The Joint Corp.

Second-quarter revenue increased 14% year over year to $15.2 million. Adjusted EBITDA from continuing operations was $1.5 million versus $88,000 in Q2 2025; consolidated adjusted EBITDA was $3.2 million, in line with last year. Consolidated net income was $653,000 versus $93,000 a year ago, and net loss from continuing operations narrowed to $251,000 from $990,000. Cash flow from operating activities rose 152% year over year to $2.2 million, and free cash flow increased by $1.6 million to $1.9 million. System-wide sales were $128 million, down 3.7%, and comp sales were negative 2.8%, improving 140 basis points from Q1. For full-year 2026, management reiterated system-wide sales of $519 million to $552 million, comp sales of negative 3% to positive 3%, and consolidated adjusted EBITDA of $12.5 million to $13.5 million. New clinic openings are now expected to be 22 to 26 versus prior guidance of 30 to 35. Management said the back half of 2026 should see improving comps, with Q4 expected to be higher than Q3.

Sanjiv Razdan framed the quarter as continued execution on Joint 2.0, emphasizing that the company is becoming a capital-light, pure-play franchisor. He highlighted the best retention rate in over five years, stronger active member trends, and a marketing push aimed at winning back lapsed patients and improving patient lifetime value. His tone was constructive and strategic, with a focus on building what he called the foundation for “The Joint 3.0” through refranchising, innovation, and consumer-facing improvements.

Scott Bowman focused on the financial leverage emerging from refranchising, citing revenue growth of 14% to $15.2 million, adjusted EBITDA from continuing operations of $1.5 million, and free cash flow of $1.9 million. He noted $22.2 million of unrestricted cash, a fully undrawn $20 million revolver available through August 2029, and $677,000 of share repurchases for about 82,000 shares at $8.23 per share. He also said about $500,000 of SG&A tied to RD buybacks and one-time refranchising costs should not recur, and restated the post-refranchising starting-point targets of 83% to 85% gross margin, 40% to 42% G&A, and 60% to 70% free cash flow conversion.

Analysts pressed on AI search optimization, lapsed-patient behavior, pricing impact, comp trends, and the profitability model. Management said it is monitoring AI search through local franchisee feedback, dedicated digital resources, and objective measurement, with its AI search score moving from 71 to the high 70s. On lapsed patients, management said the main reasons are pain easing, time constraints, and cost, and said flexible plans such as Align One have boosted conversion by several hundred basis points. On pricing, management said the benefit was in the low single-digit range and should move toward the high end of that range as more clinics adopt it; July comps were said to be slightly better than the end of Q2.