Medifast's Third-Quarter Revenue Fell 36%: Is Stabilization Near?

Medifast, Inc. MED reported a sharp year-over-year revenue decline in the latest quarter, underscoring continued pressure on its coach-driven business model. Reduced coach participation and modestly lower productivity per coach weighed heavily on performance. In the third quarter of fiscal 2025, revenue fell 36.2% to $89.4 million, primarily due to a significant drop in active earning OPTAVIA coaches. The active coach base declined 35% to 19,500, while average revenue per active earning coach decreased 1.9% to $4,585.

To address these challenges, the company implemented rightsizing actions in October aimed at improving margins as growth resumes. Medifast expects coach growth to re-emerge approximately six to nine months after recent initiatives take hold, with revenue growth typically following one to two quarters later. The company anticipates this inflection point to occur in the fourth quarter of fiscal 2025, representing an initial sign of stabilization. At a minimum, management expects growth in revenue per active earning coach within the next six months, signaling early progress toward recovery.

Medifast continues to emphasize the value of personalized coaching, supported by the Premier+ pricing structure and the EDGE leadership program, both of which are designed to enhance coach productivity and stability into 2026. In parallel, ongoing investments in digital platforms—including enhancements to the app and reporting tools—are improving visibility into client progress and coach performance, enabling more targeted and effective engagement.

While near-term results remain challenged, Medifast’s restructuring efforts, renewed focus on coach economics and continued digital investments point to potential stabilization.

Zacks Rundown for MED

Medifast’s shares have lost 15% in the past six months compared with the industry’s decline of 10.4%. MED currently carries a Zacks Rank #4 (Sell).

From a valuation standpoint, MED trades at a forward price-to-sales ratio of 0.35, lower than the industry’s average of 1.05.

The Zacks Consensus Estimate for MED’s current and next fiscal-year earnings implies year-over-year declines of 158.7% and 5.6%, respectively. 

Key Picks

Some better-ranked stocks have been discussed below:

The Vita Coco Company, Inc. COCO develops, markets and distributes coconut water products under the Vita Coco brand name in the United States, Canada, Europe, the Middle East, Africa and the Asia Pacific. COCO currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Vita Coco's current fiscal-year sales and earnings implies growth of 18% and 15%, respectively, from the year-ago reported figures. Vita Coco delivered a trailing four-quarter earnings surprise of 30.4%, on average.

Monster Beverage Corporation MNST engages in the development, marketing, sale and distribution of energy drink beverages and concentrates in the United States and internationally. MNST currently sports a Zacks Rank #1.

The Zacks Consensus Estimate for Monster Beverage's current fiscal-year sales and earnings implies growth of 9.6% and 22.8%, respectively, from the year-ago actuals. MNST delivered a trailing four-quarter earnings surprise of 5.5%, on average.

United Natural Foods, Inc. UNFI distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural flaunts a Zacks Rank of 1.

The Zacks Consensus Estimate for United Natural’s current fiscal-year sales and earnings implies growth of 1% and 187.3%, respectively, from the year-ago reported figures. UNFI delivered a trailing four-quarter earnings surprise of 52.1%, on average.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research