Quarterly report Q1 2023: Twiik continues to grow and expands its product portfolio with new digital fitness experiences

Active users continue to grow on both a quarterly and annual basis. Average monthly users in the first quarter were up 21% year-over-year and 16% quarter-over-quarter.

Twiik's recurring revenue from licenses and subscriptions (ARR) increased by 8% compared to the previous year and amounted to 4,650 (4,310) KSEK.

The turnover from digital workout plans and services to consumers through the platform has increased by 11% during the quarter compared to the same period last year.

The sales of Twiik's digital corporate wellness challenge TeamBoost increased by 27% compared to the same period last year, marking a turn-around from previous quarters.

The operating profit for the quarter amounted to -2,314 (-3,206) KSEK. The company has continued its focus on high-margin products and services such as the license business and digital fitness concepts such as TeamBoost. During the quarter, Twiik also started the development of two completely new digital training products as part of the updated strategy.

During the quarter, version 5.5 of Twiik's technology platform was released. A major update that included new app navigation, a completely new and improved experience for the company's corporate wellness challenge TeamBoost and for coaching products such as digital Bootcamps.


First quarter in numbers

• Net sales: 3 643 (2 854) KSEK  
• Operating profit: -2 314 (-3 206) KSEK  
• Profit after tax: -2 392 (-2 588) KSEK  
• Earnings per share before dilution: -0,09 (-0,39) SEK  
• Earnings per share after dilution: -0,09 (-0,39) SEK

Significant events during the first quarter

• The fully secured issue that the extraordinary general meeting decided on 8 December 2022 was registered with the Swedish Companies Registration Office on 12 January. The number of shares thus increased by 15,386,580 shares and the share capital by SEK 7,693,290. 
• In February, the exercise period for the warrants of series TO2, which were issued in connection with Twiik's rights issue in the third quarter of 2022, expired. A total of 48,540 shares were subscribed through the exercise of 48,540 Warrants, which corresponded to a utilization rate of approximately 0.69 percent. The company thus received approximately SEK 24,270.00 before issue costs.
• The app Rimlig Träning was launched. Rimlig Träning was founded and is led by Vanja Wikström, one of Sweden's leading family bloggers and influencers, as well as personal trainer Robert Svensson. The enterprise agreement was signed in the fall of 2022 and development of the app began in the fourth quarter. Rimlig Träning's app gathers inspirers with a focus on good workouts that fit into a well-fed everyday life for a wide target group.

Significant events after the end of the period 

• Twiik releases major updates to its app platform for online and hybrid training. The update includes more than 100 improvements regarding new features and also includes an improved user experience.

Comments from the CEO
We start 2023 with a good quarter where we continue to grow. We have worked intensively on our move towards products and services with higher margins and scalability. This means that we place an increasing focus on content-based digital fitness products and concepts. An area with great potential where we are already seeing positive development, among other things, by an increase in sales of TeamBoost.

Our license revenue is also increasing. However, the increase is marginal as two of our ongoing projects will be released during the second quarter instead of during the first quarter as originally planned.

The ongoing global economic development puts pressure on both fitness operators and consumers, something that we believe also affects us. Increased overhead costs for households mean that the competition for end customers increases.
There is reason to expect a slightly lower willingness to invest among larger fitness operators as core products are prioritized over larger investments in IT infrastructure and new services. This in turn will likely affect our project sales in the medium term.

At the same time, there are signs that people continue to prioritize their health. Thanks to hard work and active work together with creators connected to Twiik, the turnover from the sale of workout plans to the consumer during the first quarter increased by 11% compared to the same period last year.

During the quarter, we have intensified the work with our own products and services, where the corporate challenge TeamBoost has reached the highest degree of maturity. 

TeamBoost is sold both by gyms and directly by Twiik. For the last couple of quarters, we have seen a negative development YoY, this trend is now broken, marking a turn-around for this product.

In the first quarter, our revenue from corporate wellness challenges increased by 27% compared to the same quarter last year. We are now working more actively with the product and plan to launch an updated offer around TeamBoost during the early summer, in which we expect to increase the average order value per participant and reduce the product's seasonal variation.

We have also started the development of two completely new products, the digital bootcamp 100 Days and the fitness subscription Twiik Premium.

Twiik Premium contains 100s of workouts and programs produced both by Twiik and trainers we collaborate with. The development of the first version of the product is in the final phase and will be launched in early summer, with increased rollout during the third quarter. This is deemed to be able to be integrated with companies and thereby expand our corporate wellness business.

100 Days will be launched towards the end of the third or the beginning of the fourth quarter. The product contains a combination of workouts and nutrition plans developed and inspired by the latest science. We have appointed a team that works with the concept both in terms of content and new technology development. We have also tied in important expertise in fitness and nutrition in this project. Our goal is both to create a successful workout concept and to develop the platform's digital bootcamp format further with the help of AI, among other things.

Together with TeamBoost, Twiik Premium and 100 Days are central components of our journey forward. In addition to the fact that they mean significantly better margins for us, they are also an asset for our fitness industry customers, who are increasingly demanding ready-made concepts to offer the market.

All in all, it's a big move we're making. From being a pure technology platform to focusing more on engaging content with great technology for distribution. At the same time, it is a natural step. We have proven our ability with TeamBoost and we have created a very strong platform for distribution through our network of gyms, trainers, consumers and b2b customers. It gives us a unique opportunity to create something fantastic and make a difference for even more people.

I want to thank the team at Twiik for a job well done in times of change, our fantastic customers and partners for the trust and not least all the shareholders who follow us on the journey towards becoming a leader in digital fitness experiences - regardless of time, place or screen!

Forward-upward,
Anders Gran, CEO


Twiik's financial reports can be downloaded here.