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6 NAUTILUS Nautilus , Inc. Delivers 2nd Consecutive Record - Breaking Quarter May 10 , 2021 Net Sales Increased 120 % to $ 206 million , the highest quarterly sales in company history Operating Income of $ 39.7 million is third - highest in company history EBITDA was $ 40.4 million compared to $ 2.3 million last year Provides First Quarter 2022 Guidance and Updates Fiscal Year 2026 Operating Margin Targets VANCOUVER , Wash .-- ( BUSINESS WIRE ) -- May 10 , 2021-- Nautilus , Inc. ( NYSE : NLS ) today reported its unaudited operating results for the three - month transition period ended March 31 , 2021. As previously disclosed , the Company changed its fiscal year from the twelve months beginning January 1 and ending December 31 to the twelve months beginning April 1 and ending March 31 in order to include the primary fitness season for exercise equipment , October to March , in the same fiscal year . In addition , the new fiscal year - end is better aligned with the fiscal year- end of the Company's retail partners . As a result throughout this press release , the three - month period ended March 31 , 2021 is referred to as the " Transition Period . " Transition Period Highlights Compared to the Same Period Last Year ( 3 - months ending 3/31/2020 ) • Net sales were $ 206.1 million , up 119.9 % compared to $ 93.7 million for the same period last year and up 143.3 % , excluding sales related to the Octane brand , which was sold in October 2020. Sales growth was driven primarily by continued demand for connected fitness bikes and treadmills , like the Bowflex VeloCore® bike and T22 Treadmill , and Inc robust sales of SelectTech® weights . Strong execution across the organization coupled with supply chain improvements that began last year drove record results . • Gross profit was $ 79.1 million , up 122.2 % compared to $ 35.6 million for the same period last year . Gross margin rates expanded by 40 basis points to 38.4 % this year compared to 38.0 % for the same period last year . Improved fixed costs leverage in the Retail segment offset margin pressures from inflationary price increases in commodities , FX , and continued elevated transportation costs driven by global logistics disruptions . • Operating expenses increased by $ 3.2 million , or 8.9 % , to $ 39.4 million primarily due to increased general and administrative costs . • Operating income was $ 39.7 million , a $ 40.3 million improvement compared to a loss $ 0.6 million for the same period last year . • EBITDA was $ 40.4 million compared to $ 2.3 million for the same period last year driven higher due to increased operating income . • Income from continuing operations improved to $ 30.6 million , or $ 0.94 per diluted share , compared to $ 2.3 million , or $ 0.08 per diluted share , for the same period last year . • Net income was $ 30.4 million , or $ 0.93 per diluted share , compared to $ 2.2 million , or $ 0.07 per diluted share , for the same period last year . . The effective tax rate for the Transition Period was 19.9 % . Management Comments " Our team delivered its second consecutive quarter of record - breaking results and posted the highest quarterly revenue in our Company's 35 - year history . Net revenue of $ 206 million exceeded the high end of guidance , growing 120 % versus last year , or 143 % excluding the divested Octane business . Growth was strong across both segments with Direct crossing $ 100 million for the first time and Retail delivering quarterly revenue second only to last quarter's sales . In addition , our international business experienced 340 % growth excluding Octane and we generated $ 39.7 million of operating income in the quarter , " said Jim Barr , Nautilus Inc. Chief Executive Officer . Mr. Barr continued , " As we enter this new fiscal year , our entire organization is focused on advancing North Star , our recently unveiled digital transformation plan . We are investing in increased marketing , expanded supply chain capabilities , and in continuing enhancements to our JRNYⓇ platform to meet our goal of 250,000 members by the end of fiscal year 2022. These investments combined with our new embedded digital offerings , deep innovation pipeline , and a strong balance sheet position us well to execute on our North Star strategy and deliver sustainable long - term growth and profitability . " Transition Period Segment Results Compared to First Calendar Quarter of 2020 Direct Segment • Direct delivered its best quarterly sales in segment history . Net sales were $ 101.5 million , up 115.4 % compared to the same period last year . • Strength product sales grew 178.6 % , led by the popular SelectTech® weights and Bowflex® Home Gyms . Cardio sales increased 95.5 % , driven by connected - fitness bikes and treadmills . The latest addition to the Max Trainer® line , the M9 ,