Weight Watchers International (NASDAQ: WW) shares fell sharply Tuesday afternoon after reporting a third-quarter sales miss.
Earnings came in at 68 cents per share, beating estimates by 2 cents. Sales came in at $348.6 million, missing estimates by $4.12 million. Operating Income was $94.7 million compared to $118.9 million in the prior year period. This decrease in operating income was primarily driven by operating deleverage on lower revenues in the quarter versus the prior year period.
The company raised its 2019 earnings guidance from $1.55-$1.70 to $1.63-$1.75.
"As our strong marketing execution successfully recruited new members and retention continued to increase, we outperformed our expectations for subscriber growth, resulting in our highest-ever end of period subscribers in a third quarter," CEO Mindy Grossman said. "Next week, we will be launching our new program – our most customized yet – which we believe will have broad appeal among current, returning, and first-time members."
- End of period subscribers of 4.4 million
- Subscribers increased 6% year-over-year
- Total paid weeks were up 3.7% year-over-year
Weight Watchers shares are down 12% to $33 in Tuesday's after-hours session. The stock closed the regular session higher by 3.79% at $37.51 per share.