(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of common stock outstanding as of ~~July 31, 2019~~April 21, 2020 was ~~67,297,697.~~

	June 29,			December 29,			March 28,			December 28,
	2019			2018			2020			2019
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	180,645		$	236,974		$	292,273		$	182,736
Receivables (net of allowances: June 29, 2019 - $1,591 and December 29, 2018 - $1,743)		30,869			27,247
Receivables (net of allowances: March 28, 2020 - $1,599 and December 28, 2019 - $1,813)								42,725			30,519
Inventories		30,625			25,851			34,131			27,204
Prepaid income taxes		15,171			33,997			26,573			8,395
Prepaid marketing and advertising								8,153			15,954
Prepaid expenses and other current assets		26,793			42,355			28,787			30,582
TOTAL CURRENT ASSETS		284,103			366,424			432,642			295,390
Property and equipment, net		51,131			52,202			63,186			54,066
Operating lease assets		144,913			0			149,757			151,983
Franchise rights acquired		753,216			751,134			748,053			753,445
Goodwill		154,058			152,519			150,457			157,916
Other intangible assets, net		58,491			57,162			59,498			59,031
Deferred income taxes		16,235			16,230			13,977			14,319
Other noncurrent assets		14,128			18,870			16,102			12,164
TOTAL ASSETS	$	1,476,275		$	1,414,541		$	1,633,672		$	1,498,314
LIABILITIES AND TOTAL DEFICIT
CURRENT LIABILITIES
Portion of long-term debt due within one year	$	57,750		$	77,000		$	244,250		$	96,250
Portion of operating lease liabilities due within one year		32,003			0			33,843			33,236
Accounts payable		26,761			27,098			45,849			29,064
Salaries and wages payable		56,699			64,600			45,043			66,656
Accrued marketing and advertising		9,796			14,052			18,212			14,815
Accrued interest		28,025			28,651			30,308			24,637
Other accrued liabilities		43,232			48,218			46,850			43,558
Derivative payable		19,330			5,578			34,903			21,597
Income taxes payable		19,679			22,618			1,610			3,644
Deferred revenue		56,923			53,501			59,415			60,613
TOTAL CURRENT LIABILITIES		350,198			341,316			560,283			394,070
Long-term debt, net		1,584,460			1,669,708			1,462,140			1,479,920
Long-term operating lease liabilities		121,318			0			125,535			128,464
Deferred income taxes		184,445			190,258			184,605			175,235
Other		2,251			18,289			1,952			2,446
TOTAL LIABILITIES		2,242,672			2,219,571			2,334,515			2,180,135

Redeemable noncontrolling interest		3,763			3,913			3,630			3,722
TOTAL DEFICIT
Common stock, $0 par value; 1,000,000 shares authorized; 120,352 shares issued at June 29, 2019 and December 29, 2018		0			0
Treasury stock, at cost, 53,089 shares at June 29, 2019 and 53,396 shares at December 29, 2018		(3,164,409	)		(3,175,624	)
Common stock, $0 par value; 1,000,000 shares authorized; 120,352 shares issued at March 28, 2020 and December 28, 2019								0			0
Treasury stock, at cost, 52,899 shares at March 28, 2020 and 52,933 shares at December 28, 2019								(3,156,907	)		(3,158,274	)
Retained earnings		2,420,958			2,382,438			2,496,660			2,500,083
Accumulated other comprehensive loss		(26,709	)		(15,757	)		(44,226	)		(27,352	)
TOTAL DEFICIT		(770,160	)		(808,943	)		(704,473	)		(685,543	)
TOTAL LIABILITIES AND TOTAL DEFICIT	$	1,476,275		$	1,414,541		$	1,633,672		$	1,498,314

The accompanying notes are an integral part of the consolidated financial statements.

	Three Months Ended				Six Months Ended				Three Months Ended
	June 29,		June 30,		June 29,		June 30,		March 28,			March 30,
	2019		2018		2019		2018		2020			2019
Service revenues, net	$	313,768	$	343,730	$	620,494	$	672,399	$	324,657		$	306,726
Product sales and other, net		55,255		66,017		111,694		145,571		75,704			56,438
Revenues, net		369,023		409,747		732,188		817,970		400,361			363,164
Cost of services		122,121		128,159		251,078		267,939		135,566			128,957
Cost of product sales and other		31,088		36,794		64,347		84,236		53,804			33,259
Cost of revenues		153,209		164,953		315,425		352,175		189,370			162,216
Gross profit		215,814		244,794		416,763		465,795		210,991			200,948
Marketing expenses		49,967		55,421		164,216		154,340		117,933			114,249
Selling, general and administrative expenses		60,374		61,665		125,176		121,676		64,526			64,802
Goodwill impairment										3,665			0
Operating income		105,473		127,708		127,371		189,779		24,867			21,897
Interest expense		34,732		35,866		69,927		71,732		31,551			35,195
Other expense, net		438		1,333		741		1,097		24			303
Income before income taxes		70,303		90,509		56,703		116,950
Provision for income taxes		16,586		19,825		13,711		7,208
Net income		53,717		70,684		42,992		109,742
Net loss attributable to the noncontrolling interest		117		36		156		90
Net income attributable to Weight Watchers International, Inc.	$	53,834	$	70,720	$	43,148	$	109,832
Earnings Per Share attributable to Weight Watchers International, Inc.
Loss before income taxes										(6,708	)		(13,601	)
Benefit from income taxes										(651	)		(2,875	)
Net loss										(6,057	)		(10,726	)
Net (income) loss attributable to the noncontrolling interest										(6	)		39
Net loss attributable to WW International, Inc.									$	(6,063	)	$	(10,687	)
Net loss per share attributable to WW International, Inc.
Basic	$	0.80	$	1.07	$	0.64	$	1.67	$	(0.09	)	$	(0.16	)
Diluted	$	0.78	$	1.01	$	0.62	$	1.57	$	(0.09	)	$	(0.16	)
Weighted average common shares outstanding			��
Basic		67,124		66,400		67,044		65,761		67,436			66,964
Diluted		69,141		70,154		69,268		69,914		67,436			66,964

The accompanying notes are an integral part of the consolidated financial statements.

Three Months Ended

Six Months Ended

June 29,

June 30,

June 29,

June 30,

2019

2018

2019

2018

Net income
$
53,717

$
70,684

$
42,992

$
109,742

Other comprehensive (loss) gain:

Foreign currency translation gain (loss)

1,801

(3,804
)

3,515

(7,229
)
Income tax (expense) benefit on foreign currency translation
  gain (loss)

(457
)

965

(892
)

1,833

Foreign currency translation gain (loss), net of taxes

1,344

(2,839
)

2,623

(5,396
)
(Loss) gain on derivatives

(10,819
)

1,130

(18,180
)

12,297

Income tax benefit (expense) on (loss) gain on derivatives

2,744

(287
)

4,611

(3,119
)
(Loss) gain on derivatives, net of taxes

(8,075
)

843

(13,569
)

9,178

Total other comprehensive (loss) gain

(6,731
)

(1,996
)

(10,946
)

3,782

Comprehensive income

46,986

68,688

32,046

113,524

Net loss attributable to the noncontrolling interest

117

36

156

90

Foreign currency translation (gain) loss, net of taxes
   attributable to the noncontrolling interest

(12
)

137

(6
)

373

Comprehensive loss attributable to the noncontrolling
   interest

105

173

150

463

Comprehensive income attributable to Weight Watchers
   International, Inc.
$
47,091

$
68,861

$
32,196

$
113,987

	Three Months Ended
	March 28,			March 30,
	2020			2019
Net loss	$	(6,057	)	$	(10,726	)
Other comprehensive loss:
Foreign currency translation (loss) gain		(9,820	)		1,714
Income tax benefit (expense) on foreign currency translation (loss) gain		2,499			(435	)
Foreign currency translation (loss) gain, net of taxes		(7,321	)		1,279
Loss on derivatives		(12,956	)		(7,361	)
Income tax benefit on loss on derivatives		3,305			1,867
Loss on derivatives, net of taxes		(9,651	)		(5,494	)
Total other comprehensive loss		(16,972	)		(4,215	)
Comprehensive loss		(23,029	)		(14,941	)
Net (income) loss attributable to the noncontrolling interest		(6	)		39
Foreign currency translation loss, net of taxes attributable to the noncontrolling interest		98			6
Comprehensive loss attributable to the noncontrolling interest		92			45
Comprehensive loss attributable to WW International, Inc.	$	(22,937	)	$	(14,896	)

The accompanying notes are an integral part of the consolidated financial statements.

Weight Watchers International, Inc.

Accumulated

Redeemable

Other

Three Months Ended June 29, 2019
Noncontrolling

Common Stock

Treasury Stock

Comprehensive

Retained

Interest

Shares

Amount

Shares

Amount

Loss

Earnings

Total

Balance at March 30, 2019

$
3,868

120,352

$
0

53,375

$
(3,174,871
)

$
(19,966
)

$
2,375,903

$
(818,934
)

Comprehensive income (loss)

(105
)

(6,743
)

53,834

47,091

Issuance of treasury stock under
stock plans

(286
)

10,462

(13,651
)

(3,189
)
Compensation expense on share-
based awards

4,872

4,872

Balance at June 29, 2019

$
3,763

120,352

$
0

53,089

$
(3,164,409
)

$
(26,709
)

$
2,420,958

$
(770,160
)

				WW International, Inc.

														Accumulated
	Redeemable													Other
Three Months Ended March 28, 2020	Noncontrolling			Common Stock				Treasury Stock						Comprehensive			Retained
	Interest			Shares		Amount		Shares			Amount			Loss			Earnings			Total
Balance at December 28, 2019	$	3,722			120,352	$	0		52,933		$	(3,158,274	)	$	(27,352	)	$	2,500,083		$	(685,543	)
Comprehensive loss		(92	)												(16,874	)		(6,063	)		(22,937	)
Issuance of treasury stock under stock plans									(34	)		1,367						(1,325	)		42
Compensation expense on share- based awards																		3,965			3,965
Balance at March 28, 2020	$	3,630			120,352	$	0		52,899		$	(3,156,907	)	$	(44,226	)	$	2,496,660		$	(704,473	)

				WW International, Inc.

														Accumulated
	Redeemable													Other								��
Three Months Ended March 30, 2019	Noncontrolling			Common Stock				Treasury Stock						Comprehensive			Retained
	Interest			Shares		Amount		Shares			Amount			Loss			Earnings			Total
Balance at December 29, 2018	$	3,913			120,352	$	0		53,396		$	(3,175,624	)	$	(15,757	)	$	2,382,438		$	(808,943	)
Comprehensive loss		(45	)												(4,209	)		(10,687	)		(14,896	)
Issuance of treasury stock under stock plans									(21	)		753						(660	)		93
Compensation expense on share- based awards																		4,812			4,812
Balance at March 30, 2019	$	3,868			120,352	$	0		53,375		$	(3,174,871	)	$	(19,966	)	$	2,375,903		$	(818,934	)

Weight Watchers International, Inc.

Accumulated

Redeemable

Other

Six Months Ended June 29, 2019
Noncontrolling

Common Stock

Treasury Stock

Comprehensive

Retained

Interest

Shares

Amount

Shares

Amount

Loss

Earnings

Total

Balance at December 29, 2018

$
3,913

120,352

$
0

53,396

$
(3,175,624
)

$
(15,757
)

$
2,382,438

$
(808,943
)

Comprehensive income (loss)

(150
)

(10,952
)

43,148

32,196

Issuance of treasury stock under
stock plans

(307
)

11,215

(14,312
)

(3,097
)
Compensation expense on share-
based awards

9,684

9,684

Balance at June 29, 2019

$
3,763

120,352

$
0

53,089

$
(3,164,409
)

$
(26,709
)

$
2,420,958

$
(770,160
)

Weight Watchers International, Inc.

Accumulated

Redeemable

Other

Three Months Ended June 30, 2018
Noncontrolling

Common Stock

Treasury Stock

Comprehensive

Retained

Interest

Shares

Amount

Shares

Amount

Loss

Earnings

Total

Balance at March 31, 2018

$
4,177

120,352

$
0

54,114

$
(3,203,331
)

$
(6,938
)

$
2,210,168

$
(1,000,101
)

Comprehensive income (loss)

(173
)

(1,859
)

70,720

68,861

Issuance of treasury stock under
stock plans

(349
)

13,535

(14,586
)

(1,051
)
Compensation expense on share-
based awards

5,291

5,291

Issuance of common stock

0

Balance at June 30, 2018

$
4,004

120,352

$
0

53,765

$
(3,189,796
)

$
(8,797
)

$
2,271,593

$
(927,000
)

Weight Watchers International, Inc.

Accumulated

Redeemable

Other

Six Months Ended June 30, 2018
Noncontrolling

Common Stock

Treasury Stock

Comprehensive

Retained

Interest

Shares

Amount

Shares

Amount

Loss

Earnings

Total

Balance at December 30, 2017

$
4,467

118,947

$
0

54,258

$
(3,208,836
)

$
(10,467
)

$
2,203,317

$
(1,015,986
)

Comprehensive income (loss)

(463
)

4,155

109,832

113,987

Issuance of treasury stock under
   stock plans

(493
)

19,040

(17,033
)

2,007

Compensation expense on share-
   based awards

9,675

9,675

Issuance of common stock

1,405

9,796

9,796

Cumulative effect of revenue accounting
   change

2,933

2,933

Cumulative effect of tax accounting change

(2,485
)

(46,927
)

(49,412
)
Balance at June 30, 2018

$
4,004

120,352

$
0

53,765

$
(3,189,796
)

$
(8,797
)

$
2,271,593

$
(927,000
)

The accompanying notes are an integral part of the consolidated financial statements.

	Six Months Ended						Three Months Ended
	June 29,			June 30,			March 28,			March 30,
	2019			2018			2020			2019
Operating activities:
Net income	$	42,992		$	109,742
Adjustments to reconcile net income to cash provided by operating activities:
Net loss							$	(6,057	)	$	(10,726	)
Adjustments to reconcile net loss to cash provided by operating activities:
Depreciation and amortization		22,693			21,774			12,211			11,405
Amortization of deferred financing costs and debt discount		4,680			4,122			2,184			2,208
Goodwill impairment								3,665			0
Share-based compensation expense		9,684			9,675			3,965			4,812
Deferred tax (benefit) provision		(2,294	)		752
Deferred tax provision (benefit)								14,624			(433	)
Allowance for doubtful accounts		(303	)		54			(221	)		(290	)
Reserve for inventory obsolescence		4,244			8,338			2,664			2,243
Foreign currency exchange rate loss		527			868			916			173
Changes in cash due to:
Receivables		982			(9,650	)		(12,275	)		(3,316	)
Inventories		(8,608	)		4,999			(9,690	)		(8,059	)
Prepaid expenses		26,599			(3,023	)		(9,287	)		1,105
Accounts payable		656			(798	)		15,400			2,171
Accrued liabilities		(20,447	)		(1,696	)		(6,799	)		(326	)
Deferred revenue		2,920			13,259			(487	)		6,925
Other long term assets and liabilities, net		(2,185	)		(4,309	)		(384	)		272
Income taxes		(2,346	)		14,480			(2,013	)		(940	)
Cash provided by operating activities		79,794			168,587			8,416			7,224
Investing activities:
Capital expenditures		(7,601	)		(7,733	)		(13,533	)		(4,059	)
Capitalized software expenditures		(16,208	)		(13,118	)		(7,330	)		(7,167	)
Other items, net		120			(9,669	)		(5,051	)		3
Cash used for investing activities		(23,689	)		(30,520	)		(25,914	)		(11,223	)
Financing activities:
Net payments on revolver		0			(25,000	)
Net borrowings on revolver								148,000			0
Payments on long-term debt		(107,750	)		(38,500	)		(19,250	)		(38,500	)
Taxes paid related to net share settlement of equity awards		(4,227	)		(11,139	)		(600	)		(381	)
Proceeds from stock options exercised		326			23,262			120			127
Other items, net		(218	)		0			(64	)		(80	)
Cash used for financing activities		(111,869	)		(51,377	)
Cash provided by (used for) financing activities								128,206			(38,834	)
Effect of exchange rate changes on cash and cash equivalents		(565	)		(1,989	)		(1,171	)		(783	)
Net (decrease) increase in cash and cash equivalents		(56,329	)		84,701
Net increase (decrease) in cash and cash equivalents								109,537			(43,616	)
Cash and cash equivalents, beginning of period		236,974			83,054			182,736			236,974
Cash and cash equivalents, end of period	$	180,645		$	167,755		$	292,273		$	193,358

The accompanying notes are an integral part of the consolidated financial statements.

The accompanying consolidated financial statements include the accounts of ~~Weight Watchers~~WW International, Inc. and all of its subsidiaries. The terms “Company” and “WW” as used throughout these notes are used to indicate ~~Weight Watchers~~WW International, Inc. and all of its operations consolidated for purposes of its financial statements. The Company’s “Digital” business refers to providing subscriptions to the Company’s digital product offerings, including the Personal Coaching + Digital product. The Company’s “Studio + Digital” business refers to providing access to the Company’s weekly in-person workshops combined with the Company’s digital subscription product offerings to commitment plan subscribers. The “Studio + Digital” business also includes the provision of access to workshops for members who do not subscribe to commitment plans, including the Company’s “pay-as-you-go” members.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ~~of America~~ (“GAAP”) for interim financial information and include amounts that are based on management’s best estimates and judgments. While all available information has been considered, actual amounts could differ from those estimates. For example, the global outbreak of the coronavirus (COVID-19) has had and will continue to have a significant adverse impact on the Company’s business as well as on the business environment and the markets in which it operates. This global health crisis has also had a significant adverse effect on overall economic conditions and the Company expects consumer demand to continue to be negatively impacted due to changes in consumer behavior and confidence and health concerns. The situation remains dynamic and subject to rapid and possibly significant change, and accordingly the magnitude and duration of the negative impact to the Company’s business from the COVID-19 pandemic cannot be predicted with certainty. The Company considered the impact of COVID-19 on the assumptions and estimates used when preparing its Quarterly Report on Form 10-Q quarterly financial statements. These assumptions and estimates may change, as new events occur and additional information is obtained, and such future changes may have an adverse impact on the Company's results of operations, financial position and liquidity. The consolidated financial statements include all of the Company’s majority-owned subsidiaries. All entities acquired, and any entity of which a majority interest was acquired, are included in the consolidated financial statements from the date of acquisition. All intercompany accounts and transactions have been eliminated in consolidation. The Company’s operating results for any interim period are not necessarily indicative of future or annual results. The consolidated financial statements are unaudited and, accordingly, they do not include all of the information necessary for a comprehensive presentation of results of operations, financial position and cash flow activity required by GAAP for complete financial statements but, in the opinion of management, reflect all adjustments including those of a normal recurring nature necessary for a fair statement of the interim results presented.

These statements should be read in conjunction with the Company’s Annual Report on Form 10-K for fiscal ~~2018~~2019 filed on February ~~26, 2019,~~25, 2020, which includes additional information about the Company, its results of operations, its financial position and its cash flows.

In December 2019, the Financial Accounting Standards Board (the “FASB”)issued updated guidance simplifying the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 as well as by improving consistent application of GAAP by clarifying and amending existing guidance. The effective date of the new guidance for public companies is for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

For a discussion of the Company’s significant accounting policies, see “Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements of the Company’s Annual Report on Form 10-K for fiscal ~~2018.~~2019. For a discussion of accounting standards adopted in the current ~~period,~~year, see Note 3.

In ~~February 2016,~~August 2018, the ~~Financial Accounting Standards Board (the “FASB”)~~FASB issued updated guidance ~~regarding leases, requiring lessees~~addressing customer’s accounting for implementation costs incurred in a cloud computing arrangement that is a service contract, which requires customers to ~~recognize a right-of-use asset and a lease liability on~~apply internal-use software guidance to determine the ~~balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue~~implementation costs that are able to be ~~classified as either operating or finance leases in~~capitalized. Capitalized implementation costs are required to be amortized over the ~~income statement. Lessor accounting~~term of the arrangement, beginning when the cloud computing arrangement is ~~similar to the current model but will be updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases.~~ ready for its intended use. The effective date of the new guidance for public companies is for fiscal years beginning after December 15, ~~2018~~2019 and interim periods within those fiscal years.Early adoption is permitted. ~~In July 2018, the FASB issued updated guidance by providing an entity with an additional and optional transition method to adopt the new lease guidance.~~ On December 30, 2018, the Company adopted the updated lease guidance on a modified retrospective basis as of the adoption date. Periods prior to the adoption date continue to be reported under the historical lease accounting guidance. See Note 4 for further details.

~~On December 30, 2018,~~29, 2019, the Company adopted the updated guidance on ~~leases using~~a prospective basis to all software implementation costs incurred after the modified retrospective transition method. Results for reporting periods beginning on or after December 30, 2018 are presented under the updated guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historical lease accounting.

~~The~~date of adoption. The adoption of ~~the standard had~~this guidance did not have a material impact on the Company’s consolidated ~~balance sheets but did not have a material impact on its consolidated statements of net income. The Company recorded $155,178 as a right of use asset, $163,486 of lease~~financial statements.

liabilities and $0 for retained earnings for operating leases upon adoption of the updated guidance. The previously reported amounts have been revised by $3,595 due to the impact of prepaid rent. The standard did not have a material impact on the Company’s finance lease contracts.

A lease is defined as an arrangement that contractually specifies the right to use and control an identified asset for a specific period of time in exchange for consideration. Operating leases are included in operating lease assets, portion of operating lease liabilities due within one year, and long-term operating lease liabilities in the Company’s ~~2019~~ consolidated balance ~~sheet.~~sheets. Finance leases are included in property and equipment, net, other accrued liabilities, and other long-term liabilities in the Company’s ~~2019~~ consolidated balance ~~sheet~~sheets. Lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term, using the Company’s incremental borrowing rate commensurate with the lease ~~term.~~term, since the Company’s lessors do not provide an implicit rate, nor is one readily available. The incremental borrowing rate is calculated based on the Company’s credit yield curve and adjusted for collateralization, credit quality and economic environment impact, all where applicable. The lease asset includes scheduled lease payments and excludes lease incentives, such as free rent periods and tenant improvement allowances. The Company has certain leases that may include an option to renew and when it is reasonably probable to exercise such option, the Company will include the renewal option terms in determining the lease asset and lease liability. The Company does not have any renewal options that would have a material impact on the terms of the leases and that are also reasonably expected to be exercised ~~at this time.~~as of March 28, 2020. A lease may contain both fixed and variable payments. Variable lease payments that are linked to an index or rate are measured based on the current index or rate at adoption of the updated guidance, or lease commencement date for new leases, with the impact of future changes in the index or rate being recorded as a period expense. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company’s operating and finance leases are primarily for its studios, corporate offices, data centers and certain equipment, including automobiles.

At ~~June 29,~~March 28, 2020 and December 28, 2019, the Company’s lease assets and lease liabilities were as follows:

	June 29, 2019		March 28, 2020		December 28, 2019
Assets:
Operating lease assets	$	144,913	$	149,757	$	151,983
Finance lease assets		522		190		259
Total leased assets	$	145,435	$	149,947	$	152,242

Liabilities:
Current
Operating	$	32,003	$	33,843	$	33,236
Finance		287		127		126
Noncurrent
Operating	$	121,318	$	125,535	$	128,464
Finance		152		63		96
Total lease liabilities	$	153,760	$	159,568	$	161,922

For the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019, the components of the Company’s lease expense were as follows:

	Three Months Ended		Six Months Ended		Three Months Ended
	June 29,		June 29,		March 28,		March 30,
	2019		2019		2020		2019
Operating lease cost	$	12,363	$	25,735
Operating lease cost:
Fixed lease cost					$	12,641	$	13,372
Variable lease cost						11		0
Total operating lease cost					$	12,652	$	13,372
Finance lease cost:
Amortization of leased assets		138		218		64		80
Interest on lease liabilities		5		13		3		8
Total finance lease cost	$	143	$	231	$	67	$	88
Total lease cost	$	12,506	$	25,966	$	12,719	$	13,460

At ~~June 29,~~March 28, 2020 and December 28, 2019, the Company’s weighted average remaining lease term and weighted average discount rates were as follows:

The Company’s leases have remaining lease terms of 0 to 1312 years with a weighted average lease term of ~~7.21 years.~~6.93 years as of March 28, 2020.

At ~~June 29, 2019,~~March 28, 2020, the maturity of the Company’s lease liabilities in each of the next five fiscal years and thereafter were as follows:

	Operating Leases		Finance Leases		Total		Operating Leases		Finance Leases		Total
Remainder of fiscal 2019	$	20,478	$	286	$	20,764
2020		39,951		135		40,086
Remainder of fiscal 2020							$	32,544	$	102	$	32,646
2021		31,371		49		31,420		40,804		51		40,855
2022		21,254		20		21,274		29,553		22		29,575
2023		15,512		21		15,533		21,385		24		21,409
2024								16,007		5		16,012
Thereafter		74,253		4		74,257		66,061		0		66,061
Total lease payments	$	202,819	$	515	$	203,334	$	206,354	$	204	$	206,558
Less imputed interest		49,498		76		49,574		46,976		14		46,990
Present value of lease liabilities	$	153,321	$	439	$	153,760	$	159,378	$	190	$	159,568

~~Minimum commitments under non-cancelable obligations, primarily for office and rental facilities operating leases at December 29, 2018, consisted of the following:~~

~~Total rent expense charged~~Supplemental cash flow information related to ~~operations for office and rental facilities under these operating~~ leases for the three ~~and six~~ months ended ~~June~~March 28, 2020 and March 30, ~~2018 was $10,741 and~~ $~~21,532, respectively.~~2019 were as follows:

~~Supplemental cash flow information related to leases for the six months ended June 29, 2019 were as follows:~~

The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allowed the Company not to reassess whether any expired or existing contracts contained leases, to carry forward existing lease classifications and not to reassess initial direct costs for existing leases. In addition, the Company elected the benefit of hindsight practical expedient in determining the lease term for existing leases upon adoption of the updated guidance.

The Company has lease agreements with lease and non-lease components and has elected the practical expedient not to separate non-lease components from lease components and instead to account for each separate lease component and non-lease component as a single lease component.

The Company has elected the short-term lease exception accounting policy, whereby the recognition requirements of the updated guidance is not applied and lease expense is recorded on a straight-line basis with respect to leases with an initial term of 12 months or less.

On December 31, 2017, the Company adopted the updated guidance on revenue from contracts with customers using the modified retrospective method applied to those contracts which were not completed as of December 31, 2017. Results for reporting periods beginning after December 31, 2017 are presented under the updated guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historical revenue accounting.

The Company recorded a net increase to opening retained earnings of $2,145 as of December 31, 2017 due to the cumulative impact of adopting the updated guidance, inclusive of a $3,501 decrease to deferred revenue, a decrease of $568 to prepaid expenses and other current assets and an increase to the deferred income tax liability of $788.

Revenues are recognized when control of the promised services or goods is transferred to the Company’s customers, in an amount that reflects the consideration it expects to be entitled to in exchange for those services or goods.

The Company earns revenue from subscriptions for its digital products and by conducting workshops, for which it charges a fee, predominantly through commitment plans, prepayment plans or the “pay-as-you-go” arrangement. The Company also earns revenue by selling consumer products (including publications) in its workshops, online through its ecommerce platform and to its franchisees, collecting commissions from franchisees, collecting royalties related to licensing agreements, selling magazine subscriptions, publishing, selling advertising space on its websites and in copies of its publications and By Mail product sales.

Commitment plan revenues, prepaid workshop fees and magazine subscription revenue are recorded to deferred revenue and amortized into revenue as control is transferred over the period earned since these performance obligations are satisfied over time. Digital subscription revenues, consisting of the fees associated with subscriptions for the Company’s Digital products, including its

Personal Coaching + Digital product, are deferred and recognized on a straight-line basis as control is transferred over the subscription period. One-time Digital sign-up fees are considered immaterial in the context of the contract and the related revenue is recorded to deferred revenue and amortized into revenue over the commitment period. In the Studio + Digital business, the Company generally charges non-refundable registration and starter fees in exchange for access to the Company’s digital subscription products, an introductory information session and materials it provides to new members. Revenue from these registration and starter fees is considered immaterial in the context of the contract and is recorded to deferred revenue and amortized into revenue over the commitment period. Revenue from “pay-as-you-go” workshop fees, consumer product sales and By Mail, commissions and royalties is recognized at the point in time control is transferred, which is when services are rendered, products are shipped to customers and title and risk of loss passes to the customers, and commissions and royalties are earned, respectively. Revenue from advertising in magazines and from magazine sales is recognized upon distribution of the magazine. For revenue transactions that involve multiple performance obligations, the amount of revenue recognized is determined using the relative fair value approach, which is generally based on each performance obligation’s stand-alone selling price. Discounts to customers, including free registration offers, are recorded as a deduction from gross revenue in the period such revenue was recognized. Revenue from advertising on its websites is recognized when the advertisement is viewed by the user.

The Company grants refunds in aggregate amounts that historically have not been material. Because the period of payment of the refund generally approximates the period revenue was originally recognized, refunds are recorded as a reduction of revenue over the same period.

The following table presents the Company’s revenues disaggregated by revenue source:

	Three Months Ended				Six Months Ended				Three Months Ended
	June 29,		June 30,		June 29,		June 30,		March 28,		March 30,
	2019		2018		2019		2018		2020		2019
Digital Subscription Revenues	$	156,969	$	151,018	$	305,824	$	289,565	$	174,545	$	148,855
Studio + Digital Fees		156,799		192,712		314,670		382,834		150,112		157,871
Service Revenues, net	$	313,768	$	343,730	$	620,494	$	672,399	$	324,657	$	306,726
Product sales and other, net		55,255		66,017		111,694		145,571		75,704		56,438
Revenues, net	$	369,023	$	409,747	$	732,188	$	817,970	$	400,361	$	363,164

The following tables present the Company’s revenues disaggregated by revenue source and segment:

	Three Months Ended June 29, 2019										Three Months Ended March 28, 2020
	North		Continental		United						North		Continental		United
	America		Europe		Kingdom		Other		Total		America		Europe		Kingdom		Other		Total
Digital Subscription Revenues	$	102,851	$	43,586	$	6,993	$	3,539	$	156,969	$	116,349	$	46,638	$	7,576	$	3,982	$	174,545
Studio + Digital Fees		116,958		23,681		11,498		4,662		156,799		112,843		21,519		11,129		4,621		150,112
Service Revenues, net	$	219,809	$	67,267	$	18,491	$	8,201	$	313,768	$	229,192	$	68,157	$	18,705	$	8,603	$	324,657
Product sales and other, net		35,835		10,062		6,034		3,324		55,255		54,514		11,833		6,323		3,034		75,704
Revenues, net	$	255,644	$	77,329	$	24,525	$	11,525	$	369,023	$	283,706	$	79,990	$	25,028	$	11,637	$	400,361

	Six Months Ended June 30, 2018										Three Months Ended March 30, 2019
	North		Continental		United						North		Continental		United
	America		Europe		Kingdom		Other		Total		America		Europe		Kingdom		Other		Total
Digital Subscription Revenues	$	193,338	$	75,503	$	13,519	$	7,205	$	289,565	$	98,760	$	40,183	$	6,418	$	3,494	$	148,855
Studio + Digital Fees		282,919		58,482		28,933		12,500		382,834		117,599		23,949		11,263		5,060		157,871
Service Revenues, net	$	476,257	$	133,985	$	42,452	$	19,705	$	672,399	$	216,359	$	64,132	$	17,681	$	8,554	$	306,726
Product sales and other, net		87,458		30,138		17,043		10,932		145,571		33,652		12,025		6,930		3,831		56,438
Revenues, net	$	563,715	$	164,123	$	59,495	$	30,637	$	817,970	$	250,011	$	76,157	$	24,611	$	12,385	$	363,164

For Service Revenues, the Company typically collects payment in advance of providing services. Any amounts collected in advance of services being provided are recorded in deferred revenue. In the case where amounts are not collected, but the service has been provided and the revenue has been recognized, the amounts are recorded in accounts receivable. The opening and ending balances of the Company’s deferred revenues are as follows:

Revenue recognized from amounts included in current deferred revenue as of December ~~29, 2018~~28, 2019 was ~~$52,507~~$50,669 for the ~~six~~three months ended ~~June 29, 2019.~~March 28, 2020. The Company’s long-term deferred revenue, which is included in other liabilities on the Company’s consolidated balance sheet, had a balance of ~~$469~~$58 and $54 at ~~June 29,~~March 28, 2020 and December 28, 2019, respectively, for revenue that will not be recognized during the next fiscal year and is generally related to upfront payments received as an inducement for entering into certain sales-based royalty agreements with third party licensees. This revenue is amortized on a straight-line basis over the term of the applicable agreement.

The Company elected to apply the updated guidance only to contracts that were not completed as of December 31, 2017, the date of adoption. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. The Company expenses sales commissions when incurred (amortization period would have been one year or less) and these expenses are recorded within selling, general and administrative expenses. The Company treats shipping and handling fees as fulfillment costs and not as a separate performance obligation, and as a result, any fees received fromcustomers are included in the transaction price allocated to the performance obligation of providing goods with a corresponding amount accrued within cost of product sales and other for amounts paid to applicable carriers. Sales tax, value-added tax, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue.

Franchise rights acquired are due to acquisitions of the Company’s franchised territories as well as the acquisition of franchise promotion agreements and other factors associated with the acquired franchise territories. For the ~~six~~three months ended ~~June 29, 2019,~~March 28, 2020, the change in the carrying value of franchise rights acquired iswas primarily due to the effect of exchange rate changes.

Goodwill primarily relates to the acquisition of the Company by The Kraft Heinz Company (successor to H.J. Heinz Company) in 1978 and the Company’s acquisitions of WW.com, Inc. (formerly known as WeightWatchers.com, Inc.) in 2005, the Company’s franchised territories and the majority interest in Vigilantes do Peso Marketing Ltda. For the ~~six~~three months ended ~~June 29, 2019,~~March 28, 2020, the change in the carrying amount of goodwill was due to the impairment charge of the Company’s Brazil reporting unit and the effect of exchange rate changes as follows:

North

Continental

United

America

Europe

Kingdom

Other

Total

Balance as of December 29, 2018

$
138,156

$
7,242

$
1,178

$
5,943

$
152,519

Effect of exchange rate changes

1,646

(144
)

0

37

1,539

Balance as of June 29, 2019

$
139,802

$
7,098

$
1,178

$
5,980

$
154,058

	North			Continental			United
	America			Europe			Kingdom			Other			Total
Balance as of December 28, 2019	$	143,940		$	7,015		$	1,213		$	5,748		$	157,916
Goodwill impairment		0			0			0			(3,665	)		(3,665	)
Effect of exchange rate changes		(2,642	)		(201	)		(59	)		(892	)		(3,794	)
Balance as of March 28, 2020	$	141,298		$	6,814		$	1,154		$	1,191		$	150,457

With respect to the Company’s Brazil reporting unit, during the first quarter of fiscal 2020, the Company made a strategic decision to shift to an exclusively Digital business in that country. The Company ~~reviews~~determined that making this decision together with the negative impact of COVID-19, the ongoing challenging economic environment in Brazil and the Company’s reduced expectations regarding the reporting unit’s future operating cash flows required the Company to perform an interim goodwill ~~and other indefinite-lived intangible assets, including franchise rights acquired with indefinite lives, for potential~~ impairment on at least an annual basis or more often if events so require. The Company performed fair value impairment testing as of May 5, 2019 and May 6, 2018, each the first day of fiscal May, on its goodwill and other indefinite-lived intangible assets.

analysis. In performing ~~its annual impairment~~this discounted cash flow analysis, ~~as of May 5, 2019 and May 6, 2018,~~ the Company determined that the carrying ~~amounts of its goodwill reporting units and franchise rights acquired with indefinite lives units of account did not exceed their respective fair values and therefore no impairment existed.~~

~~For all reporting units, except for Brazil, there was significant headroom in the goodwill impairment analysis.~~ Based on the results of the Company’s annual goodwill impairment test performed for all of its reporting units except for Brazil, as of the June 29, 2019 balance sheet date, for reporting units that hold 97.0% of the Company’s goodwill, those units had an estimated fair value at least 60% higher than the respective reporting unit’s carrying amount. Based on the results of the Company’s annual goodwill impairment test performed for its Brazil reporting unit, the estimated fair valueamount of this reporting unit exceeded its ~~carrying~~fair value ~~by approximately 3.0% and accordingly a change in the underlying assumptions for Brazil would likely cause a change in the results of the impairment assessment~~ and as ~~such, could~~a result inrecorded an impairment charge of $3,665, which comprises the remaining balance of goodwill ~~related to Brazil,~~ for ~~which the net book value is $4,623.~~

~~For all units of account, except for New Zealand, there was significant headroom in the franchise rights acquired impairment analysis.~~ Based on the results of the Company’s annual franchise rights acquired impairment test performed for all of its units of account except for New Zealand, as of the June 29, 2019 balance sheet date, for units of account that hold 99.4% of the Company’s franchise rights acquired, those units had an estimated fair value at least 40% higher than the respective unit of account’s carrying amount. Based on the results of the Company’s annual franchise rights acquired impairment test performed for its New Zealand unit of account, the estimated fair value of this unit of account exceeded its carrying value by approximately 3.0% and accordingly a change in the underlying assumptions for New Zealand would likely cause a change in the results of the impairment assessment and, as such, could result in an impairment of the franchise rights acquired related to New Zealand, for which the net book value is $4,754.

When determining fair value, the Company utilizes various assumptions, including projections of future cash flows, growth rates and discount rates. A change in these underlying assumptions would likely cause a change in the results of the tests and, as such, could cause fair value to be less than the carrying amounts and result in an impairment of those assets. In the event such a result occurred, the Company would be required to record a corresponding charge, which would impact earnings. The Company would also be required to reduce the carrying amounts of the related assets on its balance sheet. The Company continues to evaluate these assumptions and believes that these assumptions are appropriate.

~~The following is a discussion of the goodwill and franchise rights acquired impairment analysis.~~

In performing the impairment analysis for goodwill, the fair value for the Company’s reporting units is estimated using a discounted cash flow approach. This approach involves projecting future cash flows attributable to the reporting unit and discounting those estimated cash flows using an appropriate discount rate. The estimated fair value is then compared to the carrying value of the reporting unit. The Company has determined the appropriate reporting unit for purposes of assessing annual impairment to be the country for all reporting units. For all of the Company’s reporting units except for Brazil (see below), the Company estimated future

cash flows by utilizing the historical debt-free cash flows (cash flows provided by operating activities less capital expenditures) attributable to that country and then applied expected future operating income growth rates for such country. The Company utilized operating income as the basis for measuring its potential growth because it believes it is the best indicator of the performance of its business. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was determined by reviewing external market data. The cost of debt was determined by estimating the Company’s current borrowing rate.

As it relates to the goodwill impairment analysis for Brazil, the Company estimated future debt-free cash flows in contemplation of its growth strategies for that market. In developing these projections, the Company considered the ~~historical impact of similar~~ growth strategies ~~in other markets as well as~~under the current market conditions in Brazil. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was determined by reviewing external market data including the current economic conditions in Brazil and the country specific risk thereon, all as reflected in the discount rate. The cost of debt was determined by estimating the Company’s current borrowing rate.

Finite-lived franchise rights acquired are amortized over the remaining contractual period, which is generally less than one year. Indefinite-lived franchise rights acquired are tested on an annual basis for impairment.

In performing the impairment analysis for indefinite-lived franchise rights acquired, the fair value for franchise rights acquired is estimated using a discounted cash flow approach referred to as the hypothetical start-up approach for franchise rights related to the Company’s Studio + Digital business and a relief from royalty methodology for franchise rights related to the Company’s Digital business. The aggregate estimated fair value for these rights is then compared to the carrying value of the unit of account for those franchise rights. The Company has determined the appropriate unit of account for purposes of assessing impairment to be the combination of the rights in both the Studio + Digital business and the Digital business in the country in which the applicable acquisition occurred.

In its hypothetical start-up approach analysis for fiscal 2019, the Company assumed that the year of maturity was reached after 7 years. Subsequent to the year of maturity, the Company estimated future cash flows for the Studio + Digital business in each country based on assumptions regarding revenue growth and operating income margins. The cash flows associated with the Digital business in each country were based on the expected Digital revenue for such country and the application of a market-based royalty rate. The cash flows for the Studio + Digital and Digital businesses were discounted utilizing rates consistent with those utilized in the annual goodwill impairment analysis.

~~The carrying values of finite-lived intangible assets as of June 29, 2019 and December 29, 2018 were as follows:~~

The carrying values of finite-lived intangible assets as of March 28, 2020 and December 28, 2019 were as follows:

Aggregate amortization expense for finite-lived intangible assets was recorded in the amounts of ~~$7,485~~$7,165 and ~~$15,041~~$7,556 for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019, respectively. ~~Aggregate amortization expense for finite-lived intangible assets was recorded in the amounts of $6,832 and $14,242 for the three and six months ended June 30, 2018, respectively.~~

Estimated amortization expense of existing finite-lived intangible assets for the next five fiscal years and thereafter is as follows:

June 29, 2019

December 29, 2018

Principal
Balance

Unamortized
Deferred
Financing
Costs

Unamortized
Debt Discount

Effective
Rate ⁽¹⁾

Principal
Balance

Unamortized
Deferred
Financing
Costs

Unamortized
Debt Discount

Effective
Rate ⁽¹⁾

Revolving Credit Facility due
   November 29, 2022

$
0

$
0

$
0

0.00
%

$
0

$
0

$
0

4.39
%
Term Loan Facility
   due November 29, 2024

1,374,500

7,342

23,833

8.07
%

1,482,250

8,307

26,033

7.53
%
Notes due December 1, 2025

300,000

1,115

0

8.62
%

300,000

1,202

0

8.69
%
Total

$
1,674,500

$
8,457

$
23,833

8.17
%

$
1,782,250

$
9,509

$
26,033

7.63
%
Less: Current Portion

57,750

77,000

Unamortized Deferred
   Financing Costs

8,457

9,509

Unamortized Debt Discount

23,833

26,033

Total Long-Term Debt

$
1,584,460

$
1,669,708

	March 28, 2020									December 28, 2019
	Principal Balance		Unamortized Deferred Financing Costs		Unamortized Debt Discount		Effective Rate ⁽¹⁾			Principal Balance		Unamortized Deferred Financing Costs		Unamortized Debt Discount		Effective Rate ⁽¹⁾
Revolving Credit Facility due November 29, 2022	$	148,000	$	0	$	0		3.18	%	$	0	$	0	$	0		0.00	%
Term Loan Facility due November 29, 2024		1,286,000		6,092		20,533		7.32	%		1,305,250		6,418		21,634		7.93	%
Notes due December 1, 2025		300,000		985		0		8.62	%		300,000		1,028		0		8.72	%
Total	$	1,734,000	$	7,077	$	20,533		7.54	%	$	1,605,250	$	7,446	$	21,634		8.07	%
Less: Current portion		244,250									96,250
Unamortized deferred financing costs		7,077									7,446
Unamortized debt discount		20,533									21,634
Total long-term debt	$	1,462,140								$	1,479,920

On November 29, 2017, the Company refinanced its then-existing credit facilities (hereinafter referred to as “the November 2017 debt refinancing”) consisting of $1,930,386 of borrowings under a term loan facility and an undrawn $50,000 revolving credit facility with $1,565,000 of borrowings under its new credit facilities, consisting of a $1,540,000 term loan facility and a $150,000 revolving credit facility (of which $25,000 was drawn upon at the time of the November 2017 debt ~~refinancing)~~refinancing and repaid on January 29, 2018) (collectively, the “Credit Facilities”), and $300,000 in aggregate principal amount of 8.625% Senior Notes due 2025 (the “Notes”). During the fourth quarter of fiscal 2017, the Company incurred fees of $53,832 (which included $30,800 of a debt discount) in connection with the November 2017 debt refinancing. In addition, the Company recorded a loss on early extinguishment of debt of $10,524 in connection thereto. This early extinguishment of debt write-off was comprised of $5,716 of deferred financing fees paid in connection with the November 2017 debt refinancing and $4,808 of pre-existing deferred financing fees.

The Credit Facilities were issued under a new credit agreement, dated November 29, 2017 (the “Credit Agreement”), among the Company, as borrower, the lenders party thereto, JPMorgan Chase Bank, N.A. (“JPMorgan Chase”), as administrative agent and an issuing bank, Bank of America, N.A., as an issuing bank, and Citibank, N.A., as an issuing bank. The Credit Facilities consist of (1) $1,540,000 in aggregate principal amount of senior secured tranche B term loans due in 2024 (the “Term Loan Facility”) and (2) a $150,000 senior secured revolving credit facility (which includes borrowing capacity available for letters of credit) due in 2022 (the “Revolving Credit Facility”).

On both May 31, 2019 and October 10, 2019, the Company made a voluntary prepayment at par of $50,000 in respect of its outstanding term loans under the Term Loan Facility. As a result of ~~this prepayment,~~these prepayments, the Company wrote off deferred financing fees of ~~$267~~$526 in the ~~second quarter~~aggregate in fiscal 2019.

On March 23, 2020, as a precautionary measure in light of ~~fiscal 2019.~~the COVID-19 outbreak, the Company drew down $148,000 on the Revolving Credit Facility in order to enhance its cash position and to provide additional financial flexibility. The revolver borrowing has been classified as a short-term liability in connection with the Company’s monthly interest elections.

As of ~~June 29, 2019,~~March 28, 2020, the Company had ~~$1,374,500~~$1,434,000 of debt outstanding under ~~the~~its Credit Facilities, with ~~$148,841~~$846 of availability and ~~$1,159~~$1,154 in issued but undrawn letters of credit outstanding under the Revolving Credit Facility. ~~There was no~~The outstanding balance under the Revolving Credit Facility is included in the current portion of long-term debt on the Company’s consolidated balance sheet as of ~~June 29, 2019.~~March 28, 2020.

All obligations under the Credit Agreement are guaranteed by, subject to certain exceptions, each of the Company’s current and future wholly-owned material domestic restricted subsidiaries. All obligations under the Credit Agreement, and the guarantees of those obligations, are secured by substantially all of the assets of the Company and each guarantor, subject to customary exceptions, including:

Under the terms of the Credit Agreement, depending on the Company’s Consolidated First Lien Net Debt Leverage Ratio (as used in the Credit Agreement), on an annual basis on or about the time the Company is required to deliver its financial statements for any fiscal year, the Company is obligated to offer to prepay a portion of the outstanding principal amount of the Term Loan Facility in an aggregate amount determined by a percentage of its annual excess cash flow (as defined in the Credit Agreement) (said payment, a “Cash Flow Sweep”).

Borrowings under the Term Loan Facility bear interest at a rate per annum equal to, at the Company’s option, either (1) an applicable margin plus a base rate determined by reference to the highest of (a) 0.50% per annum plus the higher of (i) the Federal Funds Effective Rate and (ii) the Overnight Bank Funding Rate as determined by the Federal Reserve Bank of New York, (b) the prime rate of JPMorgan Chase and (c) the LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00%; provided that such rate is not lower than a floor of 1.75% or (2) an applicable margin plus a LIBOR rate determined by reference to the ~~costs~~cost of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs, provided that LIBOR is not lower than a floor of 0.75%. Borrowings under the Revolving Credit Facility bear interest at a rate per annum equal to an applicable margin based upon a leverage-based pricing grid, plus, at the Company’s option, either (1) a base rate determined by reference to the highest of (a) 0.50% per annum plus the higher of (i) the Federal Funds Effective Rate and (ii) the Overnight Bank Funding Rate as determined by the Federal Reserve Bank of New York, (b) the prime rate of JPMorgan Chase and (c) the LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00% or (2) a LIBOR rate determined by reference to the ~~costs~~cost of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs. As of ~~June 29, 2019,~~March 28, 2020, the applicable margins for the LIBOR rate borrowings under the Term Loan Facility and the Revolving Credit Facility were 4.75% and 2.25%, respectively.In the event that LIBOR is phased out as is currently expected, the Credit Agreement provides that the Company and the administrative agent may amend the Credit Agreement to replace the LIBOR definition therein with a successor rate subject to notifying the lending syndicate of such change and not receiving within five business days of such notification objections to such replacement rate from lenders holding at least a majority of the aggregate principal amount of loans and commitments then outstanding under the Credit Agreement. If the Company fails to do so, its borrowings will be based off of the alternative base rate plus a margin.

On a quarterly basis, the Company pays a commitment fee to the lenders under the Revolving Credit Facility in respect of unutilized commitments thereunder, which commitment fee fluctuates depending upon the Company’s Consolidated First Lien Net Debt Leverage Ratio. Based on the Company’s Consolidated First Lien Net Debt Leverage Ratio as of ~~June 29, 2019,~~March 28, 2020, the commitment fee was 0.35% per annum. The Company’s Consolidated First Lien Net Debt Leverage Ratio as of ~~June 29, 2019~~March 28, 2020 was ~~2.93~~3.04:1.00.

The Credit Agreement contains other customary terms, including (1) representations, warranties and affirmative covenants, (2) negative covenants, including limitations on indebtedness, liens, mergers, acquisitions, asset sales, investments, distributions,

prepayments of subordinated debt, amendments of material agreements governing subordinated indebtedness, changes to lines of business and transactions with affiliates, in each case subject to baskets, thresholds and other exceptions, and (3) customary events of default.

The availability of certain baskets and the ability to enter into certain transactions are also subject to compliance with certain financial ratios. In addition, if the Company has more than $50,000 of outstanding extensions of credit under the Revolving Credit Facility ~~includes~~as of any fiscal quarter end, it must be in compliance with a springing Consolidated First Lien Net Debt Leverage Ratio maintenance covenant of 3.75:1.00. If at any time the Company expects that it will ~~require,~~not be in ~~certain circumstances,~~ compliance with ~~certain first lien secured net leverage ratios.~~such maintenance covenant as of the next upcoming fiscal quarter end, the Company expects it will reduce its extensions of credit under the Revolving Credit Facility to $50,000 or less prior to the last day of such fiscal quarter so that it is not required to comply with such springing maintenance covenant. In any such event, the Company would be able to reborrow the full amount under the Revolving Credit Facility subsequent to such fiscal quarter end given the maintenance covenant is only tested as of the last day of each fiscal quarter.

As of ~~June 29, 2019,~~March 28, 2020, the Company was in compliance with all applicable financial covenants in the Credit Agreement governing the Credit Facilities.

The Notes were issued pursuant to an Indenture, dated as of November 29, 2017 (the “Indenture”), among the Company, the guarantors named therein and The Bank of New York Mellon, as trustee. The Indenture contains customary covenants, events of default and other provisions for an issuer of non-investment grade debt securities. These covenants include limitations on indebtedness, liens, mergers, acquisitions, asset sales, investments, distributions, prepayments of subordinated debt and transactions with affiliates, in each case subject to baskets, thresholds and other exceptions.

The Notes accrue interest at a rate per annum equal to 8.625% and are due on December 1, 2025. Interest on the Notes is payable semi-annually on June 1 and December 1 of each year, beginning on June 1, 2018. On or after December 1, 2020, the Company may on any one or more occasions redeem some or all of the Notes at a purchase price equal to 104.313% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the redemption date, such optional redemption price decreasing to 102.156% on or after December 1, 2021 and to 100.000% on or after December 1, 2022. Prior to December 1, 2020, the Company may on any one or more occasions redeem up to 40% of the aggregate principal amount of the Notes with an amount not to exceed the net proceeds of certain equity offerings at 108.625% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the redemption date. Prior to December 1, 2020, the Company may redeem some or all of the Notes at a make-whole price plus accrued and unpaid interest, if any, to, but not including, the redemption date. If a change of control occurs, the Company must offer to purchase for cash the Notes at a purchase price equal to 101% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the purchase date. Following the sale of certain assets and subject to certain conditions, the Company must offer to purchase for cash the Notes at a purchase price equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The Notes are guaranteed on a senior unsecured basis by the Company’s subsidiaries that guarantee the Credit Facilities.

At ~~June 29, 2019,~~March 28, 2020, the Company had ~~$1,674,500~~$1,734,000 outstanding under the Credit Facilities and the Notes, consisting of borrowings under the Term Loan Facility of ~~$1,374,500, $0 drawn down on~~$1,286,000, borrowings under the Revolving Credit Facility of $148,000 and $300,000 in aggregate principal amount of Notes issued and outstanding.

At ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, the Company’s debt consisted of both fixed and variable-rate instruments. Interest rate swaps were entered into to hedge a portion of the cash flow exposure associated with the Company’s variable-rate borrowings. See Note 12 for information on the Company’s interest rate swaps. The weighted average interest rate (which includes amortization of deferred financing costs and debt discount) on the Company’s outstanding debt, exclusive of the impact of the swap then in effect, was approximately ~~8.17%~~7.19% and ~~7.73%~~8.08% per annum at March 28, 2020 and December 28, 2019, respectively, based on interest rates ~~at June 29, 2019 and December 29, 2018, respectively.~~on these dates. The weighted average interest rate (which includes amortization of deferred financing costs and debt discount) on the Company’s outstanding debt, including the impact of the swap then in effect, was approximately ~~7.61%~~7.09% and ~~7.46%~~7.59% per annum at March 28, 2020 and December 28, 2019, respectively, based on interest rates ~~at June 29, 2019 and December 29, 2018, respectively.~~on these dates.

Basic ~~earnings~~net loss per share ~~(“EPS”) are~~is calculated utilizing the weighted average number of common shares outstanding during the periods presented. Diluted ~~EPS~~net loss per share is calculated utilizing the weighted average number of common shares outstanding during the periods presented adjusted for the effect of dilutive common stock equivalents.

18The following table sets forth the computation of basic and diluted loss per share data:

The number of anti-dilutive common stock equivalents excluded from the calculation of the weighted average number of common shares for diluted net loss per share was 4,042 and 4,223 for the three months ended March 28, 2020 and March 30, 2019, respectively.

~~The following table sets forth the computation of basic and diluted earnings per share:~~

The number of anti-dilutive common stock equivalents excluded from the calculation of the weighted average number of common shares for diluted EPS was 2,032 and 32 for the three months ended June 29, 2019 and June 30, 2018, respectively. The number of anti-dilutive common stock equivalents excluded from the calculation of the weighted average number of common shares for diluted EPS was 1,975 and 399 for the six months ended June 29, 2019 and June 30, 2018, respectively.

On May 6, 2008, ~~and May 12, 2004, respectively,~~ the Company’s shareholders approved the 2008 Stock Incentive Plan (the “2008 ~~Plan”) and the 2004 Stock Incentive Plan (the “2004~~ Plan”). On May 6, 2014, the Company’s shareholders approved the 2014 Stock Incentive Plan (as amended and restated, the “2014 Plan”~~, and together with the 2004 Plan and the 2008 Plan, the “Stock Plans”~~), which replaced the 2008 ~~Plan and 2004~~ Plan for all equity-based awards granted on or after May 6, 2014. The 2014 Plan is designed to promote the long-term financial interests and growth of the Company by attracting, motivating and retaining employees with the ability to contribute to the success of the business and to align compensation for the Company’s employees over a multi-year period directly with the interests of the shareholders of the Company. The Company’s long-term equity incentive compensation program has historically included time-vesting non-qualified stock option and/or restricted stock unit (including performance-based stock unit with both time- and performance-vesting criteria (“PSUs”)) awards. From time to time, the Company has granted fully-vested shares of its common stock to individuals in connection with special circumstances. The Company’s Board of Directors or a committee thereof administers the 2014 Plan.

In fiscal 2019, the Company granted ~~275.8~~280.1 PSUs having both time- and performance-vesting criteria. The time-vesting criteria for these PSUs will be satisfied upon continued employment (with limited exceptions) on the third anniversary of the grant date. The performance-vesting criteria for these PSUs will be satisfied if the Company has achieved a certain annual operating income objective for the performance period of fiscal 2021. Pursuant to these awards, the number of PSUs that become vested, if any, upon the satisfaction of both vesting criteria, shall be equal to (x) the target number of PSUs granted multiplied by (y) the applicable achievement percentage, rounded down to avoid the issuance of fractional shares. The Company is currently accruing compensation expense to what it believes is the probable outcome upon vesting.

In fiscal 2018, the Company granted 81.3 PSUs having both time- and performance-vesting criteria. The time-vesting criteria for these PSUs will be satisfied upon continued employment (with limited exceptions) on the third anniversary of the grant date. The performance-vesting criteria for these PSUs will be satisfied if the Company has achieved a certain annual operating income objective for the performance period of fiscal 2020. Pursuant to these awards, the number of PSUs that become vested, if any, upon the satisfaction of both vesting criteria, shall be equal to (x) the target number of PSUs granted multiplied by (y) the applicable achievement percentage, rounded down to avoid the issuance of fractional shares. The applicable achievement percentage shall increase in the event the Company has achieved a certain revenue target during such performance period. The Company is currently accruing compensation expense to what it believes is the probable outcome upon vesting.

In fiscal 2017, the Company granted 98.5 PSUs in May 2017 and 47.9 PSUs in July 2017, all having both time- and performance-vesting criteria. The time-vesting criteria for these PSUs will be satisfied upon continued employment (with limited exceptions) on May 15, 2020. ~~The~~ Certain of the performance-vesting criteria for these PSUs ~~will be~~was satisfied ifwhen the Company ~~has~~ achieved, in the case of the May 2017 awards, certain annual operating income objectives and, in the case of the July 2017 award, certain net income or operating income objectives, as applicable for each of the fiscal 2017 and fiscal 2018 performance years. The performance-vesting criteria for the fiscal 2019 performance year ~~in each fiscal year over a three-year period (i.e., fiscal 2017 through fiscal 2019) (each, a “2017 Award Performance Year”).~~was not satisfied. When the performance measure ~~has been~~was met, if at all, for a particular 2017 Award Performance Year (i.e., each fiscal year over a three-year period, fiscal 2017 through fiscal 2019), that portion of units iswas “banked” for potential issuance following the satisfaction of the time-vesting criteria. Such portion of units ~~to be~~ “banked” ~~shall be~~was equal to (x) the target number of PSUs granted for the applicable 2017 Award Performance Year multiplied by (y) the applicable achievement percentage, rounded down to avoid the issuance of fractional shares. The Company is currently accruing compensation expense to what it believes is the probable outcome upon vesting.

In fiscal 2016, the Company granted 289.9 PSUs having both time- and performance-vesting criteria. The time-vesting criteria for these PSUs was satisfied upon continued employment (with limited exceptions) on the third anniversary of the grant ~~date (i.e., May 16, 2019).~~date. The performance-vesting criteria for these PSUs was satisfied when the Company achieved a Debt Ratio (as defined in the applicable term sheet for these PSU awards and based on a Debt to EBITDAS ratio (each, as defined therein)) at levels at or below 4.5x over the performance period from December 31, 2017 to December 29, 2018. Pursuant to these awards, the number of PSUs that became vested in fiscal 2019 upon the satisfaction of the time-vesting criteria of 219.3 was calculated as (x) the target number of PSUs granted multiplied by (y) 166.67%, the applicable Debt Ratio achievement percentage, rounded down to avoid the issuance of fractional shares. The Company accrued compensation expense in an amount equal to the outcome upon vesting.

The effective tax rates for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019 were ~~23.6%~~9.7% and ~~24.2%, respectively. The effective tax rates for the three and six months ended June 30, 2018 were 21.9% and 6.2%~~21.1%, respectively. For the ~~six~~three months ended ~~June 29, 2019,~~March 28, 2020, the ~~primary~~ difference between the U.S. federal statutory tax rate and the Company’s consolidated effective tax rate was primarily due to ~~$1,798~~an impairment of its Brazil reporting unit which has a full valuation allowance, a $1,305 tax expense related to global intangible low-taxed income (“GILTI”) and ~~$1,766~~$1,036 of ~~higher~~ state income tax ~~expenses versus the prior year period.~~expense. The effective tax rate for the three months ended March 28, 2020 was partially offset by a ~~$1,375~~$1,243 tax benefit ~~related to the reversal of tax reserves no longer needed, a $1,284 tax benefit related to foreign-derived intangible~~from income ~~(“FDII”)~~ ~~and a $746 tax benefit related to the cessation of certain publishing operations.~~earned in foreign jurisdictions. For the ~~six~~three months ended ~~June~~March 30, ~~2018,~~ 2019, the ~~primary~~ difference between the U.S. federal statutory tax rate and the Company’s consolidated effective tax rate was primarily due to $1,462 of higher state income tax expense versus the ~~$22,155~~prior year period and a $856 tax expense related to GILTI. The effective tax rate for the three months ended March 30, 2019 was partially offset by a $648 tax benefit related to ~~tax windfalls from stock compensation~~foreign-derived intangible income.

On March 27, 2020, the Coronavirus Aid, Relief and ~~a $1,859 tax benefit related~~Economic Security (CARES) Act (the “CARES Act”) was signed into law. The CARES Act includes provisions relating to modifications to the ~~cessation of operations~~net interest deduction limitations, refundable payroll tax credits, and deferment of the ~~Company’s Mexican subsidiary.~~

employer portion of certain payroll taxes. The ~~differences between the U.S. federal statutory tax rate and the Company’s consolidated~~Company does not expect these changes to have a significant impact on its effective tax ~~rate were as follows:~~

Three Months Ended

Six Months Ended

June 29,

June 30,

June 29,

June 30,

2019

2018

2019

2018

U.S. federal statutory tax rate

21.0
%

21.0
%

21.0
%

21.0
%

State income taxes (net of federal benefit)

0.4
%

2.2
%

3.1
%

2.3
%

Reserves for uncertain tax positions

(2.0
%)

0.3
%

(2.4
%)

0.2
%

Cessation of operations

(1.1
%)

0.0
%

(1.3
%)

(1.6
%)

Research and development credit

(0.4
%)

(0.1
%)

(1.1
%)

(0.4
%)

Tax windfall on share-based awards

0.1
%

(4.5
%)

0.2
%

(18.9
%)

GILTI

1.3
%

2.9
%

3.2
%

4.5
%

FDII

(0.9
%)

(1.2
%)

(2.3
%)

(1.9
%)

Impact of foreign operations

2.2
%

0.6
%

1.8
%

(0.4
%)

Other

2.8
%

0.7
%

2.0
%

1.4
%

Total effective tax rate

23.6
%

21.9
%

24.2
%

6.2
%

shareholder, Artal Group S.A. (“Artal”), in the United States District Court for the Southern District of New York. The actions were consolidated and lead plaintiffs were appointed in June 2019. A consolidated amended complaint was filed on July 29, 2019, naming as defendants the Company, certain of the Company’s current officers and directors, and Artal and certain of its affiliates. A second consolidated amended complaint was filed on September 27, 2019. The ~~consolidated~~operative complaint asserts claims on behalf of all purchasers of the Company’s common stock between May 4, 2018 and February 26, 2019, inclusive (the “Class Period”), including purchasers of the Company’s common stock traceable to the May 2018 secondary offering of the Company’s common stock by certain of its shareholders. The complaint alleges that, during the Class Period, the defendants disseminated materially false and misleading statements and/or concealed or recklessly disregarded material adverse facts. The complaint alleges claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 thereunder, and with respect to the secondary offering, under Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as ~~amended~~.amended. The plaintiffs seek to recover unspecified damages on behalf of the class members. The Company believes that the action is without merit and intends to vigorously defend it. The Company filed a motion to dismiss the complaint on October 31, 2019.

OnBetween March ~~26, 2019, June 4, 2019, July 22, 2019,~~ and July ~~26,~~ 2019, the Company received shareholder litigation demands alleging breaches of fiduciary duties by certain current and former Company directors and executive officers, to the alleged injury of the Company. On June 13, 2019, a separate shareholder derivative complaint was filed in the Southern District of New York against the Company’s Board of Directors alleging that the directors breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint on July 8, 2019 and the Company agreed to treat the complaint as a litigation demand. On July 23, 2019, another separate shareholder derivative complaint was filed in the Southern District of New York against the Board of Directors alleging, among other things, that the directors breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint the same day. The allegations in the demands relate to those contained in the ongoing securities class action litigation. In response to the demands, pursuant to Virginia law, the Board of Directors has created a special committee to investigate and evaluate the claims made in the demands. In addition, four derivative complaints were filed, each making allegations against certain of the Company’s officers and directors and/or Artal and certain of its affiliates. First, on June 13, 2019, a shareholder derivative complaint was filed in the Southern District of New York against certain of the Company’s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint on July 8, 2019 and the Company agreed to treat the complaint as a litigation demand. Second, on July 23, 2019, another shareholder derivative complaint was filed in the Southern District of New York against certain of the Company’s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint the same day. Third, on October 25, 2019, another shareholder derivative complaint was filed in the Southern District of New York against certain of the Company’s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. Finally, on December 16, 2019, a shareholder derivative complaint was filed in New York Supreme Court against certain of the Company’s officers and directors, and Artal and certain of its affiliates, alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The Company believes that these actions are without merit and intends to vigorously defend them.

Due to the nature of the Company’s activities, it is also, at times, subject to other pending and threatened legal actions, including patent and other intellectual property actions, that arise out of the ordinary course of business. In the opinion of management, the disposition of any such matters is not expected, individually or in the aggregate, to have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of legal actions cannot be predicted with certainty. Therefore, it is possible that the Company’s results of operations, financial condition or cash flows could be materially adversely affected in any particular period by the unfavorable resolution of one or more legal actions.

As of ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, the Company had in effect an interest rate swap with a notional amount totaling ~~$1,000,000 and $1,250,000, respectively.~~ $1,000,000.

On July 26, 2013, in order to hedge a portion of its variable rate debt, the Company entered into a forward-starting interest rate swap with an effective date of March 31, 2014 and a termination date of April 2, 2020. The initial notional amount of this swap was $1,500,000. During the term of this swap, the notional amount decreased from $1,500,000 effective March 31, 2014 to $1,250,000 on April 3, 2017 and to $1,000,000 on April 1, 2019. This interest rate swap effectively ~~fixes~~fixed the variable interest rate on the notional amount of this swap at 2.41%. This swap qualifies for hedge accounting and, therefore, changes in the fair value of this swap have been recorded in accumulated other comprehensive loss.

On June 11, 2018, in order to hedge a portion of its variable rate debt, the Company entered into a forward-starting interest rate swap (the “2018 swap”) with an effective date of April 2, 2020 and a termination date of March 31, 2024. The initial notional amount of this swap is $500,000. During the term of this swap, the notional amount will decrease from $500,000 effective April 2, 2020 to $250,000 on March 31, 2021. This interest rate swap effectively ~~fixes~~fixed the variable interest rate on the notional amount of this swap at 3.1005%. On June 7, 2019, in order to hedge a portion of its variable rate debt, the Company entered into a forward-starting interest rate swap (together with the 2018 swap, the “future swaps”) with an effective date of April 2, 2020 and a termination date of March 31, 2024. The notional amount of this swap is $250,000. This interest rate swap effectively ~~fixes~~fixed the variable interest rate on the notional amount of this swap at 1.901%. The future swaps qualify for hedge accounting and, therefore, changes in the fair value of the future swaps have been recorded in accumulated other comprehensive loss.

As of ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, cumulative unrealized losses for qualifying hedges were reported as a component of accumulated other comprehensive loss in the amounts of ~~$14,744~~$25,180 ($~~19,814~~33,812 before taxes) and ~~$1,175~~$15,529 ($~~1,634~~20,856 before taxes), respectively. As of ~~June 29, 2019,~~March 28, 2020, the fair value of the Company’s then-effective swap was a liability of ~~$2,068,~~$1,138, which is included in derivative payable in the consolidated balance sheet. As of ~~June 29, 2019,~~March 28, 2020, the fair value of the Company’s future swaps was a liability of ~~$17,262,~~$33,765, which is included in derivative payable in the consolidated balance sheet. As of December ~~29, 2018,~~28, 2019, the fair value of the Company’s then-effective swap ~~included~~was a ~~current asset~~liability of ~~$3,526 and a noncurrent asset of $398,~~$1,881, which ~~are~~is included in ~~other current assets and other noncurrent assets, respectively,~~derivative payable in the consolidated balance sheet. As of December ~~29, 2018,~~28, 2019, the fair value of the Company’s ~~2018 swap~~ future swaps was a liability of ~~$5,578,~~$19,716, which is included in derivative payable in the consolidated balance sheet.

The Company is hedging forecasted transactions for periods not exceeding the next five years. The Company expects approximately ~~$2,116~~$10,513 ($~~2,836~~14,093 before taxes) of derivative losses included in accumulated other comprehensive loss at ~~June 29, 2019,~~March 28, 2020, based on current market rates, will be reclassified into earnings within the next 12 months.

Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:

When measuring fair value, the Company is required to maximize the use of observable inputs and minimize the use of unobservable inputs.

The Company’s significant financial instruments include long-term debt and interest rate swap agreements as of ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018.~~28, 2019. The fair value of the Company’s borrowings under the Revolving Credit Facility approximated a carrying value of $148,000 and $0 at ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018, respectively.~~28, 2019, respectively, due to the nature of the debt (Level 2 input).

The fair value of the Company’s Credit Facilities is determined by utilizing average bid prices on or near the end of each fiscal quarter (Level 2 input). As of ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, the fair value of the Company’s long-term debt was approximately ~~$1,595,373~~$1,427,786 and ~~$1,757,717,~~$1,597,852, respectively, as compared to the carrying value (net of deferred financing costs and debt discount) of ~~$1,642,210~~$1,558,390 and ~~$1,746,708,~~$1,576,170, respectively.

The fair values for the Company’s derivative financial instruments are determined using observable current market information such as the prevailing LIBOR interest rate and LIBOR yield curve rates and include consideration of counterparty credit risk. See Note 12 for disclosures related to derivative financial instruments.

The following table presents the aggregate fair value of the Company’s derivative financial instruments:

The Company did ~~not~~0t have any transfers into or out of Levels 1 and 2 and did not maintain any assets or liabilities classified as Level 3 during the ~~six~~three months ended ~~June 29, 2019~~March 28, 2020 and the fiscal year ended December ~~29, 2018.~~

Amounts reclassified out of accumulated other comprehensive loss are as follows:

Six Months Ended June 29, 2019

Loss on
Qualifying
Hedges

Loss on
Foreign
Currency
Translation

Total

Beginning Balance at December 29, 2018

$
(1,175
)

$
(14,582
)

$
(15,757
)
Other comprehensive (loss) income before
   reclassifications, net of tax

(12,255
)

2,623

(9,632
)
Amounts reclassified from accumulated other
   comprehensive loss, net of tax^(b)

(1,314
)

0

(1,314
)
Net current period other comprehensive (loss)
   income including noncontrolling interest

(13,569
)

2,623

(10,946
)
Less: net current period other comprehensive
   loss attributable to the noncontrolling interest

0

(6
)

(6
)
Ending Balance at June 29, 2019

$
(14,744
)

$
(11,965
)

$
(26,709
)

	Three Months Ended March 28, 2020
	Loss on Qualifying Hedges			Loss on Foreign Currency Translation			Total
Beginning balance at December 28, 2019	$	(15,529	)	$	(11,823	)	$	(27,352	)
Other comprehensive loss before reclassifications, net of tax		(10,471	)		(7,321	)		(17,792	)
Amounts reclassified from accumulated other comprehensive loss, net of tax^(b)		820			0			820
Net current period other comprehensive loss including noncontrolling interest		(9,651	)		(7,321	)		(16,972	)
Less: Net current period other comprehensive loss attributable to the noncontrolling interest		0			98			98
Ending balance at March 28, 2020	$	(25,180	)	$	(19,046	)	$	(44,226	)

Six Months Ended June 30, 2018

(Loss) Gain on
Qualifying
Hedges

Loss on
Foreign
Currency
Translation

Total

Beginning Balance at December 30, 2017

$
(5,392
)

$
(5,075
)

$
(10,467
)
Other comprehensive income (loss) before
   reclassifications, net of tax

7,236

(5,396
)

1,840

Amounts reclassified from accumulated other
   comprehensive loss, net of tax(b)

1,942

0

1,942

Adoption of accounting standard

(1,161
)

(1,324
)

(2,485
)
Net current period other comprehensive income
   (loss) including noncontrolling interest

8,017

(6,720
)

1,297

Less: net current period other comprehensive loss
   attributable to the noncontrolling interest

0

373

373

Ending Balance at June 30, 2018

$
2,625

$
(11,422
)

$
(8,797
)

	Three Months Ended March 30, 2019
	Loss on Qualifying Hedges			Loss on Foreign Currency Translation			Total
Beginning balance at December 29, 2018	$	(1,175	)	$	(14,582	)	$	(15,757	)
Other comprehensive (loss) income before reclassifications, net of tax		(4,552	)		1,279			(3,273	)
Amounts reclassified from accumulated other comprehensive loss, net of tax^(b)		(942	)		0			(942	)
Net current period other comprehensive (loss) income including noncontrolling interest		(5,494	)		1,279			(4,215	)
Less: Net current period other comprehensive loss attributable to the noncontrolling interest		0			6			6
Ending balance at March 30, 2019	$	(6,669	)	$	(13,297	)	$	(19,966	)

	Three Months Ended						Six Months Ended							Three Months Ended
	June 29,			June 30,			June 29,			June 30,				March 28,			March 30,
	2019			2018			2019			2018				2020			2019
Details about Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss						Amounts Reclassified from Accumulated Other Comprehensive Loss						Affected Line Item in the Statement Where Net Income is Presented	Amounts Reclassified from Accumulated Other Comprehensive Loss						Affected Line Item in the Statement Where Net Income is Presented
Loss on Qualifying Hedges
Interest rate contracts	$	498		$	(346	)	$	1,760		$	(2,603	)	Interest expense	$	(1,099	)	$	1,262		Interest expense
		498			(346	)		1,760			(2,603	)	Income before income taxes		(1,099	)		1,262		Loss before income taxes
		(126	)		88			(446	)		661		Provision for income taxes		279			(320	)	Benefit from income taxes
	$	372		$	(258	)	$	1,314		$	(1,942	)	Net income	$	(820	)	$	942		Net loss

The Company has ~~four~~4 reportable segments based on an integrated geographical structure as follows: North America, Continental Europe (CE), United Kingdom and Other. Other consists of Australia, New Zealand and emerging markets operations and franchise revenues and related costs, all of which have been grouped together as if they were a single reportable segment because they do not meet any of the quantitative thresholds and are immaterial for separate disclosure. To be consistent with the information that is presented to the chief operating decision maker, the Company does not include intercompany activity in the segment results.

	Total Revenue, net				Total Revenue, net				Total Revenue, net
	Three Months Ended				Six Months Ended				Three Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018		March 28, 2020		March 30, 2019
North America	$	255,644	$	284,538	$	505,656	$	563,715	$	283,706	$	250,011
Continental Europe		77,329		81,592		153,486		164,123		79,990		76,157
United Kingdom		24,525		29,210		49,136		59,495		25,028		24,611
Other		11,525		14,407		23,910		30,637		11,637		12,385
Total revenue, net	$	369,023	$	409,747	$	732,188	$	817,970	$	400,361	$	363,164

Net Income

Net Income

Three Months Ended

Six Months Ended

June 29, 2019

June 30, 2018

June 29, 2019

June 30, 2018

Segment operating income:

North America
$
91,169

$
112,040

$
132,282

$
174,393

Continental Europe

30,764

32,478

40,839

50,409

United Kingdom

4,308

6,035

3,557

9,903

Other

1,726

3,452

1,396

5,037

Total segment operating income

127,967

154,005

178,074

239,742

General corporate expenses

22,494

26,297

50,703

49,963

Interest expense

34,732

35,866

69,927

71,732

Other expense, net

438

1,333

741

1,097

Provision for income taxes

16,586

19,825

13,711

7,208

Net income
$
53,717

$
70,684

$
42,992

$
109,742

Net loss attributable to the noncontrolling interest

117

36

156

90

Net income attributable to Weight Watchers International, Inc.
$
53,834

$
70,720

$
43,148

$
109,832

	Depreciation and Amortization				Depreciation and Amortization				Net Loss
	Three Months Ended				Six Months Ended				Three Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018		March 28, 2020			March 30, 2019
Segment operating income:
North America	$	9,081	$	9,163	$	18,386	$	18,642	$	45,253		$	41,113
Continental Europe		395		317		776		618		13,572			10,076
United Kingdom		139		350		425		715		(837	)		(751	)
Other		107		164		218		309		(2,776	)		(331	)
Total segment depreciation and amortization		9,722		9,994		19,805		20,284
General corporate depreciation and amortization		4,037		2,834		7,568		5,612
Depreciation and amortization	$	13,759	$	12,828	$	27,373	$	25,896
Total segment operating income										55,212			50,107
General corporate expenses										30,345			28,210
Interest expense										31,551			35,195
Other expense, net										24			303
Benefit from income taxes										(651	)		(2,875	)
Net loss									$	(6,057	)	$	(10,726	)
Net (income) loss attributable to the noncontrolling interest										(6	)		39
Net loss attributable to WW International, Inc.									$	(6,063	)	$	(10,687	)

~~Due to the adoption of the updated lease accounting guidance the Company has a right of use operating lease asset of $144,913~~ ~~as of June 29, 2019, of which 52% is in the North America reportable segment~~ ~~and 42% is general corporate related.~~

As previously disclosed, on October 18, 2015, the Company entered into the Strategic Collaboration Agreement with Oprah Winfrey, under which she ~~will~~would consult with the Company and participate in developing, planning, executing and enhancing the WW program and related initiatives, and provide it with services in her discretion to promote the Company and its programs, products and ~~services.~~services for an initial term of five years (the “Initial Term”).

As previously disclosed, on December 15, 2019, the Company entered into an amendment of the Strategic Collaboration Agreement with Ms. Winfrey, pursuant to which, among other things, the Initial Term of the Strategic Collaboration Agreement was extended until April 17, 2023 (with no additional successive renewal terms) after which a second term will commence and continue through the earlier of the date of the Company’s 2025 annual meeting of shareholders or May 31, 2025. Ms. Winfrey will continue to provide the above-described services during the remainder of the Initial Term and, during the second term, will provide certain consulting and other services to the Company. In consideration of Ms. Winfrey entering into the amendment to the Strategic Collaboration Agreement and the performance of her obligations thereunder, on December 15, 2019 the Company granted Ms. Winfrey a fully vested option to purchase 3,276 shares of the Company’s common stock (the "Winfrey Amendment Option") which shall become exercisable at any time after the date on which shareholder approval of such option becomes effective. The amendment to the Strategic Collaboration Agreement will not become operative unless and until the Company's shareholders approve the Winfrey Amendment Option on or before June 30, 2020. The Company will submit the Winfrey Amendment Option for shareholder approval at the Company's 2020 annual meeting of shareholders. If the Company’s shareholders do not approve the Winfrey Amendment Option, Ms. Winfrey could terminate the Strategic Collaboration Agreement with the Company as a result.

In addition to the Strategic Collaboration Agreement, Ms. Winfrey and her related entities provided services to the Company totaling ~~$720~~$938 and ~~$2,003~~$1,283 for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019, ~~respectively, and $689 and $1,988 for the three and six months ended June 30, 2018,~~ respectively, which services included advertising, production and related fees.

Also, entities related to Ms. Winfrey were reimbursed for actual costs incurred in connection with the WW Presents: Oprah’s 2020 Vision tour totaling $1,509 for the three months ended March 28, 2020.

The Company’s accounts payable to parties related to Ms. Winfrey at ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018~~28, 2019 was $0$2,188 and ~~$62,~~$72, respectively.

In March 2018, as permitted by the transfer provisions set forth in the previously disclosed Share Purchase Agreement, dated October 18, 2015, between the Company and Ms. Winfrey, and the Option Agreement, dated October 18, 2015, between the Company and Ms. Winfrey, Ms. Winfrey sold 954 of the shares she purchased under such purchase agreement and exercised a portion of her stock options resulting in the sale of 1,405 shares issuable under such options, respectively.

As previously disclosed, in the first quarter of fiscal 2019, the Company undertook an organizational realignment which resulted in the elimination of certain positions and termination of employment for certain employees ~~worldwide in the six months ended June 29, 2019.~~worldwide. The Company recorded expenses in connection with employee termination benefit costs of $6,331 ($4,727 after tax) during the ~~six~~three months ended ~~June 29,~~March 30, 2019. These expenses impacted cost of revenues by $1,425 and selling, general and administrative expense by ~~$4,906 in the six months ended June 29, 2019.~~$4,906. The Company ~~recorded all expenses in the first quarter of 2019 and does~~did not ~~anticipate recording~~record additional expenses in connection with this organizational realignment. All expenses were recorded to general corporate expenses and therefore there was no impact to the segments.

For the ~~six~~three months ended ~~June 29,~~March 28, 2020, the Company made payments of $858 towards the liability for these expenses and increased provision estimates by $29. For the fiscal year ended December 28, 2019, the Company made payments of ~~$3,882~~$5,077 towards the liability for these expenses and lowered provision estimates by ~~$91.~~$83. The Company expects the remaining liability of ~~$2,358~~$342 to be paid in full in fiscal ~~2019.~~2020.

Except for historical information contained herein, this Quarterly Report on Form 10-Q includes “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, including, in particular, the statements about our plans, strategies and prospects and the impact of the COVID-19 virus under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We have generally used the words “may,” “will,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” ~~“intend”~~“intend,” “aim” and similar expressions in this Quarterly Report on Form 10-Q to identify forward-looking statements. We have based these forward-looking statements on our current views with respect to future events and financial performance. Actual results could differ materially from those projected in these forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions, including, among other things:

You should not put undue reliance on any forward-looking statements. You should understand that many important factors, including those discussed ~~herein,~~under the heading “Risk Factors”, could cause our results to differ materially from those expressed or suggested in any forward-looking statement. Except as required by law, we do not undertake any obligation to update or revise these forward-looking statements to reflect new information or events or circumstances that occur after the date of this Quarterly Report on Form 10-Q or to reflect the occurrence of unanticipated events or otherwise.

WW International, Inc., formerly known as Weight Watchers International, Inc., is a Virginia corporation with its principal executive offices in New York, New York. In this Quarterly Report on Form 10-Q unless the context indicates otherwise: “we,” “us,” “our,” the “Company” and “WW” refer to ~~Weight Watchers~~WW International, Inc. and all of its operations consolidated for purposes of its financial statements; “North America” refers to our North American Company-owned operations; “Continental Europe” refers to our Continental Europe Company-owned operations; “United Kingdom” refers to our United Kingdom Company-owned operations; and “Other” refers to Australia, New Zealand and emerging markets operations and franchise revenues and related costs. Each of North America, Continental Europe, United Kingdom and Other is also a reportable segment. Our “Digital” business refers to providing subscriptions to our digital product offerings, including the Personal Coaching + Digital product. Our “Studio + Digital” business refers to providing access to our weekly in-person workshops combined with our digital subscription product offerings to commitment plan subscribers. Our “Studio + Digital” business also includes the provision of access to workshops for members who do not subscribe to commitment plans, including our “pay-as-you-go” members.

Our fiscal year ends on the Saturday closest to December 31st and consists of either 52- or 53-week periods. In this Quarterly Report on Form 10-Q:

The following terms used in this Quarterly Report on Form 10-Q are our trademarks: Weight Watchers^®and ~~WW Freestyle~~myWW^TM.

You should read the following discussion in conjunction with our Annual Report on Form 10-K for fiscal ~~2018~~2019 that includes additional information about us, our results of operations, our financial position and our cash flows, and with our unaudited consolidated financial statements and related notes included in Item 1 of this Quarterly Report on Form 10-Q (collectively referred to as the “Consolidated Financial Statements”).

To supplement our consolidated results presented in accordance with accounting principles generally accepted in the United States, or GAAP, we have disclosed non-GAAP financial measures of operating results that exclude or adjust certain items. Operating income and operating income margin are discussed in this Quarterly Report on Form 10-Q both as reported (on a GAAP basis) and as adjusted (on a non-GAAP basis), as applicable, for the first quarter of fiscal 2020 to exclude the impairment charge for our goodwill recorded at March 28, 2020 related to our Brazil reporting unit. We generally refer to such non-GAAP measures as excluding or adjusting for the impact of the goodwill impairment charge. We also present within this Quarterly Report on Form 10-Q the non-GAAP financial ~~measures~~measures: earnings before interest, taxes, depreciation, amortization and stock-based compensation (“EBITDAS”); earnings before interest, taxes, depreciation, amortization, stock-based compensation and goodwill impairment (“Adjusted EBITDAS”); total debt less unamortized deferred financing costs, unamortized debt discount and cash on hand (i.e., net ~~debt.~~debt); and a net debt/Adjusted EBITDAS ratio. See “—Liquidity and Capital Resources—EBITDAS, Adjusted EBITDAS and Net Debt” for the ~~calculations.~~ reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measure in each case. Our management believes these non-GAAP financial measures provide useful supplemental information to investors regarding the performance of our business and are useful for period-over-period comparisons of the performance of our business. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly entitled measures reported by other companies.

As exchange rates are an important factor in understanding period-to-period comparisons, we believe in certain cases the presentation of results on a constant currency basis in addition to reported results helps improve investors’ ability to understand our operating results and evaluate our performance in comparison to prior periods. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We use results on a constant currency basis as one measure to evaluate our performance. In this Quarterly Report on Form 10-Q, we calculate constant currency by calculating current-year results using prior-year foreign currency exchange rates. We generally refer to such amounts calculated on a constant currency basis as excluding or adjusting for the impact of foreign currency or being on a constant currency basis. These results should be considered in addition to, not as a substitute for, results reported in accordance with GAAP and are not meant to be considered in isolation. Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with GAAP.

We review goodwill and other indefinite-lived intangible assets, including franchise rights acquired with indefinite lives, for potential impairment on at least an annual basis or more often if events so require. We performed fair value impairment testing as of May 5, 2019 and May 6, 2018, each the first day of fiscal May, on our goodwill and other indefinite-lived intangible assets.

In performing our goodwill impairment analysis for our reporting units for fiscal 2019 and fiscal 2018, no impairment was identified as the respective fair values of each reporting unit exceeded its carrying value. In performing the impairment analysis for our franchise rights acquired with indefinite lives for fiscal 2019 and fiscal 2018, we determined that the carrying amounts of these units of account did not exceed their respective units of account fair values and therefore no impairment existed.

With respect to our impairment analysis, a change in the underlying assumptions would likely cause a change in the results of the impairment assessments and, as such, could result in an impairment of those assets, which would impact earnings. We would also be required to reduce the carrying amounts of the related assets on our balance sheet. We continue to evaluate these assumptions and believe that they are appropriate.

In performing our annual impairment analysis, we also considered the trading value of both our equity and debt. If the trading values of both our equity and debt were to significantly decline from their current levels, we may have to take an impairment charge at the appropriate time, which could be material. For additional information on risks associated with our recognizing asset impairment charges, see “Item 1A. Risk Factors” of our Annual Report on Form 10-K for fiscal 2018.

~~The following is a more detailed discussion of our goodwill and franchise rights acquired impairment analysis.~~

In performing the impairment analysis for goodwill, the fair value for our reporting units is estimated using a discounted cash flow approach. This approach involves projecting future cash flows attributable to the reporting unit and discounting those estimated cash flows using an appropriate discount rate. The estimated fair value is then compared to the carrying value of the reporting unit. We have determined the appropriate reporting unit for purposes of assessing annual impairment to be the country for all reporting units. The values of goodwill in the United States, Canada, Brazil and other countries as of the June 29, 2019 balance sheet date were $98.9 million, $40.9 million, $4.6 million and $9.6 million, respectively.

Based on the results of our annual goodwill impairment test performed for all of our reporting units, except for Brazil, as of the June 29, 2019 balance sheet date, for reporting units that hold 97.0% of our goodwill, those units had an estimated fair value at least 60% higher than the respective reporting unit’s carrying amount. Based on the results of our annual goodwill impairment test performed for our Brazil reporting unit as of the June 29, 2019 balance sheet date, this reporting unit holds 3.0% of our goodwill, and the estimated fair value of this reporting unit was approximately 3% higher than its carrying value. Accordingly, a change in the underlying assumptions for Brazil would likely cause a change in the results of the impairment assessment and, as such, could result in an impairment of the goodwill.

For all of our reporting units except for Brazil (see below), we estimated future cash flows by utilizing the historical debt-free cash flows (cash flows provided by operating activities less capital expenditures) attributable to that country and then applied expected future operating income growth rates for such country. We utilized operating income as the basis for measuring our potential growth because we believe it is the best indicator of the performance of our business. We then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt.

The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was determined by reviewing external market data. The cost of debt was determined by estimating our current borrowing rate.

~~The following are the more significant assumptions utilized in our annual impairment analyses (except for Brazil) for fiscal 2019 and fiscal 2018:~~

As it relates to our goodwill impairment analysis for Brazil, we estimated future debt-free cash flows in contemplation of our growth strategies for that market. In developing these projections, we considered the historical impact of similar growth strategies in other markets as well as the current market conditions in Brazil. We then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for our peer group. The risk-free rate of return was determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was determined by reviewing external market data including the current economic conditions in Brazil and the country specific risk thereon, all as reflected in the discount rate. The cost of debt was determined by estimating the Company’s current borrowing rate.

~~For Brazil, the following are the more significant assumptions utilized in our annual goodwill impairment analyses for fiscal 2019 and fiscal 2018:~~

In performing the impairment analysis for our indefinite-lived franchise rights acquired, the fair value for our franchise rights acquired is estimated using a discounted cash flow approach referred to as the hypothetical start-up approach for our franchise rights related to our Studio + Digital business and a relief from royalty methodology for our franchise rights related to our Digital business. The aggregate estimated fair value for these rights is then compared to the carrying value of the unit of account for those franchise rights. We have determined the appropriate unit of account for purposes of assessing impairment to be the combination of the rights in both the Studio + Digital business and Digital business in the country in which the applicable acquisition occurred. The book values of these franchise rights in the United States, Canada, United Kingdom, Australia, and New Zealand at June 29, 2019 were $671.9 million, $55.1 million, $11.4 million, $6.3 million, and $4.8 million, respectively.

Based on the results of our fiscal 2019 annual franchise rights acquired impairment analysis for all of our units of account, except for New Zealand, as of the June 29, 2019 balance sheet date, for units of account that hold 99.4% of our franchise rights acquired, those units had an estimated fair value at least 40% higher than the respective units of account carrying amount. Based on the results of our annual franchise rights acquired impairment test performed for our New Zealand unit of account as of the June 29, 2019 balance sheet date, this unit of account holds 0.6% of our franchise rights acquired, and the estimated fair value of this unit of account was approximately 3% higher than its carrying value. Accordingly, a change in the underlying assumptions for New Zealand would likely cause a change in the results of the impairment assessment and, as such, could result in an impairment of the franchise rights acquired.

In our hypothetical start-up approach analysis for fiscal 2019, we assumed that the year of maturity was reached after 7 years. Subsequent to the year of maturity, we estimated future cash flows for the Studio + Digital business in each country based on

assumptions regarding revenue growth and operating income margins. The cash flows associated with the Digital business in each country were based on the expected Digital revenue for such country and the application of a market-based royalty rate. The cash flows for the Studio + Digital and Digital businesses were discounted utilizing rates consistent with those utilized in the annual goodwill impairment analysis.

In performing this impairment analysis for fiscal 2019, for the year of maturity, we assumed Studio + Digital revenue (comprised of Studio + Digital Fees and revenues from products sold to members in workshops) growth of (5.3%) to 3.5% in the year of maturity from fiscal 2018, in each case, earned in the applicable country and assumed cumulative annual revenue growth rates for the years beyond the year of maturity of 1.6%. For the year of maturity and beyond, we assumed operating income margin rates of 0.3% to 17.4%.

For a discussion of the ~~other~~ critical accounting policies affecting us, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” of our Annual Report on Form 10-K for fiscal ~~2018.~~2019. Our critical accounting policies have not changed since the end of fiscal ~~2018.~~2019. A discussion of our impairment charge recognized during the first quarter of fiscal 2020 for goodwill related to our Brazil reporting unit is included in the accompanying consolidated financial statements in this Quarterly Report on Form 10-Q.

Our management team regularly reviews and analyzes ~~several~~a number of financial and operating metrics, including the key performance indicators listed below, in order to manage our business, measure our performance, identify trends affecting our business, determine the allocation of resources, make decisions regarding corporate strategies and assess the quality and potential variability of our cash flows and earnings. ~~These~~We also believe that these key performance indicators ~~include:~~

are useful to both management and investors for forecasting purposes and to facilitate comparisons to our historical operating results. These metrics are supplemental to our GAAP results and include operational measures.

In March 2020, the World Health Organization categorized the novel coronavirus (COVID-19) as a pandemic. It continues to spread globally and to impact our business operations and the markets in which we operate. While the recent outbreak of COVID-19 did not have a significant effect on our reported results for the first quarter of fiscal 2020, the pandemic caused a significant decline in recruitments beginning in the middle of March 2020 as compared to the prior year period. This decline in recruitment trends has continued through April 2020, and has negatively impacted the number of End of Period Subscribers. This negative trend has significantly impacted both our Digital and our Studio + Digital businesses, with the greater impact on our Studio + Digital recruitment. While we have recently seen some recovery in Digital recruitment trends, these negative trends in recruitment may continue in the second quarter of fiscal 2020 and may potentially do so in subsequent periods. The extent to which our operations and business trends will be impacted by, and any unforeseen costs will result from, the outbreak will depend largely on future developments, which are highly uncertain and cannot be accurately predicted. These developments include, among other things, new information that may emerge concerning the severity of the outbreak and health implications, actions by government authorities to contain the outbreak or treat its impact, and changes in consumer behavior resulting from the outbreak and such government actions. We continue to actively monitor the impact of COVID-19 and related developments and expect it will more significantly impact our reported results for the second quarter of fiscal 2020 and may potentially do so in subsequent periods.

In response to the public health crisis posed by COVID-19, we suspended our in-person workshops and moved quickly to transition these workshops to an entirely virtual experience. We continue to serve our members virtually, both via our Digital business and through virtual workshops now available to our Studio + Digital subscribers. Nevertheless, our business operations and recruitment trends with respect to our Studio + Digital business remain substantially affected by our suspension of our in-person workshops. We expect that applicable regulatory restrictions, including stay-at-home requirements and restrictions on in-person group gatherings, may delay our ability to re-open our studio locations and may impose restrictions on how we conduct our in-person workshops once they resume, including as a result of social distancing requirements. We expect that our ability to re-open studio locations and applicable regulatory restrictions on our workshops will vary by jurisdiction. Additionally, when we re-open studio locations, we may incur additional operating costs on a studio-by-studio basis.

We are accelerating our strategic digital transformation. This acceleration began with the launch of virtual workshops in March 2020 discussed above, and we expect to continue to evolve our virtual experience and offerings for our members. For example, we continue to work towards the launch of a new digitally-enabled, community-focused and coach-led offering later this year, which will reflect learnings from our current virtual workshops and ongoing test pilots. We are reallocating certain resources and will incur additional costs to support this acceleration.

In addition to addressing the immediate impact of the pandemic, we are actively planning how to best meet our members’ and consumers’ needs as restrictions are lifted. As part of this planning, and in response to the evolving regulatory and consumer landscape, we are evaluating, and will continue to evaluate, our studio locations, both branded and third-party. The decision to re-open a studio location, if at all, or consolidate studio locations, will be influenced by a number of factors, including applicable regulatory restrictions, consumer confidence and preferences, changes in consumer behavior and the health and safety of our employees and members. We will continue to evaluate our studio locations in response to the evolving regulatory restrictions and consumer behavior. We currently expect that the number of our future studio locations may be lower than that prior to the pandemic. As a result, we anticipate one-time costs associated with restructuring and real estate realignment.

Due to the negative impact of COVID-19, and the uncertainty of the magnitude and duration of such impact on our business and the economies and financial markets in which we operate, we are implementing a $100.0 million cost-savings initiative with respect to our cost structure. We are undertaking this initiative to proactively manage our liquidity so we can maintain flexibility to respond to evolving business and consumer conditions arising from the pandemic, as well as continue to fund investments in innovating our program and long-term debt obligations. As part of this cost-savings initiative, management intends to ensure it can access the liquidity available under our long-term debt, including our Revolving Credit Facility (as defined below). On March 23, 2020, as a precautionary measure in light of the COVID-19 outbreak, we drew down $148.0 million on our Revolving Credit Facility in order to enhance our cash position and to provide additional financial flexibility. We expect to continue to assess the evolving impact of the COVID-19 pandemic, and intend to refine our cost-savings initiative and resource allocation accordingly. For additional information on our cash flows and long-term debt, see “—Liquidity and Capital Resources.”

While we expect the effects of the pandemic and the related responses to negatively impact our results of operations, cash flows and financial position, the uncertainty over the duration and severity of the economic and operational impacts of COVID-19 means we cannot reasonably estimate the related financial impact at this time. For more information, see “Item 1A. Risk Factors” in Part II of this Quarterly Report on Form 10-Q. We continue to believe that our powerful communities and our ability to inspire people to adopt healthy habits will be invaluable to people across the globe as they acclimate to new social and economic environments, and that they uniquely position us in the markets in which we operate.

THREE MONTHS ENDED ~~JUNE 29, 2019~~MARCH 28, 2020 COMPARED TO THE THREE MONTHS ENDED ~~JUNE~~MARCH 30, ~~2018~~2019

The table below sets forth selected financial information for the ~~second~~first quarter of fiscal 2020 from our consolidated statements of net income for the three months ended March 28, 2020 versus selected financial information for the first quarter of fiscal 2019 from our consolidated statements of net income for the three months ended ~~June 29, 2019 versus selected financial information for the second quarter of fiscal 2018 from our consolidated statements of net income for the three months ended June~~March 30, ~~2018:~~2019.

	(In millions, except per share amounts)																	(In millions, except per share amounts)
	For The Three Months Ended													% Change				For The Three Months Ended													% Change
	June 29, 2019			June 30, 2018			Increase/ (Decrease)			% Change				Constant Currency				March 28, 2020			March 30, 2019			Increase/ (Decrease)			% Change				Constant Currency
Revenues, net	$	369.0		$	409.7		$	(40.7	)		(9.9	%)			(8.1	%)		$	400.4		$	363.2		$	37.2			10.2	%			11.3	%
Cost of revenues		153.2			165.0			(11.7	)		(7.1	%)			(5.4	%)			189.4			162.2			27.2			16.7	%			17.7	%

Gross profit		215.8			244.8			(29.0	)		(11.8	%)			(9.9	%)			211.0			200.9			10.0			5.0	%			6.1	%
Gross Margin %		58.5	%		59.7	%													52.7	%		55.3	%

Marketing expenses		50.0			55.4			(5.5	)		(9.8	%)			(7.4	%)			117.9			114.2			3.7			3.2	%			4.1	%
Selling, general & administrative expenses		60.4			61.7			(1.3	)		(2.1	%)			(0.5	%)			64.5			64.8			(0.3	)		(0.4	%)			0.3	%
Goodwill impairment																			3.7			—			3.7			100.0	%			100.0	%
Operating income		105.5			127.7			(22.2	)		(17.4	%)			(15.6	%)			24.9			21.9			3.0			13.6	%			12.6	%
Operating Income Margin %		28.6	%		31.2	%													6.2	%		6.0	%

Interest expense		34.7			35.9			(1.1	)		(3.2	%)			(3.2	%)			31.6			35.2			(3.6	)		(10.4	%)			(10.4	%)
Other expense, net		0.4			1.3			(0.9	)		67.1	%			67.1	%			0.0			0.3			(0.3	)		(92.3	%)			(92.3	%)
Income before income taxes		70.3			90.5			(20.2	)		(22.3	%)			(19.8	%)
Loss before income taxes																			(6.7	)		(13.6	)		6.9			50.7	%			49.2	%

Provision for income taxes		16.6			19.8			(3.2	)		(16.3	%)			(12.8	%)
Net income		53.7			70.7			(17.0	)		(24.0	%)			(21.7	%)
Net loss attributable to the noncontrolling interest		0.1			0.0			0.1		100.0		%	*	100.0		%	*
Benefit from income taxes																			(0.7	)		(2.9	)		2.2			(77.4	%)			(84.6	%)
Net loss																			(6.1	)		(10.7	)		4.7			43.5	%			39.7	%
Net (income) loss attributable to the noncontrolling interest																			(0.0	)		0.0			(0.0	)		100.0	%	*		100.0	%	*

Net income attributable to Weight Watchers International, Inc.	$	53.8		$	70.7		$	(16.9	)		(23.9	%)			(21.6	%)
Net loss attributable to WW International, Inc.																		$	(6.1	)	$	(10.7	)	$	4.6			43.3	%			39.4	%

Weighted average diluted shares outstanding		69.1			70.2			(1.0	)		(1.4	%)			(1.4	%)			67.4			67.0			0.5			0.7	%			0.7	%
Diluted earnings per share	$	0.78		$	1.01		$	(0.23	)		(22.8	%)			(20.4	%)
Diluted loss per share																		$	(0.09	)	$	(0.16	)	$	0.07			43.7	%			39.8	%

Certain results for the first quarter of fiscal 2020 are adjusted to exclude the $3.7 million impairment charge for goodwill related to our Brazil reporting unit. See “Non-GAAP Financial Measures” above. The table below sets forth a reconciliation of certain of those components of our selected financial data for the three months ended March 28, 2020 which have been adjusted.

Revenues in the ~~second~~first quarter of fiscal ~~2019~~2020 were ~~$369.0~~$400.4 million, ~~a decrease~~an increase of ~~$40.7~~$37.2 million, or ~~9.9%~~10.2%, versus the ~~second~~first quarter of fiscal ~~2018.~~2019. Excluding the impact of foreign currency, which negatively impacted our revenues for the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$7.5~~$3.7 million, revenues in the ~~second~~first quarter of fiscal ~~2019~~2020 would have ~~decreased 8.1%~~increased 11.3% versus the prior year period. This ~~decrease~~increase was driven primarily by ~~the~~ revenue ~~declines~~growth in North ~~America.~~America, including revenue received in connection with the WW Presents: Oprah’s 2020 Vision tour. See “—Segment Results” for additional details on revenues.

Total cost of revenues in the ~~second~~first quarter of fiscal ~~2019 decreased $11.7~~2020 increased $27.2 million, or ~~7.1%~~16.7%, versus the prior year period. Gross profit ~~decreased $29.0~~increased $10.0 million, or ~~11.8%~~5.0%, in the ~~second~~first quarter of fiscal 2020 compared to the first quarter of fiscal 2019 ~~compared to the second quarter of fiscal 2018~~ primarily due to the ~~decrease~~increase in revenues. Excluding the impact of foreign currency, which negatively impacted gross profit for the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$4.6~~$2.2 million, gross profit in the ~~second~~first quarter of fiscal ~~2019~~2020 would have ~~decreased 9.9%~~increased 6.1% versus the prior year period. Gross margin in the ~~second~~first quarter of fiscal ~~2019~~2020 decreased ~~1.3%~~2.6% to ~~58.5%~~52.7% versus ~~59.7%~~55.3% in the ~~second~~first quarter of fiscal ~~2018.~~2019. Gross margin decline was driven primarily by ~~fixed cost deleverage~~the net profit from the WW Presents: Oprah’s 2020 Vision tour as a percentage of revenue and higher compensation expenses from studios, partially offset by a mix shift to ~~the~~our higher margin Digital business.

Marketing expenses for the ~~second~~first quarter of fiscal ~~2019 decreased $5.5~~2020 increased $3.7 million, or ~~9.8%~~3.2%, versus the ~~second~~first quarter of fiscal ~~2018.~~2019. Excluding the impact of foreign currency, which decreased marketing expenses for the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$1.3~~ $0.9million, marketing expenses in the ~~second~~first quarter of fiscal ~~2019~~2020 would have ~~decreased 7.4%~~increased 4.1% versus the ~~second~~first quarter of fiscal ~~2018.~~2019. This ~~decrease~~increase in marketing expense was largely due to ~~decreased~~increased TV media costs in the United States and ~~production~~digital media costs ~~all on a global basis.~~globally. Marketing expenses as a percentage of revenue ~~was 13.5% in both~~for the ~~second~~first quarter of fiscal ~~2019 and~~2020 decreased to 29.5% from 31.5% for the first quarter of fiscal ~~2018.~~2019.

Selling, general and administrative expenses for the ~~second~~first quarter of fiscal ~~2019~~2020 decreased ~~$1.3~~$0.3 million, or ~~2.1%~~0.4%, versus the ~~second~~first quarter of fiscal ~~2018.~~2019. Excluding the impact of foreign currency, which decreased selling, general and administrative expenses for the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$1.0~~$0.5 million, selling, general and administrative expenses in the ~~second~~first quarter of fiscal ~~2019~~2020 would have ~~decreased 0.5%~~increased 0.3% versus the prior year period. The ~~decrease~~increase in selling, general and administrative expenses in the ~~second~~first quarter of fiscal ~~2019~~2020 was driven primarily by ~~lower professional fees~~higher salary and related costs in the ~~quarter.~~quarter. Selling, general and administrative expenses as a percentage of revenue for the ~~second~~first quarter of fiscal ~~2019 increased~~2020 decreased to ~~16.4%~~16.1% from ~~15.0%~~17.8% for the ~~second~~first quarter of fiscal ~~2018.~~2019.

In performing our interim impairment analysis for our Brazil reporting unit, we determined that, based on the fair values calculated, the carrying amount of goodwill related to our Brazil reporting unit exceeded our fair value and recorded an impairment charge of $3.7 million for the first quarter of fiscal 2020.

Operating income in the ~~second~~first quarter of fiscal ~~2019 decreased $22.2~~2020 increased $3.0 million, or ~~17.4%~~13.6%, versus the prior year period. Excluding the impact of the $3.7 million goodwill impairment charge related to our Brazil reporting unit and the impact of foreign currency, which ~~negatively~~positively impacted operating income for the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$2.3~~$0.2 million, operating income in the ~~second~~first quarter of fiscal ~~2019~~2020 would have ~~decreased 15.6%~~increased 33.8% versus the prior year period. This ~~decrease~~increase in operating income was driven primarily by ~~lower~~higher operating income in ~~all reportable segments~~North America and Continental Europe as compared to the prior year period. Operating income margin in the ~~second~~first quarter of fiscal ~~2019 decreased 2.6%~~ 2020 increased 0.2%to ~~28.6%~~6.2% versus ~~31.2%~~6.0% in the ~~second~~first quarter of fiscal ~~2018.~~2019. This ~~decrease~~increase in operating income margin was driven primarily by a decrease in ~~gross margin~~marketing expenses and ~~an increase in~~ selling, general and administrative expenses, each as a percentage of revenue.

Interest expense in the ~~second~~first quarter of fiscal ~~2019~~2020 decreased ~~$1.1~~$3.6 million, or ~~3.2%~~10.4%, versus the ~~second~~first quarter of fiscal ~~2018.~~2019. The decrease in interest expense was driven primarily by a decrease in our outstanding indebtedness resulting from principal repayments. The effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the ~~second~~first quarter of fiscal ~~2019~~2020 and the ~~second~~first quarter of fiscal ~~2018~~2019 and excluding the impact of our interest rate swap in effect, ~~increased~~decreased to ~~8.12%~~7.54% per annum at the end of the ~~second~~first quarter of fiscal ~~2019~~2020 from ~~7.73%~~8.22% per annum at the end of the ~~second~~first quarter of fiscal ~~2018.~~2019. Including the impact of our interest rate swap in effect, the effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the ~~second~~first quarter of fiscal 2020 and the first quarter of fiscal 2019, ~~and the second quarter of fiscal 2018, increased~~decreased to ~~8.00%~~7.82% per annum at the end of the ~~second~~first quarter of fiscal ~~2019~~2020 from ~~7.80%~~7.93% per annum at the end of the ~~second~~first quarter of fiscal ~~2018.~~2019. See “—Liquidity and Capital Resources—Long-Term Debt” for additional details regarding our debt, including interest rates and payments thereon. For additional details on our interest rate swaps, see “Item 3. Quantitative and Qualitative Disclosures about Market Risk” in Part I of this Quarterly Report on Form 10-Q.

Other expense, net, which consists primarily of the impact of foreign currency on intercompany transactions, decreased by ~~$0.9~~$0.3 million in the ~~second~~first quarter of fiscal ~~2019~~2020 to ~~$0.4~~$0.0 million of expense as compared to ~~$1.3~~$0.3 million of expense in the prior year period.

Our effective tax rate for the ~~second~~first quarter of fiscal ~~2019~~2020 was ~~23.6%~~9.7% as compared to ~~21.9%~~21.1% for the ~~second~~first quarter of fiscal ~~2018.~~2019. The effective tax rate in the ~~second~~first quarter of fiscal ~~2019~~2020 was impacted by an impairment of our Brazil reporting unit which has a ~~$0.9~~full valuation allowance, a $1.3 million tax expense related to global intangible low-taxed income, or GILTI,. and $1.0 million of state income tax expense. The ~~GILTI~~effective tax ~~expense~~rate in the first quarter of fiscal 2020 was partially offset by a ~~$1.4~~$1.2 million tax benefit from income earned in foreign jurisdictions. The effective tax rate in the first quarter of fiscal 2019 was impacted by $1.5 million of higher state income tax expense versus the prior year period and a $0.9 million tax expense related to GILTI. The effective tax rate for the ~~reversal~~first quarter of ~~tax reserves no longer needed, a $0.8 million tax benefit related to the cessation of certain publishing operations and~~fiscal 2019 was partially offset by a $0.6 million tax benefit related to f~~oreign-derived~~foreign-derived intangible ~~income, or FDII~~income.~~. Our effective tax rate in the second quarter of fiscal 2018 was impacted by the $4.1 million tax benefit related to tax windfalls from stock compensation.~~

Net ~~income~~loss attributable to the Company in the ~~second~~first quarter of fiscal ~~2019~~ 2020 reflected a $~~16.9~~4.6 million, or ~~23.9%~~43.3%, ~~decline~~decrease from the ~~second~~first quarter of fiscal ~~2018.~~2019. Excluding the impact of foreign currency, which ~~negatively~~positively impacted net ~~income~~loss attributable to the Company in the ~~second~~first quarter of fiscal ~~2019~~2020 by ~~$1.6~~$0.4 million, net ~~income~~loss attributable to the Company in the ~~second~~first quarter of fiscal 2020 would have decreased 39.4% from the first quarter of fiscal 2019.

Diluted net loss per share in the first quarter of fiscal 2020 was a loss of $0.09 compared to a loss of $0.16 per share in the first quarter of fiscal 2019.Diluted net loss per share for the first quarter of fiscal 2020 included a $0.05 impairment charge for goodwill related to our Brazil reporting unit. Diluted net loss per share for the first quarter of fiscal 2019 ~~would have declined 21.6% from the second quarter of fiscal 2018.~~

~~Earnings per fully diluted share, or EPS,~~included a $0.07 expense in connection with our organizational realignment in the ~~second quarter of fiscal 2019 was $0.78 compared to $1.01 in the second quarter of fiscal 2018.~~ quarter.

The following tables set forth key metrics by reportable segment for the ~~second~~first quarter of fiscal ~~2019~~2020 and the percentage change in those metrics versus the prior year period:

	Q2 2019																											Q1 2020
	GAAP									Constant Currency																		GAAP									Constant Currency
				Product									Product						Total												Product									Product						Total
	Service			Sales &			Total			Service			Sales &			Total			Paid			Incoming			EOP			Service			Sales &			Total			Service			Sales &			Total			Paid			Incoming			EOP
	Revenues			Other			Revenues			Revenues			Other			Revenues			Weeks			Subscribers			Subscribers			Revenues			Other			Revenues			Revenues			Other			Revenues			Weeks			Subscribers			Subscribers
																						(in thousands)																											(in thousands)
North America	$	219.8		$	35.8		$	255.6		$	220.3		$	35.9		$	256.2			39.2			2,950.5			2,940.7		$	229.2		$	54.5		$	283.7		$	229.3		$	54.5		$	283.8			42.4			2,722.1			3,251.2
CE		67.3			10.1			77.3			71.4			10.7			82.1			15.1			1,157.5			1,137.6			68.2			11.8			80.0			70.1			12.2			82.3			16.0			1,059.9			1,262.9
UK		18.5			6.0			24.5			19.6			6.4			25.9			5.2			391.9			387.0			18.7			6.3			25.0			19.0			6.4			25.4			5.5			361.4			404.1
Other ⁽¹⁾		8.2			3.3			11.5			8.9			3.4			12.3			1.3			109.6			102.8			8.6			3.0			11.6			9.4			3.1			12.5			1.5			101.8			116.1
Total	$	313.8		$	55.3		$	369.0		$	320.1		$	56.4		$	376.5			60.8			4,609.5			4,568.1		$	324.7		$	75.7		$	400.4		$	327.8		$	76.2		$	404.0			65.4			4,245.3			5,034.2

	% Change Q2 2019 vs.Q2 2018																											% Change Q1 2020 vs. Q1 2019
North America		(9.9	%)		(11.9	%)		(10.2	%)		(9.6	%)		(11.7	%)		(9.9	%)		(4.2	%)		(2.8	%)		(1.9	%)		5.9	%		62.0	%		13.5	%		6.0	%		62.0	%		13.5	%		12.0	%		6.4	%		10.2	%
CE		(2.1	%)		(21.7	%)		(5.2	%)		3.8	%		(16.8	%)		0.6	%		10.7	%		11.3	%		11.5	%		6.3	%		(1.6	%)		5.0	%		9.3	%		1.3	%		8.1	%		11.9	%		12.7	%		9.1	%
UK		(14.0	%)		(21.7	%)		(16.0	%)		(9.0	%)		(17.2	%)		(11.2	%)		(1.5	%)		0.7	%		0.9	%		5.8	%		(8.8	%)		1.7	%		7.6	%		(7.7	%)		3.3	%		6.7	%		8.3	%		3.1	%
Other ⁽¹⁾		(14.7	%)		(30.6	%)		(20.0	%)		(7.9	%)		(28.2	%)		(14.7	%)		(2.6	%)		2.9	%		2.0	%		0.6	%		(20.8	%)		(6.0	%)		9.6	%		(18.5	%)		0.9	%		7.8	%		1.8	%		5.9	%
Total		(8.7	%)		(16.3	%)		(9.9	%)		(6.9	%)		(14.5	%)		(8.1	%)		(0.6	%)		0.9	%		1.5	%		5.8	%		34.1	%		10.2	%		6.9	%		35.0	%		11.3	%		11.4	%		8.0	%		9.2	%

	Q2 2019																														Q1 2020
	Digital Subscription Revenues						Digital			Incoming			EOP			Studio + Digital Fees						Studio + Digital			Incoming			EOP			Digital Subscription Revenues						Digital			Incoming			EOP			Studio + Digital Fees						Studio + Digital			Incoming			EOP
				Constant			Paid			Digital			Digital						Constant			Paid			Studio + Digital			Studio + Digital						Constant			Paid			Digital			Digital						Constant			Paid			Studio + Digital			Studio + Digital
	GAAP			Currency			Weeks			Subscribers			Subscribers			GAAP			Currency			Weeks			Subscribers			Subscribers			GAAP			Currency			Weeks			Subscribers			Subscribers			GAAP			Currency			Weeks			Subscribers			Subscribers
										(in thousands)															(in thousands)															(in thousands)															(in thousands)
North America	$	102.9		$	103.1			26.0			1,968.2			1,995.8		$	117.0		$	117.2			13.1			982.3			944.9		$	116.3		$	116.4			29.4			1,870.5			2,311.3		$	112.8		$	112.9			13.0			851.6			940.0
CE		43.6			46.3			12.0			913.9			914.5			23.7			25.1			3.1			243.6			223.1			46.6			48.0			13.0			863.4			1,032.1			21.5			22.1			3.0			196.6			230.7
UK		7.0			7.4			2.5			192.8			195.0			11.5			12.2			2.7			199.1			192.0			7.6			7.7			2.9			189.7			220.8			11.1			11.3			2.6			171.8			183.2
Other ⁽¹⁾		3.5			3.8			0.8			61.4			59.3			4.7			5.0			0.6			48.1			43.4			4.0			4.3			0.9			61.4			72.2			4.6			5.0			0.6			40.4			43.9
Total	$	157.0		$	160.6			41.3			3,136.3			3,164.7		$	156.8		$	159.5			19.5			1,473.0			1,403.4		$	174.5		$	176.5			46.2			2,984.9			3,636.4		$	150.1		$	151.4			19.2			1,260.4			1,397.8

	% Change Q2 2019 vs. Q2 2018																														% Change Q1 2020 vs. Q1 2019
North America		1.7	%		2.0	%		2.2	%		2.8	%		4.3	%		(18.1	%)		(17.9	%)		(14.9	%)		(12.2	%)		(12.7	%)		17.8	%		17.9	%		19.6	%		13.5	%		17.4	%		(4.0	%)		(4.0	%)		(2.1	%)		(6.4	%)		(4.3	%)
CE		10.8	%		17.6	%		17.8	%		18.2	%		18.3	%		(19.5	%)		(14.6	%)		(10.5	%)		(8.7	%)		(9.8	%)		16.1	%		19.5	%		16.2	%		18.2	%		12.9	%		(10.1	%)		(7.6	%)		(3.5	%)		(6.4	%)		(5.3	%)
UK		0.5	%		6.3	%		6.5	%		7.5	%		8.4	%		(21.0	%)		(16.4	%)		(8.0	%)		(5.0	%)		(5.7	%)		18.0	%		20.2	%		18.3	%		18.5	%		14.5	%		(1.2	%)		0.5	%		(3.7	%)		(1.0	%)		(7.9	%)
Other ⁽¹⁾		(2.3	%)		5.6	%		4.0	%		6.2	%		6.9	%		(22.2	%)		(16.1	%)		(10.2	%)		(1.0	%)		(4.0	%)		14.0	%		24.1	%		19.1	%		11.0	%		17.5	%		(8.7	%)		(0.4	%)		(6.4	%)		(9.5	%)		(8.8	%)
Total		3.9	%		6.3	%		6.6	%		7.2	%		8.3	%		(18.6	%)		(17.2	%)		(13.2	%)		(10.4	%)		(11.1	%)		17.3	%		18.5	%		18.5	%		15.1	%		15.9	%		(4.9	%)		(4.1	%)		(2.7	%)		(5.8	%)		(5.1	%)

The ~~decrease~~increase in North America revenues in the ~~second~~first quarter of fiscal ~~2019~~2020 versus the prior year period was driven by both ~~a decrease in Service Revenues and a decrease~~an increase in product sales and other. This decrease in Service Revenues in the second quarter of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees, partially offset by an increase in Digital Subscription Revenues. The decrease in North America Total Paid Weeks was driven by lower recruitments in the quarter partially offset by the higher number of Incoming Digital Subscribers at the beginning of the second quarter of fiscal 2019 versus the beginning of the second quarter of fiscal 2018.

~~The decrease in North America product sales~~other and ~~other in the second quarter of fiscal 2019 versus the prior year period was driven primarily by a decrease in product sales.~~

The decrease in Continental Europe revenues in the second quarter of fiscal 2019 versus the prior year period was driven by the impact of foreign currency. Excluding foreign currency, revenues in the second quarter of fiscal 2019 would have increased slightly above the prior year period driven by an increase in Service Revenues. ~~This~~The increase in Service Revenues in the ~~second~~first quarter of fiscal ~~2019~~2020 versus the prior year period was driven by an increase in Digital Subscription Revenues, partially offset by a decrease in Studio + Digital Fees. The increase in North America Total Paid Weeks was driven by the higher number of Incoming Digital Subscribers at the beginning of the first quarter of fiscal 2020 versus the beginning of the first quarter of fiscal 2019 and higher Digital recruitments in the first quarter of fiscal 2020 versus the prior year period. Higher Digital recruitments in the first quarter of fiscal 2020 were driven by the successful launch of the new myWW program.

The increase in North America product sales and other in the first quarter of fiscal 2020 versus the prior year period was driven primarily by revenue received in connection with the WW Presents: Oprah’s 2020 Vision tour.

The increase in Continental Europe revenues in the first quarter of fiscal 2020 versus the prior year period was driven by an increase in Service Revenues. The increase in Service Revenues in the first quarter of fiscal 2020 versus the prior year period was driven by an increase in Digital Subscription Revenues. The increase in Continental Europe Total Paid Weeks was driven primarily by the higher number of Incoming Digital Subscribers at the beginning of the ~~second~~first quarter of fiscal ~~2019~~2020 versus the beginning of the ~~second~~first quarter of fiscal ~~2018, partially offset by lower Studio +~~2019 and higher Digital recruitments in the ~~second~~first quarter of fiscal ~~2019.~~2020 versus the prior year period. Higher Digital recruitments in the first quarter of fiscal 2020 were driven by the successful launch of the new myWW program.

The decrease in Continental Europe product sales and other in the ~~second~~first quarter of fiscal 2020 versus the prior year period was driven by the impact of foreign currency. Excluding the impact of foreign currency, product sales and other in the first quarter of fiscal 2020 would have increased above the prior year period driven by publishing.

The increase in UK revenues in the first quarter of fiscal 2020 versus the prior year period was driven by an increase in Service Revenues, partially offset by a decrease in product sales and other. The increase in Service Revenues in the first quarter of fiscal 2020 versus the prior year period was driven by an increase in Digital Subscription Revenues. The increase in UK Total Paid Weeks was driven primarily by the higher number of Incoming Digital Subscribers at the beginning of the first quarter of fiscal 2020 versus the beginning of the first quarter of fiscal 2019 and higher Digital recruitments in the first quarter of fiscal 2020 as compared to the prior year period. Higher Digital recruitments in the first quarter of fiscal 2020 were driven by the successful launch of the new myWW program.

The decrease in UK product sales and other in the first quarter of fiscal 2020 versus the prior year period was driven primarily by a decrease in product sales.

The decrease in UKOther revenues in the ~~second~~first quarter of fiscal 2019 versus the prior year period was driven by both the decrease in Service Revenues and product sales and other. This decrease in Service Revenues in the second quarter of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees. The decrease in UK Total Paid Weeks was driven by lower Studio + Digital recruitments in the quarter partially offset by the higher number of Incoming Subscribers at the beginning of the second quarter of fiscal 2019 versus the beginning of the second quarter of fiscal 2018.

~~The decrease in UK product sales and other in the second quarter of fiscal 2019~~2020 versus the prior year period was driven primarily by a decrease in product ~~sales.~~

~~The decrease in Other revenues in the second quarter of fiscal 2019 versus the prior year period was driven by both a decrease in Service Revenues and a decrease in product~~ sales and other. The ~~decrease in Service Revenues in the second quarter of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees.~~

~~The decrease in Other product sales and other in the second quarter of fiscal 2019 versus the prior year period was driven primarily by a decrease in both product sales and franchise commissions.~~

~~SIX MONTHS ENDED JUNE 29, 2019 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2018~~

The table below sets forth selected financial information for the first six months of fiscal 2019 from our consolidated statements of net income for the six months ended June 29, 2019 versus selected financial information for the first six months of fiscal 2018 from our consolidated statements of net income for the six months ended June 30, 2018:

(In millions, except per share amounts)

For The Six Months Ended

% Change

June 29, 2019

June 30, 2018

Increase/
(Decrease)

%
Change

Constant
Currency
Revenues, net

$
732.2

$
818.0

$
(85.8
)

(10.5
%)

(8.3
%)

Cost of revenues

315.4

352.2

(36.8
)

(10.4
%)

(8.4
%)

Gross profit

416.8

465.8

(49.0
)

(10.5
%)

(8.3
%)

Gross Margin %

56.9
%

56.9
%

Marketing expenses

164.2

154.3

9.9

6.4
%

9.6
%

Selling, general & administrative
   expenses

125.2

121.7

3.5

2.9
%

4.8
%

Operating income

127.4

189.8

(62.4
)

(32.9
%)

(31.2
%)

Operating Income Margin %

17.4
%

23.2
%

Interest expense

69.9

71.7

(1.8
)

(2.5
%)

(2.5
%)

Other expense, net

0.7

1.1

(0.4
)

32.4
%

32.4
%

Income before income taxes

56.7

116.9

(60.2
)

(51.5
%)

(48.8
%)

Provision for income taxes

13.7

7.2

6.5

90.2
%

100.0
%
*
Net income

43.0

109.7

(66.8
)

(60.8
%)

(58.8
%)

Net loss attributable to the
   noncontrolling interest

0.2

0.1

��
0.1

74.4
%

86.2
%

Net income attributable to Weight Watchers International, Inc.

$
43.1

$
109.8

$
(66.7
)

(60.7
%)

(58.7
%)

Weighted average diluted shares
   outstanding

69.3

69.9

(0.6
)

(0.9
%)

(0.9
%)

Diluted earnings per share

$
0.62

$
1.57

$
(0.95
)

(60.3
%)

(58.3
%)

Revenues in the first six months of fiscal 2019 were $732.2 million, a decrease of $85.8 million, or 10.5%, versus the first six months of fiscal 2018. Excluding the impact of foreign currency, which negatively impacted our revenues for the first six months of

fiscal 2019 by $17.7 million, revenues in the first six months of fiscal 2019 would have decreased 8.3% versus the prior year period. This decrease was driven primarily by the revenue declines in North America. See “—Segment Results” for additional details on revenues.

Total cost of revenues in the first six months of fiscal 2019 decreased $36.8 million, or 10.4%, versus the prior year period. Gross profit decreased $49.0 million, or 10.5%, in the first six months of fiscal 2019 compared to the first six months of fiscal 2018 primarily due to the decrease in revenues. Excluding the impact of foreign currency, which negatively impacted gross profit for the first six months of fiscal 2019 by $10.6 million, gross profit in the first six months of fiscal 2019 would have decreased 8.3% versus the prior year period. Gross margin in the first six months of fiscal 2019 was flat when compared to the first six months of fiscal 2018.

Marketing expenses for the first six months of fiscal 2019 increased $9.9 million, or 6.4%, versus the first six months of fiscal 2018. Excluding the impact of foreign currency, which decreased marketing expenses for the first six months of fiscal 2019 by $5.0 million, marketing expenses in the first six months of fiscal 2019 would have increased 9.6% versus the first six months of fiscal 2018. This increase in marketing expense was largely due to increased Online media expense and agency and celebrity fees, all on a global basis. Marketing expenses as a percentage of revenue increased to 22.4% in the first six months of fiscal 2019 as compared to 18.9% in the prior year period.

Selling, general and administrative expenses for the first six months of fiscal 2019 increased $3.5 million, or 2.9%, versus the first six months of fiscal 2018. Excluding the impact of foreign currency, which decreased selling, general and administrative expenses for the first six months of fiscal 2019 by $2.3 million, selling, general and administrative expenses in the first six months of fiscal 2019 would have increased 4.8% versus the prior year period. The increase in selling, general and administrative expenses in the first six months of fiscal 2019 was driven primarily by expenses related to our organizational realignment in the first quarter of 2019 and higher salary and related costs partially offset by a reduction in professional fees. Selling, general and administrative expenses as a percentage of revenue for the first six months of fiscal 2019 increased to 17.1% from 14.9% for the first six months of fiscal 2018.

Operating income in the first six months of fiscal 2019 decreased $62.4 million, or 32.9%, versus the prior year period. Excluding the impact of foreign currency, which negatively impacted operating income for the first six months of fiscal 2019 by $3.2 million, operating income in the first six months of fiscal 2019 would have decreased 31.2% versus the prior year period. This decrease in operating income was driven primarily by lower operating income in all reportable segments as compared to the prior year period. Operating income margin in the first six months of fiscal 2019 decreased 5.8% to 17.4% versus 23.2% in the first six months of fiscal 2018. This decrease in operating income margin was driven primarily by an increase in marketing as a percentage of revenue and an increase in selling, general and administrative expenses as a percentage of revenue.

Interest expense in the first six months of fiscal 2019 decreased $1.8 million, or 2.5%, versus the first six months of fiscal 2018. The decrease in interest expense was driven primarily by a decrease in our outstanding indebtedness resulting from principal repayments. The effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the first six months of fiscal 2019 and the first six months of fiscal 2018 and excluding the impact of our interest rate swap in effect, increased to 8.17% per annum at the end of the first six months of fiscal 2019 from 7.44% per annum at the end of the first six months of fiscal 2018. Including the impact of our interest rate swap in effect, the effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the first six months of fiscal 2019 and the first six months of fiscal 2018, increased to 7.97% per annum at the end of the first six months of fiscal 2019 from 7.72% per annum at the end of the first six months of fiscal 2018. ~~See “—Liquidity and Capital Resources—Long-Term Debt” for additional details regarding our debt, including interest rates and payments thereon.~~ ~~For additional details on our interest rate swaps, see “Item 3. Quantitative and Qualitative Disclosures about Market Risk” in Part I of this Quarterly Report on Form 10-Q.~~

Other expense, net, which consists primarily of the impact of foreign currency on intercompany transactions, decreased by $0.4 million in the first six months of fiscal 2019 to $0.7 million of expense as compared to $1.1 million of expense in the prior year period.

Our effective tax rate for the first six months of fiscal 2019 was 24.2% as compared to 6.2% for the first six months of fiscal 2018. The effective tax rate in the first six months of fiscal 2019 was impacted by a $1.8 million tax expense related to ~~GILTI~~ and $1.8 million of higher state income tax expenses versus the prior year period. The GILTI tax expense was partially offset by a $1.4 million tax benefit related to the reversal of tax reserves no longer needed, a $1.3 million tax benefit related to ~~FDII~~ and a $0.8 million tax benefit related to the cessation of certain publishing operations. Our effective tax rate in the first six months of fiscal 2018 was impacted by the $22.2 million tax benefit related to tax windfalls from stock compensation and a $1.9 million tax benefit related to the cessation of operations of our Mexican subsidiary.

~~Net income attributable to the Company in the first six months of fiscal 2019 reflected a~~ ~~$66.7 million, or 60.7%, decline from the first six months of fiscal 2018.~~ Excluding the impact of foreign currency, which negatively impacted net income attributable to the Company in the first six months of fiscal 2019 by $2.2 million, net income attributable to the Company in the first six months of fiscal 2019 would have declined 58.7% from the first six months of fiscal 2018.

EPS in the first six months of fiscal 2019 was $0.62 compared to $1.57 in the first six months of fiscal 2018. EPS for the first six months of fiscal 2019 included a $0.07 expense in connection with our organizational realignment and EPS for the first six months of fiscal 2018 included a $0.25 tax benefit from Oprah Winfrey’s exercise of a portion of her stock options.

~~The following tables set forth key metrics by reportable segment for the first six months of fiscal 2019 and the percentage change in those metrics versus the prior year period:~~

First Half of 2019

GAAP

Constant Currency

Product

Product

Total

Service

Sales &

Total

Service

Sales &

Total

Paid

Incoming

EOP

Revenues

Other

Revenues

Revenues

Other

Revenues

Weeks

Subscribers

Subscribers

(in thousands)

North America

$
436.2

$
69.5

$
505.7

$
437.4

$
69.7

$
507.1

77.0

2,558.5

2,940.7

CE

131.4

22.1

153.5

141.0

23.7

164.7

29.4

940.2

1,137.6

UK

36.2

13.0

49.1

38.5

13.8

52.2

10.4

333.7

387.0

Other ⁽¹⁾

16.8

7.2

23.9

18.3

7.5

25.8

2.8

100.0

102.8

Total

$
620.5

$
111.7

$
732.2

$
635.2

$
114.7

$
749.9

119.5

3,932.3

4,568.1

% Change First Half of 2019 vs. First Half of 2018

North America

(8.4
%)

(20.6
%)

(10.3
%)

(8.2
%)

(20.3
%)

(10.0
%)

(1.5
%)

20.9
%

(1.9
%)
CE

(1.9
%)

(26.7
%)

(6.5
%)

5.3
%

(21.3
%)

0.4
%

11.8
%

30.0
%

11.5
%
UK

(14.8
%)

(23.9
%)

(17.4
%)

(9.4
%)

(19.1
%)

(12.2
%)

0.5
%

12.7
%

0.9
%
Other ⁽¹⁾

(15.0
%)

(34.5
%)

(21.9
%)

(7.0
%)

(31.5
%)

(15.8
%)

0.8
%

27.8
%

2.0
%
Total

(7.7
%)

(23.3
%)

(10.5
%)

(5.5
%)

(21.2
%)

(8.3
%)

1.7
%

22.4
%

1.5
%

First Half of 2019

Digital Subscription Revenues

Digital

Incoming

EOP

Studio + Digital Fees

Studio + Digital

Incoming

EOP

Constant

Paid

Digital

Digital

Constant

Paid

Studio + Digital

Studio + Digital

GAAP

Currency

Weeks

Subscribers

Subscribers

GAAP

Currency

Weeks

Subscribers

Subscribers

(in thousands)

(in thousands)

North America

$
201.6

$
202.2

50.6

1,648.4

1,995.8

$
234.6

$
235.2

26.4

910.1

944.9

CE

83.8

89.9

23.1

730.3

914.5

47.6

51.1

6.2

209.9

223.1

UK

13.4

14.3

5.0

160.1

195.0

22.8

24.2

5.4

173.6

192.0

Other ⁽¹⁾

7.0

7.7

1.6

55.3

59.3

9.7

10.6

1.2

44.7

43.4

Total

$
305.8

$
314.1

80.3

2,594.0

3,164.7

$
314.7

$
321.2

39.2

1,338.4

1,403.4

% Change First Half of 2019 vs. First Half of 2018

North America

4.3
%

4.6
%

5.5
%

31.8
%

4.3
%

(17.1
%)

(16.9
%)

(12.7
%)

5.1
%

(12.7
%)
CE

10.9
%

19.1
%

18.8
%

36.6
%

18.3
%

(18.6
%)

(12.6
%)

(8.3
%)

11.3
%

(9.8
%)
UK

(0.8
%)

5.4
%

7.8
%

19.2
%

8.4
%

(21.3
%)

(16.4
%)

(5.4
%)

7.3
%

(5.7
%)
Other ⁽¹⁾

(2.4
%)

6.8
%

7.9
%

24.9
%

6.9
%

(22.2
%)

(15.0
%)

(7.1
%)

31.6
%

(4.0
%)
Total

5.6
%

8.5
%

9.2
%

32.1
%

8.3
%

(17.8
%)

(16.1
%)

(10.9
%)

7.1
%

(11.1
%)

The decrease in North America revenues in the first six months of fiscal 2019 versus the prior year period was driven by both a decrease in Service Revenues and a decrease in product sales and other. This decrease in Service Revenues in the first six months of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees, partially offset by an increase in Digital Subscription Revenues. The decrease in North America Total Paid Weeks was driven by lower recruitments in the first six months of fiscal 2019 partially offset by the higher number of Incoming Subscribers at the beginning of fiscal 2019 versus the beginning of fiscal 2018. Lower recruitments in the first six months of fiscal 2019 were driven by cycling against the successful launch of our WW Freestyle program in December 2017 and by the impact of ineffective marketing at the start of fiscal 2019.

~~The decrease in North America product sales and other in the first six months of fiscal 2019 versus the prior year period was driven primarily by a decrease in product sales.~~

The decrease in Continental Europe revenues in the first six months of fiscal 2019 versus the prior year period was driven by the impact of foreign currency. Excluding foreign currency, revenues in the first six months of fiscal 2019 would have increased slightly above the prior year period driven by an increase in Service Revenues. Thisslight increase in Service Revenues in the first ~~six months~~quarter of fiscal ~~2019~~2020 versus the prior year period was driven by an increase in Digital Subscription Revenues, partially offset by a decrease in Studio + Digital Fees. The increase in Continental Europe Total Paid Weeks was driven primarily by the higher number of Incoming Subscribers at the beginning of fiscal 2019 versus the beginning of fiscal 2018, partially offset by lower recruitments in the first six months of fiscal 2019. Lower recruitments in the first six months were driven by cycling against the successful launch of our new program in December 2017 and by the impact of ineffective marketing at the start of fiscal 2019.

~~The decrease in Continental Europe product sales and other in the first six months of fiscal 2019 versus the prior year period was driven primarily by a decrease in product sales.~~

The decrease in UK revenues in the first six months of fiscal 2019 versus the prior year period was driven by both the decrease in Service Revenues and product sales and other. This decrease in Service Revenues in the first six months of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees. The increase in UK Total Paid Weeks was driven by the higher number of Incoming Subscribers at the beginning of fiscal 2019 versus the beginning of fiscal 2018, partially offset by lower recruitments in the first six months of fiscal 2019. Lower recruitments in the first six months were driven by cycling against the successful launch of our new program in December 2017 and by the impact of ineffective marketing at the start of fiscal 2019.

The decrease in UK product sales and other in the first six months of fiscal 2019 versus the prior year period was driven primarily by a decrease in product sales and to a lesser extent a decrease in licensing.

The decrease in Other revenues in the first six months of fiscal 2019 versus the prior year period was driven by both a decrease in Service Revenues and a decrease in product sales and other. The decrease in Service Revenues in the first six months of fiscal 2019 versus the prior year period was driven primarily by the decrease in Studio + Digital Fees.

The decrease in Other product sales and other in the first ~~six months~~quarter of fiscal ~~2019~~2020 versus the prior year period was driven ~~primarily~~ by a decrease in ~~both~~ product ~~sales and franchise commissions.~~ sales.

Cash flows provided by operating activities have historically supplied, and are expected to continue to supply, us with our primary source of liquidity. We use these cash flows, supplemented with long-term debt and short-term borrowings, to fund our operations and global strategic initiatives, pay down debt and engage in selective acquisitions. On March 23, 2020, as a precautionary measure in light of the COVID-19 outbreak, we drew down $148.0 million on our Revolving Credit Facility in order to enhance our cash position and to provide additional financial flexibility. We currently believe that cash generated by operations, ~~during fiscal 2019,~~ our cash on hand of approximately ~~$180.6~~$144.3 million ~~at June 29, 2019, our $148.8~~(exclusive of the $148.0 million of ~~availability~~borrowings under our Revolving Credit ~~Facility~~Facility) at March 28, 2020 and our ~~continued cost focus~~cost-savings initiative described below, which is in our control, will provide us with sufficient liquidity to meet our obligations for the next twelve months. In addition, if necessary, we have the flexibility to delay investments or reduce marketing spend.

Due to the negative impact of COVID-19, and the uncertainty of the magnitude and duration of such impact on our business and the economies and financial markets in which we operate, we are implementing a $100.0 million cost-savings initiative with respect to our cost structure. We are undertaking this initiative to proactively manage our liquidity so we can maintain flexibility to respond to evolving business and consumer conditions arising from the pandemic, as well as continue to fund investments in innovating our program and long-term debt obligations. In connection with this initiative, we are instituting a number of measures throughout our operations to mitigate expenses and reduce costs as well as ensure liquidity and the availability of our Revolving Credit Facility. While we have targeted $100.0 million of potential cost-savings measures, we may not be able to recognize all identified potential savings. Even if we are able to recognize the identified savings, the magnitude of our cost-savings initiative may be insufficient to address the evolving and uncertain economic impact of COVID-19 and resulting liquidity needs. To the extent that we do not successfully manage our costs, our liquidity and financial results, as well as our ability to access our Revolving Credit Facility, may be adversely affected.

As market conditions warrant, we may, from time to time, seek to purchase our outstanding debt securities or loans, including the Notes and borrowings under the Credit Facilities (each as defined below). Such transactions could be privately negotiated or open market transactions, pursuant to tender offers or otherwise. Subject to any applicable limitations contained in the agreements governing, or terms of, our indebtedness, any such purchases made by us may be funded by the use of cash on our balance sheet or the incurrence of new secured or unsecured debt. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material. Any such purchases may equate to a substantial amount of a particular class or series of debt, which may reduce the trading liquidity of such class or series.

The following table sets forth certain relevant measures of our balance sheet working capital deficit, excluding cash and cash equivalents and current portion of long-term debt at:

		June 29,			December 29,			Increase/			March 28,			December 28,			Increase/
		2019			2018			(Decrease)			2020			2019			(Decrease)
		(in millions)									(in millions)
Total current assets		$	284.1		$	366.4		$	(82.3	)	$	432.6		$	295.4		$	137.3
Total current liabilities			350.2			341.3			8.9			560.3			394.1			166.2
Working capital (deficit) surplus			(66.1	)		25.1			91.2
Working capital deficit												(127.6	)		(98.7	)		29.0
Cash and cash equivalents			180.6			237.0			(56.3	)		292.3			182.7			109.5
Current portion of long-term debt			57.8			77.0			(19.3	)		244.3			96.3			148.0
Working capital deficit, excluding cash and cash equivalents and current portion of long-term debt	Working capital deficit, excluding cash and cash equivalents and current portion of long-term debt	$	(189.0	)	$	(134.9	)	$	54.1		$	(175.7	)	$	(185.2	)	$	(9.5	)

The following table sets forth a summary of the primary factors contributing to the ~~$54.1~~$9.5 million ~~increase~~decrease in our working capital deficit, excluding cash and cash equivalents and current portion of long-term debt:

		June 29,		December 29,		Increase/			Impact to Working			March 28,		December 28,		Increase/			Impact to Working
		2019		2018		(Decrease)			Capital Deficit			2020		2019		(Decrease)			Capital Deficit
		(in millions)										(in millions)
Derivative payable												$	34.9	$	21.6	$	13.3		$	13.3
Accrued interest												$	30.3	$	24.6	$	5.7		$	5.7
Portion of operating lease liabilities due within one year		$	32.0	$	-	$	32.0		$	32.0		$	33.8	$	33.2	$	0.6		$	0.6
Prepaid income taxes		$	15.2	$	34.0	$	(18.8	)	$	18.8
Derivative payable, net		$	19.3	$	2.1	$	17.3		$	17.3
Deferred revenue		$	56.9	$	53.5	$	3.4		$	3.4		$	59.4	$	60.6	$	(1.2	)	$	(1.2	)
Accrued interest		$	28.0	$	28.7	$	(0.6	)	$	(0.6	)
Income taxes payable		$	19.7	$	22.6	$	(2.9	)	$	(2.9	)	$	1.6	$	3.6	$	(2.0	)	$	(2.0	)
Operational liabilities and other, net of assets		$	48.2	$	62.0	$	(13.8	)	$	(13.8	)	$	42.3	$	50.0	$	(7.7	)	$	(7.7	)
Prepaid income taxes												$	26.6	$	8.4	$	18.2		$	(18.2	)
Working capital deficit change, excluding cash and cash equivalents and current portion of long-term debt	Working capital deficit change, excluding cash and cash equivalents and current portion of long-term debt								$	54.1									$	(9.5	)

The increase in derivative payable was due ~~within one year is~~to a change in fair value driven by the change in interest rates. The increase in accrued interest was due to the ~~adoption~~timing of ~~the updated lease accounting guidance. The decrease in prepaid income taxes is primarily related to refunds received.~~debt principal payments. The decrease in operational liabilities and other, net of assets, which includes accrued salaries and wages, was driven primarily by the timing of payments. The increase in ~~deferred revenue~~prepaid income taxes was ~~driven~~ primarily ~~by seasonality.~~ related to an increase in interest expense carryforward utilization as a result of the Coronavirus Aid, Relief and Economic Security (CARES) Act.

The following table sets forth a summary of ~~the Company’s~~our cash flows for the ~~six~~three months ended:

	June 29, 2019			June 30, 2018			March 28, 2020			March 30, 2019
	(in millions)						(in millions)
Net cash provided by operating activities	$	79.8		$	168.6		$	8.4		$	7.2
Net cash used for investing activities	$	(23.7	)	$	(30.5	)	$	(25.9	)	$	(11.2	)
Net cash used for financing activities	$	(111.9	)	$	(51.4	)
Net cash provided by (used for) financing activities							$	128.2		$	(38.8	)

Cash flows provided by operating activities of $8.4 million for the first quarter of fiscal 2020 reflected an increase of $1.2 million from $7.2 million of cash flows provided by operating activities in the first quarter of fiscal 2019. The increase in cash provided by operating activities was primarily the result of a decrease in net loss attributable to the Company of $4.6 million in the first quarter of fiscal 2020 as compared to the prior year period.

Cash flows provided by operating activities of ~~$79.8~~$7.2 million for the first ~~six months~~quarter of fiscal 2019 reflected a decrease of ~~$88.8~~$66.2 million from ~~$168.6~~$73.5 million of cash flows provided by operating activities in the first ~~six months~~quarter of fiscal 2018. The decrease in cash provided by operating activities was primarily the result of a decrease in net income attributable to the Company of ~~$66.7~~$49.8 million in the first ~~six months~~quarter of fiscal 2019 as compared to the prior year period.

~~Cash flows provided by operating~~Net cash used for investing activities of $168.6 million for the first six months of fiscal 2018 reflected an increase of $70.5 million from $98.1 million of cash flows provided by operating activities in the first six months of fiscal 2017. The increase in cash provided by operating activities was primarily the result of an increase in net income attributable to the Company of $54.0totaled $25.9 million in the first ~~six months~~quarter of fiscal ~~2018~~2020, an increase of $14.7 million as compared to the ~~prior year period.~~

~~Investing Activities~~first quarter of fiscal 2019. This increase was primarily attributable to higher capital expenditures in the first quarter of fiscal 2020. In the first quarter of fiscal 2020, we entered into a strategic collaboration agreement with ClassPass Inc. (“ClassPass”) and also invested $5.0 million in ClassPass’ recent $285.0 million Series E Preferred Stock funding round.

Net cash used for investing activities totaled ~~$23.7~~$11.2 million in the first ~~six months~~quarter of fiscal 2019, ~~a decrease~~an increase of ~~$6.8~~$3.5 million as compared to the first ~~six months~~quarter of fiscal 2018. This ~~decrease~~increase was primarily a~~ttributable~~attributable to ~~lower~~higher capital expenditures for technology in the first ~~six months~~quarter of fiscal 2019.

Net cash used for investing activities totaled $30.5 million in the first six months of fiscal 2018, an increase of $11.4 million as compared to the first six months of fiscal 2017. This increase was due to investments in intellectual properties in the first six months of fiscal 2018.

Net cash provided by financing activities totaled $128.2 million in the first quarter of fiscal 2020 primarily due to borrowings under the Revolving Credit Facility of $148.0 million. See “—Long-Term Debt” for additional details on debt.

Net cash used for financing activities totaled ~~$111.9~~$38.8 million in the first ~~six months~~quarter of fiscal 2019 primarily due to ~~$50.0 million used for the debt prepayment and $57.8 million used for scheduled debt repayments under our Term Loan Facility.~~ ~~See “—Long-Term Debt” for additional details on debt payments.~~

Net cash used for financing activities totaled $51.4 million in the first six months of fiscal 2018, primarily due to $25.0 million of net repayments on the outstanding principal amount on the Revolving Credit Facility and $38.5 million used for the scheduled debt repayments under our Term Loan ~~Facility, which was partially offset by $23.3 million in proceeds from stock options exercised.~~Facility.

We currently plan to meet our long-term debt obligations by using cash flows provided by operating activities and opportunistically using other means to repay or refinance our obligations as we determine appropriate.

The following schedule sets forth our long-term debt obligations at ~~June 29, 2019:~~March 28, 2020:

On November 29, 2017, we refinanced our then-existing credit facilities (referred to herein as the November 2017 debt refinancing) consisting of $1,930.4 million of borrowings under a term loan facility and an undrawn $50.0 million revolving credit facility with $1,565.0 million of borrowings under our new credit facilities, consisting of a $1,540.0 million term loan facility and a $150.0 million revolving credit facility (of which $25.0 million was drawn upon at the time of the November 2017 debt ~~refinancing)~~refinancing and repaid on January 29, 2018) (collectively referred to herein as the Credit Facilities), and $300.0 million in aggregate principal amount of 8.625% Senior Notes due 2025, or the Notes. During the fourth quarter of fiscal 2017, we incurred fees of $53.8 million (which included $30.8 million of a debt discount) in connection with the November 2017 debt refinancing. In addition, we recorded a loss on early extinguishment of debt of $10.5 million in connection thereto. This early extinguishment of debt write-off was comprised of $5.7 million of deferred financing fees paid in connection with the November 2017 debt refinancing and $4.8 million of pre-existing deferred financing fees.

The Credit Facilities were issued under a new credit agreement, dated November 29, 2017, or the Credit Agreement, among the Company, as borrower, the lenders party thereto, JPMorgan Chase Bank, N.A., or JPMorgan Chase, as administrative agent and an

issuing bank, Bank of America, N.A., as an issuing bank, and Citibank, N.A., as an issuing bank. The Credit Facilities consist of (1) $1,540.0 million in aggregate principal amount of senior secured tranche B term loans due in 2024, or the Term Loan Facility and (2) a $150.0 million senior secured revolving credit facility (which includes borrowing capacity available for letters of credit) due in 2022, or the Revolving Credit Facility.

On both May 31, 2019 and October 10, 2019, we made a voluntary prepayment at par of $50.0 million in respect of our outstanding term loans under the Term Loan Facility. As a result of ~~this prepayment,~~these prepayments, we wrote off deferred financing fees of ~~$0.3~~$0.5 million in the ~~second quarter~~aggregate in fiscal 2019.

the COVID-19 outbreak, we drew down $148.0 million on the Revolving Credit Facility in order to enhance our cash position and to provide additional financial flexibility. The revolver borrowing has been classified as a short-term liability in connection with our monthly interest elections.

As of ~~June 29, 2019,~~March 28, 2020, we had ~~$1,374.5~~$1,434.0 million of debt outstanding under ~~the~~our Credit Facilities, with ~~$148.8~~$0.8 million of availability and $1.2 million in issued but undrawn letters of credit outstanding under the Revolving Credit Facility. ~~There was no~~The outstanding balance under the Revolving Credit Facility is included in the current portion of long-term debt on our consolidated balance sheet as of ~~June 29, 2019.~~March 28, 2020.

All obligations under the Credit Agreement are guaranteed by, subject to certain exceptions, each of ~~the Company’s~~our current and future wholly-owned material domestic restricted subsidiaries. All obligations under the Credit Agreement, and the guarantees of those obligations, are secured by substantially all of the assets of the Company and each guarantor, subject to customary exceptions, including:

Under the terms of the Credit Agreement, depending on our Consolidated First Lien Net Debt Leverage Ratio (as used in the Credit Agreement), on an annual basis on or about the time we are required to deliver our financial statements for any fiscal year, we are obligated to offer to prepay a portion of the outstanding principal amount of the Term Loan Facility in an aggregate amount determined by a percentage of our annual excess cash flow (as defined in the Credit Agreement) (said payment referred to herein as a Cash Flow Sweep).

Borrowings under the Term Loan Facility bear interest at a rate per annum equal to, at our option, either (1) an applicable margin plus a base rate determined by reference to the highest of (a) 0.50% per annum plus the higher of (i) the Federal Funds Effective Rate and (ii) the Overnight Bank Funding Rate as determined by the Federal Reserve Bank of New York, (b) the prime rate of JPMorgan Chase and (c) the LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00%; provided that such rate is not lower than a floor of 1.75% or (2) an applicable margin plus a LIBOR rate determined by reference to the ~~costs~~cost of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs, provided that LIBOR is not lower than a floor of 0.75%. Borrowings under the Revolving Credit Facility bear interest at a rate per annum equal to an applicable margin based upon a leverage-based pricing grid, plus, at our option, either (1) a base rate determined by reference to the highest of (a) 0.50% per annum plus the higher of (i) the Federal Funds Effective Rate and (ii) the Overnight Bank Funding Rate as determined by the Federal Reserve Bank of New York, (b) the prime rate of JPMorgan Chase and (c) the LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00% or (2) a LIBOR rate determined by reference to the ~~costs~~cost of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs. As of ~~June 29, 2019,~~March 28, 2020, the applicable margins for the LIBOR rate borrowings under the Term Loan Facility and the Revolving Credit Facility were 4.75% and 2.25%, respectively. In the event that LIBOR is phased out as is currently expected, the Credit Agreement provides that the Company and the administrative agent may amend the Credit Agreement to replace the LIBOR definition therein with a successor rate subject to notifying the lending syndicate of such change and not receiving within five business days of such notification objections to such replacement rate from lenders holding at least a majority of the aggregate principal amount of loans and commitments then outstanding under the Credit Agreement. If we fail to do so, our borrowings will be based off of the alternative base rate plus a margin.

On a quarterly basis, we pay a commitment fee to the lenders under the Revolving Credit Facility in respect of unutilized commitments thereunder, which commitment fee fluctuates depending upon our Consolidated First Lien Net Debt Leverage Ratio. Based on our Consolidated First Lien Net Debt Leverage Ratio as of ~~June 29, 2019,~~March 28, 2020, the commitment fee was 0.35% per annum. Our Consolidated First Lien Net Debt Leverage Ratio as of ~~June 29, 2019~~March 28, 2020 was ~~2.93~~3.04:1.00.

The availability of certain baskets and the ability to enter into certain transactions are also subject to compliance with certain financial ratios. In addition, if we have more than $50.0 million of outstanding extensions of credit under the Revolving Credit Facility ~~includes~~as of any fiscal quarter end, we must be in compliance with a springing Consolidated First Lien Net Debt Leverage Ratio maintenance covenant of 3.75:1.00. If at any time we expect that we will ~~require,~~not be in ~~certain circumstances,~~ compliance with ~~certain first lien secured net leverage ratios.~~such maintenance covenant as of the next upcoming fiscal quarter end, we expect we will reduce our extensions of credit under the Revolving Credit Facility to $50.0 million or less prior to the last day of such fiscal quarter so that we are not required to comply with such springing maintenance covenant. In any such event, we would be able to reborrow the full amount under the Revolving Credit Facility subsequent to such fiscal quarter end given the maintenance covenant is only tested as of the last day of each fiscal quarter.

As of ~~June 29, 2019,~~March 28, 2020, we were in compliance with all applicable financial covenants in the Credit Agreement governing the Credit Facilities.

The Notes were issued pursuant to an Indenture, dated as of November 29, 2017, or the Indenture, among the Company, the guarantors named therein and The Bank of New York Mellon, as trustee. The Indenture contains customary covenants, events of default and other provisions for an issuer of non-investment grade debt securities. These covenants include limitations on indebtedness, liens, mergers, acquisitions, asset sales, investments, distributions, prepayments of subordinated debt and transactions with affiliates, in each case subject to baskets, thresholds and other exceptions.

The Notes accrue interest at a rate per annum equal to 8.625% and are due on December 1, 2025. Interest on the Notes is payable semi-annually on June 1 and December 1 of each year, beginning on June 1, 2018. On or after December 1, 2020, ~~the Company~~we may on any one or more occasions redeem some or all of the Notes at a purchase price equal to 104.313% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the redemption date, such optional redemption price decreasing to 102.156% on or after December 1, 2021 and to 100.000% on or after December 1, 2022. Prior to December 1, 2020, ~~the Company~~we may on any one or more occasions redeem up to 40% of the aggregate principal amount of the Notes with an amount not to exceed the net proceeds of certain equity offerings at 108.625% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the redemption date. Prior to December 1, 2020, ~~the Company~~we may redeem some or all of the Notes at a make-whole price plus accrued and unpaid interest, if any, to, but not including, the redemption date. If a change of control occurs, ~~the Company~~we must offer to purchase for cash the Notes at a purchase price equal to 101% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the purchase date. Following the sale of certain assets and subject to certain conditions, ~~the Company~~we must offer to purchase for cash the Notes at a purchase price equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The Notes are guaranteed on a senior unsecured basis by ~~the Company’s~~our subsidiaries that guarantee the Credit Facilities.

At ~~June 29, 2019,~~March 28, 2020, we had ~~$1,674.5~~$1,734.0 million outstanding under the Credit Facilities and the Notes, consisting of borrowings under the Term Loan Facility of ~~$1,374.5~~$1,286.0 million, ~~$0.0 million drawn down on~~borrowings under the Revolving Credit Facility of $148.0 million and $300.0 million in aggregate principal amount of Notes issued and outstanding.

At ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, our debt consisted of both fixed and variable-rate instruments. Interest rate swaps were entered into to hedge a portion of the cash flow exposure associated with our variable-rate borrowings. Further information regarding our interest rate swaps can be found in Part I, Item 1 of this Quarterly Report on Form 10-Q under Note 12 “Derivative Instruments and Hedging” in the Notes to the Consolidated Financial Statements. The weighted average interest rate (which includes amortization of deferred financing costs and debt discount) on our outstanding debt, exclusive of the impact of the swap then in effect, was approximately ~~8.17%~~7.19% and ~~7.73%~~8.08% per annum at ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, respectively, based on interest rates on these dates. The weighted average interest rate (which includes amortization of deferred financing costs and debt discount) on our outstanding debt, including the impact of the swap then in effect, was approximately ~~7.61%~~7.09% and ~~7.46%~~7.59% per annum at ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018,~~28, 2019, respectively, based on interest rates on these dates.

The following schedule sets forth our year-by-year debt obligations at ~~June 29, 2019:~~March 28, 2020:

Remainder of Fiscal 2019	$	19.3
Fiscal 2020	$	96.3
Remainder of fiscal 2020			$	225.0
Fiscal 2021	$	77.0	$	77.0
Fiscal 2022	$	77.0	$	77.0
Fiscal 2023	$	77.0	$	77.0
Fiscal 2024 and thereafter	$	1,328.0
Fiscal 2024			$	978.0
Fiscal 2025 and thereafter			$	300.0
Total	$	1,674.5	$	1,734.0

Our accumulated other comprehensive loss includes changes in the fair value of derivative instruments and the effects of foreign currency translations. At ~~June 29,~~March 28, 2020 and March 30, 2019, ~~and June 30, 2018,~~ the cumulative balance of changes in the fair value of derivative instruments, net of taxes, was a loss of ~~$14.7~~$25.2 million and ~~a gain of $2.6~~$6.7 million, respectively. At ~~June 29,~~March 28, 2020 and March 30, 2019, ~~and June 30, 2018,~~ the cumulative balance of the effects of foreign currency translations, net of taxes, was a loss of ~~$12.0~~$19.0 million and ~~$11.4~~$13.3 million, respectively.

We do not currently pay a dividend and we have no current plans to pay dividends in the foreseeable future. Any future determination to declare and pay dividends will be made at the sole discretion of our Board of Directors, after taking into account our financial condition and results of operations, capital requirements, contractual, legal, tax and regulatory restrictions, the provisions of Virginia law affecting the payment of distributions to shareholders and such other factors our Board of Directors may deem relevant. In addition, our ability to pay dividends may be limited by covenants in our existing indebtedness, including the Credit Facilities and the Indenture governing the Notes, and may be limited by the agreements governing other indebtedness we or our subsidiaries incur in the future.

On October 9, 2003, our Board of Directors authorized, and we announced, a program to repurchase up to $250.0 million of our outstanding common stock. On each of June 13, 2005, May 25, 2006 and October 21, 2010, our Board of Directors authorized, and we announced, ~~adding $250.0��~~the addition of $250.0 million to this program. The repurchase program allows for shares to be purchased from time to time in the open market or through privately negotiated transactions. No shares will be purchased from Artal Holdings Sp. z o.o., Succursale de Luxembourg and its parents and subsidiaries under this program. The repurchase program currently has no expiration date. During the three months ended ~~June 29,~~March 28, 2020 and March 30, 2019, ~~and June 30, 2018,~~ we repurchased no shares of our common stock ~~in the open market~~ under this ~~program.~~program or otherwise.

We define EBITDAS, a non-GAAP financial measure, as earnings before interest, taxes, depreciation, amortization and stock-based ~~compensation.~~ compensation and Adjusted EBITDAS, a non-GAAP financial measure, as earnings before interest, taxes, depreciation, amortization, stock-based compensation and goodwill impairment.

The table below sets forth the ~~calculations~~reconciliation for EBITDAS and Adjusted EBITDAS, each a non-GAAP financial measure, to net loss, the most comparable GAAP financial measure, for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019, and ~~June 30, 2018,~~EBITDAS and Adjusted EBITDAS to net income for the trailing twelve months ended ~~June 29, 2019:~~March 28, 2020:

	Three Months Ended				Six Months Ended				Trailing Twelve		Three Months Ended						Trailing Twelve
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018		Months		March 28, 2020			March 30, 2019			Months
Net Income	$	53.8	$	70.7	$	43.1	$	109.8	$	157.1
Net (loss) income											$	(6.1	)	$	(10.7	)	$	124.2
Interest		34.7		35.9		69.9		71.7		140.5		31.6			35.2			131.6
Taxes		16.6		19.8		13.7		7.2		27.0		(0.7	)		(2.9	)		33.7
Depreciation and Amortization		11.3		10.6		22.7		21.8		45.0
Stock-based Compensation		4.9		5.3		9.7		9.7		20.2
Depreciation and amortization												12.2			11.4			45.8
Stock-based compensation												4.0			4.8			19.6
EBITDAS	$	121.3	$	142.3	$	159.2	$	220.2	$	389.8	$	41.0		$	37.9		$	355.0
Goodwill Impairment												3.7			—			3.7
Adjusted EBITDAS ⁽¹⁾											$	44.7		$	37.9		$	358.7

Reducing leverage is a capital structure priority for the Company. As of ~~June 29, 2019,~~March 28, 2020, our net debt/Adjusted EBITDAS ratio was ~~3.7x.~~ 3.9x.

The table below sets forth the ~~calculation~~reconciliation for net debt, a non-GAAP financial ~~measure:~~measure, to total debt, the most comparable GAAP financial measure, for the three months ended:

	June 29, 2019		March 28, 2020
Total debt	$	1,674.5	$	1,734.0
Less: Unamortized deferred financing costs		8.5		7.1
Less: Unamortized debt discount		23.8		20.5
Less: Cash on hand		180.6		292.3
Net debt	$	1,461.6	$	1,414.1

We present EBITDAS, Adjusted EBITDAS and net debt/Adjusted EBITDAS because we consider them to be useful supplemental measures of our performance. In addition, we believe EBITDAS, Adjusted EBITDAS and net debt/Adjusted EBITDAS are useful to investors, analysts and rating agencies in measuring the ability of a company to meet its debt service obligations. See “—Non-GAAP Financial Measures” herein for an explanation of our use of these non-GAAP financial measures.

As part of our ongoing business, we do not participate in arrangements that generate relationships with unconsolidated entities or financial partnerships established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes, such as entities often referred to as structured finance or special purpose entities.

Our business is seasonal due to the importance of the winter season to our overall member recruitment environment. Historically, we experience our highest level of recruitment during the first quarter of the year, which is supported with the highest concentration of advertising spending. Therefore, our number of End of Period Subscribers in the first quarter of the year is typically higher than the number in other quarters of the year, historically reflecting a decline over the course of the year.

Corporate information and our press releases, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and amendments thereto, are available free of charge on our corporate website at corporate.ww.com as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (i.e., generally the same day as the filing), or the SEC. Moreover, we also make available at that site the Section 16 reports filed electronically by our officers, directors and 10 percent shareholders.

We use our corporate website at corporate.ww.com and certain social media channels such as our corporate Facebook page (www.facebook.com/WW), Instagram account (Instagram.com/WW) and Twitter account (@ww_us) as channels of distribution of Company information. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. The contents of our website and social media channels shall not be deemed to be incorporated herein by reference.

As of ~~June 29, 2019,~~March 28, 2020, the market risk disclosures appearing in “Item 7A. Quantitative and Qualitative Disclosures about Market Risk” of our Annual Report on Form 10-K for fiscal ~~2018~~2019 have not materially changed from December ~~29, 2018.~~28, 2019.

At the end of the ~~second~~first quarter of fiscal ~~2019,~~ 2020, borrowings under the Credit Facilities bore interest at LIBOR plus an applicable margin of 4.75%. For the Term Loan Facility, the minimum interest rate for LIBOR applicable to such facility pursuant to the terms of the Credit Agreement is set at 0.75%, referred to herein as the LIBOR Floor. In addition, as of ~~June 29, 2019,~~March 28, 2020, our interest rate swap in effect had a notional amount of ~~$1.00~~$1.0 billion. Accordingly, as of ~~June 29, 2019,~~March 28, 2020, based on the amount of variable rate debt outstanding and the then-current LIBOR rate, after giving consideration to the impact of the interest rate swap and the LIBOR Floor, a hypothetical ~~100~~90 basis point increase in interest rates would have increased annual interest expense by approximately ~~$3.7~~$3.9 million and a hypothetical ~~100~~90 basis point decrease in interest rates would have decreased annual interest expense by approximately ~~$3.7~~$3.0 million. ~~These changes are~~This increase and decrease is driven primarily by the interest rate applicable to our Term Loan ~~Facility and~~ ~~the lower outstanding debt balance as of June 29, 2019 as compared to December 29, 2018~~.Facility.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Our management, with the participation of our principal executive officer and our principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of ~~June 29, 2019,~~March 28, 2020, the end of the ~~second~~first quarter of fiscal ~~2019.~~2020. Based upon that evaluation and subject to the foregoing, our principal executive officer and our principal financial officer concluded that, as of the end of the ~~second~~first quarter of fiscal ~~2019,~~2020, the design and operation of our disclosure controls and procedures were effective at the reasonable assurance level.

There was no change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

In March 2019, two substantially identical class action complaints alleging violations of the federal securities laws were filed by individual shareholders against the Company, certain of the Company’s current officers and the Company’s former controlling shareholder, Artal, in the United States District Court for the Southern District of New York. The actions were consolidated and lead plaintiffs were appointed in June 2019. A consolidated amended complaint was filed on July 29, 2019, naming as defendants the Company, certain of the Company’s current officers and directors, and Artal and certain of its affiliates. A second consolidated amended complaint was filed on September 27, 2019. The ~~consolidated~~operative complaint asserts claims on behalf of all purchasers of the Company’s common stock between May 4, 2018 and February 26, 2019, inclusive, or the Class Period, including purchasers of the Company’s common stock traceable to the May 2018 secondary offering of the Company’s common stock by certain of its shareholders. The complaint alleges that, during the Class Period, the defendants disseminated materially false and misleading statements and/or concealed or recklessly disregarded material adverse facts. The complaint alleges claims under Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 thereunder, and with respect to the secondary offering, under Sections 11, 12(a)(2), and 15 of the Securities Act. The plaintiffs seek to recover unspecified damages on behalf of the class members. The Company believes that the action is without merit and intends to vigorously defend it. The Company filed a motion to dismiss the complaint on October 31, 2019.

OnBetween March ~~26, 2019, June 4, 2019, July 22, 2019,~~ and July ~~26,~~ 2019, the Company received shareholder litigation demands alleging breaches of fiduciary duties by certain current and former Company directors and executive officers, to the alleged injury of the Company. On June 13, 2019, a separate shareholder derivative complaint was filed in the Southern District of New York against the Company’s Board of Directors alleging that the directors breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint on July 8, 2019 and the Company agreed to treat the complaint as a litigation demand. On July 23, 2019, another separate shareholder derivative complaint was filed in the Southern District of New York against the Board of Directors alleging, among other things, that the directors breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint the same day. The allegations in the demands relate to those contained in the ongoing securities class action litigation. In response to the demands, pursuant to Virginia law, the Board of Directors has created a special committee to investigate and evaluate the claims made in the demands. In addition, four derivative complaints were filed, each making allegations against certain of the Company’s officers and directors and/or Artal and certain of its affiliates. First, on June 13, 2019, a shareholder derivative complaint was filed in the Southern District of New York against certain of the Company��s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint on July 8, 2019 and the Company agreed to treat the complaint as a litigation demand. Second, on July 23, 2019, another shareholder derivative complaint was filed in the Southern District of New York against certain of the Company’s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The plaintiff voluntarily dismissed the complaint the same day. Third, on October 25, 2019, another shareholder derivative complaint was filed in the Southern District of New York against certain of the Company’s officers and directors alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. Finally, on December 16, 2019, a shareholder derivative complaint was filed in New York Supreme Court against certain of the Company’s officers and directors, and Artal and certain of its affiliates, alleging, among other things, that the defendants breached fiduciary duties to the alleged injury of the Company. The Company believes that these actions are without merit and intends to vigorously defend them.

There have been no material changes in the risk factors from those detailed in our Annual Report on Form 10-K for fiscal ~~2018.~~2019 other than as set forth below.

The global outbreak of the COVID-19 virus is adversely impacting, and will continue to adversely impact, our business.

The global outbreak of the coronavirus (COVID-19) has had and will continue to have a significant adverse impact on our business as well as on the business environment and the markets in which we operate. This global health crisis has also had a significant adverse effect on overall economic conditions and we expect consumer demand to continue to be negatively impacted due to changes in consumer behavior and confidence and health concerns. The situation remains dynamic and subject to rapid and possibly significant change, and accordingly the magnitude and duration of the negative impact to our business from the COVID-19 pandemic cannot be predicted with certainty.

While we have taken steps to address the risks and impact of the COVID-19 pandemic, as a result of the pandemic, we have experienced significant disruption to our business, including with respect to decreases in member recruitment in both our Digital and Studio + Digital businesses as compared to the prior year period. This disruption has been more pronounced in our Studio + Digital business, in part due to our suspension in mid-March of our in-person workshops. Our member retention in both our Digital and Studio + Digital businesses may also be negatively impacted by the pandemic.

Following the suspension of our in-person workshops, we rapidly transitioned these workshops to an entirely virtual experience. This transition may not be successful in meeting the needs or preferences of many of our members, employees and the communities in which we operate and may result in further decreases in our recruitment as well as a decrease in our retention of members. The suspension of our workshops may also adversely impact our product sales. We cannot predict how long this suspension will continue as federal, state, local and foreign authorities and public health officials have adopted numerous mitigation measures to address the spread of the virus, including temporary closure requirements with respect to non-essential business operations (including our workshops) to discourage people from congregating. The duration of these requirements will also likely vary by jurisdiction. The decision to resume in-person workshops will be influenced by a number of factors, including applicable regulatory restrictions, consumer confidence and preferences and the health and safety of our employees and members, and there is substantial uncertainty regarding the manner and timing in which our studio locations can resume in-person workshops. We may face longer closure requirements than expected and other operational restrictions with respect to some or all of our studio and other physical locations due to, among other factors, evolving and stringent federal, state, local and foreign restrictions including social distancing requirements.

Even once we are able to re-open closed studio locations, changes in consumer behavior, including willingness to meet in groups, increasing unemployment levels and associated changes in household income, as well as health concerns may impact consumer demand for our products, customer traffic at our studio locations and recruitment and retention of members in both our Digital and Studio + Digital businesses. A number of our members may be more concerned with maintaining social distancing for a longer period if they perceive themselves to be a part of a higher at-risk group for complications arising from COVID-19. We may also find it more difficult to staff our business operations. The perceived risk of infection or health risk may adversely affect traffic to our studio locations and, in turn, our business, liquidity, financial condition and results of operations, particularly if any self-imposed or government-imposed restrictions are in place for a significant amount of time. In addition, government requirements may increase our operating costs on a studio-by-studio basis once a studio location re-opens due to, among other things, social distancing requirements and costs associated with increased cleaning and other sanitary or protective measures. We also anticipate that we may not re-open a significant number of our current studio locations. As a result, we anticipate one-time costs associated with restructuring and real estate realignment. The decision to re-open a studio location, if at all, or consolidate studio locations, will be influenced by a number of factors, including applicable regulatory restrictions, consumer confidence and preferences, changes in consumer behavior and the health and safety of our employees and members. We will continue to evaluate our studio locations in response to the evolving regulatory restrictions and consumer behavior. We may not be able to successfully control our studio environments and realize the intended business advantages of maintaining a select group of studio locations, which could adversely affect our Studio + Digital business and results of operations.

Our business depends on a number of third parties including vendors, landlords, lenders, marketing partners, third-party technology providers and suppliers. The COVID-19 outbreak may have a material adverse impact on these parties and their ability to meet their obligations to us. Any such failure by our third-party partners could negatively impact our ability to provide our products and services to customers. One or more of these third parties may experience financial distress, staffing shortages or liquidity challenges, file for bankruptcy protection, go out of business, or suffer disruptions in their business due to the COVID-19 outbreak. For example, the failure of any third-party technology provider to provide continuous and uninterrupted service could result in disruptions in our websites, services and products or network systems. The extent of the impact of COVID-19 on these third-party partners continues to evolve and is uncertain.

If a significant percentage of our workforce, or the workforces of our suppliers and other third-party partners, is unable to work, whether because of illness, quarantine, limitations on travel or other government restrictions in connection with COVID-19, our operations may be negatively impacted. We also depend on senior management and other key personnel and consultants, and the illness of certain personnel or consultants could result in the loss of expertise and negatively affect our operations, brand image and goodwill.

The widespread health crisis also could adversely affect the economies and financial markets of many countries in which we operate, resulting in an economic downturn that could affect consumer demand for our products and services. Our customer purchasing patterns can be influenced by economic factors. The precise impact on our business from the disruption of financial markets and the weakening of overall economic conditions cannot be predicted with certainty. Uncertainties regarding the economic impact of COVID-19 have resulted in, and are likely to continue to result in, sustained impact on the economy. Our business is particularly sensitive to reductions in discretionary consumer spending, which may be adversely impacted by a recession or fears of a recession, volatility and declines in the stock market and increasingly pessimistic consumer sentiment due to perceived or actual economic and/or health risks. Consumers may shift purchases to lower-priced or other perceived value offerings during economic downturns. Prolonged unfavorable economic conditions, including as a result of COVID-19, and any resulting recession or slowed economic growth, may have an adverse effect on our financial condition and results of operations.

Due to the negative impact of COVID-19, and the uncertainty of the magnitude and duration of such impact on our business and the economies and financial markets in which we operate, we are implementing a $100.0 million cost-savings initiative with respect to our cost structure. In connection with this initiative, we are instituting a number of measures throughout our operations to mitigate such expenses and reduce costs as well as ensure liquidity and the availability of our revolving credit facility. While we have targeted $100.0 million of potential cost-savings measures, we may not be able to recognize all identified potential savings. Even if we are able to recognize the identified savings, the magnitude of our cost-savings initiative may be insufficient to address the evolving and uncertain economic impact of COVID-19 and resulting liquidity needs. To the extent that we do not successfully manage our costs, our liquidity and financial results, as well as our ability to access our Revolving Credit Facility, may be adversely affected.

While emerging and evolving regulations impact our effective tax rate, and while we anticipate receiving certain benefits thereunder in the future, given the uncertainty of the regulatory environment, we cannot predict with certainty whether we will receive any such benefits in the future, or the extent to which we will receive such benefits, if at all.

If we are unable to generate sufficient cash or to access liquidity at the time and on terms we may require, we may encounter difficulty funding our business requirements including debt repayments when due. We may not be able to access liquidity, including our revolving credit facility, or the terms and conditions of available credit may be substantially more expensive than previously expected due to changes in financial conditions and credit markets. We may require waivers or amendments to our existing long-term debt and these requirements may trigger pricing increases from lenders for available credit. Reductions in our liquidity position and the need to use capital for other day to day requirements of our business may affect a number of our business initiatives and long-term investments and as a result we may be required to curtail and/or postpone business investments as well as other initiatives that require capital investment.

We have implemented emergency pay policies and taken other compensation and benefit actions to support our employees during the COVID-19 business interruption, but those actions may not be sufficient to compensate them for the entire duration of any business interruption resulting from COVID-19. Those employees might seek and find other employment during that interruption, or might otherwise choose not to return to their positions, which could materially adversely affect our ability to properly staff and re-open our studio locations with experienced teams when the business interruptions caused by COVID-19 abate or end.

The COVID-19 pandemic (including governmental responses, broad economic impacts and market disruptions) has heightened the risks related to the other risk factors described in our Annual Report on Form 10-K for fiscal 2019.

We may not be able to successfully accelerate or implement our strategic digital transformation, which could adversely impact our business, financial conditions or results of operations.

We are accelerating our strategic digital transformation. This acceleration began with the launch of virtual workshops in March 2020 when we suspended our in-person workshops in response to COVID-19. We expect to continue to evolve our virtual experience and offerings for our members. For example, we continue to work towards the launch of a new digitally-enabled, community-focused and coach-led offering later this year, which will reflect learnings from our current virtual workshops and ongoing test pilots. We are reallocating certain resources and will incur additional costs to support this acceleration. This transition to a more virtual experience may not be successful in meeting the needs or preferences of many of our current or potential members. As a result, we may experience decreases in our recruitment and retention of members, or increased member cancellations, in our Studio + Digital business. Additionally, we may also find it difficult to transition our coaches from in-person coaching to virtual coaching, which may negatively affect our ability to properly staff virtual workshops with experienced coaches. We may not be able to successfully launch our new virtual or other digital offerings and realize the intended business opportunities, growth prospects, including new business channels, and competitive advantages of our digital transformation. Assumptions underlying expected financial results or consumer demand and receptivity may not be met or economic or consumer conditions may deteriorate, including as a result of the impact of COVID-19, and may adversely impact our ability to successfully implement this digital strategy. If these or other factors limit our ability to successfully execute this strategic initiative, our business, financial conditions or results of operations may be adversely impacted.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	WW	The Nasdaq Stock Market LLC

		Page No.

PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements		2

	Unaudited Consolidated Balance Sheets at ~~June 29, 2019~~March 28, 2020 and December ~~29, 2018~~28, 2019		2

	Unaudited Consolidated Statements of Net Income for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019 ~~and June 30, 2018~~		3

	Unaudited Consolidated Statements of Comprehensive Income for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019 ~~and June 30, 2018~~		4

	Unaudited Consolidated Statements of Changes in Total Deficit for the three ~~and six~~ months ended ~~June 29,~~March 28, 2020 and March 30, 2019 ~~and June 30, 2018~~		5

	Unaudited Consolidated Statements of Cash Flows for the ~~six~~three months ended ~~June 29,~~March 28, 2020 and March 30, 2019 ~~and June 30, 2018~~		76

	Notes to Unaudited Consolidated Financial Statements		87

Cautionary Notice Regarding Forward-Looking Statements			2623

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		2725

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		4540

Item 4.	Controls and Procedures		4640

PART II—OTHER INFORMATION

Item 1.	Legal Proceedings		4741

Item 1A.	Risk Factors		4741

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		4744

Item 3.	Defaults Upon Senior Securities		4744

Item 4.	Mine Safety Disclosures		4744

Item 5.	Other Information		4744

Item 6.	Exhibits		4844

Signatures			4945

	~~June 29, 2019~~
~~Weighted Average Remaining Lease Term (years)~~
~~Operating leases~~		~~7.22~~
~~Finance leases~~		~~1.66~~

~~Weighted Average Discount Rate~~
~~Operating leases~~		~~7.04~~
~~Finance leases~~		~~4.33~~

	March 28, 2020		December 28, 2019
Weighted Average Remaining Lease Term (years)
Operating leases		6.94		7.06
Finance leases		2.29		2.43

Weighted Average Discount Rate
Operating leases		6.95		7.02
Finance leases		6.01		5.97

	Three Months Ended
	March 28,		March 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	12,701	$	12,742
Operating cash flows from finance leases	$	3	$	8
Financing cash flows from finance leases	$	64	$	80

Leased assets obtained in exchange for new operating lease liabilities	$	8,488	$	887
Leased assets obtained in exchange for new finance lease liabilities	$	0	$	0

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

					Weight Watchers International, Inc.

															Accumulated
	Redeemable														Other
Three Months Ended June 29, 2019	Noncontrolling				Common Stock				Treasury Stock						Comprehensive			Retained
	Interest				Shares		Amount		Shares			Amount			Loss			Earnings			Total
Balance at March 30, 2019		$	3,868			120,352	$	0		53,375		$	(3,174,871	)	$	(19,966	)	$	2,375,903			$	(818,934	)

Comprehensive income (loss)			(105	)												(6,743	)		53,834				47,091

Issuance of treasury stock under stock plans										(286	)		10,462						(13,651	)			(3,189	)
Compensation expense on share- based awards																			4,872				4,872
Balance at June 29, 2019		$	3,763			120,352	$	0		53,089		$	(3,164,409	)	$	(26,709	)	$	2,420,958			$	(770,160	)

2019	$	63,261
2020		38,491
2021		22,341
2022		14,017
2023		9,192
2024 and thereafter		37,704
Total	$	185,006

	Three Months Ended June 30, 2018
	North		Continental		United
	America		Europe		Kingdom		Other		Total
Digital Subscription Revenues	$	101,099	$	39,342	$	6,955	$	3,622	$	151,018
Studio + Digital Fees		142,767		29,402		14,551		5,992		192,712
Service Revenues, net	$	243,866	$	68,744	$	21,506	$	9,614	$	343,730
Product sales and other, net		40,672		12,848		7,704		4,793		66,017
Revenues, net	$	284,538	$	81,592	$	29,210	$	14,407	$	409,747

	Six Months Ended June 29, 2019
	North		Continental		United
	America		Europe		Kingdom		Other		Total
Digital Subscription Revenues	$	201,611	$	83,769	$	13,411	$	7,033	$	305,824
Studio + Digital Fees		234,557		47,630		22,761		9,722		314,670
Service Revenues, net	$	436,168	$	131,399	$	36,172	$	16,755	$	620,494
Product sales and other, net		69,488		22,087		12,964		7,155		111,694
Revenues, net	$	505,656	$	153,486	$	49,136	$	23,910	$	732,188

	Deferred		Deferred
	Revenue		Revenue-Long Term
Balance as of December 29, 2018	$	53,501	$	961
Net increase (decrease) during the period		3,422		(492	)
Balance as of June 29, 2019	$	56,923	$	469

	June 29, 2019				December 29, 2018
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
Capitalized software costs	$	129,091	$	108,034	$	121,508	$	102,659
Website development costs		113,882		86,710		105,710		77,825
Trademarks		11,756		11,116		11,620		11,010
Other		14,021		4,399		13,967		4,149
Trademarks and other intangible assets	$	268,750	$	210,259	$	252,805	$	195,643
Franchise rights acquired		8,120		4,452		8,110		4,319
Total finite-lived intangible assets	$	276,870	$	214,711	$	260,915	$	199,962

Remainder of fiscal 2019	$	12,273
Fiscal 2020	$	22,175
Fiscal 2021	$	13,046
Fiscal 2022	$	3,533
Fiscal 2023 and thereafter	$	11,132

Remainder of fiscal 2020	$	20,432
Fiscal 2021	$	20,233
Fiscal 2022	$	10,169
Fiscal 2023	$	1,992
Fiscal 2024 and thereafter	$	10,181

			Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate swap liability at June 29, 2019	$	19,330	$	0	$	19,330	$	0
Interest rate swap asset at December 29, 2018	$	3,924	$	0	$	3,924	$	0
Interest rate swap liability at December 29, 2018	$	5,578	$	0	$	5,578	$	0

	Six Months Ended June 30, 2018
	(Loss) Gain on Qualifying Hedges			Loss on Foreign Currency Translation			Total
Beginning Balance at December 30, 2017	$	(5,392	)	$	(5,075	)	$	(10,467	)
Other comprehensive income (loss) before reclassifications, net of tax		7,236			(5,396	)		1,840
Amounts reclassified from accumulated other comprehensive loss, net of tax(b)		1,942		0				1,942
Adoption of accounting standard		(1,161	)		(1,324	)		(2,485	)
Net current period other comprehensive income (loss) including noncontrolling interest		8,017			(6,720	)		1,297
Less: net current period other comprehensive loss attributable to the noncontrolling interest	0				373			373
Ending Balance at June 30, 2018	$	2,625		$	(11,422	)	$	(8,797	)

			Operating
	Operating		Income
(in millions except percentages)	Income		Margin
First Quarter of Fiscal 2020	$	24.9		6.2	%
Adjustments to Reported Amounts ⁽¹⁾
Goodwill impairment		3.7
Total Adjustments ⁽¹⁾		3.7
First Quarter of Fiscal 2020, as adjusted ⁽¹⁾	$	28.5		7.1	%

	(In millions, except per share amounts)
	For The Six Months Ended												% Change
	June 29, 2019			June 30, 2018			Increase/ (Decrease)			% Change			Constant Currency
Revenues, net	$	732.2		$	818.0		$	(85.8	)		(10.5	%)		(8.3	%)
Cost of revenues		315.4			352.2			(36.8	)		(10.4	%)		(8.4	%)

Gross profit		416.8			465.8			(49.0	)		(10.5	%)		(8.3	%)
Gross Margin %		56.9	%		56.9	%

Marketing expenses		164.2			154.3			9.9			6.4	%		9.6	%
Selling, general & administrative expenses		125.2			121.7			3.5			2.9	%		4.8	%
Operating income		127.4			189.8			(62.4	)		(32.9	%)		(31.2	%)
Operating Income Margin %		17.4	%		23.2	%

Interest expense		69.9			71.7			(1.8	)		(2.5	%)		(2.5	%)
Other expense, net		0.7			1.1			(0.4	)		32.4	%		32.4	%
Income before income taxes		56.7			116.9			(60.2	)		(51.5	%)		(48.8	%)

Provision for income taxes		13.7			7.2			6.5			90.2	%	100.0		%	*
Net income		43.0			109.7			(66.8	)		(60.8	%)		(58.8	%)
Net loss attributable to the noncontrolling interest		0.2			0.1		��	0.1			74.4	%		86.2	%

Net income attributable to Weight Watchers International, Inc.	$	43.1		$	109.8		$	(66.7	)		(60.7	%)		(58.7	%)

Weighted average diluted shares outstanding		69.3			69.9			(0.6	)		(0.9	%)		(0.9	%)
Diluted earnings per share	$	0.62		$	1.57		$	(0.95	)		(60.3	%)		(58.3	%)


	First Half of 2019
	GAAP									Constant Currency
				Product									Product						Total
	Service			Sales &			Total			Service			Sales &			Total			Paid			Incoming			EOP
	Revenues			Other			Revenues			Revenues			Other			Revenues			Weeks			Subscribers			Subscribers
																						(in thousands)
North America	$	436.2		$	69.5		$	505.7		$	437.4		$	69.7		$	507.1			77.0			2,558.5			2,940.7
CE		131.4			22.1			153.5			141.0			23.7			164.7			29.4			940.2			1,137.6
UK		36.2			13.0			49.1			38.5			13.8			52.2			10.4			333.7			387.0
Other ⁽¹⁾		16.8			7.2			23.9			18.3			7.5			25.8			2.8			100.0			102.8
Total	$	620.5		$	111.7		$	732.2		$	635.2		$	114.7		$	749.9			119.5			3,932.3			4,568.1

	% Change First Half of 2019 vs. First Half of 2018
North America		(8.4	%)		(20.6	%)		(10.3	%)		(8.2	%)		(20.3	%)		(10.0	%)		(1.5	%)		20.9	%		(1.9	%)
CE		(1.9	%)		(26.7	%)		(6.5	%)		5.3	%		(21.3	%)		0.4	%		11.8	%		30.0	%		11.5	%
UK		(14.8	%)		(23.9	%)		(17.4	%)		(9.4	%)		(19.1	%)		(12.2	%)		0.5	%		12.7	%		0.9	%
Other ⁽¹⁾		(15.0	%)		(34.5	%)		(21.9	%)		(7.0	%)		(31.5	%)		(15.8	%)		0.8	%		27.8	%		2.0	%
Total		(7.7	%)		(23.3	%)		(10.5	%)		(5.5	%)		(21.2	%)		(8.3	%)		1.7	%		22.4	%		1.5	%

	Balance
Term Loan Facility due November 29, 2024	$	1,374.5
Notes due December 1, 2025		300.0
Total		1,674.5
Less: Current Portion		57.8
Unamortized Deferred Financing Costs		8.5
Unamortized Debt Discount		23.8
Total Long-Term Debt	$	1,584.5

Exhibit Number		Description

†**Exhibit ~~10.1~~3.1		~~Separation Agreement, dated~~Amended and Restated Bylaws of WW International, Inc. (effective as of ~~May 30, 2019,~~March 17, 2020) (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K, as filed on March 17, 2020 (File No. 001-16769), and incorporated herein by ~~and between Stacey Mowbray and Weight Watchers International, Inc~~reference)..

*Exhibit 31.1		Rule 13a-14(a) Certification by Mindy Grossman, Chief Executive Officer.

*Exhibit 31.2		Rule 13a-14(a) Certification by Nicholas P. Hotchkin, Chief Financial Officer.

*Exhibit 32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*Exhibit 101

*EX-101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

*EX-101.SCH		Inline XBRL Taxonomy Extension Schema Document

*EX-101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

*EX-101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

*EX-101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

*EX-101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

*Exhibit 104		The cover page from ~~Weight Watchers~~WW International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended ~~June 29, 2019,~~March 28, 2020, formatted in Inline XBRL (included within the Exhibit 101 attachments).


	~~WEIGHT WATCHERS~~WW INTERNATIONAL, INC.

Date: ~~August 7, 2019~~April 28, 2020	By:	/s/ Mindy Grossman
		Mindy Grossman
		President, Chief Executive Officer and Director (Principal Executive Officer)


Date: ~~August 7, 2019~~April 28, 2020	By:	/s/ Nicholas P. Hotchkin
		Nicholas P. Hotchkin
		Chief Financial Officer, Operating Officer, North America and President, Emerging Markets (Principal Financial Officer)