Sima Sistani : I’ll speak first to the discounting question. So, we do have discounting activities going on, much like we always have. I would say, it’s not necessarily ramped up or differentiated approaches to discounting. And our approach is quite similar to other best-in-class subscription businesses where members joining pay less should they commit to longer-term plans. So, we continue to operate with discounting such as that and we’re really pleased to see that the pricing and promotional activity that we’re carrying out in 2023 is proving out to be both revenue and CLTB accretive both in-year and in the long-term. So, we’re really pleased with the outcomes.
Isabel Thompson: Thank you.
Operator: The next question comes from Brian Nagel of Oppenheimer. Please go ahead.
Unidentified Analyst : Hi. This is William on for Brian. Thank you for taking our questions. So, I realize that you’ve touched on this topic quite a bit, but I just wanted to ask maybe a little bit differently. Our question is on the step-up in the core membership in Q2 from Q1. You mentioned reinvigorating your offering and other marketing efficiencies. Can you discuss further the drivers of this step-up? And also, any changes to the way that you would look upon the cadence of first half membership in your business going forward?
Sima Sistani : Sure. Hey William. Look, the drivers are product improvement, better data-informed performance marketing, and overall awareness and alignment with our new Weight Health approach. We’re seeing a lot of continued momentum on our modern performance marketing. We under spent plan but drove better LTV and sign up. This is just a reflection of more nimble data informed decisions with in-house performance. We’re moving cross channels, cross regions, and thanks to the centralized global marketing organization. So that’s been a part of it, as I mentioned on the awareness front, lots of media activity, resonance with the work that we are doing, and I think being more authentic and forthcoming in our messaging. And finally, product improvement.
We’ve said that activation is not just about the people we sign up today, but them doing better in their first 30 days, which is a signal that they’re more engaged. And weight loss, let’s be clear, this is a word of mouth product. And so when we drive up MPS, which we have, more people hear about it, talk about it, have success with it. And so not only does it help on the retention side, but it also has a positive impact on driving further organic signups. So, as we mentioned, the Q2 and a period sub excluding clinical is above Q1, and that is the first time in our company’s reporting history. But I think that achievement is a combination of all of the things that I just spoke about.
Unidentified Analyst : Excellent. Our next question is on the balance sheet. To the extent that you plan to de-lever somewhat, when would you look to do this and then how would you carry it out?
Sima Sistani : Thanks for the question, William. I don’t think that I would be committing to anything in terms of actions or timing or scale or activity. I would say, though, if we did do something, our intention would be to act in a way that benefits all of our stakeholders, producing our leverages and absolute capital priority, pleased with our strong liquidity and solid runway. But at this time, I wouldn’t speak further. Thank you, though.
Unidentified Analyst : Thank you.
Operator: The next question is a follow-up from Jason English of Goldman Sachs. Please go ahead.
Jason English : Hey, again, thanks for slotting me back in one more time. So, I was just going to help myself, I had to come back for more. You mentioned the lifestyle program for GLP-1 patients to come on later this year. I guess my question is around the viability of applying that to GLP patients who aren’t coming through on Sequence. There’s been some chatter out there around employers looking to make insurability conditional, potentially on some sort of behavior modification program such as your own. And I know you’ve got a lot of deep-seated relationships with many of those potential employers. So my question is very vague. I appreciate that. I’m kind of rambling now. But as we think about the forward, are you having discussions with these employers and is there a viable solution or a future where they could be authorizing use of these, but requiring participation on a program like yours and giving you a relationship?
What is the likelihood that they actually recommend you as the program of choice for that? Thank you.
Sima Sistani : Hey, Jason, I love that you came back for more. So, and this is a great question. Look, we have a lot of enterprise experience. We’ve been running our B2B business for years. But in the past it’s been viewed more as a perk and now we are getting a lot of incoming requests from new employers as well as our existing employers and also payers who want to talk about a covered benefit. And then the way that they need to manage and be able to provide these life-changing medications to their population is by figuring out the best way to recover the cost of the medication. And that means helping somebody such that it’s a preventative tool for other chronic conditions, right? Heart disease, high cholesterol, hypertension, diabetes, some cancers.
