Vancouver fitness equipment company Bowflex has notified investors and regulators that there is significant doubt that it will be able to continue operating into next year.
In its third-quarter earnings report released Wednesday, the company formerly known as Nautilus cited a difficult retail environment, worsening macroeconomic conditions and lower customer demand as contributing to the significant year-over-year revenue decline.
“Furthermore, we currently believe the situation will not improve in the coming quarters,” the report said, adding that the situation is impacting expected liquidity.
Bowflex executives are looking to sell the company or its assets or find other ways to access funds, the report said. The company said it may file for voluntary bankruptcy.
The report states that if the company is unable to promptly conclude a transaction or access funds, it may be unable to comply with its debt agreements and be unable to continue operating.
“Management has determined that, under the circumstances, there is material doubt about the Company’s ability to continue as a going concern for 12 months from the date of this report,” the report said. . Going concern is an accounting term that indicates that a company continues to operate indefinitely.
The company reported a net loss of $34.3 million, or 94 cents per diluted share, for the third quarter of 2023 ended December 31, 2023. In the third quarter, the company reported a loss of $11.1 million, or 35 cents per diluted share. Quarter of 2022.
In the three quarters so far this year, BowFlex reported a loss of $51.8 million, compared to a loss of $84.4 million in the first three quarters of 2022.
The company reported revenue of $67.6 million in the third quarter of 2023, down from $98.1 million in the third quarter of 2022.
Amid the at-home workout revolution that swept the world during the global pandemic, Bowflex saw demand for its products soar, sending its stock price as high as $29.53 per share in February 2021. But demand slumped as the world returned to normal.
Since then, the company has struggled for years, enduring layoffs, selling its former namesake brand, Nautilus, and enduring the threat of delisting from the New York Stock Exchange.
The company changed its name to BowFlex on November 1 after selling the Nautilus brand.
The company’s stock trades on the New York Stock Exchange as BFX. The stock closed Wednesday at 20 cents a share, down sharply from its closing price of 52 cents a share on Feb. 14, when the company issued a late filing notice amid concerns about its solvency.
