Investing.com -- Shares in Weight Watchers International Inc (N:WTW) jumped more than 15% in after-hours trading after the international weight loss company increased its 2016 guidance on Thursday amid stronger than expected quarterly earnings.
During Weight Watchers third quarter, which ended in early-October, the New York-based company saw its revenue plummet 21% to $273 million, amid double digit percentage declines in active subscribers, total paid weeks and meeting paid weeks on a year-over-year basis. Weight Watchers' net profits also tumbled more than 40% to $21.8 million or 0.38 per share, down from $37.9 million or 0.67 per share in the third quarter of 2014.
The company, though, raised its guidance on Thursday following the completion of its comprehensive partnership with talk show host Oprah Winfrey. Last month, shares in Weight Watchers more than doubled after Winfrey declared a 10% stake in the weight loss company. On October 19, Weight Watchers shares ended the day at $13.92 up more than 105% for the session. Winfrey purchased her stake at $6.79 a share the previous Friday, netting a profit of more than $45 million. The agreement provided Winfrey with a seat on the company's Board of Directors and the option of purchasing an additional 5% of the fully diluted shares.
"Weight Watchers has given me the tools to begin to make the lasting shift that I and so many of us who are struggling with weight have longed for," Winfrey said at the time. "I believe in the program so much I decided to invest in the company and partner in its evolution."
Analysts expected revenues from Weight Watchers of $266 million on earnings of 0.29 per share. The deal with Winfrey provides Weight Watchers' president and CEO Jim Chambers with a great deal of optimism for the company's short-term outlook.
"In December, we will be launching a comprehensive program innovation as we expand our purpose from weight loss alone to more broadly helping people lead healthier, happier lives," Chambers said in a statement. "The response to our groundbreaking partnership with Oprah Winfrey has been terrific. I am thrilled about the impact it will have on accelerating our transformation."
For Fiscal Year 2016, Weight Watchers now expects per share earnings of 0.64 to 0.74 up from its previous guidance of 0.57 to 0.72.
Shares in Weight Watchers soared 2.69 or 15.88% to 19.63 in after-hours.