Weight Watchers shares surged 16% Tuesday after the company released second-quarter earnings that beat Wall Street estimates and told investors its 2019 profits will be better than originally expected.
Here's what the company reported compared with Wall Street estimates, based on a survey of analysts by Refinitiv:
- Earnings per share: 78 cents vs. 64 cents expected
- Revenue: $369 million vs. $376.1 million expected
Weight Watchers reported fiscal second-quarter net income of $53.8 million, or 78 cents per share, down 24% from $70.7 million, or $1.01 per share a year earlier. Analysts surveyed by Refinitiv had expected 64 cents per share.
Net sales declined nearly 10% to $369 million, shy of Wall Street's expectations of $376.1 million.
Weight Watchers Chief Financial Officer Nick Hotchkin told CNBC the company was "very pleased" with the revenue trends. The company warned of a slow start to the year as its new look and message fell flat with consumers and people experimented with the trendy keto diet.
Weight Watchers rebranded itself to WW last year as it tries to transform itself to a wellness brand from a diet company. It revamped its marketing to clarify that WW was Weight Watchers "reimagined." It enlisted board member Oprah Winfrey to help sell wellness.
Weight Watchers CEO Mindy Grossman in an interview with CNBC said the turnaround wasn't just about Winfrey.
"I think we have to be very clear. It's great we have Oprah as part of the family and board, but this momentum we are seeing is global across every market and it really is a testament to the team and our overall marketing efforts, digital efforts, tech efforts and global integration," she said.
At the end of the quarter, Weight Watchers boasted 4.6 million total members, up from 4.5 million members in the year-ago quarter. The company said this was its highest number of members ever for a second quarter.
Weight Watchers usually sees an influx of members at the beginning of the year then watches them taper off throughout the year as they ditch their diets. It had just as many members at the end of the second quarter as the first.
The company boosted its full-year adjusted earnings forecast to a range of $1.55 to $1.70 per share. Analysts were expecting $1.52 per share.