Q2 2024 Nerdy Inc Earnings Call Transcript
Key Points
- Nerdy Inc (NRDY) successfully enabled access to the Varsity Tutors for Schools platform for an additional 1.1 million students, bringing the total to 3.3 million students across nearly 600 school districts.
- The company has shifted its focus towards premium learning memberships, which have shown higher retention rates and increased average revenue per member.
- Recent improvements in the digital user experience have led to faster time to first session, higher levels of tutoring sessions per week, and improved engagement.
- Nerdy Inc (NRDY) has expanded its Varsity Tutors for Schools' sales and go-to-market team, positioning itself for growth in the institutional sector.
- The company maintains a strong balance sheet with $69.8 million in cash and cash equivalents, providing ample liquidity for growth initiatives.
- Nerdy Inc (NRDY) experienced higher-than-expected levels of seasonal cancellations in its consumer business, leading to fewer active members than anticipated.
- The company faced lower-than-expected average revenue per member (ARPM) due to a higher mix of lower frequency, non-premium learning memberships.
- Gross profit decreased by 2% year over year, with gross margin falling from 69.8% to 65.7% due to higher tutor substitute costs and lower margins in institutional offerings.
- The onboarding of the Varsity Tutors for Schools' sales team took longer than expected, resulting in lower-than-anticipated bookings during the summer months.
- Nerdy Inc (NRDY) reported a non-GAAP adjusted EBITDA loss of $2.1 million for the quarter, compared to a positive $1.3 million in the same period last year.
Good afternoon. Thank you for attending today's Nerdy Inc., Q2 2024 earnings call. My name is Matt, and I'll your moderator for today's call. (Operator Instructions)
I would now like to pass the conference over to your host, TJ Lynn, Associate General Counsel at Nerdy.
Good afternoon, and thank you for joining us for Nerdy's second-quarter 2024 earnings call. With me are Chuck Cohn, Founder, Chairman and Chief Executive Officer of Nerdy; and Jason Pello, Chief Financial Officer.
Before I turn the call over to Chuck, I'll remind everyone that this discussion will contain forward-looking statements, including, but not limited to, expectations with respect to Nerdy's future financial and operating results, strategy, opportunities, plans and outlook. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. Any forward-looking statements are made as of today's date, and Nerdy does not undertake or
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