Nautilus reduced its losses in the second quarter thanks to a 13.3 percent increase in net sales to $34.7 million and a 14.9 percent reduction in operating expenses, partly achieved through more effective advertising. Losses from continuing operations went down by 68.6 percent to $2.2 million. The net loss fell by 69.5 percent to $3.27 million, but this included a loss of $1.1 million from the discontinuation of the company's former commercial business. Direct revenues increased by 21.8 percent to $22.5 million, led by the TreadClimber, which will be followed by new cardio fitness products. Retail sales were off by 3.4 percent to $11.4 million. Royalty income jumped by 125 percent to $852,000 on the strength of its elliptical equipment.

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