Release Date: February 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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.
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