The Oprah Effect Fails to Lift Weight Watchers Sales; Sorry!

 

The company roped in Winfrey as its public face in October, in a bid to use her popularity to lift subscription numbers and reverse a nearly three-year decline in sales.
Winfrey, who made a $43.2 million investment for a 10 percent stake, was also added to the company's board. 


Her involvement was seen as a much-needed boost, with the stock more than doubling on October 19, when the partnership was announced. The stock had fallen 68 percent since the beginning of 2015 to its October 16 close. 

The former TV talk-show star sparked interest in Weight Watchers by hosting a conference call with its members and tweeting about her weight loss under a company program.
However, overall active subscriber numbers still fell 4.8 percent to 2.39 million in the fourth quarter ended Jan. 2. 

It is too early to judge Winfrey's impact on driving sales, S&P Global Market Intelligence analyst Efraim Levy said, adding he expected the stock and earnings to be volatile.
The company's net revenue fell 21 percent to $259.2 million in the quarter, continuing the trend of double digit percentage declines for the past two years. 

Weight Watchers reported a net loss of $11.3 million, or 18 cents per share, compared with net income of $4.4 million, or 8 cents per share, a year earlier.