Xwell (NASDAQ:XWEL), best known for its airport wellness spas and health services, released its second quarter 2025 results on August 14, 2025. The release showed GAAP revenue of $7.7 million, down 17.2% from the prior year period. There were no Wall Street estimates for the quarter. Operating loss grew to $2.7 million and net loss attributable to Xwell reached $2.3 million, both higher than a year ago. The results underline continuing challenges as one-time pandemic-related income wanes, even as the company pushes cost reductions and moves to expand outside the airport sector.
| Metric | Q2 2025 | Q2 2024 | Y/Y Change |
|---|---|---|---|
| Revenue | $7.7 million | $9.3 million | (17.2%) |
| Operating Expenses | $4.5 million | $5.0 million | (10.0%) |
| Operating Loss | $2.7 million | $1.9 million | 42.1% |
| Net Loss Attributable to XWELL | $2.3 million | $2.0 million | 15.0% |
| Cash and Cash Equivalents (end of period) | $5.3 million | N/A |
Understanding Xwell: Core Business and Shifts
Xwell operates wellness spas, medical testing centers, and retail locations, with a focus on airport travelers. Over recent years, it has pushed deeper into health diagnostics, adding services such as infectious disease testing and vaccinations.
Key success factors for Xwell include attracting steady airport traffic, expanding its suite of health and spa services, controlling operational costs, and integrating digital booking and e-commerce. The company recently rebranded to expand its image beyond airport spas, now targeting both travelers and urban customers. Management has flagged diversification -- such as partnerships with sports teams and digital upgrades -- as central to its growth strategy.
Quarter-in-Review: Results, Partnerships, and Expense Controls
Xwell’s latest results reflect ongoing challenges as it transitions from pandemic-driven demand. Revenue (GAAP) fell year over year, a change the company credits to the loss of “additional CDC revenue generated during Q2 2024 from providing more services to airports than base contract amounts.” In other words, some of last year’s revenue came from surge contracts for pandemic screening, which did not recur this period.
Despite the revenue drop, Xwell grew its top line approximately 10% from the first to the second quarter of 2025 on a GAAP basis, and continued to invest in new business lines. The XpresSpa segment, which offers on-site wellness services like massage and skincare in airports, generated about $4.9 million in GAAP revenue. The XpresCheck segment, which provides COVID-19 and infectious disease testing, contributed $2.2 million. Naples Wax Center, a retail and service division, brought in about $647,000 in revenue.
Xwell stressed progress in diversifying away from airports. It opened a new brick-and-mortar wellness center in Clearwater, Florida, and is developing a new site at New York City’s Penn Station. It also entered a multiyear agreement to serve as the official wellness spa of the Orlando Magic basketball team. This pushes Xwell further into the local market and away from sole reliance on airport foot traffic. Digital expansion also featured, as the company launched a new integrated website allowing customers to explore services, book appointments, and connect with staff more easily across brands.
Operating expenses fell 10% year over year, while cost of sales and general and administrative costs dropped 5% and 9%, respectively. However, these savings did not fully offset lower revenue, and both operating and net losses worsened. There were no material one-time events or adjustments called out in the filing, and Xwell did not declare or change a dividend this period.
Looking Ahead: Focus and Uncertainties
Xwell did not offer formal revenue or profit guidance for upcoming quarters or fiscal 2025. In the press release, its CEO described being “excited by the opportunities that lie ahead” and noted recent achievements in brand partnerships, service expansion, and digital improvements. However, no quantitative outlook was provided in the filing.
With the end of the pandemic-related revenue surge, Analysts will also be watching liquidity, as period-end cash totaled $5.3 million. Cost discipline and the performance of the company’s digital platform will be key areas to monitor.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
