XWELL, Inc. Reports First Quarter 2024 Results
XWELL, an authority in wellness solutions, reported its first quarter 2024 financial results. The company saw a 24% revenue growth to $8.7 million compared to the same quarter in 2023. Total cost of sales decreased by 7%, and general and administrative expenses were cut by 47%, leading to a 62% reduction in operating loss, now at $2.4 million. XWELL continued to enhance its business model by expanding its CDC Traveler-based Genomic Surveillance Program to Miami and Chicago airports.
Additionally, the company signed leases for new Naples Wax Center locations in Florida and confirmed the opening of an XpresSpa at Penn Station in New York. XWELL also introduced new tech-forward wellness services at its airport locations, including IV hydration therapy. Overall, XWELL aims to return to profitability by focusing on strategic priorities and expanding its wellness portfolio.
- Revenue increased by 24% compared to Q1 2023, reaching $8.7 million.
- Total cost of sales decreased by 7% from Q1 2023.
- General and administrative expenses decreased by 47% from Q1 2023.
- Operating expenses decreased by 26% from Q1 2023.
- Operating loss reduced by 62% to $2.4 million.
- Expansion of the CDC Traveler-based Genomic Surveillance Program to new airports, increasing program value to $36.7 million.
- New leases for three additional Naples Wax Center locations in Florida.
- Introduction of tech-forward wellness services, including IV hydration therapy at Miami International Airport.
- No long-term debt and $4.3 million in cash and cash equivalents as of March 31, 2024.
- Net loss attributable to XWELL was $2.5 million.
- Despite reduced losses, the company still operates at a loss of $2.4 million.
- Operating expenses, though reduced, still amounted to $5.1 million.
Insights
XWELL has shown significant improvement in its financial performance for Q1 2024. The 24% increase in revenue compared to Q1 2023 and the 26% reduction in operating expenses are strong indicators that the company's efforts to streamline operations and cut costs are paying off. Particularly noteworthy is the 62% decrease in operating loss, dropping from
The decrease in cost of sales by 7% and a substantial 47% reduction in general and administrative expenses highlight effective cost management. These improvements can increase investor confidence, as lower costs generally translate to higher profitability margins and better financial health in the long-term.
From a shareholder's perspective, the company's liquidity position is also strong, with
XWELL's strategic expansion into non-airport wellness centers and new locations within airports and transportation hubs is a strategic move to diversify its revenue streams. The leases signed for three additional Naples Wax Center locations and the new XpresSpa in New York City's Penn Station are likely to bolster the company's presence in high-traffic areas. This diversification is key to mitigating risks associated with depending solely on airport traffic.
The introduction of IV hydration drip therapy at Miami International Airport signals an innovative approach to enhancing the customer experience with new wellness services. The focus on tech-forward, labor-lite models exemplifies strategic adaptation to current market trends such as automation and efficiency, which can attract a broader customer base and reduce operational costs.
In addition, the expansion of the Traveler-based Genomic Surveillance Program showcases XWELL's commitment to leveraging partnerships to grow its biosurveillance capabilities. This initiative has the potential for significant long-term value as global health monitoring becomes increasingly critical.
Overall, these strategic actions could enhance revenue diversity and sustainability, providing a more balanced growth trajectory.
The expanded collaboration with Ginkgo Bioworks and the CDC for the Traveler-based Genomic Surveillance Program is a noteworthy development. The contract's increased funding to an estimated
This partnership also aligns with broader trends in healthcare and biosurveillance, positioning XWELL as a pivotal player in this space. The expanded testing for over 30 additional priority pathogens broadens the scope of their surveillance, adding more value to the data collected and the services provided. This can lead to new government contracts and collaborations in the future, further solidifying XWELL's foothold in the health tech industry.
Long-term, these efforts could translate into sustainable revenue streams and enhanced brand reputation in public health sectors.
NEW YORK, May 15, 2024 (GLOBE NEWSWIRE) -- XWELL, Inc. (Nasdaq: XWEL) ("XWELL" or the "Company"), an authority in wellness solutions for people on the go, today reported results for the first quarter ended March 31, 2024.
Recent Highlights:
- XWELL delivered 2024 first quarter revenue growth of approximately
24% from the 2023 first quarter. - The Company has reduced its cost structure, simplified its processes, and has maintained continued momentum on its path to profitability. The following demonstrates the positive effects of XWELL’s actions to enhance its business model:
- Total cost of sales decreased approximately
7% from the 2023 first quarter. - General and administrative expenses decreased approximately
47% from the 2023 first quarter. - Total operating expenses decreased approximately
26% from the 2023 first quarter. - As a result, the Company’s 2024 first quarter operating loss decreased approximately
62% to approximately$2.4 million from an operating loss of approximately$6.3 million in the 2023 first quarter.
- Total cost of sales decreased approximately
- During the first quarter of 2024, XWELL and Ginkgo Bioworks expanded the CDC Traveler-based Genomic Surveillance Program to new collection locations at US international airports in Miami (MIA) and Chicago (ORD).
- During the first quarter of 2024, XWELL announced that it had signed leases to open three additional Naples Wax Center® locations in 2024.
- During the first quarter of 2024, XWELL announced it had signed a lease agreement to open an XpresSpa location in New York City’s Penn Station.
“We believe that XWELL’s first quarter operating performance demonstrates accelerated progress in our efforts to drive growth cost-effectively and return to profitability,” commented Scott Milford, XWELL’s Chief Executive Officer. “During the quarter, we expanded the scope and long-term value of our CDC Traveler-based Genomic Surveillance Program, secured multiple new leases for our Naples Wax Center brand, and advanced plans to open a new labor-lite model in New York City’s Penn Station.”
Mr. Milford added, “We continue to see opportunities for better performance and achieved year-over-year first quarter 2024 revenue growth of
Travel Wellness Portfolio - XpresSpa® and Treat™
XpresSpa is the leading airport retailers of wellness services and related products, with 32 locations in 15 airports globally.
XWELL continues to innovate in its airport locations bringing new technologies and trends, including new tech-forward equipment, adding new products in-store and on-line, as well as deploying plans to refresh the look and appearance of some XpresSpa locations. These automated offerings including Novo XT massage chairs, HydroMassage units and fully autonomous, AI-powered express manicure units, provide self-care to guests while bringing operational efficiency to the Company’s business model.
Additionally, on May 2, 2024, the Company announced the introduction of IV hydration drip therapy at its Miami International Airport (MIA) XpresSpa location. In collaboration with Revitalize IV Lounge, the new service offers a fast and efficient way to deliver vitamins, minerals, and amino acids directly into the bloodstream and is available in MIA’s North Terminal, Concourse D, Gate D-11.
New York City’s Penn Station XpresSpa
Consistent with XWELL’s strategy to extend its footprint into transportation hubs, the Company is opening an XpresSpa location in New York City’s Penn Station. The tech-forward, labor-lite spa will serve commuters, neighborhood locals, and tourists with wellness-focused retail, autonomous massage, and nail care services, enabling seamless and efficient experiences for time-crunched New York City travelers. The Penn Station XpresSpa is currently slated to open this summer.
Out-of-Airport Wellness Portfolio - Naples Wax Center®
XWELL’s first off-airport brand, Naples Wax Center, is a group of upscale hair removal and aesthetic services boutiques with current locations in Florida. Acquired in mid-September 2023, Naples Wax Center provides core products and service including face and body waxing as well as a range of skincare and cosmetic products from its current three locations.
On February 14, 2024, the Company announced plans to open three additional Naples Wax Center locations in 2024. Two of the new Florida locations, which will extend Naples Wax Center’s footprint in the greater Naples and Cape Coral markets, are expected to open in the second half of 2024. Additionally, a third location is scheduled to open in the growing Tampa-Saint Peterburg metro area during the third quarter of 2024. The Company believes that the new locations coupled with new facial services, which will be rolled out in existing stores over the summer and will be an available offering in future locations, will strengthen the brand’s esthetic service foundation and enhance its retail and skin care offerings as a growing one-stop esthetic and beauty authority.
The Company is intending to execute additional Florida leases across the state. It continues to forecast approximately 10 Naples Wax Center locations by early 2025. As previously announced, XWELL also intends to extend its reach across the Southeast and as new locations are opened, they will also incorporate the additional aesthetic services into the Naples Wax Center model to drive new revenue and broaden their offering.
Life Sciences & Biosurveillance -- XpresCheck® and HyperPointe™
The Company XpresTest, Inc. subsidiary (“XpresCheck”), in collaboration with the Centers for Disease Control and Prevention (“CDC”) and Ginkgo Bioworks, currently operates 9 biosurveillance stations in 7 of the nation’s busiest airports.
On August 17, 2023, the Company announced that the CDC renewed the traveler-based SARS-CoV-2 Genomic Surveillance program through a new one-year contract.
On November 6, 2023, XWELL and Ginkgo Bioworks announced they expanded their work with the CDC’s Traveler-based Genomic Surveillance program (TGS) to test for more than 30 additional priority pathogens, in addition to SARS-CoV-2. The program expansion was launched in late October 2023 at four of the program’s six major international airport locations, including New York, JFK, San Francisco, Boston, and Washington DC, Dulles.
On March 12, 2024, XWELL and Ginkgo Bioworks announced that the TGS program was being expanded further to new collection locations at U.S. international airports in Miami (MIA) and Chicago (ORD). Pursuant to the March 2024 expansion, the program funding and scope were increased to an estimated
TGS is a flexible, multimodal platform that consists of four complementary approaches of sample collection from arriving international travelers at U.S. airports, including voluntary nasal swabbing, aircraft wastewater, air monitoring and airport wastewater sampling to enhance early detection of new SARS-CoV-2 variants and other pathogens, and fill gaps in global surveillance.
As background, in late 2021, in collaboration with the CDC and Ginkgo Bioworks, XpresTest began conducting biosurveillance monitoring aimed at identifying existing and new SARS-CoV-2 variants. During the third quarter of 2022, XpresCheck, in partnership with Ginkgo Bioworks, were awarded a new contract in continuation of their support to the CDC’s traveler-based SARS-CoV-2 Genomic Surveillance program. In the first quarter of 2023, in addition to SARS-CoV-2, XpresCheck and Ginkgo Bioworks expanded their support of the program to include a pilot study monitoring influenza viruses. This provided an additional source of viral surveillance to inform the selection of influenza vaccine viruses for the 2023-2024 flu season.
Additionally, beginning in third quarter of 2023, the Company began reporting operating results for HyperPointe within its XpresCheck business. Beginning in June 2020, and following its acquisition by XWELL in January 2022, HyperPointe’s management team and suite of services and technology have been utilized to develop and deploy the technological infrastructure necessary to scale the growth of the XpresCheck business. HyperPointe’s experience in this space continues to play a critical role in the expansion of ongoing biosurveillance efforts created in partnership with Ginkgo Bioworks and the CDC.
HyperPointe is a leading digital healthcare and data analytics relationship marketing agency, servicing the global healthcare and pharmaceutical industry. HyperPointe has significant experience in patient and healthcare professional marketing and deep technological experience with CXM (customer experience management) and data analytics.
Liquidity and Financial Condition
As of March 31, 2024, the Company had approximately
Summary First Quarter 2024 Financial Results
Total revenue for the first quarter ended March 31, 2024, was
Revenue for 2024 first quarter primarily consisted of approximately
Total Cost of Sales
Total cost of sales was approximately
Salaries and Benefits; General and Administrative Expenses
Salaries and benefits and general and administrative expenses were approximately
Total Operating Expenses
Total operating expenses were approximately
Operating Loss
The operating loss decreased to approximately
Net Loss Attributable to XWELL
Net loss attributable to XWELL was approximately
About XWELL, Inc.
XWELL, Inc. (Nasdaq: XWEL) is a leading global wellness holding company operating multiple brands: XpresSpa®, Treat™, Naples Wax Center®, XpresCheck® and HyperPointe™.
- XpresSpa is a leading retailer of wellness services and related products, with 32 locations in 15 airports globally.
- Naples Wax Center is a group of upscale skin care boutiques, with three locations currently operating.
- XpresCheck is a provider of screening and diagnostic testing in partnership with the CDC and Concentric by Ginkgo, conducting biosurveillance monitoring in its airport locations to identify new SARS-CoV-2 variants of interest and concern as well as other pathogens entering the country from across the world.
- HyperPointe is a leading digital healthcare and data analytics relationship company serving the global healthcare industry.
Forward-Looking Statements
This press release may contain "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These include statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "estimates," "projects," "intends," "should," "seeks," "future," "continue," or the negative of such terms, or other comparable terminology. Forward-looking statements relating to expectations about future results or events, including the Company’s current plans and expectations relating to the business and operations and future store openings, including but not limited to, future openings of Naples Wax Center and XpresSpa stores, are based upon information available to XWELL as of the date of this press release, and are not guarantees of the future performance of the Company, and actual results may vary materially from the results and expectations discussed. Additional information concerning these and other risks is contained in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and other Securities and Exchange Commission filings. All subsequent written and oral forward-looking statements concerning XWELL, or other matters and attributable to XWELL or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. XWELL does not undertake any obligation to publicly update any of these forward-looking statements to reflect events or circumstances that may arise after the date hereof.
Media
Maria Kucinski
MWW
mkucinski@mww.com
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