Business Context and Reporting Period
Company: The Beachbody Company, Inc. (BODi)
Filing Type: Form 10-K (Annual Report)
Period Ended: December 31, 2025
Business Overview: BODi is a fitness and nutrition company providing digital streaming content and nutritional products. The company operates a single segment focused on holistic health solutions via its BODi platform. As of December 31, 2025, the company reported 0.87 million digital subscriptions and 0.08 million nutritional subscriptions.
Key Financial Metrics
| Metric | 2025 | 2024 |
|---|---|---|
| Total Revenue | $251.7 million | $418.8 million |
| Gross Profit | $183.8 million | $287.3 million |
| Gross Margin | 73.0% | 68.6% |
| Operating Income | $5.5 million | ($66.2 million) Loss |
| Net Loss | ($2.9 million) | ($71.6 million) |
| Adjusted EBITDA | $30.8 million | $28.3 million |
| Adjusted Net Income | $3.5 million | ($31.2 million) Loss |
| Cash and Cash Equivalents | $39.0 million | $20.2 million |
| Free Cash Flow | $17.4 million | ($2.0 million) |
Material Changes vs. Prior Period
- Revenue Decline: Total revenue decreased 40% to $251.7 million. This was driven by a 32% drop in digital revenue and a 48% drop in nutrition revenue, primarily due to the "Pivot" restructuring which eliminated the Multi-Level Marketing (MLM) Partner model and associated fees.
- Profitability Improvement: The company achieved its first full year of operating income ($5.5 million) and Adjusted Net Income ($3.5 million) since going public, compared to significant losses in 2024. This was achieved despite revenue declines, due to substantial cost reductions.
- Cost Reductions: Total operating expenses fell from $353.6 million in 2024 to $178.3 million in 2025. Selling and marketing expenses dropped 53% largely due to the elimination of Partner compensation ($93 million decrease).
- Debt Restructuring: In May 2025, the company repaid its Term Loan in full and entered a new $35.0 million Asset-Based Lending (ABL) Facility. This resulted in a $2.2 million loss on debt extinguishment in 2025.
- Product Strategy: The company ceased sales of connected fitness equipment (BODi Bike) in Q1 2025, resulting in minimal connected fitness revenue ($0.9 million) for the year.
Guidance, Outlook, and Risks
Strategic Outlook:
- The Pivot: The transition from an MLM model to a single-level affiliate model was completed in late 2024. The company is now focused on a multi-channel distribution strategy including direct response, affiliates, and e-commerce marketplaces.
- Retail Expansion: In 2026, the company plans to launch a retail initiative, selling Shakeology via retail markets for the first time, followed by P90X and Insanity branded supplements.
- Content Library: The company continues to invest in its digital library, which includes over 11,000 unique videos. Engagement metrics (DAU/MAU) averaged 31.8% in 2025.
- Debt Covenants: The company is subject to financial covenants under its ABL Facility, including minimum liquidity ($12 million, increased to $15 million in a Jan 2026 amendment) and minimum digital subscription targets. Failure to meet these could trigger a default.
- Goodwill Impairment: While no impairment was recorded in 2025, the company noted that continued revenue declines or stock price volatility could trigger future impairment charges. A $20.0 million goodwill impairment was recorded in 2024.
- Legal Proceedings: A class action regarding Partner misclassification was settled and dismissed in early 2026. A securities class action regarding the 2021 merger (Reilly Action) is currently on appeal, with a decision expected around May 2026.
- Concentrated Ownership: Co-founder Carl Daikeler controls over 80% of voting power through Class X stock, limiting other stockholders' influence on corporate matters.
Investor Verification Checklist
- Debt Covenant Compliance: Verify the company's ability to maintain the minimum liquidity and digital subscription covenants under the amended ABL Facility, particularly given the revenue decline.
- Revenue Sustainability: Assess whether the new affiliate model can sustainably replace the revenue previously generated by the MLM Partner network and preferred customer fees.
- Goodwill Valuation: Monitor the company's stock price and revenue forecasts, as further declines could necessitate additional non-cash goodwill impairment charges.
- Retail Execution: Evaluate the success of the planned 2026 retail launch for nutritional products, which represents a new and unproven revenue channel for the company.
- Legal Resolution: Track the outcome of the Reilly Action appeal, as a negative ruling could result in indemnification obligations or reputational damage.