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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

     ☐

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___ to

Commission File Number: 001-38843

OneSpaWorld Holdings Limited

(Exact name of Registrant as Specified in its Charter)


Commonwealth of The Bahamas		Not Applicable
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Harry B. Sands, Lobosky Management Co. Ltd. Office Number 2 Pineapple Business Park Airport Industrial Park P.O. Box N-624 Nassau, Island of New Providence, Commonwealth of The Bahamas		Not Applicable
(Address of principal executive offices)		(Zip Code)

(242) 322-2670

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange
on which registered

     Common Shares, par value (U.S.)
$0.0001 per share

     OSW

     The Nasdaq Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Sections 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 ☒

As of July 28, 2025, the registrant had 102,697,235 voting common shares issued and outstanding.

OneSpaWorld Holdings Limited

Table of Contents


		Page
PART I - FINANCIAL INFORMATION		1

Item 1.	Unaudited Financial Statements	1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	28

Item 4.	Controls and Procedures	28

PART II - OTHER INFORMATION		29

Item 1.	Legal Proceedings	29

Item 1A.	Risk Factors	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 4.	Mine Safety Disclosures	29

Item 5.	Other Information	29

Item 6.	Exhibits	29

PART I - FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share and par value data)



	As of
	June 30, 2025			December 31, 2024
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	35,028		$	57,439
Restricted cash		1,198			1,198
Accounts receivable, net		47,309			46,264
Inventories, net		56,433			46,748
Prepaid expenses		6,064			3,849
Other current assets		7,376			6,007
Total current assets		153,408			161,505
Property and equipment, net		19,752			17,678
Operating lease right-of-use assets, net		12,880			13,898
Intangible assets, net		521,765			530,032
OTHER ASSETS:
Deferred tax asset		1,233			1,233
Other non-current assets		22,780			22,077
Total other assets		24,013			23,310
Total assets	$	731,818		$	746,423
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Accounts payable	$	33,078		$	29,748
Accrued expenses		40,016			41,218
Current portion of operating leases		2,502			2,555
Current portion of long-term debt		5,000			5,000
Other current liabilities		794			884
Total current liabilities		81,390			79,405
Other long-term liabilities		218			7,333
Long-term operating leases		10,680			11,631
Long-term debt, net		91,202			93,557
Total liabilities		183,490			191,926
Commitments and contingencies (Note 12)
SHAREHOLDERS' EQUITY:
Common stock:
Voting common stock, $0.0001 par value; 225,000,000 shares authorized, 102,697,235 issued and outstanding at June 30, 2025 and 104,551,189 shares issued and outstanding at December 31, 2024		10			10
Additional paid-in capital		814,701			833,979
Accumulated deficit		(265,924	)		(279,889	)
Accumulated other comprehensive (loss) income		(459	)		397
Total shareholders' equity		548,328			554,497
Total liabilities and shareholders' equity	$	731,818		$	746,423

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per share data)


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
REVENUES:
Service revenues	$	193,358		$	180,846		$	371,877		$	353,055
Product revenues		47,368			44,045			88,479			83,062
Total revenues		240,726			224,891			460,356			436,117
COST OF REVENUES AND OPERATING EXPENSES:
Cost of services		161,250			150,801			309,404			294,826
Cost of products		39,984			37,138			75,281			70,668
Administrative		4,410			4,740			8,623			8,797
Salaries, benefits and payroll taxes		8,821			9,230			19,816			17,723
Amortization of intangible assets		4,134			4,143			8,268			8,287
Total cost of revenues and operating expenses		218,599			206,052			421,392			400,301
Income from operations		22,127			18,839			38,964			35,816
OTHER (EXPENSE) INCOME
Interest expense, net		(1,395	)		(2,221	)		(2,542	)		(5,176	)
Change in fair value of warrant liabilities		—			(46	)		—			7,677
Total other (expense) income		(1,395	)		(2,267	)		(2,542	)		2,501
Income before income tax expense		20,732			16,572			36,422			38,317
INCOME TAX EXPENSE		792			813			1,211			1,392
NET INCOME	$	19,940		$	15,759		$	35,211		$	36,925
NET INCOME PER SHARE
Basic	$	0.19		$	0.15		$	0.34		$	0.36
Diluted	$	0.19		$	0.15		$	0.34		$	0.35
WEIGHTED-AVERAGE SHARES OUTSTANDING
Basic		103,211			105,123			103,903			103,292
Diluted		103,620			105,767			104,345			104,346

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(in thousands)


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Net income	$	19,940		$	15,759		$	35,211		$	36,925
Other comprehensive loss, net of tax:
Foreign currency translation adjustments		234			(77	)		345			(115	)
Cash flows hedges:
Net unrealized (loss) gain on derivative		(186	)		75			(745	)		342
Amount realized and reclassified into earnings		(228	)		(945	)		(456	)		(1,892	)
Total other comprehensive loss, net of tax		(180	)		(947	)		(856	)		(1,665	)
Total comprehensive income	$	19,760		$	14,812		$	34,355		$	35,260

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

(in thousands)


				Three Months Ended June 30, 2025
	Issued Common Voting Shares			Voting Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Shareholders’ equity
BALANCE, March 31, 2025		102,697		$	10	$	816,697		$	(279	)	$	(285,864	)	$	530,564
Net income		—			—		—			—			19,940			19,940
Stock-based compensation		—			—		2,112			—			—			2,112
Foreign currency translation adjustment		—			—		—			234			—			234
Unrecognized loss on derivatives		—			—		—			(414	)		—			(414	)
Dividends (1)		—			—		(4,108	)		—			—			(4,108	)
BALANCE, June 30, 2025		102,697		$	10	$	814,701		$	(459	)	$	(265,924	)	$	548,328

				Six Months Ended June 30, 2025
	Issued Common Shares			Voting Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Accumulated Deficit			Total Shareholders’ equity
BALANCE, December 31, 2024		104,551		$	10	$	833,979		$	397		$	(279,889	)	$	554,497
Net income		—			—		—			—			35,211			35,211
Stock-based compensation		—			—		5,672			—			—			5,672
Foreign currency translation adjustment		—			—		—			345			—			345
Repurchase and retirement of common shares (1)		(2,094	)		—		(16,655	)		—			(21,246	)		(37,901	)
Unrecognized loss on derivatives		—			—		—			(1,201	)		—			(1,201	)
Dividends (1)		—			—		(8,295	)		—			—			(8,295	)
Common shares issued under equity incentive plan		240			—		—			—			—			—
BALANCE, June 30, 2025		102,697		$	10	$	814,701		$	(459	)	$	(265,924	)	$	548,328

(1) See Note 5 – “Equity” for further details.

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

(in thousands)

(CONTINUED)


				Three Months Ended June 30, 2024
	Issued Common Shares			Voting Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Accumulated Deficit			Total Shareholders’ equity
BALANCE, March 31, 2024		104,714		$	10	$	841,113		$	737		$	(326,324	)	$	515,536
Net income		—			—		—			—			15,759			15,759
Stock-based compensation		—			—		2,094			—			—			2,094
Foreign currency translation adjustment		—			—		—			(77	)		—			(77	)
Unrecognized loss on derivatives		—			—		—			(870	)		—			(870	)
Cashless exercise of warrants		—			—		209			—			—			209
BALANCE, June 30, 2024		104,714		$	10	$	843,416		$	(210	)	$	(310,565	)	$	532,651

				Six Months Ended June 30, 2024
	Issued Common Shares			Voting Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Accumulated Deficit			Total Shareholders’ equity
BALANCE, December 31, 2023		99,735		$	10	$	777,062		$	1,455		$	(344,458	)	$	434,069
Net income		—			—		—			—			36,925			36,925
Stock-based compensation		—			—		4,188			—			—			4,188
Foreign currency translation adjustment		—			—		—			(115	)		—			(115	)
Repurchase and retirement of common shares		(606	)		—		(4,704	)		—			(3,032	)		(7,736	)
Unrecognized loss on derivatives		—			—		—			(1,550	)		—			(1,550	)
Accrued dividends cancelled on common stock		—			—		2,449			—			—			2,449
Exercise of Sponsor and Public Warrants		4,503			—		57,628			—			—			57,628
Cashless exercise of 2020 PIPE Warrants		484			—		6,793			—			—			6,793
Common shares issued under equity incentive plan		598			—		—			—			—			—
BALANCE, June 30, 2024		104,714		$	10	$	843,416		$	(210	)	$	(310,565	)	$	532,651

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	35,211		$	36,925
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		12,430			12,079
Amortization of deferred financing costs		154			618
Change in fair value of warrant liabilities		—			(7,677	)
Stock-based compensation		5,672			4,188
Provision for doubtful accounts		9			9
Loss from write-offs of property and equipment		—			67
Noncash lease expense		14			76
Changes in:
Accounts receivable, net		(1,054	)		(5,107	)
Inventories, net		(9,685	)		4,453
Prepaid expenses		(2,215	)		(797	)
Other current assets		(1,641	)		(794	)
Other non-current assets		(3,199	)		(22,100	)
Accounts payable		3,330			3,080
Accrued expenses		(8,535	)		1,439
Other current liabilities		(90	)		(150	)
Other long-term liabilities		—			7,333
Net cash provided by operating activities		30,401			33,642
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(4,426	)		(2,322	)
Net cash used in investing activities		(4,426	)		(2,322	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of warrants		—			51,698
Repurchase of common shares		(37,901	)		(7,736	)
Repayment on first lien and term loan facilities		(2,500	)		(35,000	)
Payment of deleveraging fee on term loan facilities		—			(5,420	)
Payment of deferred financing costs		(9	)		—
Dividends		(8,295	)		—
Net cash (used in) provided by financing activities		(48,705	)		3,542
Effect of exchange rate changes on cash, cash equivalents and restricted cash		319			(98	)
Net (decrease) increase in cash, cash equivalents and restricted cash		(22,411	)		34,764
Cash, cash equivalents and restricted cash, Beginning of period		58,637			28,902
Cash, cash equivalents and restricted cash, End of period	$	36,226		$	63,666

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(CONTINUED)

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2025		2024
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes	$	1,941	$	2,244
Interest	$	3,161	$	6,987
Non-cash financing transactions:
Cashless exercise of warrants	$	—	$	6,793
Accrued dividends cancelled on common stock	$	—	$	2,449

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

ONESPAWORLD HOLDINGS LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2025

(Unaudited)

1. DESCRIPTION OF BUSINESS

OneSpaWorld Holdings Limited (“OneSpaWorld,” the “Company,” “we,” “us,” or “our”) is an international business company incorporated under the laws of the Commonwealth of The Bahamas. OneSpaWorld is a global provider and innovator in the fields of health and wellness, fitness and beauty. In facilities on cruise ships and in land-based destination resorts, the Company strives to create a relaxing and therapeutic environment where guests can receive health and wellness, fitness and beauty services and experiences of the highest quality. The Company’s services include traditional and alternative massage, body and skin treatments, fitness, acupuncture, and medi-spa treatments. The Company also sells premium quality health and wellness, fitness and beauty products at its facilities and through its timetospa.com website. The predominant business, based on revenues, is sales of services and products on cruise ships and in land-based destination resorts, followed by sales of products through the timetospa.com website.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation, Principles of Consolidation

In the opinion of management, the accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in quarterly financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been omitted or condensed pursuant to the SEC’s rules and regulations. However, management believes that the disclosures contained herein are adequate to make the information presented not misleading. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments (which are of a normal recurring nature) necessary to present fairly our unaudited financial position, results of operations and cash flows. The unaudited results of operations and cash flows of our interim periods are not necessarily indicative of the results of operations or cash flows that may be expected for the entire fiscal year. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”). The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Actual results could differ from those estimates. The accompanying unaudited condensed consolidated financial statements include the condensed consolidated balance sheet and statement of operations, comprehensive income, changes in equity, and cash flows of OneSpaWorld. All significant intercompany items and transactions have been eliminated in consolidation.

Restricted Cash

These balances include amounts held in escrow accounts, as a result of a legal proceeding related to a tax assessment. See Note 12-"Commitments and Contingencies" for further information. The following table reconciles cash, cash equivalents and restricted cash reported in our condensed consolidated balance sheet as of June 30, 2025 and 2024 to the total amount presented in our condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024 (in thousands):


	Balance as of June 30,
	2025		2024
Cash and cash equivalents	$	35,028	$	62,468
Restricted cash		1,198		1,198
Total cash and restricted cash in the condensed consolidated statement of cash flows	$	36,226	$	63,666

Inventories

Inventories, consisting principally of beauty, health and wellness products, are stated at the lower of cost, as determined on a first-in, first-out basis, or market. All inventory balances are comprised of finished goods used in beauty and health and wellness services or held for sale to customers. Inventory reserve is recorded to write down the cost of inventory to the estimated market value. No inventory impairment charge was recorded for the three and six months ended June 30, 2025 and 2024.

Other Assets-Deferred Costs

Costs incurred to enter into new or renew long-term contracts are capitalized and amortized to cost of revenues over the term of the contract. Deferred contract costs, which relate to fees accrued to cruise line partners, amounted to $22.4 million and $21.0 million as of June 30, 2025 and December 31, 2024, respectively, and is presented within other non-current assets in the accompanying condensed consolidated balance sheets. Amortization of the deferred contract costs for the three months ended June 30, 2025 and 2024 was $0.9 million for each period, respectively.

Amortization of the deferred contract costs was $1.8 million and $1.9 million for the six months ended June 30, 2025 and 2024, respectively. Amortization of deferred costs are included in cost of services in the accompanying condensed consolidated statements of operations.

Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income adjusted for the change in fair value of warrant liabilities, if the impact is dilutive, by the weighted average number of diluted shares, as calculated under the treasury stock method, which includes the potential effect of dilutive common stock equivalents, such as options and warrants to purchase common shares, and contingently issuable shares. If the entity reports a net loss, rather than net income for the period, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, if their effect is anti-dilutive.

The following table provides details underlying OneSpaWorld’s income per basic and diluted share calculation (in thousands, except per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Numerator:
Net income	$	19,940	$	15,759	$	35,211	$	36,925
Denominator:
Weighted average shares outstanding – Basic		103,211		105,123		103,903		103,292
Dilutive effect of warrants		—		11		—		437
Dilutive effect of stock-based awards		409		633		442		617
Weighted average shares outstanding – Diluted		103,620		105,767		104,345		104,346
Net income per voting and non-voting share:
Basic	$	0.19	$	0.15	$	0.34	$	0.36
Diluted	$	0.19	$	0.15	$	0.34	$	0.35

The table below presents the number of antidilutive potential common shares that are not considered in the calculation of diluted income per share (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Performance stock units		181		—		181		—
		181		—		181		—

Recent Accounting Pronouncements

With the exception of those discussed below, there have been no recent accounting pronouncements or changes in accounting pronouncements that are of significance, or potential significance, to the Company. The following summary of recent accounting pronouncements is not intended to be an exhaustive description of the respective pronouncement.

In December 2023, the FASB issued ASU No. 2023-09 ("ASU 2023-09"), Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires, among other things, the following for public business entities: (i) enhanced disclosures of specific categories of reconciling items included in the rate reconciliation, as well as additional information for any of these items meeting certain qualitative and quantitative thresholds; (ii) disclosure of the nature, effect and underlying causes of each individual reconciling item disclosed in the rate reconciliation and the judgment used in categorizing them if not otherwise evident; and (iii) enhanced disclosures for income taxes paid, which includes federal, state, and foreign taxes, as well as for individual jurisdictions over a certain quantitative threshold. The amendments in ASU 2023-09 eliminate the requirement to disclose the nature and estimate of the range of the reasonably possible change in unrecognized tax benefits for the 12 months after the balance sheet date. The provisions of ASU 2023-09 are effective for annual periods beginning after December 15, 2024; early adoption is permitted. The Company is currently assessing the expected impact of the future adoption of this guidance.

In November 2024, the FASB issued ASU No. 2024-03 ("ASU 2024-03"), Income Statement - Reporting Comprehensive Income -Expense Disaggregation Disclosures (Subtopic 220-40) amending existing income statement disclosure guidance, primarily requiring more detailed disclosure for expenses. The provisions of ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The amendments can be applied on either a prospective or retroactive basis. The Company is currently assessing the expected impact of the future adoption of this guidance.

3. INTANGIBLE ASSETS

Intangible assets consist of finite and indefinite life assets. The following is a summary of the Company’s intangible assets as of June 30, 2025 (in thousands, except amortization period):


	Cost		Accumulated Amortization and Impairment			Net Balance		Weighted Average Amortization Period (in years)
Retail concession agreements	$	604,700	$	(97,443	)	$	507,257		39
Destination resort agreements		17,900		(8,892	)		9,008		15
Trade name		6,200		(700	)		5,500	Indefinite-life
Licensing agreement		1,000		(1,000	)		-	8
	$	629,800	$	(108,035	)	$	521,765

The following is a summary of the Company’s intangible assets as of December 31, 2024 (in thousands, except amortization period):


	Cost		Accumulated Amortization and Impairment			Net Balance		Weighted Average Amortization Period (in years)
Retail concession agreements	$	604,700	$	(89,691	)	$	515,009		39
Destination resort agreements		17,900		(8,377	)		9,523		15
Trade name		6,200		(700	)		5,500	Indefinite-life
Licensing agreement		1,000		(1,000	)		-		8
	$	629,800	$	(99,768	)	$	530,032

The Company amortizes intangible assets with definite lives on a straight-line basis over their estimated useful lives. Amortization expense was $4.1 million for each of the three-month periods ended June 30, 2025 and 2024. Amortization expense was $8.3 million for each of the six-month periods ended June 30, 2025 and 2024. Amortization expense is estimated to be $16.5 million in each of the next five years beginning in 2025.

4. LONG-TERM DEBT

Long-term debt consisted of the following (in thousands, except interest rate):




	Interest Rate As of			As of
	June 30, 2025	December 31, 2024	Maturities Through	June 30, 2025			December 31, 2024
Term loan facility	6.2%	6.3%	2029	$	97,500		$	100,000
Less: unamortized debt issuance cost					(1,298	)		(1,443	)
Total debt, net of unamortized debt issuance cost					96,202			98,557
Less: current portion of long-term debt					(5,000	)		(5,000	)
Long-term debt, net				$	91,202		$	93,557

On September 20, 2024 (the “Closing Date”), the Company and its subsidiaries, Dory Acquisition Sub, Inc. (“Dory Acquisition”) and OneSpaWorld (Bahamas) Limited (“OneSpaWorld Bahamas” and together with Dory Acquisition, the “Borrowers”), entered into a credit agreement (the “New Credit Agreement”) with Bank of America, N.A., as administrative agent, and certain lenders party thereto, providing for senior secured credit facilities consisting of (x) a term loan facility of $100 million (of which $70 million was borrowed by Dory Acquisition and $30 million was borrowed by OneSpaWorld Bahamas) (the “Term Loan Facility”), which was fully drawn on the Closing Date, and (y) a revolving loan facility of up to $50 million (the “Revolving Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which Revolving Facility remained undrawn upon the closing of the Credit Facilities and as of June 30, 2025 and December 31, 2024. The Revolving Facility includes borrowing capacity available for letters of credit up to $5 million. Any issuance of letters of credit reduces the amount available under the Revolving Facility. The Credit Facilities mature on September 20, 2029.

Loans outstanding under the Credit Facilities will accrue interest at a rate per annum equal to Term Secured Overnight Financing Rate (“SOFR”) plus a margin of 1.90%, with three step ups to a maximum margin of 2.65% depending on the most recent consolidated leverage ratio of the Company and its restricted subsidiaries, and undrawn amounts under the Revolving Facility will accrue a commitment fee at a rate per annum of 0.25% on the average daily undrawn portion of the commitments thereunder, with three step ups to a maximum commitment fee of 0.40% depending on the most recent consolidated leverage ratio of the Company and its restricted subsidiaries.

The obligations under the Credit Facilities are guaranteed by the Company and each of its direct or indirect wholly-owned subsidiaries other than certain excluded subsidiaries (the “Subsidiary Guarantors”). The obligations of the Company, the Borrowers and the Subsidiary Guarantors under the Credit Facilities are secured by substantially all of their assets.

The Term Loan Facility requires the Borrowers to make certain mandatory prepayments, with (i) 100% of net cash proceeds of all non-ordinary course asset sales or other dispositions of property, subject to the ability to reinvest such proceeds and certain other exceptions, and (ii) 100% of the net cash proceeds of any debt incurrence, other than debt permitted under the definitive agreements (but excluding debt incurred to refinance the Credit Facilities). The Borrowers also are required to make quarterly amortization payments equal to 1.25% of the original principal amount of the Term Loan Facility commencing on March 31, 2025 (subject to reductions by optional and mandatory prepayments of the loans). The Borrowers may prepay the Credit Facilities at any time without premium or penalty, subject to payment of customary breakage costs.

The New Credit Agreement contains a financial covenant requiring the Company and its restricted subsidiaries to maintain a maximum consolidated total leverage ratio of 4.00 to 1.00, subject to certain exceptions, and a minimum fixed charge coverage ratio of 1.25 to 1.00. Additionally, the New Credit Agreement contains a number of customary negative covenants that restrict, among other things and in each case subject to specified exceptions, the Company's and its restricted subsidiaries' ability to: consummate consolidations, mergers and sales of assets; grant certain liens; incur additional debt; pay certain dividends; and engage in transactions with affiliates. As of June 30, 2025 and December 31, 2024, the Company was in compliance with all of the covenants contained in the New Credit Agreement.

The New Credit Agreement also contains certain customary representations and warranties, affirmative covenants and events of default. If an event of default occurs, the lenders under the Credit Facilities are entitled to take various actions, including the acceleration of amounts due under the Credit Facilities and all actions permitted to be taken by a secured creditor.

The following are scheduled principal repayments on long-term debt as of June 30, 2025 for each of the next five years (in thousands):


Year	Amount
Remainder of 2025	$	2,500
2026		5,000
2027		5,000
2028		5,000
2029		80,000
Total	$	97,500

Borrowing Capacity:

As of June 30, 2025, our available borrowing capacity under the Revolving Facility was $50 million. Utilization of the borrowing capacity was as follows (in thousands):


	Borrowing Capacity		Amount Borrowed
Revolving Facility	$	50,000	$	-

5. EQUITY

Dividends Declared Per Common Share

On February 12, 2025, our Board of Directors declared a quarterly dividend of $0.04 per share of common stock, which we paid in cash on March 26, 2025, to shareholders of record at the close of business on March 12, 2025.

On April 23, 2025, our Board of Directors approved a quarterly dividend payment of $0.04 per share of common stock, which we paid in cash on June 4, 2025 to shareholders of record at the close of business on May 21, 2025. See Note 13-"Subsequent Events" for additional dividends declared and further information.

Share Repurchase Program

On April 23, 2024, the Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $50 million of its common shares (the "2024 Share Repurchase Program”). Share repurchases made under the 2024 Share Repurchase Program were funded through the Company’s available cash. During the first quarter of 2025, the Company purchased 2,094,498 common shares at an aggregate cost of $37.9 million. Upon consummation of the repurchases, such common shares reverted to authorized but unissued common shares of the Company. We allocated the excess of the repurchase price over the par value of the shares acquired between Additional paid-in capital and Accumulated deficit.

On April 23, 2025, the Board of Directors approved a new share repurchase program to repurchase up to $75.0 million of the Company’s common shares (the “2025 Share Repurchase Program”). As of the approval date, $900,000 remained available under the 2024 Share Repurchase Program, which was cancelled upon the adoption of the 2025 Share Repurchase Program. Repurchases under the 2025 Share Repurchase Program will be funded through the Company’s available cash. The Company may repurchase shares of its outstanding common stock from time to time on the open market, including through Rule 10b5-1 plans, in privately negotiated transactions, through block purchases, or otherwise in compliance with applicable laws, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The timing and amount of share repurchases will depend on a variety of factors, including business and market conditions. The 2025 Share Repurchase Program may be suspended, modified, or discontinued at any time and the Company has no obligation to repurchase any specific value or number of its common shares under the program. As of the date of this filing, no repurchases have been made under the 2025 Share Repurchase Program. The entire authorized amount under the 2025 Share Repurchase Program remains available.

6. STOCK-BASED COMPENSATION

The share-based compensation expense was $2.1 million for each of the three-month periods ended June 30, 2025 and 2024, and is included as a component of salary, benefits and payroll taxes in the accompanying condensed consolidated statements of operations.

The share-based compensation expense for the six months ended June 30, 2025 and 2024 was $5.7 million and $4.2 million, respectively, and is included as a component of salary, benefits and payroll taxes in the accompanying condensed consolidated statements of operations.

During the first quarter of 2025, the Company accelerated the vesting of certain restricted stock units ("RSUs") and performance stock units ("PSUs"), including those related to a previously announced executive departure in March 2025, making them fully vested, resulting in incremental share-based compensation expense of $1.4 million.

The following is a summary of restricted share units ("RSUs") activity for the six months ended June 30, 2025:


RSUs Activity	Number of Awards			Weighted-Average Grant Date Fair Value

Outstanding at December 31, 2024		590,739		$	17.10
Vested		(55,423	)		15.34
Forfeited		(4,708	)		16.15
Non-Vested share units as of June 30, 2025		530,608		$	17.29

The following is a summary of performance share units ("PSUs") activity for the six months ended June 30, 2025:


PSUs Activity	Number of Performance-Based Awards			Weighted-Average Grant Date Fair Value

Outstanding at December 31, 2024		591,325		$	14.62
Granted (1)		36,142			12.08
Vested		(185,121	)		13.09
Forfeited		(4,708	)		16.15
Non-Vested share units as of June 30, 2025		437,638		$	15.04

(1) The amount shown represents performance adjustments for performance-based awards granted in prior fiscal years and vested during the first quarter of 2025 based on the Company’s achievement of the performance conditions.

7. REVENUE RECOGNITION

The Company's revenue generating activities include the following:

Service Revenues

Service revenues consist primarily of sales of health and wellness, aesthetics and fitness services, including a full range of body care, skin care, hair care, cosmetics, medi-spa, acupuncture, fitness, nutrition/weight management and mindfulness services, among others, to cruise ship passengers and destination resort guests. Each service represents a separate performance obligation and revenues are generally recognized immediately upon the completion of our service. Given the short duration of our performance obligation, although some services are recognized over time, there is no material difference in the timing of recognition across reporting periods.

Product Revenues

Product revenues consist primarily of sales of health and wellness products, such as facial skincare, body care, hair care, orthotics and nutritional supplements to cruise ship passengers, destination resort guests and timetospa.com customers. Our Shop & Ship program provides guests the ability to buy retail products onboard and have products shipped directly to their home. Each product unit represents a separate performance obligation. Our performance obligations are satisfied, and revenue is recognized when the customer obtains control of the product, which occurs either at the point of sale for retail sales or at the time of shipping for Shop & Ship and timetospa.com product sales. The Company provides no warranty on products sold. Shipping and handling fees charged to customers are included in net sales.

Gift Cards

The Company only offers no-fee, non-expiring gift cards to its customers. At the time gift cards are sold, no revenue is recognized; rather, the Company records a contract liability to customers. The liability is relieved, and revenue is recognized equal to the amount redeemed at the time gift cards are redeemed for products or services. The Company records revenue from an estimate of unredeemed gift cards (breakage) in Product revenues on a pro-rata basis over the time period gift cards are redeemed. At least three years of historical data, updated annually, is used to determine actual redemption patterns. The liability for unredeemed gift cards is included in Other current liabilities on the Company's condensed consolidated balance sheets and was not material as of June 30, 2025 and December 31, 2024, respectively.

Customer Loyalty Rewards Program

The Company initiated a customer loyalty program during October 2019 in which customers earn points based on their spending on timetospa.com. The Company recognizes the estimated net amount of the rewards that will be earned and redeemed as a reduction to Product revenues at the time of the initial transaction and as tender when the points are subsequently redeemed by a customer. The liability for customer loyalty programs was not material as of June 30, 2025 and December 31, 2024.

Contract Balances

Receivables from the Company’s contracts with customers are included within Accounts receivable, net. Such amounts are typically remitted to us by our cruise line or destination resort partners, except for amounts attributable to online sales of products included in Product revenues, and are net of commissions they withhold. Although paid by our cruise line partners, customers are typically required to pay with major credit cards, reducing our credit risk to individual customers. Amounts are billed immediately, and our cruise line and destination resort partners typically remit payments to us within 30 days. As of June 30, 2025 and December 31, 2024, our Accounts receivable, net from contracts with customers were $47.3 million and $46.3 million, respectively. Our contract liabilities for gift cards and customer loyalty programs are described above.

Disaggregation of Revenue and Segment Reporting

The Company operates facilities on cruise ships and in destination resorts, where we provide health, fitness, beauty and wellness services and sell related products. The Company also sells health and wellness, fitness and beauty related products through its timetospa.com website, which is a post-cruise sales tool where guests may continue their wellness journey after disembarking. The Company’s Maritime and Destination Resorts operating segments are aggregated into a single reportable segment based upon similar economic characteristics, products, services, customers and delivery methods. See Note 8 – “Segment and Geographical Information” for further details regarding the Company's operating segments. The following table disaggregates the Company’s revenues by revenue source and operating segment (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Service revenues:
Maritime	$	185,349	$	172,060	$	354,860	$	333,773
Destination resorts		8,009		8,786		17,017		19,282
Total service revenues		193,358		180,846		371,877		353,055
Product revenues:
Maritime		46,369		42,872		86,309		80,602
Destination resorts		510		634		1,172		1,345
Timetospa.com		489		539		998		1,115
Total product revenues		47,368		44,045		88,479		83,062
Total revenues	$	240,726	$	224,891	$	460,356	$	436,117

8. SEGMENT AND GEOGRAPHICAL INFORMATION

The Company operates facilities on cruise ships and in destination resorts, where we provide health and wellness services and sell beauty products. The Company’s Maritime and Destination Resorts operating segments are aggregated into a single reportable segment based upon similar business and economic characteristics, operations, services and product offerings, and customers. Additionally, the Company’s operating segments are components for which separate financial information is available. However, the Chief Executive Officer, who serves as the Company’s Chief Operating Decision Maker (CODM), primarily reviews financial results and makes decisions on a consolidated basis. The CODM uses this consolidated financial information to assess performance, allocate resources, and make strategic decisions, including those related to capital expenditures and personnel. The CODM regularly analyzes net income (loss), and the components thereof, as reported on the Company’s consolidated statements of operations, to assess operating trends and performance, including budget-to-actual variances; allocate resources; and make key strategic and operating decisions. All expense categories on the condensed consolidated statements of operations are significant and there are no other significant segment expenses that would require disclosure.

Since the Company operates as one reportable segment, all financial information required by “Segment Reporting” can be found in the accompanying condensed consolidated financial statements. The CODM does not review segment assets at a level other than that presented in the Company’s condensed consolidated balance sheets. There are no intra-entity sales or transfers and no significant expense categories regularly provided to the CODM beyond those disclosed in the condensed consolidated statements of operations. Information related to the Company’s services and products is disclosed in Note 7, “Revenue Recognition”.

The basis for determining the geographic information below is based on the countries in which the Company operates. The Company is not able to identify the country of origin for the customers to which revenues from cruise ship operations relate. Geographic information is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Revenues:
U.S.	$	4,025	$	4,476	$	8,159	$	9,559
Other countries		5,214		5,633		11,425		12,509
Not connected to a country		231,487		214,782		440,772		414,049
Total	$	240,726	$	224,891	$	460,356	$	436,117


	As of
	June 30, 2025		December 31, 2024
Property and equipment, net:
U.S.	$	4,682	$	4,977
Other countries		3,370		1,633
Not connected to a country		11,700		11,068
Total	$	19,752	$	17,678

9. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following table presents the changes in accumulated other comprehensive income (loss) by component (in thousands):



	Accumulated Other Comprehensive Income (Loss) for the Six Months Ended June 30, 2025									Accumulated Other Comprehensive Income (Loss) for the Six Months Ended June 30, 2024
	Foreign Currency Translation Adjustments			Changes Related to Cash Flow Derivative Hedge (1)			Accumulated Other Comprehensive Income (Loss)				Foreign Currency Translation Adjustments			Changes Related to Cash Flow Derivative Hedge (1)			Accumulated Other Comprehensive Income (Loss)
Beginning of the period	$	(968	)	$	1,365		$	397			$	(917	)	$	2,372		$	1,455
Current period other comprehensive income (loss) before reclassifications		345			(745	)		(400	)			(115	)		342			227
Amounts reclassified into earnings		-			(456	)		(456	)			-			(1,892	)		(1,892	)
Net current period other comprehensive income (loss)		345			(1,201	)		(856	)			(115	)		(1,550	)		(1,665	)
Ending balance	$	(623	)	$	164		$	(459	)		$	(1,032	)	$	822		$	(210	)

(1)

See Note 10.

10. FAIR VALUE MEASUREMENTS AND DERIVATIVES

Fair Value Measurements

Cash and cash equivalents at June 30, 2025 and December 31, 2024 are comprised of cash and are categorized as Level 1 instruments. The Company maintains cash with various high-quality financial institutions. Restricted cash at June 30, 2025 and December 31, 2024 is comprised of amounts held in escrow accounts, as a result of a legal proceeding related to a tax assessment and is categorized as a Level 1 instrument. The fair value of outstanding long-term debt as of December 31, 2024 is estimated using a discounted cash flow analysis based on current market interest rates for debt issuances with similar remaining years-to-maturity and adjusted for credit risk, which represents a Level 3 measurement in the fair value hierarchy. The carrying amounts and estimated fair values of the Company's cash, restricted cash and long-term debt were as follows (in thousands):


	June 30, 2025				December 31, 2024
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Cash	$	35,028	$	35,028	$	57,439	$	57,439
Restricted cash		1,198		1,198		1,198		1,198
Total cash	$	36,226	$	36,226	$	58,637	$	58,637
Term loan facility (a)	$	97,500	(b)

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ONESPAWORLD HOLDINGS Ltd 10-Q