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Sep 30, 2024
Xponential Fitness Q3 2024 Earnings Report
Xponential Fitness reported mixed Q3 2024 results with revenue consistent year-over-year, but a net loss posted. The company saw growth in North America system-wide sales and AUV, while strategically shifting away from company-owned transition studios.
Key Takeaways
Xponential Fitness reported Q3 2024 financial results with revenue of $80.5 million, consistent with the prior year. The company posted a net loss of $18.0 million, or a loss of $0.29 per basic share, compared to a net loss of $5.2 million, or earnings per basic share of $0.91, in the prior year period. North America system-wide sales increased by 21% to $431.2 million, and North America quarterly run-rate AUV grew to $631,000 from $585,000.
Revenue remained consistent at $80.5 million compared to the previous year.
North America system-wide sales increased by 21% to $431.2 million.
North America same store sales grew by 5%, a decrease from the previous 15%.
Net loss was $18.0 million, or a loss of $0.29 per basic share.
Xponential Fitness
Xponential Fitness
Forward Guidance
Xponential Fitness is reiterating its 2024 guidance for system-wide sales, total revenue, and adjusted EBITDA, while lowering guidance for global new studio openings.
Positive Outlook
- North America system-wide sales are expected to be in the range of $1.705 billion to $1.715 billion, representing a 22% increase at the midpoint compared to full year 2023.
- Revenue is projected to be in the range of $310.0 million to $320.0 million, consistent with full year 2023.
- Adjusted EBITDA is anticipated to be in the range of $120.0 million to $124.0 million, a 16% increase at the midpoint compared to full year 2023.
- Tax rate is expected to be in the mid-to-high single digits.
- Share count is estimated to be 31.8 million shares of Class A Common Stock for GAAP EPS and Adjusted EPS calculations.
Challenges Ahead
- Gross new studio openings are now projected to be in the range of 490 to 510, a decrease of 10% at the midpoint compared to full year 2023 gross new openings.
- The company is unable to provide a quantitative reconciliation of the estimated full year Adjusted EBITDA due to the variability and complexity of certain items.
- Potential unpredictable and significant impact on future GAAP financial results.
- Reconciliations provided would imply a degree of precision that would be confusing or misleading to investors.
- Variability of items such as taxes, TRA remeasurements, and income and expense from changes in fair value of contingent consideration from acquisitions.