While major gyms in the U.S. haven’t experienced the traffic boom they typically see in January, it’s been a tough start last month that doesn’t bode well for gyms considering raising prices.
Foot traffic was flat year over year at 10 major U.S. fitness chains last month, typically the busiest month of the year, according to previously reported data from Placer.ai. bloomberg.
This is in contrast to 2023 and 2022, when the 10 clubs Placer.ai tracked (including Planet Fitness and Equinox) saw January visitor numbers increase by more than 40% annually.
Budget-friendly Planet Fitness, which is considered an industry agency because it is the largest chain, typically added about 400,000 members in January, according to a Bloomberg report. This corresponds to approximately 25% of the 1.7 million annual registered users.
All the while, the chain, which boasts about 2,500 clubs across the country, posted its second-worst quarterly revenue growth since the pandemic in 2021, according to Bloomberg.
Xponential Fitness, which owns popular boutique fitness studios such as CycleBar, Pure Barre, and boxing club Rumble, also expects first-quarter revenue growth to be its slowest since going public in 2021, Bloomberg reported.
While Xponential’s stock price has plummeted more than 54% over the past year, Xponential Chief Financial Officer John Meroon told investors during a 2023 earnings call in November that consumer The number of customers “increased compared to last year,” he said. ”
Analysts said attempts to raise membership prices are having a negative impact on membership growth.
For example, Planet Fitness considered raising the price of its $10 per month Classic membership late last year.
Interim CEO Craig Benson told analysts that the chain was considering raising prices as consumers became accustomed to higher prices, but did not respond to such increases. It would have been Planet Fitness’s first price increase in 30 years.
Benson has taken over the role of CEO since Chris Rondeau abruptly stepped down after 10 years at the helm.
Stifel analyst Chris Okal said in a Monday note obtained by Bloomberg that Planet Fitness’ inability to raise prices means it could rely on promotions if it wants to drive growth. He said that it shows that.
“The $10 price point is where investors and the industry are really attracted,” TD Cowen’s Rakulenko said, according to Bloomberg.
Planet Fitness’ stock price has fallen more than 15% over the past 12 months.
The Post has reached out to Planet Fitness and Xponential for comment.
