Weight Watchers International Inc (NASDAQ:WW) Q2 2022 Earnings Conference Call - Final Transcript
Aug 04, 2020 • 05:00 pm ET
[Operator Instructions] Our first question will come from Steph Wissink with Jefferies. Please go ahead.
Thank you. Good afternoon, everyone. Maybe a two-part question for you. One is really just to clarify. You talked about a premium experience targeting millennials in the back half of the year. Is that similar to or aligned with the virtual coaching model? Or is that something separate that's more targeted towards that specific demographic?
Mindy F. Grossman
No. That is separate. So it is a whole new vertical of membership that we will be launching. Now we are going to continue some virtual workshops for our workshop members, but this is a completely different vertical. We are bringing in a new cohort of coaches. It's very content-driven and community-driven. And we're very excited. We'll be in between from a pricing perspective, our digital and our workshop membership, but I really think it is going to accomplish two things. It will attract new audience, new diverse audience, but it's also an opportunity to upsell from digital for those people who want more accountability, more engagement and more community.
That's great. And then just one follow-up for you, Nick. This is more just a numeric question, but you mentioned that the July business has continued to demonstrate some nice acceleration. So it almost looks like your business is defying some of the historic seasonal patterns. Can you talk a little bit about, as you think through the back half of the year, how we should think about the normal seasonality of that waterfall effect versus what you're able to actually offset and maybe gain some ground relative to that historic trend?
Nicholas P. Hotchkin
Okay. I've been pleased with the rebound, and we're growing nicely in July also, which is important as we approach our fall campaign. Look, having Q2 end of subscribers be at 5 million, an all-time high for Q2 end, effectively equaling the Q1 number, also 5 million, was a very important achievement for us. And so to your point on seasonality. Look, last year's seasonality was pretty exceptional historically, a peak to trough decline during the year of 8% from Q1 to year-end. But certainly, our performance in Q2, and the speed of the digital growth of subscribers up 23%. It was a very encouraging quarter.
Okay. Thank you.
Our next question will come from Lauren Cassel with Morgan Stanley. Please go ahead.
Great. Thanks so much. My first question was just on the real estate. The color you gave was helpful. But I guess, how should we think about what the right number of branded studio locations is long term? And then ultimately, what sort of savings do you think we could see there? I think in 2019, you spent a little over $50 million on rent. Is it $20 million or $30 million there sort of ballpark, what could we see in '21? And then my second question is just around marketing spend in the back half of the year, you noted a return to TV in