering margin improvements through reduced product landed costs year-over-year for four consecutive quarters despite declining sales.

重要的是，在過去的幾個季度中，我們有意調整了自己的庫存。這項策略性舉措使我們處於有利地位，可以在日益促銷的環境中更好地維持我們的價格紀律。我們繼續透過勤奮的成本管理和以供應鏈計劃為基礎的卓越營運努力來抵消營收疲軟的影響，儘管銷售額下降，但透過連續四個季度同比降低產品到岸成本，實現了利潤率的提高。

Notably, these actions also drove a second consecutive quarter of year-over-year improvement in adjusted EBITDA loss during Q2, $17 million cumulative improvement in the first half of fiscal '24 versus fiscal '23. We have made the necessary investments in JRNY and taken deliberate steps to scale to reduce cash spend and to focus on paid subscriber conversion to accelerate break even.

值得注意的是，這些行動也推動第二季調整後 EBITDA 損失連續第二季年比改善，與 23 財年相比，24 財年上半年累計改善了 1,700 萬美元。我們對 JRNY 進行了必要的投資，並採取了審慎的措施來擴大規模，以減少現金支出，並專注於付費用戶轉化，以加速收支平衡。

By the end of Q2, we had nearly 600,000 JRNY members, up 51% versus second quarter fiscal '23, and we now expect about 650,000 members by fiscal year by the end of the fiscal year versus our original guidance of 625,000, total subscribers at the end of Q2 '24 was up 1% to 143,000.

到第二季末，我們擁有近60 萬名JRNY 會員，比23 財年第二季成長51%，我們現在預計到本財年結束時，本財年會員數量約為65 萬名，而我們最初的指導值為625,000 名，訂戶總數為2024 年第二季末成長 1%，達到 143,000 人。

And most importantly, we achieved significant growth in paid subscribers versus the same quarter one year ago. This progress reflects not only additional JRNY product capabilities such as motion tracking and form coaching with SelectTech dumbbells, but also our ongoing efforts to optimize our subscriber funnel through shorter trial periods and better communication and merchandising.

最重要的是，與一年前同一季度相比，我們的付費用戶實現了顯著成長。這項進展不僅反映了 JRNY 的其他產品功能，例如運動追蹤和 SelectTech 啞鈴的體形訓練，而且還反映了我們不斷努力透過更短的試用期以及更好的溝通和推銷來優化我們的用戶管道。

As we discussed last quarter, we recently launched an exciting pipeline of new connected fitness equipment for this fitness season. Two Bowflex products, the Max Trainer SE and the IC Bike SE and our new Schwinn 490 elliptical.

正如我們上季度討論的那樣，我們最近為這個健身季節推出了一系列令人興奮的新型互聯健身設備。兩款 Bowflex 產品：Max Trainer SE 和 IC Bike SE 以及我們的新型 Schwinn 490 橢圓機。

Paired with our re-branded identity, BowFlex continues to demonstrate its strength in producing consumer centric equipment that is inclusive and designed for different rooms in your home. These products will be sold through our direct business as we deliberately focus on our new products and innovation efforts to drive continued momentum in this segment.

與我們重新命名的品牌形象相結合，BowFlex 繼續展示其生產以消費者為中心的設備的實力，這些設備具有包容性，專為您家中的不同房間而設計。這些產品將透過我們的直接業務進行銷售，因為我們刻意專注於我們的新產品和創新努力，以推動該領域的持續發展勢頭。

We are encouraged by early reception of these new products, which has been supported by our focused marketing spend. We continually evaluate and optimize our advertising strategy to make sure our products are hitting the right places and the right people. In addition managing our marketing investments continues to be a lever we can pull quickly and adjust as we monitor the demand environment.

我們對這些新產品的早期接受感到鼓舞，這得到了我們重點行銷支出的支持。我們不斷評估和優化我們的廣告策略，以確保我們的產品到達正確的地方和正確的人群。此外，管理我們的行銷投資仍然是我們在監控需求環境時可以快速拉動和調整的槓桿。

Turning to our fiscal 2024 outlook. As I mentioned earlier, as we begin fitness season in Q3 we're seeing the macroeconomic environment continue to impact the consumer. Retailers' reorders have remained slow as our partners continue to largely service the category with existing inventory. Based on these dynamics and the visibility into fitness season orders we have today, we have revised our FY 2024 guidance.

轉向我們的 2024 財年展望。正如我之前提到的，當我們在第三季開始健身季節時，我們看到宏觀經濟環境繼續影響消費者。由於我們的合作夥伴繼續主要利用現有庫存為該類別提供服務，零售商的重新訂購仍然緩慢。根據這些動態以及我們今天掌握的健身季節訂單的可見性，我們修訂了 2024 財年指導。

We continue to take the necessary steps that position us well to navigate the near term. As previously mentioned, we have rightsized our inventory position, enabling us to maintain our price, support our profitability and maintain our brand equity in a promotional environment. Our semi-variable operating model enables us to continually manage costs and prioritize investments that will drive the business forward.

我們將繼續採取必要的步驟，使我們能夠在短期內順利度過難關。如前所述，我們調整了我們的庫存狀況，使我們能夠在促銷環境中維持我們的價格，支持我們的盈利能力並維持我們的品牌資產。我們的半可變營運模式使我們能夠持續管理成本並優先考慮推動業務發展的投資。

We have demonstrated our ability to drive improved results as an outcome of these efforts highlighted by the $17 million year-over-year improvement in adjusted EBITDA for the first half of the year, which is seasonally our softer period.

作為這些努力的成果，我們已經證明了我們有能力推動業績改善，今年上半年調整後 EBITDA 同比增長了 1,700 萬美元，這是我們季節性疲軟的時期。

As reflected in our guidance, we continue to believe we can deliver significant year-over-year improvement in adjusted EBITDA this year, while managing near term opportunities and near term temporary headwinds, we continue to position ourselves to capitalize on the enduring change in long-term at-home fitness habits as we introduce new products and scale JRNY.

正如我們的指引所反映的，我們仍然相信今年我們能夠實現調整後 EBITDA 的同比顯著改善，同時管理近期機會和近期暫時的不利因素，我們將繼續定位自己，以利用長期的持久變化-隨著我們推出新產品和擴大JRNY 規模，長期在家健身習慣。

Even as workouts at gyms have risen, the percentage of consumers working out at home has remained consistent over the last two years at significantly elevated levels relative to pre pandemic. And we are well situated to fulfill these the needs of our consumers sustain interest in home workouts with our broad portfolio of strength and cardio equipment at a variety of price points and by highlighting the total cost of ownership advantages that we have.

儘管去健身房運動的人數有所增加，但過去兩年中，在家運動的消費者比例仍然保持一致，與大流行前相比，顯著提高了水平。我們有能力滿足消費者的這些需求，透過我們以各種價位提供的廣泛的力量和有氧運動設備產品組合，並強調我們擁有的總擁有成本優勢，維持對家庭運動的興趣。

As we look ahead, we continue to be thoughtful and responsive to consumer behavior with calendar year 2024 product priorities, focusing on introducing new strength, equipment, treadmills and other products that broaden our portfolio at important price points.

展望未來，我們將繼續深思熟慮並回應消費者行為，確定 2024 年的產品優先事項，重點推出新的力量、設備、跑步機和其他產品，以重要的價位擴大我們的產品組合。

I will now turn it over to Aina, who will give us more detail on the second quarter results and our fiscal 2024 guidance.

我現在將其交給 Aina，她將為我們提供有關第二季度業績和 2024 財年指導的更多詳細資訊。

Thank you, Jim, and good afternoon, everyone. Today, I'll be speaking to results for the second quarter of fiscal '24, and we'll provide guidance for the full year fiscal '24. Please go to our website to view our press release and the slides accompanying this call for more information on Q2 and year-to-date results.

謝謝吉姆，大家下午好。今天，我將談論 24 財年第二季的業績，我們將為 24 財年全年提供指導。請造訪我們的網站查看我們的新聞稿以及本次電話會議隨附的幻燈片，以了解有關第二季度和年初至今業績的更多資訊。

Turning now to slide 10. Net sales for the second quarter were $49 million, down 26% versus last year. Direct declined by about 15%, direct cardio was down 30%, but direct strength was up 15% versus last year. The first positive comp and strength since Q1 fiscal '22.Our retail segment declined by 30% as retailers continue to be conservative with reordering inventory.

現在轉向投影片 10。第二季的淨銷售額為 4,900 萬美元，比去年同期下降 26%。與去年相比，直接下降了約 15%，直接有氧運動下降了 30%，但直接力量上升了 15%。這是自 22 財年第一季以來的首次積極的比較和實力。由於零售商在重新訂購庫存方面繼續持保守態度，我們的零售部門下降了 30%。

Importantly, our international business is growing again, delivering positive 41% comp in the quarter. Gross profit was $10 million, down 13% versus last year. However, we were pleased to deliver another quarter of gross margin expansion on softer year-over-year net sales. As such, Q2 gross margin of 20% was up 300 basis points versus last year. This improvement demonstrates the success of our North Star initiatives in supply chain.

重要的是，我們的國際業務再次成長，本季實現了 41% 的正成長。毛利為 1000 萬美元，比去年下降 13%。然而，我們很高興在淨銷售額同比疲軟的情況下，毛利率又實現了一個季度的成長。因此，第二季毛利率為 20%，比去年增加了 300 個基點。這項改進證明了我們的北極星計畫在供應鏈中的成功。

Breaking into the specific drivers, the gross margin improvement was driven by 900 basis points increase due to lower landed product costs, 200 basis point increase due to lower inventory adjustments. These margin gains were partially offset by 400 basis points of deleverage related to JRNY COGs, negative 300 basis points due to increased discounting and negative 100 basis points due to increases in other costs.

從具體驅動因素來看，到岸產品成本下降導致毛利率提高 900 個基點，庫存調整減少導致毛利率提高 200 個基點。這些利潤率成長被與 JRNY COG 相關的 400 個基點的去槓桿化、由於折現增加而導致的負 300 個基點以及由於其他成本的增加而導致的負 100 個基點所部分抵消。

Turning now to slide 11, the next few lines of the P&L have been adjusted to exclude the impact of restructuring and exit charges. Please see our press release for reconciliation to GAAP adjusted operating expenses were $20 million, down $5 million or 21% versus last year.

現在轉向投影片 11，損益表的接下來幾行已進行調整，以排除重組和退出費用的影響。請參閱我們的新聞稿，了解根據 GAAP 調整後的營運費用為 2000 萬美元，比去年減少 500 萬美元，即 21%。

The key drivers of the decrease were $3 million lower personnel expenses related to the February reduction in force, $1 million lower advertising and $1 million lower other expenses. Adjusted operating loss was $10 million, an improvement of $4 million versus last year. Adjusted EBITDA loss was $6 million, an improvement of $4 million versus last year.

減少的主要原因是與 2 月裁員相關的人員費用減少了 300 萬美元，廣告費用減少了 100 萬美元，其他費用減少了 100 萬美元。調整後營業虧損為 1,000 萬美元，比去年減少 400 萬美元。調整後 EBITDA 損失為 600 萬美元，比去年增加了 400 萬美元。

Turning to slide 12 of the balance sheet as of 930, cash was $10 million, debt was $16 million, which represents our term loan balance as we had zero borrowings on our ABL. We had $29 million available for borrowing, bringing our liquidity to $39 million.

轉向截至 930 年資產負債表的第 12 張投影片，現金為 1,000 萬美元，債務為 1,600 萬美元，這代表我們的定期貸款餘額，因為我們的 ABL 借款為零。我們有 2900 萬美元可用於借款，使我們的流動資金達到 3900 萬美元。

Other key call-outs on the balance sheet, inventory was $66 million, up 42% versus fiscal year end '23, driven by purchases to support the upcoming fitness season. About 40% of our inventory at 930 was in transit and weighted to our best selling SKUs versus the same quarter last year, inventory was down 33%. AR was $24 million and trade payables were $63 million, both up from fiscal year end '23.

資產負債表上的其他關鍵指標是，庫存為 6,600 萬美元，比 23 財年末增長了 42%，這是受到為支持即將到來的健身季節而進行的採購的推動。我們的 930 個庫存中約有 40% 處於運輸途中，並按我們最暢銷的 SKU 進行加權，與去年同期相比，庫存下降了 33%。 AR 為 2,400 萬美元，應付帳款為 6,300 萬美元，皆較 2023 財年末增加。

Turning now to guidance on slide 13. Consumer demand remains soft amid an ongoing uncertain macro environment. Retailers continue to be conservative with their inventory, reorders and competitors and retailers are aggressively discounting to clear through their excess inventory. At BowFlex we did the hard work last year to clear our inventory.

現在轉向投影片 13 中的指引。在持續不確定的宏觀環境中，消費者需求仍然疲軟。零售商對庫存、重新訂購繼續持保守態度，競爭對手和零售商則積極打折以清理過剩庫存。在 BowFlex，我們去年做了艱苦的工作來清理我們的庫存。

Our inventory balances this year in line with sales trends and units are heavily weighted to our top SKUs. Our inventory discipline it gives us flexibility to navigate this fitness season and removes the pressure to aggressively discount, which would only erode our brand equity. We believe we have the right assortment and value proposition to be competitive this fitness season. And because we have managed our inventory well, we have the flexibility to choose whether to forego low margin revenue to preserve the momentum of our gross margin expansion and position BowFlex well for the long term.

今年我們的庫存平衡與銷售趨勢一致，並且我們的頂級 SKU 的銷售量佔據很大比重。我們的庫存紀律使我們能夠靈活地度過這個健身季節，並消除了大幅折扣的壓力，這只會侵蝕我們的品牌資產。我們相信我們擁有正確的產品組合和價值主張，可以在這個健身季節中保持競爭力。由於我們的庫存管理得當，我們可以靈活地選擇是否放棄低利潤收入，以保持毛利率擴張的勢頭，並使 BowFlex 長期處於有利地位。

Given the continued challenging macro environment and year-to-date, sales trends we are lowering our expectations for full year revenue. We now expect full year revenue to be between $215 million and $240 million, compared to previous guidance of between $270 million and $300 million.

鑑於持續充滿挑戰的宏觀環境和今年迄今為止的銷售趨勢，我們降低了對全年收入的預期。我們現在預計全年收入將在 2.15 億美元至 2.4 億美元之間，而先前的指引為 2.7 億美元至 3 億美元之間。

The bottom of our sales guidance range assumes the second half year-over-year sales declines will be similar to first half, roughly minus 25% versus last year. The top end of our guidance range assumes for the second half, a less negative sales decline and slight growth in gross profit dollars versus last year.

我們銷售指導範圍的底部假設下半年銷售額年減將與上半年相似，與去年相比約為-25%。我們的指導範圍上限假設下半年銷售額下降幅度較小，毛利與去年相比略有成長。

We continue to expect year-over-year gross margin expansion for the full year with gross margin in the back half slightly higher than the first half of this year. Margin expansion, coupled with strong expense discipline, will minimize the impact of lowered revenue on adjusted EBITDA. As a result, we now expect full year adjusted EBITDA loss to be between $15 million and $25 million dollars, which continues to represent significant improvement over last year's loss of $47 million.

我們繼續預計全年毛利率將年增，下半年毛利率將略高於今年上半年。利潤率擴張，加上嚴格的費用紀律，將最大限度地減少收入下降對調整後 EBITDA 的影響。因此，我們現在預計全年調整後 EBITDA 損失將在 1500 萬美元至 2500 萬美元之間，這與去年 4700 萬美元的損失相比仍然有顯著改善。

Lastly, we are increasing our guidance for fiscal year end '24 JRNY members. We now expect to be at about 650,000 members at 33,124, versus our original guidance of 625,000. Like many other companies, we are preparing for a continuation of a difficult operating environment. While it has been challenging to predict consumer demand, we are confident in our ability to flex all available levers to minimize the impact of lower top line on the bottom line, allowing us to deliver improved adjusted EBITDA loss, compared to last year.

最後，我們正在增加 24 財年末 JRNY 會員的指導。我們現在預計會員數將達到 65 萬人，達到 33,124 人，而我們最初的指導值為 625,000 人。與許多其他公司一樣，我們正在為持續困難的營運環境做好準備。雖然預測消費者需求具有挑戰性，但我們有信心能夠利用所有可用的槓桿，最大限度地減少收入下降對利潤的影響，從而使我們能夠比去年改善調整後的 EBITDA 損失。

I'll turn it back now to Jim for his final comments.

我現在將其轉回吉姆以徵求他的最終意見。

Thank you, Aina. As we step into fitness season in the second half of our fiscal 2024, our steadfast commitment to operational excellence and prudent inventory management has equipped us to support the successful launch of our new BowFlex and Schwinn products.

謝謝你，艾娜。隨著 2024 財年下半年進入健身季節，我們對卓越營運和審慎庫存管理的堅定承諾使我們有能力支持新 BowFlex 和 Schwinn 產品的成功推出。

As the challenges in retail persist, we will remain agile in managing our costs with a focus on driving strong cash flow and supporting our path back to profitability. As we remain on track to deliver a significant year-over-year improvement in adjusted EBITDA in the fiscal 2024 as implied by our guidance.

由於零售業的挑戰持續存在，我們將保持靈活地管理成本，重點是推動強勁的現金流並支持我們恢復利潤。正如我們的指引所暗示的那樣，我們仍有望在 2024 財年實現調整後 EBITDA 同比大幅改善。

Despite the ongoing challenges, we remain encouraged by several bright spots over the quarter, including strength in our direct segment, growth in our international retail business and conversion to pay paid subscribers in JRNY, all of which support our conviction in our future as we capitalize on the long term shift to at-home fitness. I want to thank our dedicated employees and partners for their diligence, perseverance and passion for serving our consumers in their pursuit of lifelong fitness.

儘管面臨持續的挑戰，但本季的幾個亮點仍然令我們感到鼓舞，包括我們的直接部門的實力、我們的國際零售業務的增長以及JRNY 向付費訂閱用戶的轉變，所有這些都支持了我們在資本化過程中對未來的信念。從長遠來看，轉向在家健身。我要感謝我們敬業的員工和合作夥伴的勤奮、毅力和熱情，為追求終身健身的消費者提供服務。

Lastly, as a reminder, our Board of Directors remains diligent in assessing value-creating opportunities and initiatives to accelerate and strategic transformation. We have no additional information to share regarding the process at this time, we are grateful for your continued support, and we remain focused on delivering value for our shareholders and customers as we navigate these exciting opportunities ahead.

最後，提醒一下，我們的董事會仍然努力評估創造價值的機會和舉措，以加速策略轉型。目前我們沒有關於流程的更多資訊可分享，我們感謝您的持續支持，在我們把握未來這些令人興奮的機會時，我們將繼續專注於為股東和客戶創造價值。

We'll now open up the call to Q&A. Operator.

我們現在將開放問答電話。操作員。

Thank you. At this time we'll be conducting a question-and-answer session. (Operator Instructions)

謝謝。此時我們將進行問答環節。 （操作員說明）

JP Wollam, ROTH MKM.

JP 沃拉姆，羅斯 MKM。

Good morning, everyone. Thanks for taking my questions here. Maybe just starting first, I know we're headed into the seasonally strong period, but if I could maybe just think about kind of the off-season for a minute. And, Jim, I know you like talk about kind of the permanent change we have with at-home fitness and there are more people working out at home, given work hybrid that we see.

大家，早安。感謝您在這裡提出我的問題。也許剛開始，我知道我們即將進入季節性強勁時期，但如果我可以考慮休賽期。而且，吉姆，我知道你喜歡談論我們在家健身所帶來的永久性變化，考慮到我們看到的混合工作，越來越多的人在家運動。

So my question really is kind of just as we exit the off season, what are the biggest takeaways, you have in consumers purchasing habits and what is really the lesson here as we get further away from COVID and really understanding kind of off-season and what people are looking for?

所以我的問題實際上是，當我們退出淡季時，消費者的購買習慣中最大的收穫是什麼，以及當我們遠離新冠病毒並真正了解淡季和淡季的情況時，真正的教訓是什麼？人們在尋找什麼？

I mean, I still continue to see what I call long-term tailwind in that home fitness is more important over time than it was pre-pandemic. And we see strength across first is going to come across in our strength products. We starting to see that we talked about bright spots, it's kind of tough to do anything like that on a quarter like this, but where the consumer seems to be, but we're beginning to see some hopeful encouraging signals.

我的意思是，我仍然繼續看到我所說的長期順風車，因為隨著時間的推移，家庭健身比疫情前更重要。我們看到，我們的優勢產品首先會體現出優勢。我們開始看到我們談到了亮點，在這樣的季度做這樣的事情有點困難，但消費者似乎在哪裡，但我們開始看到一些充滿希望的鼓舞訊號。

Interac strength we talked about in international retail JRNY, we can sort of see the light at the end of the tunnel with the investment in JRNY, and we're seeing real progress there from quarter-to-quarter and I'm happy about our ability to leverage the bottom line despite the things we don't control on the top line. So those are kind of some of the trends.

我們在國際零售 JRNY 中談到了 Interac 的實力，透過對 JRNY 的投資，我們可以看到隧道盡頭的曙光，我們看到每個季度都取得了真正的進展，我對我們的業績感到高興儘管我們無法控制營收，但仍有能力利用獲利。這些都是一些趨勢。

I do see in terms of consumer trends, you can see in our products that products are moving to a different room of the home as people are working out at home. So these products have to be sleeker, they have to belong in the family room of the living room, not necessarily in the garage or some special room or your bedroom. These are things that people want to be proud of, that are things people talk about and so they are getting slimmer. They are not as bulky as they were before, they reflect our new branding and the reality of where things will be there.

我確實看到了消費者趨勢，你可以在我們的產品中看到，當人們在家運動時，產品正在轉移到家裡的不同房間。所以這些產品必須更時尚，它們必須屬於客廳的家庭房間，而不一定是車庫或一些特殊的房間或你的臥室。這些是人們想要自豪的事情，這些是人們談論的事情，所以他們變得更苗條。它們不像以前那麼笨重，它們反映了我們的新品牌和事物所在位置的現實。

We're continuing to see people building out their home gyms. So we're seeing people buy on the second piece more often than they were before. That's been an important trend for us. And then in connected Fitness, it used to be that your second purchase was wholly independent brand-wise to your first purchase. That is no longer the case as connected fitness pervades, you're essentially getting people who will buy the same brand on the second purchase as well. So these are things we're seeing, in the short term.

我們繼續看到人們建造他們的家庭健身房。因此，我們看到人們比以前更頻繁地購買第二件商品。這對我們來說是一個重要趨勢。然後在互聯健身中，您的第二次購買在品牌方面與您的第一次購買完全獨立。隨著互聯健身的普及，這種情況已不再是這樣，你基本上會吸引那些在第二次購買時也會購買同一品牌的人。這些都是我們在短期內看到的事情。

These headwinds for sure deals are important this holiday and I had hoped that we'd seen the consumer strengthen going into the holidays. I don't think that's happening. I think we're seeing a weakening of that going into the holidays.

這些不利因素在這個假期肯定很重要，我本來希望我們能看到消費者在假期期間有所加強。我不認為這種情況會發生。我認為我們看到假期後這種情況有所減弱。

Just reading other people's earnings reports and experiencing ourselves. So those are some of the things that we're kind of seeing and changing in the industry for the short term and long term. Hopefully, that answers your question. But if not, let's follow up.

只是閱讀別人的收益報告並體驗我們自己。這些是我們在行業中短期和長期看到和改變的一些事情。希望這能回答你的問題。但如果沒有，我們繼續跟進。

No, I think that did. And you kind of took some of the next question about promotional environment that I was going to ask. So maybe I'll switch it instead in just kind of any changes you're seeing to fitness floor space at some of your retail partners, whether that's your products alone or just the broader kind of fitness space that retail has designated?

不，我想確實如此。您回答了我要問的關於促銷環境的下一個問題。因此，也許我會在您看到的一些零售合作夥伴的健身場地空間發生任何變化時進行切換，無論是您的產品本身還是零售業指定的更廣泛的健身空間？

Yes, that's a great question. And we're really not. I mean, that's the short answer is we're not seeing any structural differences in who's carrying fitness, how many doors are carrying fitness, our products and how many doors our products are in. So we're not seeing any what I'll call significant structural differences. And that's important to us because while retail may be down right now with our on the channel approach, we are dedicated to making sure that our consumer can reach us in a variety of different channels. And so that's going to continue to be important.

是的，這是一個很好的問題。而我們確實不是。我的意思是，簡短的回答是，我們沒有看到任何結構性差異，包括誰攜帶健身、有多少門攜帶健身、我們的產品以及我們的產品有多少門。所以我們沒有看到任何我將要看到的內容。稱為顯著的結構差異。這對我們來說很重要，因為雖然零售業目前可能會因我們的通路方式而下降，但我們致力於確保我們的消費者可以透過各種不同的管道接觸到我們。因此，這將繼續發揮重要作用。

What we're really seeing and what is driving the guidance revision that we've talked about is look, they're driving down the inventory, and this is the first time, we've given the number on that. That units are down 50% year-over-year. So they have driven at retail significant reduction in units. And that's great. I think it's hard to predict when the ordering will return, right? That's what hasn't happened yet. We had hoped that it would for this year holiday season and it continues to be slow. And really that's the case in our category and some other categories.

我們真正看到的以及推動我們討論的指導修訂的因素是，他們正在降低庫存，這是我們第一次給出這個數字。該單位較去年同期下降 50%。因此，他們推動零售量大幅減少。那太好了。我認為很難預測訂單何時會恢復，對嗎？那是還沒有發生的事情。我們原本希望今年的假期會如此，但進展仍然緩慢。事實上，我們的類別和其他一些類別的情況就是如此。

So as the retail environment remains uncertain, we're encouraged by some of the things I talked about before international getting a second consecutive quarter of growth and growth in smaller retailers, I think is a notable thing that I didn't talk about in my script, but those big retailers that had a lot of inventory are not reordering, as I mentioned, and they can't be counterbalanced by the smaller ones. But our smaller retailers who didn't have those inventory problems are reordering strongly. So that gives us that gives us a lot of promise in that particular area.

因此，由於零售環境仍然不確定，我們對我在國際連續第二個季度增長和小型零售商增長之前談到的一些事情感到鼓舞，我認為這是我在我的報告中沒有談論的值得注意的事情。腳本，但正如我所提到的，那些擁有大量庫存的大型零售商不會重新訂購，而且它們無法被較小的零售商所抵消。但我們沒有這些庫存問題的小型零售商正在大力重新訂購。因此，這給了我們在該特定領域的巨大希望。

So BowFlex has done a great job at focusing on those folks that those retailers that didn't have as much inventory and making sure that they were well supplied as we go into that to the holiday season. So we offer a premium product that a strong brand and a reasonable price point with a great total cost of ownership. And this gives us optimism that when the investments do open up that we'll be in a good position to take advantage of the market.

因此，BowFlex 做得很好，它專注於那些沒有那麼多庫存的零售商，並確保他們在假期期間有充足的供應。因此，我們提供優質產品，具有強大的品牌和合理的價格點，並且整體擁有成本很高。這讓我們樂觀地認為，當投資開放時，我們將處於有利地位，可以利用市場。

Great, really appreciate that. And then just one last quick one, maybe more after I end up. Just in terms of liquidity, I'll leave it pretty open-ended. I saw inventories creep higher, I know that's kind of building for the strong season, but maybe if you could just give us your high-level view on liquidity and cash burn. We've taken a lot of costs out of the business, but how are you thinking about it there? Thank you.

太棒了，真的很感激。然後只是最後一個快速的，也許在我結束後會更多。就流動性而言，我會保持開放式的態度。我看到庫存上升，我知道這是為旺季準備的，但也許您可以向我們提供您對流動性和現金消耗的高層看法。我們已經從業務中削減了很多成本，但您對此有何看法？謝謝。

Thanks, Jason, for the question. So we are comfortable with our liquidity. It was $39 million at 930 and our guidance suggests that the second half adjusted EBITDA loss would be a range of 3-minus to 13-minus, which is better than last year. And as we said several times in our script, I believe we've proven that this management team can minimize the impact of lower revenue on adjusted EBITDA.

謝謝傑森的提問。因此，我們對我們的流動性感到滿意。 930 點為 3,900 萬美元，我們的指導表明下半年調整後的 EBITDA 損失將在 3 負 13 負之間，這比去年要好。正如我們在腳本中多次說過的那樣，我相信我們已經證明這個管理團隊可以最大限度地減少收入下降對調整後 EBITDA 的影響。

So we're very focused on delivering stronger EBITDA year-over-year, and that gives us confidence in our liquidity. And finally, we believe we're managing through our debt. So, concurrently, preparing the company for the recovery. Gross margin is going to be important for that. We have momentum there and we're getting new products ready for the new year. And we believe that revenue growth will come as we introduce those products in the market.

因此，我們非常注重逐年實現更強勁的 EBITDA，這讓我們對流動性充滿信心。最後，我們相信我們正在管理債務。因此，同時，公司要為復甦做好準備。毛利率對此非常重要。我們在那裡勢頭強勁，正在為新的一年準備新產品。我們相信，當我們將這些產品推向市場時，收入將會成長。

Understood. Thank you all for the time.

明白了。謝謝大家的時間。

Thanks, JP.

謝謝，JP。

There are no further questions at this point, I'd like to turn the call back over to Jim Barr for closing comments.

現在沒有其他問題了，我想將電話轉回給吉姆·巴爾 (Jim Barr) 以供結束評論。

Thank you again to everyone on this call today that and for your continued support of BowFlex. We look forward to providing our next update on our third quarter fiscal 2024 earnings call in February. Have a great rest of your day onwards and upwards.

再次感謝今天參加本次電話會議的所有人以及您對 BowFlex 的持續支持。我們期待在 2 月的 2024 財年第三季財報電話會議上提供下一次更新。祝您一天愉快地休息。

This concludes today's conference. You may disconnect your lines at this time. And we thank you for your participation.

今天的會議到此結束。此時您可以斷開線路。我們感謝您的參與。