Planet Fitness Inc. Signals Reset Year After Record 2025
Planet Fitness Inc ((PLNT)) has held its Q4 earnings call. Read on for the main highlights of the call.
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Planet Fitness Inc.’s latest earnings call struck a confident tone, highlighting robust 2025 execution across membership, unit growth and margins while openly flagging a deliberately slower 2026. Management framed the coming year as a “reset” driven by equipment cycles and portfolio changes, not by weakening demand, and underscored continued balance sheet strength and shareholder returns.
Strong Full-Year Financial Performance
Planet Fitness closed 2025 with impressive full-year momentum as same-club sales rose 6.7% and revenue climbed 12% year over year. Adjusted EBITDA grew 13%, adjusted diluted EPS jumped 19%, membership expanded by about 1.1 million net adds to roughly 20.8 million, and the footprint reached nearly 2,900 clubs worldwide.
Solid Q4 Results and Profitability
Fourth-quarter performance reinforced the full-year narrative, with system-wide same-club sales up 5.7% and revenue increasing to $376.3 million from $340.5 million a year earlier. Adjusted EBITDA rose to $146.3 million with a 38.9% margin, and for the full year the adjusted EBITDA margin ticked up to 41.7% from 41.3%.
Record Quarterly Openings and Unit Growth
Unit growth accelerated sharply as the company opened a record 104 clubs in Q4 and 181 in 2025, more than 20% above 2024 openings. Internationally, Planet Fitness surpassed 1 million members and topped 200 clubs while expanding its development pipeline into Northern Mexico and advancing its entry into Spain.
Membership Product Momentum and Conversion Gains
The High School Summer Pass program continued to prove its strategic value, attracting more than 3.7 million teen participants who completed over 19 million workouts. Importantly, Planet Fitness converted 8.3% of those teens into paying members, an improvement over prior years, while Black Card penetration hit a record 66.5% in Q4, boosting rate mix and revenue quality.
Marketing, Brand Visibility and Customer Recognition
Brand-building efforts remained front and center, with Planet Fitness leaning into high-profile marketing such as its presenting sponsorship of Dick Clark’s New Year’s Rockin’ Eve alongside its ongoing “We Are All Strong” campaign. The company’s consumer positioning was validated by being named USA Today’s Best Customer Service Company for 2026 and ranking as the highest-rated fitness brand on that list.
Digital Engagement and Product Innovation
Digital engagement continues to be a competitive edge as the Planet Fitness app remains a top download in the health and fitness category and early AI pilots are ramping in CRM, churn prediction and in-club training. Enhancements to the digital join and membership management flow drove roughly a 6% improvement in conversion, while the Q4 rejoin rate landed at about 34.8%, in the mid-thirties.
Capital Allocation and Balance Sheet Strength
The balance sheet remains solid, with cash, cash equivalents and marketable securities totaling $607 million versus $529.5 million a year earlier and a recently refinanced debt stack of $750 million at a blended coupon near 5.4%. Planet Fitness executed a $350 million accelerated share repurchase and has returned nearly $800 million via buybacks over two years, with plans for roughly $150 million of repurchases in 2026.
Format Optimization and Franchise Adoption
Management emphasized ongoing format and equipment optimization as a key driver of traffic and retention, noting that 95% of clubs opened or remodeled in 2025 selected an optimized layout. Nearly 80% of the system now features some version of this upgraded format, which the company says is supporting joins, Black Card upgrades and member stickiness.
Lower Near-Term Growth Guidance for 2026
Despite strong current trends, Planet Fitness expects 2026 to be the lowest growth year within its three-year framework, largely due to structural factors. Guidance calls for 4–5% system-wide same-club sales growth, about 9% total revenue growth, around 10% adjusted EBITDA growth, 4–5% adjusted net income growth and 9–10% adjusted diluted EPS growth.
Equipment Replacement Cycle and Segment Headwinds
A new growth model and extended equipment replacement cadence are set to weigh on the equipment segment in the near term even as Q4 equipment revenue rose 15.3% and cost of equipment revenue increased 12.1% to $90.2 million. For 2026, Planet Fitness expects re-equipment to make up roughly 70% of equipment segment revenue with an equipment margin rate of about 30%, creating a drag on top-line growth.
Sale of Corporate Clubs Impacting Comparables
The sale of eight corporate-owned California clubs in the third quarter of 2025 is another headwind to reported growth as revenue shifts from company-operated to franchise economics. While strategically aligned with Planet Fitness’s asset-light model, the transaction lowers year-over-year revenue and profit comparisons in 2026, contributing to the tempered growth outlook despite underlying demand resilience.
January Weather Disruption and Short-Term Attrition Bump
Near-term noise also came from external factors as late-January storms and extreme cold hit join trends across roughly 2,000 clubs and temporarily suppressed sign-ups. Management also noted a brief uptick in cancellations after heightened awareness of click-to-cancel options, but said attrition rates normalized by February, suggesting no structural change in member behavior.
Higher Interest Expense After Refinancing and Buybacks
On the financial side, Planet Fitness is bracing for a meaningful increase in interest expense following its refinancing and capital return actions, with 2026 net interest expense guided to about $114 million. The company highlighted that interest costs are expected to rise by roughly $29 million year over year, reflecting higher coupons around 5.4% and financing for the $350 million accelerated share repurchase.
Rising Operating and Advertising Expenses
Operating and marketing costs are also trending higher as Planet Fitness invests behind growth and brand scale, with Q4 club operations expenses up 7.1% and National Ad Fund spending up 10.5% year over year. A planned 1% shift from local to national advertising starting in the second quarter of 2026 will further centralize spend and is expected to increase National Ad Fund activity in the back half of the year.
2026 Outlook and Forward Guidance
Looking ahead, Planet Fitness guided to 180–190 new club openings in 2026, with 150–160 equipment placements skewing to the back half of the year and especially the fourth quarter. The company expects around 9% revenue growth, 10% adjusted EBITDA growth with roughly flat margins, 9–10% EPS growth, higher capex and D&A, and about $114 million in net interest expense, with comps driven roughly 75% by rate and 25% by volume and strength building in the second half.
Planet Fitness’s earnings call painted a picture of a high-growth model temporarily dialing back to absorb an equipment-heavy year, portfolio shifts and higher financing costs. Yet with record 2025 performance, strong brand equity, expanding digital initiatives and continued unit growth, management signaled confidence that 2026 is a manageable pause rather than a pivot away from its long-term growth trajectory.
