• System-wide Same Club Sales Growth: 5.5% in Q4 2024.
• Revenue Growth: 19.4% increase in Q4 2024.
• Adjusted EBITDA Growth: 14.4% increase in Q4 2024.
• New Club Openings: 86 new clubs in Q4 2024, totaling 150 for the year.
• Total Club Count: Over 2,700 clubs globally by year-end 2024.
• Membership Growth: Increased by 1 million members in 2024, reaching approximately 19.7 million members.
• Classic Card Price Increase: From $10 to $15 at the end of June 2024.
• Black Card Penetration: Approximately 64% at the end of Q4 2024.
• Total Revenue: $340.5 million in Q4 2024, up from $285.1 million in Q4 2023.
• Net Income: $47.6 million in Q4 2024.
• Adjusted Net Income: $59.7 million in Q4 2024.
• Adjusted EBITDA Margin: 38.4% in Q4 2024, down from 40.1% in Q4 2023.
• Cash Equivalents and Marketable Securities: $529.5 million as of December 31, 2024.

• Warning! GuruFocus has detected 8 Warning Signs with PLNT.

Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Planet Fitness Inc (NYSE:PLNT) achieved a 19.4% revenue growth and a 14.4% increase in adjusted EBITDA during Q4 2024.
• The company added 86 new clubs in Q4, totaling 150 new clubs for the year, bringing the global count to over 2,700.
• Membership grew by 1 million in 2024, reaching approximately 19.7 million members.
• The company successfully implemented a price increase for the classic card membership, raising it from $10 to $15, which is expected to improve unit economics.
• Planet Fitness Inc (NYSE:PLNT) is expanding internationally, with five clubs opened in Spain by the end of 2024, and plans to enter one to two new international markets annually.

Negative Points

• The adjusted EBITDA margin decreased in Q4 compared to the prior year, primarily due to increased marketing investment and equipment sales in the lowest margin segment.
• The company anticipates a slower pace to reach 200 new club openings annually, indicating it may take a few years to achieve this goal.
• There is a potential short-term increase in churn rates due to the implementation of click-to-cancel policies in more states.
• The company faces challenges with real estate availability, as retail vacancies remain tight, impacting new club development.
• Increased SG&A expenses are expected in 2025 due to investments in strategic imperatives and new executive hires, which may limit margin expansion.

Q & A Highlights

Q: Can you provide insights on how the price hike is affecting your full-year comp and revenue guidance, and what are you seeing in terms of churn post-price hike? A: Jay Stasz, Incoming CFO, explained that the classic card price increase, implemented in June, is expected to contribute a low-to-mid single-digit comp lift annually. The churn rates have shown improvement, with members showing stickiness to the $10 price point, and attrition rates aligning year-over-year, which is a positive trend.

Q: Could you elaborate on the international expansion strategy, particularly in Spain, and the appetite for franchisee growth in the U.S.? A: CEO Colleen Keating highlighted the successful ramp-up in Spain, with plans to continue expansion and transition to a franchise model. In the U.S., franchisees are showing renewed interest in growth, supported by improved IRRs and reduced build costs. The company aims to return to opening 200 new clubs annually within a few years.

Q: Are you seeing more members opting for the black card due to the price compression between membership types, and any updates on the black card pricing test? A: Jay Stasz noted an increase in black card penetration to 64%, driven by the value proposition of a $10 difference from the classic card. The black card pricing test is ongoing, and results will be shared once concluded.

Q: How is the new marketing campaign resonating with consumers, and what are the plans for marketing spend throughout the year? A: CEO Colleen Keating stated that the campaign launched at the end of December is receiving positive social sentiment. Marketing spend will increase with revenue growth, focusing heavily on Q1, with promotional periods planned throughout the year.

Q: What are the priorities for strategic investments in 2025, and how do you plan to manage churn with the click-to-cancel feature? A: Colleen Keating emphasized top-line growth and unit expansion as key priorities, supported by new leadership roles. Regarding churn, the click-to-cancel feature shows a short-term increase in cancellations, but normalizes over time, with a high rejoin rate indicating strong brand loyalty.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.