Medifast (NYSE:MED) reported fourth-quarter and full-year 2025 results while outlining continued efforts to reposition the business around metabolic health, highlighting early signs of improving coach productivity even as revenue and the active earning coach base declined sharply.
Leadership transition and strategic focus
Chairman and CEO Dan Chard said he plans to step down as chief executive officer effective June 1, 2026, following a planned transition discussed with the board over recent months. Chard said he will remain chairman after the transition and expects President Nick Johnson—recently appointed by the board—to assume the CEO role following Chard’s departure.
Management said the company’s clinically supported system is intended to address metabolic dysfunction and improve body composition, energy, and overall health. Chard cited results from a 16-week clinical study of the company’s “5-in-1 metabolic plan,” saying participants reduced visceral fat by 14% while retaining 98% of lean mass and experienced clinically significant weight loss.
Coach-led model, programs, and early field indicators
Johnson said the coach-led model remains the company’s key advantage, emphasizing human connection, accountability, and community. He said clients working with a coach can achieve substantially better outcomes than those trying to lose weight on their own, citing that clients can lose “up to 10 times more weight and 17 times more fat” on the flagship plan compared to self-directed efforts.
The company highlighted initiatives designed to support coach productivity and engagement, including:
- Premier Plus, which Johnson said simplifies the offering and is expected to support client acquisition and retention.
- Edge, a program designed to incentivize “duplication” of highly productive coaches by rewarding behaviors tied to client acquisition, coach sponsoring, and leadership development.
Johnson said that during the fourth quarter the company achieved a “double-digit” percentage of active earning coaches reaching the executive director rank, described as an important business leadership milestone and the highest percentage since mid-2023. He also said retention of coaches who reached that rank over the following two months was the highest since 2022.
Management also pointed to higher levels of coach-led opportunity meetings and training activity, and said client referral-oriented activity is showing signs of strengthening word-of-mouth recommendations.
Fourth-quarter results: revenue decline, loss driven by tax valuation allowance
CFO Jim Maloney said fourth-quarter 2025 revenue was $75.1 million, down 36.9% year over year, primarily due to a lower number of active earning coaches. The company ended the quarter with about 16,100 active earning coaches, a 40.6% decrease from the fourth quarter of 2024. Maloney attributed the decline in part to GLP-1 adoption impacting the traditional weight loss category, and also to changes in the coach base as the company builds a leadership structure centered on more productive organizations.
Despite the decline in the coach count, Medifast reported an increase in average revenue per active earning coach, which rose 6.2% year over year to $4,664. Maloney said revenue per active earning coach grew year over year for the first time since the second quarter of 2022, reaching its highest level since the third quarter of 2024. Chard and Maloney framed the productivity improvement as an “early indicator” that can precede improvements in client acquisition and coach growth, while noting revenue improvement would likely take several quarters and requires sustained productivity gains.
The company posted a net loss of $18.1 million, or $1.65 per diluted share, compared with net income of $0.8 million, or $0.07 per diluted share, in the year-ago quarter. Maloney said results included a $12.1 million non-cash valuation allowance against deferred tax assets, equal to the company’s ending deferred tax asset balance. That allowance represented $1.10 of the per-share loss; excluding it, loss per share was $0.55, which Maloney said was better than the company’s guidance range.
Gross profit declined 40.9% to $52.1 million, and gross margin fell 470 basis points to 69.4%, primarily reflecting loss of leverage on fixed costs and a one-time restructuring charge. SG&A expense decreased 31.5% to $59.9 million, driven mainly by lower coach compensation, reduced company-led marketing, and employee realignment, partially offset by restructuring charges and higher coach event costs.
Cost actions, balance sheet, and outlook
Maloney said the company executed a restructuring across all business functions in the fourth quarter and further scaled back marketing spend, targeting future savings of more than $30 million. He said these changes, along with other initiatives, are reflected in 2026 guidance.
Medifast ended 2025 with $167.3 million in cash, cash equivalents, and investment securities and no debt. Working capital was $158.7 million as of December 31, 2025.
For the first quarter of 2026, Medifast guided revenue of $65 million to $80 million and loss per share of $0.15 to $0.70. Maloney said the company expects continued coach productivity growth both year over year and sequentially.
With “confidence level up” on full-year visibility, management reinstated annual guidance. For 2026, the company expects revenue of $270 million to $300 million and loss per share of $1.55 to $2.75. Maloney said the company believes improvements toward profitability will start in the fourth quarter of 2026, “following the launch of our new product line,” with continued earnings improvement targeted into 2027 and beyond. The company also expects working capital to be more than $140 million at December 31, 2026.
Q&A: GLP-1 “off-ramp,” customer mix, and potential stabilization
On the call’s only analyst question, Stephens’ Jim Salera asked about the sequencing of coach productivity improvements into 2026 and the changing composition of consumers attached to coaches. Chard said the productivity improvement reflects coaches telling a “new story” focused on metabolic health that is resonating as GLP-1 drugs reshape the weight loss narrative, and he said the company is seeing a “new type of customer” seeking a different health benefit.
Salera also asked whether revenue could approach flat or positive levels by the fourth quarter. Chard said the company was not providing quarterly guidance, but noted the reinstated annual outlook reflects greater confidence as Medifast moves from transformation to execution, adding that it was “not unreasonable” to think the business could stabilize on a top-line basis.
Regarding GLP-1 users, Chard discussed what he called an “off-ramp” opportunity—people coming off the medications—and said a “recent study” showed that after two years roughly two-thirds of GLP-1 patients stop using them for a variety of reasons, often regaining weight. He said Medifast estimates roughly a quarter of its patients either have used or are on GLP-1 drugs. Johnson said the company’s messaging around visceral fat reduction and lean mass preservation is resonating, particularly with consumers focused on body composition and the quality of weight loss.
In closing remarks, Chard said Medifast is focused on executing its transition to a metabolic health company, strengthening the coach community, and positioning the business for sustainable long-term performance.
About Medifast (NYSE:MED)
Medifast, Inc (NYSE: MED) is a health and wellness company specializing in clinically supported weight-loss, weight-management and healthy living products and services. Through its OPTAVIA brand, the company offers a range of meal replacement products, snacks, supplements and coaching programs designed to support metabolic health and sustainable lifestyle changes. Medifast markets its products directly to consumers via a network of independent distributors—known as OPTAVIA Coaches—who provide personalized guidance and support throughout the client’s weight‐loss journey.
Founded in 1980 by William Vitale and headquartered in Baltimore, Maryland, Medifast has grown into a nationally recognized provider of nutrition and weight‐management solutions.
