Nautilus (NLS) Misses Q2 EPS by 1c, Revenues Miss

Nautilus (NYSE: NLS) reported Q2 EPS of $0.03, $0.01 worse than the analyst estimate of $0.04. Revenue for the quarter came in at $75.5 million versus the consensus estimate of $78.67 million.

Bruce M. Cazenave, Chief Executive Officer, stated, “Our overall performance was in-line with our expectations for the second quarter, historically the seasonally slowest quarter of the year. We continued to see solid momentum in our Retail segment during the second quarter, which achieved 5.7% year-over-year growth, driven by double-digit expansion in our mass retail channel. Our Direct segment remained challenged in the second quarter by the continued phase-down of the mature TreadClimber® and softer than expected results from Max Trainer®. We expect strong growth in the Direct segment in the back-half of 2018 based on new product launches and the introduction of our new digital platform, which will be incorporated onto an upgraded and refreshed Max Trainer product line.”

Mr. Cazenave continued, “Our year is unfolding as expected and key initiatives such as new product launches and fall season order plans for retail customers are tracking well. These positive factors give us the confidence to increase our full year revenue guidance range by $3 million. We are now expecting full year revenues in 2018 to be in the range of $431 million to $440 million and are reiterating operating income to be in the range of $42 million to $45 million. The Company has also taken pricing actions and cost improvement measures to help mitigate the impact of inflationary product cost pressures and unfavorable foreign exchange trends that negatively impacted gross margins in the first half of 2018. New product introductions slated for the third quarter include two models of the Bowflex LateralX® trainer in the Direct segment and the Octane MTX Max Trainer®, the commercial version of our popular Max Trainer line designed for the specialty and commercial channels of distribution. In addition, we plan to launch upgraded versions of the Max Trainer that will support our exciting new digital subscription platform in our Direct segment during the fourth quarter. Our Retail segment is expected to continue to perform well in the back-half of this year and achieve growth in each quarter of 2018 versus the comparable quarters in 2017. Retail growth in the back-half of this year is anticipated to come from expanded product offerings across our Octane, Nautilus, and Bowflex brands, which will be sold in commercial, traditional retail, and e-commerce channels this fall. We are also pleased with the progress to date on several of the key strategic initiatives we outlined earlier in the year. Specifically, we have ramped up investments in the international channel, and key logistics and systems integration initiatives have been completed. While there is much we still need to do to accomplish the acceleration in future top line and bottom line growth, we believe we are on track to deliver on our stated objectives for 2018.”

For earnings history and earnings-related data on Nautilus (NLS) click here.

You May Also Be Interested In

• Tesla plans 'flying' Roadster stunt at SpaceX Texas site as early as August
• SVB & T Corporation (SVBT) Tops Q2 EPS by 275c
• Outlook Therapeutics (OTLK) Misses Q3 EPS by 9c