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2023 ICR: Fitness Chains Resume Aggressive Growth Plans

Speaking at the 2023 ICR Conference, executives from Planet Fitness, Life Time Group and Xponential Fitness indicated that their respective health clubs continue to see healthy recovery post-pandemic while noting stepped-up expansion plans.

Planet Fitness Sees Record Q4 Membership Growth
Before presenting at the Conference, Planet Fitness had reported its largest fourth-quarter membership growth. Planet Fitness had approximately 17.0 million members across its 2,410 gyms as of December 31, an increase of 12 percent, or 1.8 million members, since the end of 2021.

Chris Rondeau, CEO, said the momentum set Planet Fitness for success in the critical first quarter. Traditionally, about 60 percent of annual memberships join Planet Fitness and fitness chains in the first quarter.

Said Rondeau, “When you think about it, this is the first quarter in almost four years to have uninterrupted operations, so this is a big first quarter for us. And to have that kind of momentum in the fourth quarter is a great sign.”

Rondeau attributed the gains partly to reaching Gen Z, representing the chain’s second-largest member base after being its smallest pre-COVID. He believes the Gen Z demographic better recognizes the benefits of fitness from the pandemic, including “not just waistline but mental health.”

The Gen Z growth also reflects the success of the company’s High School Summer Pass Program, which offers free membership to teens during the summer months. A total of 3.5 million signed up for the program in 2022 versus one million in 2019 when the program launched. In the third quarter, 5 percent had joined as members, outpacing the conversion rate of the 2019 program.

Other factors supporting Planet Fitness’ membership growth include marketing campaigns featuring three agencies and continued increased comfort in returning to a gym. 

Planet Fitness reiterated its three-year annual financial targets detailed at its Investor Day last November that called for:

Annual Revenue in the low-to-mid teens percent growth;
Annual Adjusted EBITDA in the high-teens percent growth; and
Annual Adjusted Earnings Per…..

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