Planet Fitness<\/a> plunged more than 30% Thursday after the company reported a drag on sign-ups and trimmed its guidance.<\/p>\nThe stock was having its worst day ever, as of midday trading. <\/p>\n
Even though the fitness company saw 21.9% revenue growth in its first fiscal quarter and same-club sales increased by 3.5%, CEO Colleen Keating said the company saw a “slower than expected start from a net member growth perspective.”<\/p>\n
“As a result, we are sharpening our marketing to prioritize capturing demand and driving net member growth,” Keating said in a statement. “Additionally, we are pausing the planned national Black Card price increase pending a broader pricing review.”<\/p>\n
The first fiscal quarter is usually the company’s peak sign-up period. Keating said “internal and external headwinds” dealt a blow to the company’s performance.<\/p>\n
Planet Fitness cut its revenue growth projection to 7% from a previous estimate of 9%. It also now expects same-club sales of just 1%, compared with previous expectations of 4% to 5%, and adjusted net income to decrease 2%, compared with a previous expected increase of between 4% and 5%. <\/p>\n
On a call with analysts Thursday, Keating said four factors affected the company’s first-quarter performance: a lack of resonance from marketing, competition in some markets, bad weather conditions and macroeconomic pressures.<\/p>\n
“We are making immediate and near-term adjustments to broaden our reach and ensure our messaging is both visible and resonates with the fitness beginner and more casual gym-goer,” Keating said on the call.<\/p>\n
Keating also reaffirmed the company’s confidence in its strategy to return to long-term growth. She said Planet Fitness is focusing this year on driving member acquisition and reinforcing affordability.<\/p>\n
“Looking at data from Q4 of last year and Q1 of this year, we saw that our messaging and targeting was successful in driving increased penetration with the fitness-minded consumer, yet we may have\u00a0pivoted\u00a0too far,” she said.<\/p>\n
Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"People work out at a Planet Fitness in Alexandria, Virginia, on Jan. 8, 2024. Leah Millis | Reuters…\n","protected":false},"author":2,"featured_media":629591,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[448,28,122,225775,8084,2601,271,271709,5682],"class_list":["post-629590","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-breaking-news-business","tag-business","tag-business-news","tag-colleen-keating","tag-earnings","tag-health-care-industry","tag-life","tag-planet-fitness-inc","tag-retail-industry"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/629590","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=629590"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/629590\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/629591"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=629590"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=629590"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=629590"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}