These statements may include our future expectations regarding financial results and guidance, market opportunities, and our growth. A reconciliation of these measures can be found in our earnings release as filed this morning and in our most recent 10-K, which is available on our website. For this morning's call, I will start with a review of our first quarter performance, followed by an update on strategic priorities which are driving our return to growth. Michael will then take you through our first quarter financials and 2026 outlook.
We stabilized revenue year-over-year and delivered positive same-center sales for the first time in over two years. We expanded gross margin and made important investments in marketing and talent. We remain confident in our outlook and our ability to deliver sustained long-term profitable growth and value creation for our shareholders. Let me now share highlights of our progress on the strategic priorities that have repositioned our company for sustainable and consistent growth.
Combined with fat removal and fat transfer, these procedures have the potential to unlock more than $100 million in long-term revenue across our existing centers. The marketing initiatives we launched at the end of 2025 are translating into more consistent demand. Through better training, deeper product understanding, and aligned incentives, our teams are converting demand more effectively. As a result, we are seeing improvement in conversion rates and revenue.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year 2026 revenue | FY2026 | $151M-$157M (reaffirmed) |
| Full-year 2026 Adjusted EBITDA | FY2026 | $15M-$17M (reaffirmed) |
| Comparable revenue growth (midpoint, ex-London) | FY2026 | approximately 3% |
| De novo center openings | FY2026 | none contemplated in guidance |
| Same-store sales and EBITDA | Q2 2026 | sequential improvement in both revenue and EBITDA in absolute dollars vs. Q1 |
| Metric | YoY | Note |
|---|---|---|
| Revenue | flat at $39.4M (+1% same-store ex-London) | Higher case volume driven by enhanced sales and marketing initiatives; +19% sequentially. |
| Gross margin | +~1 pt to 60% of revenue | Cost of services of $15.6M with improved operating leverage. |
| SG&A | +~$800K to ~$22.6M | Deliberate increase in marketing and brand development investment, which drove revenue growth for the first time in nine quarters. |
| Adjusted EBITDA | down to 8.4% from 9.5% of revenue ($3.3M) | Higher marketing/brand investment and elevated customer acquisition cost. |
| Customer acquisition cost | up to ~$3,400 from $3,130 per case | Increased investment in the media mix and marketing to rebuild demand. |
| Cash flow from operations | up to ~$5M from ~$1M | Improved profitability and working capital versus 2025. |
| Leverage | below 2.5x, down over one turn | Nearly $30M of debt repaid over the last five quarters, including $11M in Q1. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| GLP-1 market opportunity | not previously quantified | GLP-1 user base seen growing from ~5M in 2023 to 25M by 2030 (~400%) in a $200B market; 63% of patients interested in treatment implies nearly 19M potential body-contouring patients. | — |
| New procedures (skin tightening / skin removal) | not previously quantified | Over 150 skin excision procedures in Q1; still in pilot/rollout, potential to unlock more than $100M in long-term revenue across existing centers. | — |
| Sales and marketing strategy | initiatives launched at the end of 2025 | Expanded media mix including Connected TV, influencer engagement, and targeted campaigns, plus improved digital funnel/website and sales execution, driving higher-quality leads, better conversion, and revenue. | — |
| Financial discipline / debt reduction | nearly $30M repaid over last five quarters (per prior call) | Leverage below 2.5x (down over one turn); term loan refinancing in process, details to be shared with Q2 results. | — |
| Same-store sales trajectory | negative comps for over two years | First positive same-center sales in over two years; +1% same-store ex-London; targeting sequential improvement in Q2. | — |