Life Time Group Holdings, Inc. (LTH): BCG Matrix [Dec-2025 Updated]

You're looking for the hard truth on where Life Time Group Holdings, Inc. (LTH) is actually making and spending money as we close out 2025, so let's cut straight to the Boston Consulting Group Matrix view. Honestly, the story is clear: stable Core Membership Dues are the Cash Cow, churning out $630.7 million in operating cash flow to feed the high-growth Stars-like Dynamic Personal Training hitting $220.0 million in Adjusted EBITDA-and the capital-hungry Question Marks, namely the 10 new centers opening this year, plus the digital push. We're also flagging the older, less-utilized legacy retail operations as Dogs that just aren't pulling their weight. This framework shows you precisely which segments are funding the future and which ones are just taking up space.

Background of Life Time Group Holdings, Inc. (LTH)

Life Time Group Holdings, Inc. (LTH) is a major operator in the health and wellness space, running a network of premium athletic country clubs across the United States and Canada. You'll find they offer a full suite of fitness and lifestyle services within these locations. Honestly, their model focuses on a high-touch, comprehensive experience, which is reflected in their average monthly dues, which grew 10.6% year-over-year in the second quarter of 2025.

The company has been aggressively expanding its footprint. As of early 2025, Life Time had 179 locations in its portfolio, and they planned to open between 10 and 12 new centers during fiscal year 2025. By the end of the third quarter of 2025, they reported exceeding 849,000 center memberships. To fund this expansion, Life Time Group Holdings, Inc. is actively using sale-leaseback transactions to unlock capital.

Financially, Life Time Group Holdings, Inc. showed strong momentum through the first nine months of 2025. Total revenue for the nine months ended September 30, 2025, reached $2,250.16 million, a 14.9% increase from the prior year period. Net income for the same nine-month period was $250.67 million, more than doubling the $119.08 million reported a year prior. For the third quarter of 2025 alone, revenue was $782.65 million, and net income was $102.43 million.

The company's operational improvements are clear in its balance sheet management. Following the third quarter of 2025, Life Time Group Holdings, Inc. reported that its net debt leverage ratio had improved significantly to 1.6 times. Furthermore, the company raised its full-year 2025 comparable center revenue guidance to a range of 10.8% to 11.0%, up from earlier projections. The CEO noted that the growth strategy remains on track, supported by a solid balance sheet and strong cash generation.

Life Time Group Holdings, Inc. (LTH) - BCG Matrix: Stars

The segments categorized as Stars for Life Time Group Holdings, Inc. (LTH) demonstrate high market share within rapidly expanding service categories, necessitating significant investment to maintain leadership.

Dynamic Personal Training and In-Center Services generated an Adjusted EBITDA of $220.0 million for the third quarter of 2025. This segment's Adjusted EBITDA margin for the quarter reached 28.1%.

Comparable center revenue growth guidance for the full year 2025 has been raised to a range of 10.8% to 11.0%, up from previous expectations of 9.5% to 10.0%. This reflects the high-growth nature of the core business, aligning with the requested range of 9.5% to 11.0%.

Premium, high-utilization offerings are evidenced by the average revenue per center membership of $888 in Q2 2025. By the third quarter of 2025, this metric had further increased to $907.

These units represent the high-margin, high-growth core of the existing high-share club footprint. The overall third quarter 2025 Total Revenue was $782.6 million, a 12.9% increase year-over-year.

Here's a quick look at the operational strength driving these Star classifications:

• Full Year 2025 Comparable Center Revenue Growth Guidance: 10.8% to 11.0%.
• Q3 2025 Total Revenue: $782.6 million.
• Q3 2025 Revenue Year-over-Year Growth: 12.9%.
• Q3 2025 Average Monthly Visits per Membership: 12.5.

The sustained success in these areas is what positions them to potentially become Cash Cows as the overall market growth rate moderates. The investment required to support this growth is substantial, as seen in the capital expenditures.

The high utilization and premium nature of these offerings are key drivers. Consider the following operational metrics that underscore the high-share, high-utilization aspect:

• Q3 2025 Adjusted EBITDA Margin: 28.1%.
• Q3 2025 Total Visits Growth Year-over-Year: 7%.
• Q3 2025 Revenue Per Center Membership Year-over-Year Growth: 11.3%.
• Full Year 2025 Guidance Net Debt Leverage Ratio Target: At or below 2.00 times.

These figures show the segment is currently consuming cash for expansion while generating significant, high-margin revenue.

Life Time Group Holdings, Inc. (LTH) - BCG Matrix: Cash Cows

The core of Life Time Group Holdings, Inc. (LTH)'s stability rests within its established club base, which functions as the quintessential Cash Cow in the BCG framework. These are mature assets operating in a segment where market share is high, and growth, while present, is more measured than in newer ventures.

Core Membership Dues from Mature Athletic Country Clubs provide the bedrock of predictable, recurring revenue. This stability is what allows Life Time Group Holdings, Inc. (LTH) to fund riskier growth areas. You see this stability reflected in the consistent ability to command premium pricing, which is a hallmark of a market leader that has achieved competitive advantage.

The financial performance clearly demonstrates this cash-generating power. For the first nine months of 2025, Life Time Group Holdings, Inc. (LTH) generated $630.7 million from operations. This substantial inflow is the lifeblood of the organization, covering overhead and fueling expansion.

Pricing power within this segment is evident when you look at the average member spend. The average monthly dues reached $208 in Q1 2025. This figure reflects both the premium positioning of the brand and strong member retention rates, suggesting members see the value proposition as worth the recurring cost.

This segment's primary role is capital allocation. The cash generated here is directly applied to strategic initiatives. Specifically, this cash flow is used to fund the new club expansion pipeline and actively manage the balance sheet through debt reduction. As a result of this disciplined approach, the net debt leverage ratio improved to 1.8 times as of June 30, 2025, showing the success of using Cash Cow profits to de-risk the enterprise.

Here is a snapshot of the financial metrics supporting the Cash Cow status, based on recent reporting periods:

The strategy for these mature assets is clear: maintain the high market share and extract maximum, efficient cash flow. Investments here are targeted, not broad-based marketing pushes.

• Investments focus on efficiency improvements in existing centers.
• Maintain high member engagement and utilization rates.
• Support infrastructure to handle current volume without major cost overruns.
• Ensure pricing strategy keeps pace with inflation and value delivery.
• Use cash to service corporate debt obligations.

The continued strength in the core business allows Life Time Group Holdings, Inc. (LTH) to manage its capital structure proactively. For instance, the company had $218.9 million of cash and cash equivalents as of September 30, 2025, a position built on the reliable cash generation from these established clubs.

You can see the direct impact of this cash generation on the balance sheet improvement:

• Cash flow funds new club development (12 to 14 planned for next year).
• Cash flow supports debt reduction efforts.
• The goal is to maintain leverage below 2.00 times for the full year 2025.

Honestly, these Cash Cows are what you want to see in a portfolio; they are the engine that pays for the exploration of new growth areas. Finance: draft 13-week cash view by Friday.

Life Time Group Holdings, Inc. (LTH) - BCG Matrix: Dogs

Dogs are units or products with a low market share and low growth rates. They frequently break even, neither earning nor consuming much cash. Dogs are generally considered cash traps because businesses have money tied up in them, even though they bring back almost nothing in return. These business units are prime candidates for divestiture.

For Life Time Group Holdings, Inc. (LTH), the Dog quadrant likely consists of assets or services that do not align with the company's overall high-growth trajectory, which saw TTM revenue of $2.91B as of September 30, 2025.

The characteristics suggesting potential Dogs within the Life Time Group Holdings, Inc. portfolio relate to units that fail to meet the strong performance benchmarks set by the core business.

Older, less-utilized legacy retail operations within centers are candidates for the Dog quadrant if their revenue contribution and growth fall below the company's overall momentum. The search results indicate that center operations expenses increased due to operating costs related to increased club utilization in mature centers. This suggests that older locations may require disproportionate operational spending relative to their revenue generation, a classic Dog characteristic.

Low relative market share against large, specialized e-commerce and retail competitors is a structural issue for any non-core retail component. While specific market share data for Life Time Group Holdings, Inc.'s retail segment versus e-commerce giants is not available, the general principle applies to any segment not benefiting from the core membership and in-center service strength.

Non-core, low-margin services that have not been successfully integrated into the premium wellness ecosystem would be Dogs. The strong performance noted in Dynamic Personal Training implies that other in-center offerings that are not achieving similar utilization or revenue per member growth may fall into this category. For context, average revenue per center membership was $844 in Q1 2025, and $888 in Q2 2025, indicating the high-value core services.

Any older, non-strategic club locations that are not meeting the comparable center revenue growth targets are prime Dogs. The company raised its full-year 2025 comparable center revenue guidance to between 10.8% to 11.0% as of Q3 2025, following an earlier guidance of 7% to 8% for the full year 2025. Any mature club generating growth significantly below these figures would be classified as a Dog, as newer clubs are outpacing their plans.

The following table summarizes the strong performance metrics of the core business, against which any Dog unit would underperform:

The focus for Dogs is minimization. Expensive turn-around plans usually do not help. You should look to divestiture for these units.

• Older clubs failing to achieve comparable center revenue growth above 10.8%.
• In-center services that do not match the growth of Dynamic Personal Training.
• Legacy retail operations with utilization costs outweighing revenue contribution.
• Units contributing to the Center operations expenses increase related to mature centers.

Life Time Group Holdings, Inc. (LTH) - BCG Matrix: Question Marks

You're looking at the growth engines that haven't quite proven themselves yet, the Question Marks of Life Time Group Holdings, Inc. (LTH). These are areas in fast-growing markets where the company has a small piece of the pie, meaning they suck up cash now but hold the potential to become tomorrow's Stars.

New Club Development Pipeline represents a major Question Mark category. Life Time Group Holdings, Inc. has a stated plan to open 10 new centers during fiscal 2025, with seven already open as of November 4, 2025. These ground-up builds are capital-intensive; the company generally expects net invested capital of $25-$30 million per new location. To be fair, these new assets don't immediately contribute; they take, on average, three to four years to ramp up to their expected performance levels, consuming cash during that initial period. The company plans to continue this aggressive pace, guiding for 12-14 new clubs in 2026, each averaging nearly 100,000 square feet.

Here's a quick look at the investment profile for these high-growth, high-cash-consumption areas:

The Digital Offerings and the Life Time app, featuring the L•AI•C™ AI-powered health companion, operate squarely in the high-growth digital fitness market. The growth is undeniable, with Life Time Digital accounts reaching 2.3 million and showing a 216% increase year over year as of Q2 2025. However, relative to established pure-play digital platforms, the relative market share is low, fitting the Question Mark profile perfectly. This segment requires continuous investment to build out features and capture share.

Also falling into this quadrant are ancillary businesses like the iconic athletic events. Life Time Group Holdings, Inc. owns and produces nearly 30 of the most iconic athletic events in the country. While these build brand equity, they are a small, capital-intensive revenue stream compared to the core membership business. For example, nutritional supplement revenues, another ancillary line, grew 31% versus the prior year quarter in Q2 2025, showing growth potential but remaining secondary to club dues.

The company is definitely investing heavily here, which is the required strategy for a Question Mark. Life Time Group Holdings, Inc. achieved positive free cash flow of $216.4 million for the nine months ended September 30, 2025, and a significant portion of this is being directed toward these growth vectors, particularly the new club pipeline, to try and convert these low-share, high-growth units into Stars.