LifeMD — Third Quarter 2026 Earnings Summary

Financial Performance:

• Third quarter 2026 revenue was $44.6 million, a 7% decrease year-over-year from $47.7 million in the prior-year period.
• GAAP net loss from continuing operations attributable to common stockholders was $5.2 million ($0.11 per share), compared to $8.4 million ($0.18 per share) in the second quarter of 2026 and $5.4 million ($0.12 per share) in the prior-year period.
• Adjusted EBITDA was a loss of approximately $0.4 million, compared to a loss of $3.5 million in the second quarter of 2026 and a profit of $2.8 million in the prior-year period.
• Gross profit was $36.4 million, down from $40.7 million in the prior-year period; gross margin was approximately 82%, compared to 85% in the prior-year period.
• Selling and marketing expenses decreased 18% year-over-year and 34% sequentially to $18.5 million.
• General and administrative expenses increased 6% year-over-year to $14.7 million.
• Cash totaled $21.9 million as of September 30, 2026, with no debt at quarter-end.
• Accounts payable increased significantly to $37.7 million from $14.1 million at the end of 2025.
• Inventory increased to $10.3 million from $2.8 million at the end of 2025.

Guidance and Future Outlook:

• Fourth quarter 2026 revenue guidance is $46 million to $49 million.
• Fourth quarter 2026 Adjusted EBITDA guidance is a loss of $4 million to $2 million.
• Full year 2026 revenue guidance was revised down to $188 million to $191 million, compared to previous guidance of $205.5 million to $212.5 million.
• Full year 2026 Adjusted EBITDA guidance was revised down to a loss of $12.6 million to $10.6 million, compared to previous guidance of a loss of $6.0 million to breakeven.
• Management expects to sustain or improve unit economics going forward.

Business Segments and Product Lines:

• Total active subscribers increased 13% year-over-year to approximately 350,000.
• LifeMD Pharmacy shipment volume grew 58.3% year-over-year.
• Entered into arrangements with Novo Nordisk and Eli Lilly to dispense self-pay branded GLP-1 medications (Wegovy, Wegovy Pill, Ozempic, Zepbound, and Foundayo).
• Entered into an exclusive relationship with AT&T to provide healthcare and pharmacy services to its 100 million wireless and fiber customers and 110,000 U.S. employees.
• Women's health program continued to improve with the addition of experienced leadership.
• Enterprise healthcare offering is being prepared for marketing to businesses across the country in the fourth quarter.
• Gross margin decline to 82% from 85% is attributed to a change in presentation recognizing medications fulfilled by the pharmacy on a gross revenue basis.

Market and Competitive Landscape:

• Cost per acquisition fell 32% from May to September, while monthly media spend declined 45%.
• Partnerships with major pharmaceutical companies and AT&T are expected to drive future growth.
• The company is prioritizing longer patient commitments over short-term revenue growth.

Risks and Challenges:

• Revenue for the quarter was below guidance due to reduced marketing spend, prioritization of longer patient commitments, and slower-than-expected ramp-up of new partnerships.
• Litigation costs related to the Johnston v. LifeMD, Inc. class action complaint and executive separation agreements were included in Adjusted EBITDA adjustments.
• Forward-looking statements are subject to risks including regulatory developments, market conditions, and the ability to comply with complex regulations.

Management Commentary and Tone:

• CEO Justin Schreiber stated the company is "getting more efficient" and believes decisions made to reduce marketing spend and prioritize patient commitments put the company in a stronger position to grow profitably.
• CFO Atul Kavthekar noted that the gross margin decline reflects a presentation change rather than an economic one and highlighted the new $12.5 million term loan provides greater flexibility for working capital.
• Management expressed confidence in sustaining or improving unit economics despite the revenue miss.

Other Key Points:

• Subsequent to quarter-end, LifeMD closed on a $12.5 million non-convertible senior secured term loan with Avenue Capital to replace its prior revolving credit facility.
• The company divested WorkSimpli on November 4, 2025, which is reported as discontinued operations.
• Preferred stock dividends for the quarter were $776,563.
• The company reported a net loss from continuing operations before income taxes of $4.5 million for the quarter.
• Cash paid for interest was $0 for the quarter, compared to $241,464 in the prior-year period.