Medifast ( NYSE: MED ) stock slumped 16.1% to $144.05 in Thursday trading, as investors overlooked the weight management company's Q2 earnings beat and focused on its significantly lowered guidance for FY 2022.
MED reported Q2 non-GAAP EPS of $3.87 which beat estimates by $0.64 , and Q2 revenue of $453.3M which beat expectations by $5.43M .
Medifast ( MED ) runs the Optavia brand, which provides weight management services, specialized diets and weight plans, while also providing personal weight coaches to customers under the Optavia Coach program.
MED's Q2 revenue, which grew 15% Y/Y, was primarily driven by an increase in the total number of active earnings Optavia Coaches.
"We're not immune to issues in the wider macroeconomic environment, and like many consumer-focused businesses, we've seen the impact of inflation on customer retention and consumer sentiment, which will cause slower-than-anticipated growth in the second half," said MED CEO Dan Chard in the earnings report .
The macroeconomic factors and impact on customer retention led the company to slash its FY 2022 revenue guidance to a range of $1.58B to $1.66B from an earlier forecast of $1.78B to $1.84B. The consensus revenue estimate is $1.54B.
MED's FY non-GAAP EPS outlook is now $12.70 to $14.10 compared to a previous guidance of $14.60 to $16.05. The consensus EPS estimate is $11.15.
Up to Wednesday's close, MED stock -18.1% YTD.
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Medifast shares sink ~16% as co slashes FY 2022 guidance on impact to customer retention