FitLife Brands' Q1 2025: Contradictions Unveiled in MusclePharm's Growth, Margins, and Strategic Initiatives

MusclePharm revenue and growth expectations, gross margin expectations, MusclePharm's growth strategy, and the Vitamin Shoppe pilot program are the key contradictions discussed in FitLife Brands' latest 2025Q1 earnings call.



Revenue Decline and Online Sales Growth:
- FitLife Brands reported a 4% year-over-year decline in total revenue to $15.9 million in Q1 2025, with online sales accounting for 67% of total revenue at $10.6 million.
- The revenue decline was partly due to a significant M&A-related expense during the first quarter, which impacted net income and earnings per share.

Brand Performance and Margin Variations:
- Legacy FitLife revenue increased by 5%, with a gross margin of 44.6%, contributing to 43.4% of revenue.
- MusclePharm revenue declined by 6%, with a gross margin of 30.1%, attributed to promotional investments aimed at driving sales.

Tariffs and Inventory Strategy:
- FitLife faced challenges due to uncertain tariffs on Chinese ingredients, but a recent 90-day de-escalation has provided relief.
- The company has opportunistically increased its inventory levels at pre-tariff prices to manage potential future impacts.

MusclePharm Challenges and Strategic Focus:
- MusclePharm's revenue declined by 6% in Q1 2025, with declines in wholesale revenue and increased online sales.
- The company is actively investing in promotional support for MusclePharm products, focusing on growing online sales and supporting key customers.