WW’s stock surges after profit rises above expectations, while revenue falls shy

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Shares of WW International Inc. surged 1.7% in after-hours trading Thursday, after the weight management and wellness company formerly known as Weight Watchers reported a third-quarter profit that rose above expectations, but revenue that fell shy of forecasts. Net income grew to $54.5 million, or 78 cents a share, from $47.1 million, or 68 cents a share, in the year-ago period. The FactSet consensus for net earnings per share was 62 cents. Revenue fell 8.0% to $320.7 million, below the FactSet consensus of $322.9 million, as both service and product revenue fell short of forecasts. End-of-period subscribers grew 5.3% to 4.7 million, a new record for the third quarter, while digital subscribers increased 23.5%. “The power of our high-margin digital subscription business is demonstrated in our Q3 results as year-over-year we grew total subscribers, matched operating income levels, and grew EPS, despite the negative impact of COVID-19 on our Studio business,” said Chief Financial Officer Amy O’Keefe. The stock, which closed Thursday’s regular session down 0.1%, has dropped 42.1% year to date, while the S&P 500 has gained 2.5%.
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