Xponential Fitness Sets Three-Year Growth Targets; Shares Fall 15 Percent

Source:China Sport ShowRelease time:14-Sep-2023Clicks:

Article From：SGB Media

Shares of Xponential Fitness, Inc. fell sharply on Wednesday as investors returned from the company’s inaugural Analyst and Investor Day presentation at the NYSE with far less enthusiasm for the business after management presented the company’s three-year targets.

“It is great to be at the NYSE today to discuss a wide range of topics, including our three-year operating targets,” said Anthony Geisler, CEO of Xponential Fitness, Inc., to kick off the presentation. “In addition, we are thrilled to announce our new partnership with Gympass and look forward to working with Gary Vaynerchuk and VaynerMedia as they lead Xponential’s marketing efforts moving forward.”

XPOF shares were up initially as management said it was confident it would achieve the high-end of the ranges in its full-year 2023 outlook, which the company provided in its second quarter 2023 earnings release announced on August 3 and remains as follows:

New studio openings in the range of 540 to 560, or an increase of 8 percent at the midpoint as compared to full year 2022;

North America system-wide sales in the range of $1.385 billion to $1.395 billion, or an increase of 35 percent at the midpoint as compared to full year 2022;

Revenue in the range of $295.0 million to $305.0 million, or an increase of 22 percent at the midpoint as compared to full year 2022; and

Adjusted EBITDA in the range of $102.5 million to $106.5 million, or an increase of 41 percent at the midpoint as compared to full year 2022.

But the company also told the crowd in attendance that it is targeting 500 new studio openings in 2026, system-wide sales of $2.33 billion and revenue of $405.0 million. That should have been good news, but the conference did not have its desired effect.

The company also said it had entered into a collaboration agreement with Gympass, a corporate well-being platform.

“With more than 15,000 corporate customers and 2 million paid subscribers, all ten brands will be available on the Gympass app in October, which will utilize excess inventory to offer Xponential classes to a new market of potential customers and drive incremental studio revenue,” the company said in a statement.

Xponential’s stock was up 2 percent in the pre-market on Wednesday but fell throughout the day to close down 15.4 percent to $19.07 on Wednesday.