Planet Fitness Inc ((PLNT)) has held its Q1 earnings call. Read on for the main highlights of the call.
Planet Fitness Inc. recently held its earnings call, revealing a strong performance characterized by impressive membership growth, revenue increases, and strategic initiatives. Despite facing challenges such as tariff concerns and rising expenses, the company remains optimistic about its future growth prospects and has reaffirmed its guidance for 2025.
Strong Membership Growth
Planet Fitness ended the first quarter with an impressive 20.6 million members, marking an increase of approximately 900,000 from the end of 2024. This growth underscores the company’s successful efforts in attracting new members and retaining existing ones.
System-wide Same Club Sales Growth
The company reported a 6.1% growth in system-wide same club sales, reflecting strong performance across its locations. This growth is a testament to the company’s effective operational strategies and customer engagement.
Club Expansion
Planet Fitness expanded its global footprint by opening 19 new clubs, bringing the total number of clubs to 2,741. This expansion is part of the company’s broader strategy to increase its market presence and accessibility.
Black Card Penetration
The company achieved a 65% penetration rate for its Black Card membership, representing a nearly 300 basis point increase from the first quarter of the previous year. This growth highlights the success of Planet Fitness’s promotional strategies in enhancing membership value.
Revenue Growth
Total revenue for the quarter reached $276.7 million, an 11.5% increase from the previous year. This significant revenue growth reflects the company’s strong market position and effective business strategies.
Adjusted EBITDA Growth
Planet Fitness reported an adjusted EBITDA of $117 million, marking a 10.1% increase year-over-year. This growth indicates the company’s efficient cost management and profitability.
Tariff Concerns
The company is engaged in ongoing discussions with vendors to address potential impacts of tariffs on its business and franchisee unit economics. This proactive approach aims to mitigate any adverse effects on the company’s operations.
New Club Placements
This quarter, Planet Fitness completed 10 new club placements compared to 14 last year. While slightly lower, this figure still demonstrates the company’s commitment to expanding its reach.
Increased SG&A Expenses
SG&A expenses for the quarter were $34.3 million, up from $29.2 million, with adjusted SG&A at $32.5 million, a 19.1% increase. This rise in expenses is attributed to the company’s strategic investments in growth and expansion.
Forward-Looking Guidance
Looking ahead, Planet Fitness has reiterated its 2025 growth targets, expecting system-wide same club sales growth between 5% and 6%, revenue growth of approximately 10%, and adjusted EBITDA growth of about 10%. The company also plans to open between 160 and 170 new clubs throughout the year, underscoring its commitment to sustained expansion.
In summary, Planet Fitness’s earnings call highlighted a robust performance with significant growth in membership, revenue, and strategic initiatives. Despite challenges such as tariff concerns and increased expenses, the company remains optimistic about its future, reaffirming its guidance for continued growth in 2025.