Planet Fitness, Inc. PLNT reported stellar fourth-quarter 2024 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate. Both the metrics increased on a year-over-year basis.

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Following the results, the company’s shares fell 9.2% during trading hours yesterday. Negative investor sentiment was driven by concerns over the company’s 2025 outlook, which projected revenue and adjusted EBITDA growth of approximately 10%, slightly below investors’ expectations. Additionally, the company cited increased capital expenditures, projected to rise by 25% in 2025, as it invests in new club openings and corporate-owned locations. While Planet Fitness remains focused on long-term growth, the measured pace of franchise expansion and potential moderation of pricing benefits after June 2025 added to investor caution.

PLNT’s Earnings & Revenue Discussion

The company reported adjusted earnings per share (EPS) of 70 cents, beating the Zacks Consensus Estimate of 62 cents by 12.9%. In the prior-year quarter, the company reported adjusted EPS of 60 cents.

Planet Fitness, Inc. Price, Consensus and EPS Surprise

Planet Fitness, Inc. price-consensus-eps-surprise-chart | Planet Fitness, Inc. Quote

Quarterly revenues of $340.5 million topped the consensus mark of $327 million by 4.2%. The top line also improved 19.4% year over year, driven by system-wide same-club sales growth of 5.5% year over year.

Adjusted EBITDA during the quarter came in at $130.8 million, up from $114.3 million reported in the year-ago quarter.

PLNT’s Segmental Performance

Franchise: During the fourth quarter, the segment revenues rose 11% year over year to $109 million. Our model predicted the metric to increase 7.8% from the prior-year level. This upside was driven by a rise of $5.6 million, stemming from an uptick in royalty revenues, $1.3 million from new clubs opened since Oct. 1, 2023, and $0.7 million from higher royalties on annual fees.

The segment’s EBITDA was $74.7 million, up 9.8% year over year. Our estimate for the metric was $77.1 million.

Corporate-owned Clubs: Revenues of this segment amounted to $126.3 million, up 8.5% year over year. This uptick can be attributed to an increase of $3.6 million from corporate-owned clubs and $6.4 million from new clubs opened and acquired since Oct. 1, 2023. Our anticipated value was $130.7 million.

Segment EBITDA totaled $46.4 million, up 1.8% year over year. Our estimate for the metric was $47.9 million.

Equipment: Segmental revenues totaled $105.1 million, up 49.2% year over year. We expected the metric to rise 15.9% year over year. This upside was due to higher revenues from equipment sales to existing and new franchisee-owned clubs.

This segment’s EBITDA was $29.9 million, up 78.3% year over year. Our estimate for the metric was $13.7 million.

Other Financial Details of PLNT

As of Dec. 31, 2024, Planet Fitness had cash and cash equivalents of $293.2 million compared with $275.8 million as of Dec. 31, 2023. Long-term debt (net of current maturities) was $2.15 billion, up from $1.96 billion as of Dec. 31, 2023.

2024 Highlights

Total revenues in 2024 came in at $1.18 billion compared with $1.07 billion reported in 2023.

Adjusted EBITDA in 2024 came in at $487.7 million compared with $435.4 million reported in 2022.

In 2024, adjusted net income per share (diluted) came in at $2.59 compared with $2.24 reported in the previous year.

2025 Outlook of Planet Fitness

For 2025, the company expects new equipment placements to be approximately 130 to 140  franchisee-owned locations, with system-wide new club openings projected to be around 160 to 170 locations.

System-wide same-club sales growth in 2025 is expected to be in the 5-6% range. The company anticipates revenues to increase by approximately 10% over 2024 levels.

Adjusted EBITDA for 2025 is estimated to grow by approximately 10%, while adjusted net income is expected to increase in the 8-9% range. Adjusted diluted EPS is projected to rise in the 11-12% range, based on adjusted diluted weighted-average shares outstanding of approximately 84.5 million.

For 2025, the company expects net interest expense to be approximately $86 million. Capital expenditures are projected to increase by approximately 25%, driven by additional corporate-owned clubs. Depreciation and amortization are expected to remain consistent with 2024 levels.

PLNT’s Zacks Rank

PLNT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Consumer Discretionary Releases

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Marriott International, Inc. MAR reported fourth-quarter 2024 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate. The top line increased year over year while the bottom line declined from the prior-year quarter.

Marriott posted strong results in 2024, driven by steady global travel demand and strategic portfolio expansion. The company’s development momentum remained strong, with the signing of a record number of new deals and its development pipeline reaching 577,000 rooms. Given its vast global footprint, a loyalty program comprising nearly 228 million Marriott Bonvoy members and an asset-light model, MAR remains well-positioned to capitalize on travel demand and drive growth in the upcoming periods.

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