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07 Sep 2023
Xponential reveals three year forecasts, joins forces with Gympass and Gary Vee to drive growth
By Liz Terry
Xponential reveals three year forecasts, joins forces with Gympass and Gary Vee to drive growth
Anthony Geisler, CEO of Xponential Fitness
Photo: Xponential Fitness
Xponential Fitness presented its three-year operating targets at its first Analyst and Investor Day at the New York Stock Exchange today.

Taking to the floor, CEO Anthony Geisler said Xponential is expecting to see 500 openings in the year 2026, along with North America system-wide sales of US$2.330 billion, revenue of US$405 million and Adjusted EBITDA of US$190 million.

Reverse engineering the numbers gives an insight into how scale will drive profits for the business as it grows, with system-wide sales looking likely to grow from the approx US$400k per site average that was achieved in 2022 to around US$500k per site in 2026. Xponential takes 9 per cent of these sales in addition to franchise and other fees.

A new deal with corporate wellbeing platform Gympass was also revealed by Geisler who said inventory from all ten of Xponential’s brands will be available on the Gympass app from October, giving franchisees an outlet for their spare class spaces, enabling them to attract new customers from the high-value corparate wellness sector and drive incremental revenue.

Gympass, which was recently valued at US$2.4 billion, has 15,000 corporate customers and 50,000 operator partners, including Life Time, Orangetherory and Barry’s, so Xponential is fairly late to the party with this deal.

The volume of brands and locations it brings will be material for Gympass.

The final announcement saw Geisler revealing that the company has hired a new marketing agency, mobile-first specialist VaynerMedia, which is run by Gary Vaynerchuk (Gary Vee) and works with brands such as TikTok and Tinder.

Vaynerchuk will lead marketing efforts personally, with each Xponential brand having its own content plan to ‘drive awareness, capture new audiences and optimise marketing spend’.

Vaynerchuk said he believes his agency will help Xponential to “reach new levels of growth globally.”

During the presentations, Geisler also confirmed that Xponential remains on track to hit the high-end of its forecast range of KPIs for 2023 – which were announced on 3 August.

These include:

- 540-560 studio openings – an 8 per cent increase on 2022
- Revenues between US$295 and US$305
- Adjusted EBITDA between US$102.5m and US$106.5m
- System wide sales of between US$1.385 and US$1.395 billion (the company broke the billon dollar barrier in March this year).

Share prices – that haven’t fully recovered from the Fuzzy Panda incident – dropped 15 per cent in spite of these solid results and forecasts, however, on the day that Xponential looks three years ahead, it’s worth noting that even with today’s drop, Xponential's share prices have increased 56 per cent over the last five years.

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