Planet Fitness (PLNT) Q4 2025 Earnings Transcript
Planet Fitness (PLNT) Q4 2025 Earnings Transcript
Motley Fool Transcribing, The Motley FoolTue, February 24, 2026 at 7:08 PM UTC
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Date
Tuesday, Feb. 24, 2026, at 8 a.m. ET
Call participants -
Chief Executive Officer — Colleen Keating
Chief Financial Officer — Jay Stasz
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Risks -
CFO Stasz noted, "knew this year would represent the lowest growth year in the three-year algorithm," due to an extended replacement cycle on equipment and the sale of eight corporate-owned California clubs.
The company experienced "short-term transitory items" including weather-related disruption to join trends and a "slightly higher cancel rate" in January. Management states recent attrition is now in line with expectations.
Management anticipates 2026 net interest expense of approximately $114 million, reflecting the annualized impact of the 2025 refinancing.
The company guides full-year capital expenditures to increase 10%-15%, which may impact free cash flow relative to prior periods.
Takeaways -
Ending membership and club count -- Approximately 20.8 million members and nearly 2,900 clubs at year-end, reflecting significant network expansion.
Same club sales -- Grew 6.7% for the full year and 5.7% in the fourth quarter, indicating ongoing comparable performance gains.
Total revenue -- Increased 12% year over year to $376.3 million in the quarter, driven by all business segments.
Adjusted EBITDA -- Rose 13% year over year to $146.3 million for the quarter, with a margin improvement to 38.9% from 38.4%.
Adjusted diluted EPS -- Increased 19% year over year for the full year; quarterly adjusted net income per diluted share was $0.83.
Club openings -- 181 new clubs in 2025, including a record 104 in Q4, showing accelerated unit growth momentum.
Black Card penetration -- Reached a record 66.5% at quarter-end, up 260 basis points, supporting blended rate gains.
Guidance for 2026 -- Expects system-wide same club sales growth of 4%-5% and opening 180-190 new clubs, anticipating full-year revenue growth of 9% and adjusted EBITDA growth of approximately 10%.
Equipment segment performance -- Equipment revenue grew 15.3% year over year in the quarter, with 60% from replacement sales.
Balance sheet and capital return -- Ended the period with $607 million in cash, cash equivalents, and marketable securities; repurchased nearly $800 million of stock over two years; refinanced $400 million of debt and upsized to $750 million at a blended coupon of 5.4%.
Conversion from High School Summer Pass -- Converted 8.3% of 3.7 million teen participants into paying members, marking a multi-year improvement.
Digital engagement and member management -- Mobile app remains the highest downloaded in its category; early digital engagement in the first 100 days shown to improve long-term retention and value.
Asset-light franchise model -- Company confirmed 90/10 franchise/corporate club mix provides operational focus and higher cash generation.
National Ad Fund change -- Franchisee shift to increase National Ad Fund beginning Q2 2026, driving expanded media and advanced technology pilots, including AI-driven CRM and churn modeling.
Black Card price increase -- Company plans to implement the Black Card price increase after the peak join season, modeled into the 2026 comp outlook.
Summary
Planet Fitness (NYSE:PLNT) delivered notable year-over-year gains across membership, same club sales, total revenue, and profitability, while achieving record expansion in both net new members and club openings. Management presented a detailed 2026 outlook, anticipating decelerated growth due to known structural and transitory headwinds, yet reaffirmed the company’s three-year financial targets and ongoing commitment to strategic imperatives. Shareholder returns remained significant, highlighted by accelerated share repurchases financed through new debt instruments and continued strong free cash flow from the asset-light model. The earnings call featured confirmation of Black Card pricing strategy, expanded marketing initiatives funded by franchisee contributions, and robust penetration in high-value product tiers, all reinforcing the scalable nature of the business and future growth levers.
Keating highlighted, "more than 3,700,000" teens participated in the High School Summer Pass, the highest ever, illustrating focused acquisition of next-generation members.
The company executed its largest-ever Q4 quarterly expansion with 104 club openings, enabled by both organic growth and franchisee-led conversions of acquired gyms.
Ongoing investment in technology, such as AI-enabled CRM and predictive churn modeling, is positioned to further drive member engagement and optimize retention.
Franchise segment revenue increased 9.6%, corporate-owned segment by 7.4%, and equipment segment by 15.3%, each contributing to quarterly top-line growth.
The company surpassed 1 million international members and now exceeds 200 international clubs, evidencing increasing overseas momentum.
For the 2026 comp guide, approximately 75% of the outlook is expected to come from rate improvement, aided by record Black Card penetration, above historic volume-driven splits.
The Ro partnership, though early, is noted as the "most successful Perks program yet," indicating growing integration of health trends such as GLP-1 treatments into member targeting strategies.
Keating described achieving the "highest rated fitness brand" distinction in USA Today’s Best Customer Service Companies for 2026, reflecting external recognition of member experience improvements.
Management emphasized a "mid-30%" rejoin rate among lapsed members, with focused marketing on accelerating time to rejoin.
Guidance for the year incorporates the dilutive effect of shifting eight corporate clubs to franchise and an approximately 300-basis-point revenue headwind from the equipment replacement cycle transition.
Industry glossary -
Classic Card: Entry-level membership tier at Planet Fitness targeting price-sensitive customers.
Black Card: Premium Planet Fitness membership offering expanded amenities and higher pricing, often driving blended rate increase and improved retention.
GLP-1: Glucagon-like peptide-1, a class of medications often used for weight management with implications for muscle mass and gym engagement.
High School Summer Pass: Seasonal promotion offering free summer access to teens, designed to convert young participants to paying members.
National Ad Fund (NAF): Centralized marketing fund sourced from franchisee contributions supporting national advertising and marketing technology initiatives.
Local Ad Fund (LAF): Marketing fund managed at the franchisee or local market level, previously the primary budget for localized campaigns.
Asset-light model: Strategic approach where a minimal percentage of total facilities are company-owned, focusing instead on franchising to maximize scale and capital efficiency.
ASR (Accelerated Share Repurchase): A financial mechanism allowing rapid company share buybacks, often funded by incremental debt.
DCO (Dynamic Content Optimization): AI-driven marketing tool enabling tailored digital content delivery to targeted customer segments based on real-time behavior data.
Full Conference Call Transcript
Colleen Keating: Thank you, Stacey, and thank you everyone for joining us for the Planet Fitness fourth quarter earnings call. Our strong 2025 performance is a direct result of our discipline and focus on our four strategic imperatives. I want to personally thank our franchisees and our team members. Their passion is what fuels this brand. We ended the year with approximately 20,800,000 members, and a global footprint of nearly 2,900 clubs, reinforcing the quality of our member experience and our compelling value proposition. Anyone can get a great workout at Planet Fitness for an incredible value.
Our financial performance was strong across the board for the year as well. Same club sales grew 6.7%, revenue increased 12%, adjusted EBITDA 13%, and we delivered 19% growth in adjusted diluted EPS. Importantly, we opened 181 new clubs and added 1,100,000 net new members in 2025. This growth occurred during the first full year of our new Classic Card membership dues, proving that the value of our brand remains unique in the industry. The progress we made on both our top line and new club growth is evidence of our powerful scale and reach, and the strength of our team.
Our scale provides a foundation to introduce our brand to even more people looking to improve their physical and mental health globally.
There was no better way to wrap up the strong year than by taking center stage as the presenting sponsor of Dick Clark's New Year's Rockin' Eve, as we have done for the past decade. With 20,000 purple hats blanketing Times Square, we ensured Planet Fitness was the brand millions of people saw as they set their 2026 wellness goals. As we continue to grow our international presence, we see New Year's Rockin' Eve as an opportunity to put the Planet Fitness brand on a global stage.
We are seeing momentum as we execute against our four strategic imperatives: redefining our brand promise and communicating it through our marketing, enhancing our member experience, refining our product and optimizing our format, and accelerating new club growth. Let us dive into the specific progress we achieved across these areas during 2025.
I will start with redefining our brand promise. A key driver in member growth was our intentional focus on the next generation of fitness enthusiasts. The 2025 High School Summer Pass program yielded our most successful results to date, with more than 3,700,000 teens completing more than 19,000,000 workouts, an all-time high. We believe the strong year-over-year results were enhanced by the marketing emphasis on our expanded product offering, showcasing that our clubs have a strong complement of strength equipment so members can achieve the workouts they desire at Planet Fitness. We also augmented our social media strategy to reach our younger consumer and increased our use of influencers to promote the Summer Pass.
Through the end of the year, we converted 8.3% of teen participants to paying members which represents an elevation in conversion over the past two years. Our strong conversion rate reflects how young people prioritize their well-being, and we provide them a judgment free environment to start or continue their fitness journeys. Our success would not have been possible without our club team members, who are instrumental in ensuring the participants' first experience with Planet Fitness was positive, laying the groundwork for them to become members.
We continue to lean into our We Are All Strong on This Planet campaign which effectively showcases our best-in-class equipment and supportive atmosphere. This follows our 2025 strategic shift in our messaging approach, leading with the compelling “Why Planet Fitness” message followed by a “Why Planet Fitness now” call to action, to reengage lapsed members and attract new ones. Because this campaign resonated so strongly last year, we extended it into 2026. By maintaining this consistency, we avoided the cost of developing a completely new creative from scratch while updating creative assets focusing on differentiators for our brand. This efficiency allowed us to redirect those savings into high-impact working media to drive even greater reach.
The agreement with our franchisees to shift a portion of contribution from the Local Ad Fund to the National Ad Fund for 2026 beginning in the second quarter allows us to move faster in executing on several strategic initiatives. Beyond driving efficiencies by centralizing more of our ad spend, we are accelerating high-impact technology projects including AI-enabled CRM and dynamic content optimization to reach new members more effectively than ever before and invest in an AI-enabled predictive churn model to help us increase member retention. Marking his first year with us this month, Chief Marketing Officer Brian Povinelli has made rapid progress in scaling our marketing capabilities.
Key milestones include strategic hires who are driving AI-enabled member experience initiatives, national media buying, and CRM work, a new social media marketing strategy as well as augmenting the team responsible for our perks and partnerships. These moves will help us refine and better personalize our messaging, drive marketing spend efficiencies, and more effectively engage and retain members. We are proud of the progress we have made so far and our strong join volume last year, and we are excited for the impact these new leaders will make on our business moving forward.
I enjoy spending time in our clubs, and I particularly like spending time in our clubs in early January to hear from our club managers and get a firsthand look at volume, club traffic, and what pieces of equipment are getting the most usage. Last month, I spent time in several of our corporate clubs that are part of the new Black Card amenities test. I tried a few of the new Black Card Spa modalities we are currently testing, including the dry cold plunge and the red light sauna. I spoke with members who were using the new amenities as well to hear their feedback, and it was resoundingly positive.
We see an opportunity to drive both joins and upgrades as well as enhanced retention with these new amenities. It is our opportunity to democratize recovery and wellness just as we did with fitness thirty years ago.
Turning now to member experience and format optimization. We are elevating the member experience through a sophisticated data-driven approach, strategically leveraging technology to drive deeper engagement and strengthen member retention. Our mobile app is a prime example. It remains the top download in the health and fitness category, serving as a touch point for our community. We know that the first 100 days of membership influence long-term retention. Our data indicates that early engagement, both digitally and in club, contributes to higher lifetime value and the emotional connection to unlock our next wave of growth. Looking ahead, we are piloting AI-driven tools to augment our in-club trainers, providing members with personalized coaching and workout support.
We are also leaning into the evolving health landscape, specifically regarding GLP-1. As these treatments can lead to a loss of muscle mass, it is essential that users incorporate strength training to maintain their overall health. Our judgment free environment makes us the natural partner for this growing demographic. A recent survey conducted by one of our franchisees indicated that roughly 50% of people who take a GLP-1 consider a gym membership. We see positive indicators for continued growth and demand for our offering as GLP-1s become more accessible through lower pricing and pill formats. To that end, we are seeing excellent early results from our Perks partnership with Ro.
While it is still early days, and too soon to run a victory lap, we can share that this has been our most successful Perks program yet, with high download and conversion. Collaborations like this help to position us at the forefront of a major shift in consumer wellness.
Beyond digital perks, we are focused on the physical member experience through format optimization. We believe in giving members the ideal equipment mix designed for them to complete their workout their way. Not only has member response been favorable, the response from our franchisees has been overwhelming. In 2025, 95% of those who opened or remodeled clubs chose an optimized format. We concluded the year with nearly 80% of our entire system featuring some version of a format-optimized layout or equipment offering.
And finally, our efforts to accelerate new club growth. Our focus is on leveraging our collective size and scale to defend and expand our industry leadership position in the HVL space. Thanks to an incredible push by our total system, particularly in the last several weeks of the year, we opened 104 clubs during the fourth quarter, an all-time quarterly high, for a total of 181 openings in 2025. Let me say that again, because it bears repeating. This is the highest number of Q4 openings in our history. While the real estate market showed a few signs of easing in 2025, it remains highly competitive.
We are navigating this by partnering with franchisees to demonstrate our unique value proposition to landlords, specifically, how Planet Fitness drives foot traffic that benefits the entire retail center. Furthermore, we are leveraging industry relationships to capitalize on prime site opportunities emerging from retail bankruptcies. We are also seeing success with franchisee-led acquisitions where they purchase small portfolios of regional gyms and convert them to Planet Fitness locations—an effective way of expanding our footprint in high-demand tight real estate markets.
This can be beneficial from a build cost standpoint, as electrical and plumbing is already in place, and from a financial ramp standpoint as we have seen a solid percentage convert to Planet Fitness, so the club has a member base and cash flows from day one.
Our international expansion remains a key growth pillar. We are focused on scaling our presence in existing markets like Mexico, Australia, and Spain, while strategically entering one to two new markets annually. A prime example of this momentum is our recent entry into Northern Mexico, with a new franchisee set to develop Tijuana and Mexicali. We have also partnered with a bank to lead the Spain marketing process and have a number of interested investors as we look to convert that territory to a franchise market for accelerated growth. We are disciplined in our approach. We are building sustainable, healthy international market positions.
This deliberate strategy is yielding results as we surpass the 1,000,000 member milestone across our international markets last year and have now crested 200 international clubs.
Our Chief Development Officer, Chip Olson, recently celebrated his one year anniversary, during which he has strengthened his leadership team with several key appointments. He recently added a franchise sales director to his team with a focus on driving growth domestically to accelerate our outreach and expand our network of franchise partners.
Finally, our commitment to member experience continues to earn prestigious third-party recognition. We are especially proud to be named one of USA Today’s Best Customer Service Companies for 2026. Planet Fitness was the highest rated fitness brand on a list of 750 companies across a wide number of industries, a distinction based on millions of reviews measuring friendliness, competence, and reliability. Exceptional service is a business imperative that builds trust and drives the loyalty essential to our long-term retention and top-line growth. I will now turn the call over to Jay. Thanks, Colleen.
Jay Stasz: Our financial foundation remains exceptionally strong. I would like to reiterate, we are extremely proud of what we delivered in 2025. Our highly franchised asset-light model continues to generate significant predictable cash flow. This has allowed us to return nearly $800,000,000 to shareholders through buybacks over the last two years while also funding strategic investments for future growth.
Now to our fourth quarter results. All of my comments regarding our quarter performance will be comparing 2025 to 2024, unless otherwise noted. We opened 104 new clubs compared to 86. We completed 96 new club placements this quarter compared to 77 last year. We delivered system-wide same club sales growth of 5.7%. Franchisee same club sales increased 5.6%, corporate same club sales increased 6%. Approximately 80% of our fourth quarter comp increase was driven by rate growth, with the balance being net membership growth. Black Card penetration was 66.5% at the end of the quarter, an all-time high and an increase of 260 basis points from the prior year.
Our ending fourth quarter member count of approximately 20,800,000 was in line with our expectations.
For the fourth quarter, total revenue was $376,300,000 compared to $340,500,000. The increase was driven by revenue growth across all three segments, including a 9.6% increase in the franchise segment, a 7.4% increase in the corporate-owned club segment, and a 15.3% increase in the equipment segment. The increase in our equipment segment revenue is driven by higher revenue from sales to franchisee-owned clubs. For the quarter, replacement equipment accounted for approximately 60% of total equipment revenue compared to 58%. For the fourth quarter, the average royalty rate was 6.7%, flat to the prior year. Our cost of revenue, related to the cost of equipment sales to franchisee-owned clubs, was $90,200,000, an increase of 12.1% compared to $80,500,000.
Club operations expense increased 7.1% to $79,600,000 from $74,400,000. SG&A for the quarter was $37,300,000 compared to $35,700,000. Adjusted SG&A was $36,800,000 or 9.8% of total revenue compared to $34,400,000 or 10.1% of total revenue. National advertising fund expense was $21,400,000 compared to $19,400,000, an increase of 10.5%. Net income was $60,700,000. Adjusted net income was $69,000,000 and adjusted net income per diluted share was $0.83. Adjusted EBITDA was $146,300,000 and adjusted EBITDA margin was 38.9%, compared to $130,800,000 with adjusted EBITDA margin of 38.4%. For the full year, adjusted EBITDA margin increased to 41.7% compared to 41.3% in the prior year.
Now turning to the balance sheet. As of 12/31/2025, we had total cash, cash equivalents, and marketable securities of $607,000,000 compared to $529,500,000 on 12/31/2024, which included $66,300,000 and $56,500,000 of restricted cash respectively, in each period. During the quarter, we refinanced $400,000,000 of our debt that was due next year and upsized the deal to $750,000,000 at a blended coupon of 5.4% and executed a $350,000,000 accelerated share repurchase.
Now to our outlook. We knew this year would represent the lowest growth year in the three-year algorithm for two primary reasons. First, the extended replacement cycle for equipment as part of our new growth model we rolled out in 2024. Second, in Q3 of last year, we sold eight corporate-owned clubs in California. Transitioning these clubs from the corporate-owned segment to the franchise segment aligns with our asset-light strategy yet reduces our revenue and profit year-over-year growth in 2026. We have seen strong join demand during the year, a clear signal that our brand value and offerings are resonating. We have also experienced two short-term transitory items quarter to date.
Our join trends were impacted by the storms and cold weather in late January across many of our markets. And we experienced a slightly higher cancel rate last month than anticipated. Notably, recent attrition trends are returning in line with our expectations.
Now to our guidance for 2026, which incorporates the factors described earlier. We expect system-wide same club sales growth of 4% to 5%. We expect to open 180 to 190 new clubs system-wide. Like last year, we anticipate the cadence of these openings and the related 150 to 160 equipment placements to be weighted to the second half of the year and especially the fourth quarter. We expect re-equipment sales to represent approximately 70% of total segment revenue and we expect an equipment margin rate of approximately 30%. We expect total revenue growth of 9% over 2025. We expect adjusted EBITDA to grow approximately 10% over 2025. We project adjusted net income growth in the 4% to 5% range.
On a per share basis, we expect adjusted diluted EPS to increase between 9% to 10%. This is based on approximately 80,000,000 adjusted diluted weighted average shares outstanding which includes the impact from our ASR entered into at the end of last year, and our plan to repurchase approximately $150,000,000 worth of shares in 2026. We anticipate 2026 net interest expense of approximately $114,000,000 reflecting the annualized impact of our 2025 refinancing. Lastly, we expect capital expenditures to be up between 10% to 15% and D&A to be up approximately 10%. We reiterate our three-year growth algorithm we outlined at last year's Investor Day.
The strategic imperatives and growth initiatives we outlined continue to build momentum, positioning us well to deliver against our long-term objectives. The fundamentals of our business are strong, the model is resilient, and we continue to generate significant cash flow that enables us to return value to shareholders. I will now turn the call back to the operator to open it up for Q&A.
Operator: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press 1 on your telephone keypad. To withdraw your question, please pick up your handset when asking a question. If you are muted locally, please remember to unmute your device. Please stand by now while we compile the Q&A roster. Your first question comes from the line of Randy Konik with Jefferies. Your line is open. Please go ahead.
Randy Konik: Yeah. Thanks a lot, and good morning. I guess, Jay, question for you is when you look at the 2026 guide, and you think about—you just reiterated your three-year growth algo that you gave at the Analyst Day. Give us some perspective on what does that mean for the two out years in terms of shaping the revenue growth, unit expansion and EBITDA dollar growth? How are we to think about that as we think, you know, further from 2026 into 2027 and 2028. Thanks. And then you brought it up, can we then follow up with trying to get a little bit more granular about the month of January then?
Jay Stasz: Hey, Randy. Good morning, and thanks for the question. As we said, we knew that this year would represent the lowest growth year in the three-year algo because of the re-equip cycle and because of the sale of the California clubs. So those impacts, if we think about that, on the year-over-year growth for this year, is about a 300 basis point impact to top line and about a 200 basis point, slightly north of that, on EBITDA. That was contemplated and known.
Also included in our guidance this year are some transitory headwinds related to the weather impact in joins, as well as a slight elevation in attrition versus our expectations that we saw in January, which is now normalized. We have reiterated our commitment to the three-year algorithm, and we expect to get back to those targets that we laid out both for revenue and EBITDA over the three-year period. There is a bit of a step up in the out years. We did not indicate that the algo was going to be an annual growth rate. The strategic imperatives are building, and once we continue to drive revenue and net member growth, there is significant flow-through to the bottom line.
So we see increases in both year two and year three of that growth algo to get back to the targets we laid out. In terms of January, from a join standpoint, we saw healthy join trends for the first few weeks of January leading into the storm that started late in January. We had a significant impact across many of our markets—about 2,000 clubs had some form of impact—and we saw a marked difference in relative join volumes during the storm period. Since that time, for the impacted markets, we have seen a nice rebound and very healthy join rates related to promotions we have run in February. These impacts are temporary in nature.
With the subscription model, a join earlier in the year is more economically beneficial than one later in the year, and we have reflected that in guidance, though the impact is much less than the other impacts discussed. From an attrition standpoint, there was a slight elevation in January. This was the first year of a high-volume period with the ability to manage your membership with our messaging around cancel anytime, so maybe it was more top of mind. We made tweaks to our digital messaging, and attrition has come in line in February with our expectations.
Operator: Your next question comes from the line of Simeon Siegel with Guggenheim Securities. Your line is open. Please go ahead.
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Simeon Siegel: Thanks. Hey, everyone. Good morning. So, Jay, just for the guidance, how are you thinking about Black Card penetration and then price versus member growth embedded within those revenues? And then just because we are talking about January, I guess, Colleen, we have been talking about smoothing out the seasonality of your joins, so how do you think about the significance of a challenging weather January now for Planet Fitness versus maybe how we would have thought about it historically? Thanks, guys.
Jay Stasz: From a join standpoint, historically about 60% of joins came in the first quarter, and in the past couple years it has been higher. We have consistently talked about achieving net member growth across several quarters, and we have levers to drive joins with traction on our strategic imperatives. On Black Card penetration, we reached a record 66.5% in Q4. That benefits rate. For the guide and the comp, we expect about a 75/25 split—75% from rate, 25% from volume or membership growth.
Colleen Keating: On January joins and seasonality, we have been successfully running promotions and delivering net member growth outside Q1. In 2025, we had net member growth in Q4, and in the prior year we had net member growth in the back half. You will continue to see us deploy marketing outside of the first quarter. We added 1,100,000 net new members in 2025, a 10% increase versus 2024, during our first full year of elevated Classic Card pricing and with nationwide online member management in place. We were seeing strong join trends coming through January prior to the storm impact, which, along with our track record of multi-quarter joins, gives us confidence in momentum.
Operator: Your next question comes from the line of Max Rakhlenko with TD Cowen. Your line is open. Please go ahead.
Max Rakhlenko: Great. Thanks a lot. So first, just on the lower EBITDA and the EPS guide for 2026. Can you maybe talk about the shape of the year and how we should think about both for 1H versus 2H? And a quick follow-up on margins—how should we think about first half versus second half progression given the puts and takes you mentioned? And lastly, Colleen, what is the latest thinking around the timing of the Black Card price increase, how it changes the comp build and Black Card mix, and is it embedded in the guide?
Jay Stasz: On the comp guide of 4% to 5%, we will be lapping the nationwide rollout of member management in Q2, so expect lower comps in the first half and higher in the back half. Equipment revenue is back-loaded; last year 57% of openings were in Q4; this year likely around that or a few points higher, closer to 60%. We will also see an increase in NAF revenue. Otherwise, model consistently. On EBITDA margins, ex-NAF we expect significant margin leverage. Including NAF, we expect margins to be pretty consistent year over year. We have set our expense structure appropriately and see leverage particularly in SG&A.
Colleen Keating: We indicated we would roll out the Black Card price increase after our peak join season. For competitive reasons we are not being overly specific, but where we took the Classic Card price increase two years ago is a directional indication—Q3 is our lower join quarter, which should guide expectations. We have seen organic rate lift from increased Black Card penetration and expect continued rate impact from the Black Card price increase. Directionally, our comp assumes about 75% from rate and 25% from volume. The Black Card price lift is embedded in the guide, taken after the peak season.
Operator: Your next question comes from the line of Joe Altobello with Raymond James. Your line is open. Please go ahead.
Joe Altobello: First question on attrition rates. You mentioned them a couple times this morning. Back when you implemented click to cancel, are they back to where you thought they would be in February? And then on interest expense, I was not expecting a $29,000,000 increase year over year. Can you bridge that?
Jay Stasz: From an expectation standpoint, attrition is back in line in February. While there was an elevation after click to cancel last year, rates have remained within historical norms, and for the full year we expect attrition to be within historical norms. We anniversary the national rollout in Q2. Strategically, this is the right approach for member experience and de-risking. We are seeing a 6% increase in conversion in the digital join flow with the ability to manage your membership in the flow. On interest expense, the increase is largely the coupon change—we gave up a coupon in the threes, and the new tranche is about 5.4%. It includes the $400,000,000 refinanced plus the $350,000,000 incremental used for the ASR.
There is also an interest income component; that should get you close.
Colleen Keating: For the full year 2025, attrition was well within historical norms on an annualized basis—we have shared it as a three-handle average attrition rate, and that is where we landed in 2025. We also continue to see mid-30% of our joins as rejoins, demonstrating that empowering members to manage their membership builds goodwill and drives return behavior. And as Jay noted, we have seen about a 6% increase in conversion in the join flow since noting the ability to manage your membership.
Operator: Your next question comes from the line of Christopher O’Cull with Stifel. Your line is open. Please go ahead.
Christopher O’Cull: Thanks. Good morning. Colleen, I am trying to understand the 4% to 5% comp guide. You should have the coming benefit of the Black Card pricing, a 25% increase in media impressions from additional ad dollars, and residual benefit of the Classic Card pricing. Q4 comp was almost 6%. Why guide lower—is this conservatism or higher cancellation rate? And a follow-up on the Ro partnership—plans to jointly market and is the Perks discount ongoing or one-time?
Jay Stasz: A couple things. New stores enter the comp base after the thirteenth month. The 150 clubs opened in 2024 largely impact 2026, and 2024 was a lower opening year versus the 181 we just opened, which will impact 2027. Also, with a large installed base that generates significant cash flow, it takes a lot to move the comp needle even with rate lifts. Embedded in the comp guide is the modestly higher attrition post national click-to-cancel rollout, which we expect to moderate as we lap in Q2.
Colleen Keating: Our openings were very back-end loaded in 2025—over 100 in Q4—so those will enter the comp base much later this year. In 2024, openings were also back-end loaded and lower in total, so the comp contribution dynamics differ. We are also coming up on the second anniversary of the June 2024 Classic Card price lift; the most pronounced impact has been realized. The Black Card price lift is modeled, but we will take it after peak join season, so it will be impactful but less so than if taken during peak. On Ro, we launched late Q4. The intent is mutually beneficial: Ro gains exposure to 20,800,000 fitness-minded members; our members receive discounts and a complementary health solution.
Early click-through and conversion are high, but it is early days. We see compelling indicators—studies suggest 50% of GLP-1 users consider a gym membership. We and Ro are pleased with early results; we will not detail go-forward plans for competitive reasons.
Operator: Your next question comes from the line of Rahul Krotthapalli with JPMorgan. Please go ahead.
Rahul Krotthapalli: I want to revisit the comps waterfall and member join waterfall for clubs, especially those opened in the last two years and entering the comp base. And as a follow-up, do you expect tailwinds if the rest of the industry is forced to adopt click to cancel?
Jay Stasz: For new clubs, year one in comp typically runs 40%+, year two low to mid-teens, year three mid single digits, and beyond that low to mid single digits. On click to cancel, strategically this is the right thing for member experience and de-risking. We are seeing lift in digital conversions with cancel anytime messaging, which sets us up well. If others are required to adopt, the playing field evens, but we believe our early move and brand positioning are advantages.
Colleen Keating: More municipalities are focusing on enabling consumers to manage subscriptions. We believe we did the right thing by getting ahead of that and de-risking our business. With a mid-30% rejoin rate, empowering members strengthens relationships. Top cancellation reasons remain moving or lack of time—not experience—so many return to Planet Fitness.
Operator: Your next question comes from the line of Jonathan Komp with Baird. Your line is open. Please go ahead.
Jonathan Komp: Hi. Could you share more on join trends and whether you can still add close to the number of members you added in 2025? And Jay, on EBITDA—guided to 10% growth. You explained 200 bps of the delta versus the mid-teens three-year average. Can you bridge the rest?
Colleen Keating: We saw very strong join trends late 2025 into early 2026 prior to weather impacts, reinforcing secular tailwinds. We are confident in driving strong member growth through the year. In 2025, net member growth rose 10% despite online member management and the Classic Card price lift. The broader market remains large—50 to 60 million active adults likely to pay—so we see ample runway.
Jay Stasz: We knew this would be the lowest growth year in the three-year algo; the intent was not an annual rate each year. Strategic imperatives are gaining traction—the first 100 days engagement, Black Card Spa amenities, app improvements in training—supporting joins and retention. Our expense structure is set appropriately. As the flywheel compounds, we expect greater flow-through and step-ups in years two and three.
Colleen Keating: Momentum with younger consumers adds to lifetime value potential. High School Summer Pass participation rose from just shy of 3,000,000 to 3,700,000 with higher conversion. Unit openings in 2025 were up over 20% versus 2024, fueling future growth.
Operator: Your next question comes from the line of Sharon Zackfia with William Blair. Your line is open. Please go ahead.
Sharon Zackfia: One wildcard this year was the increase to the NAF. How do you think about that in terms of more shots on goal for member growth through the rest of the year? And how do we think about your use of $1 down, especially after the Black Card price increase?
Colleen Keating: The 1% shift from LAF to NAF begins impacting in Q2. We asked franchisees to keep LAF spend whole for Q1, so the most impact is in Q2–Q4. The shift funds capabilities like dynamic content optimization, enhanced AI-enabled CRM, and a predictive churn model moving into pilot. DCO will allow more tailored messaging based on consumer behavior; AI-enabled CRM will sharpen insights and targeting, especially for likely-to-pay consumers using other brands or modalities. On offers, our approach balances brand-building “Why Planet Fitness” with a compelling “Why Planet Fitness now” call to action, which may include financial inducements like $1 down. We will continue to use a balanced approach to drive conversions within specific timelines.
Operator: Your next question comes from the line of Jean Tzu with BNP Paribas. Your line is open. Please go ahead.
Jean Tzu: Thanks. On the mid-30% rejoin rate, can you talk about time away from the system—are lapsed members returning faster? And any early reads on GLP-1 members joining via the Ro partnership or otherwise?
Colleen Keating: We market consistently to former members and are testing narrower lapsed windows for rejoin offers versus waiting longer, along with different offer constructs. The most important thing is the rising rejoin rate—we finished Q4 at 34.8%, solidly mid-thirties. While we do not track GLP-1 usage specifically, our member base should mirror national utilization, roughly 13%. GLP-1 users often are first-time gym-goers and may experience gymtimidation; Planet Fitness is well positioned with our judgment free environment and focus on strength to combat muscle loss. We see this as an opportunity to expand our reach, and early Ro partnership metrics show high click-through and conversion.
Operator: Your next question comes from the line of Stephen Grambling with Morgan Stanley. Your line is open. Please go ahead.
Stephen Grambling: On cash and CapEx, you expect 10% to 15% growth again this year. Is that front-loaded or consistent, and any thoughts on selling additional corporate-owned clubs?
Jay Stasz: Last year CapEx growth was closer to ~6%. We may be conservative, but drivers this year include corporate-owned clubs, new clubs, and a fair amount of relocations and remodels. From a modeling standpoint, we have continued Spain development on our balance sheet this year, even as we work to recycle that capital with a franchise partner. That growth range is a reasonable way to think about it going forward. We will continue to build cash and invest in buybacks. On corporate-owned clubs, we will evaluate opportunities case-by-case. The 90/10 franchise/corporate mix is a good balance given strong four-wall profitability.
Colleen Keating: We have engaged a banker and are in market for Spain. We would like to bring in a strong franchise partner to accelerate growth—clubs there are performing well with ramps akin to domestic new clubs. The California sale was a geographic efficiency move, placing an outlier market with a well-capitalized West Coast franchisee while most of our corporate clubs are East/Northeast/Southeast.
Operator: There are no further questions at this time. I would now like to turn the call back to Colleen Keating, CEO, for closing remarks. Go ahead.
Colleen Keating: Thank you, and thank you for all the thoughtful questions. In closing, I will just reiterate our performance in 2025 demonstrates the immense power of our model. We remain laser focused on our four strategic imperatives which serve as the foundation for our next chapter of growth and our unwavering commitment to delivering long-term shareholder value. Thank you.
Operator: This concludes today's call. Thank you for attending. You may now disconnect.
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