Xponential Grows Revenue 30%, Eyes More With Wellness Push
The boutique fitness and wellness franchisor sees massive potential in Lindora, it’s first foray into the GLP-1 weight-loss drug space
Xponential Fitness, the boutique fitness and wellness franchisor overseeing ten brands, opened an average of one and a half new studios each day in 2023 — a feat founder and CEO Anthony Geisler said can continue this year on Thursday’s earnings call with investors.
The leading health and wellness franchisor grew its full-year 2023 revenue by 30% to $318.7 million and grew its Q4 2023 revenue by 27% to $90.2 million, reporting strong growth despite a net loss of $9.1 million in Q4, resulting from restructuring costs from company-owned transition studios, lower overall profitability and an increase in impairment of goodwill and other assets.
“In 2023, we experienced substantial growth on both the top and bottom lines as members continued to demonstrate that they prioritize their health and wellness routines,” Geisler said. “We further streamlined our business and are operating from a position of strength as we leverage our operations.”
Xponential also increased its North America system-wide sales by 36% to $1.40 billion, sold 805 franchise licenses and opened 557 new studios in 2023. Total members in North America grew 21% year-over-year in 2023 to 717,000, while visitation rates increased 31% to 51.5 million studio visits last year.
“We see this momentum carrying into 2024 and are confident that our optimized portfolio of global brands will deliver considerable margin expansion and operational cash flows.”
Looking ahead to full year 2024, Xponential expects 550 new studio openings and an 8% growth in revenue.
The Lindora Effect
Lindora, Xponential’s most recent acquisition that signals its push into the GLP-1 and wellness space, took center stage on Thursday’s earnings call.
Based on preliminary findings, Geisler noted that the company sees the greatest similarities between Lindora member profiles and those of Club Pilates and StretchLab, alluding to two of Xponential’s most popular and successful brands. He also indicated that apparel may be added to Lindora’s retail mix and sees the metabolic health brand as a lucrative addition.
“Given that the average member in Lindora spends more than the average member in our fitness brands, there’s … more wallet share there than the fitness product,” Geisler said. “People that have shown up at Lindora have tried typically some version of weight loss, whether that be diet and exercise or both in the past and so when they come to Lindora, they’re willing to spend whatever they need to spend to get the ultimate result.”
Earlier this month, Xponential sold its treadmill-based interval fitness brand Stride Fitness, which represented less than 1% of its total studios open at the close of 2023.
