Xponential Fitness Earnings Call Transcripts
Fiscal Year 2026
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The meeting confirmed a quorum and approved the election of two directors and the appointment of the independent auditor. No questions were submitted by stockholders, and final voting results will be filed in a Form 8-K.
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Q1 saw strong unit growth and leadership additions, but revenue and EBITDA declined year-over-year due to digital marketing headwinds and timing issues. Member retention remains high, and 2026 guidance is reaffirmed as operational and marketing initiatives are expected to drive improvement.
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Management highlighted a renewed operational focus, improved franchisee support, and strong Club Pilates performance. Strategic shifts have enhanced margins and set the stage for international growth, while legal overhangs are nearly resolved.
Fiscal Year 2025
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Opened 201 net new studios in 2025, led by Club Pilates, with system-wide sales up 13% to $1.75B. 2026 guidance anticipates lower net openings, a 16% revenue decline due to divestitures and outsourcing, and adjusted EBITDA of $100–$110M.
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Management outlined a shift to a focused, centralized structure supporting five core brands, with Club Pilates driving growth and international expansion. StretchLab is undergoing operational changes to restore profitability, while refinancing efforts aim to lower costs and extend debt runway.
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Q3 saw streamlined operations after divestitures, with 78 new studios opened and 3,066 total. Revenue declined 2% year-over-year, but Adjusted EBITDA rose 9%. Club Pilates led with strong AUVs, while guidance for 2025 remains unchanged despite a more conservative sales outlook.
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Q2 saw 12% system-wide sales growth and improved profitability, but guidance for 2025 was lowered due to divestitures, macro headwinds, and a conservative outlook. Strategic focus is on core brands, operational efficiency, and new retail partnerships to drive future growth.
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Revised summary: The company is moving from rapid expansion to operational excellence, focusing on four core brands, rationalizing its portfolio, and internationalizing via master franchise deals. Guidance targets 10% annual studio growth, 40-45% EBITDA margins, and over 50% levered free cash flow by 2026, with SG&A stabilized and fewer closures.
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North America system-wide sales grew 18% year-over-year, with strong performance in Club Pilates, YogaSix, and Pure Barre, while StretchLab faced challenges. Guidance for net new studio openings was lowered, but revenue and adjusted EBITDA outlooks were reiterated, with stabilization and operational efficiency as key 2025 themes.
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Leadership is prioritizing franchisee support, operational investments, and brand optimization, with a focus on profitable growth and international expansion. Club Pilates and StretchLab remain key drivers, while retail operations are being re-evaluated for efficiency.
Fiscal Year 2024
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System-wide sales and membership grew strongly in 2024, but revenue was flat and net loss widened due to impairments and legal costs. 2025 will focus on operational improvements, franchisee profitability, and technology, with modest growth in openings and EBITDA expected.
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Q3 saw strong membership and studio growth, with North America system-wide sales up 21% year-over-year and adjusted EBITDA up 17%. Guidance for new studio openings was lowered, but revenue and EBITDA targets were reiterated. Focus remains on franchisee profitability, operational excellence, and international expansion.
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Q2 results were impacted by leadership transition and regulatory scrutiny, leading to lower revenue and reduced guidance for 2024. Membership and studio KPIs remain strong, with robust system-wide sales and a healthy pipeline of future openings.
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Strong consumer demand and pricing power are driving growth, with new wellness offerings like Lindora diversifying the portfolio. Leadership transition is progressing quickly, and operational focus remains on supporting franchisees, optimizing processes, and expanding margins toward 45% by 2026.
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Leadership transition is underway with a stable executive team and a new CEO expected within 30–60 days. The portfolio is being optimized for growth, with strong unit openings, robust license sales, and expansion into wellness. Consumer demand and operational momentum remain strong.