Planet Fitness, Inc. (PLNT): Business Model Canvas [Dec-2025 Updated]

You're looking at the engine behind one of the market's most successful gym operators, and honestly, it's a masterclass in asset-light scaling. Based on the latest figures, this model is projected to hit 11% revenue growth in 2025, driven by a massive base of nearly 20.7 million members who are happy paying as little as $15 a month for access. We've broken down exactly how this high-margin structure works-from the 7% royalty stream to the culture that keeps first-time users coming back-so you can see the mechanics behind the 2,795 club footprint as of September 30, 2025. Dive in below to see the full Business Model Canvas.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that let Planet Fitness, Inc. scale so quickly, which is mostly about letting others put up the capital. This asset-light approach is central to their model, so these partners are critical to hitting their growth targets.

Franchisees

Franchisees are the engine for Planet Fitness, Inc.'s rapid, capital-light expansion. They own and operate the vast majority of the locations. As of June 30, 2025, the system had 2,762 clubs system-wide. More than 90% of these clubs are owned and operated by independent business owners. For the full year 2025, the company is guiding for system-wide new club openings of approximately 160 to 170 locations, with the bulk expected to be franchisee-owned. In the second quarter of 2025 alone, 20 new clubs opened were franchisee-owned, out of 23 total new clubs.

This structure means Planet Fitness, Inc. collects royalty revenue from these partners. Franchise segment revenue in the second quarter of 2025 saw higher royalty revenue of $8.0 million, with $5.0 million attributable to a franchise same club sales increase of 8.3%.

Equipment Suppliers

Equipment suppliers are key for both new club builds and ongoing maintenance, which drives a significant portion of the Equipment segment revenue. The company expects 130 to 140 new equipment placements in franchisee-owned locations for the full year 2025. The Equipment segment revenue for the second quarter ended June 30, 2025, was $82.2 million, an increase of 21.5% year-over-year. For the full year 2025 outlook, re-equips are projected to constitute 70% of total equipment segment revenue.

Here's a quick look at the equipment-related activity:

Metric	Value as of Q2 2025 / FY 2025 Outlook
Equipment Segment Revenue (Q2 2025)	$82.2 million
New Equipment Placements Expected (FY 2025 Guidance)	130 to 140 units
Equipment Sales to New Franchisee Clubs (Q2 2025)	19 clubs
Re-equips as % of Total Equipment Segment Revenue (FY 2025 Expectation)	70%

Real Estate Developers

Securing prime retail locations is vital for the projected growth rate. The company's 2025 guidance anticipates system-wide new club openings of 160 to 170 locations. This requires consistent site identification and lease execution with real estate developers and landlords. The company is focused on refining club floorplans to improve franchise returns as part of its long-term strategy.

Boys & Girls Clubs of America

This social impact partnership drives community outreach under the Judgement Free Generation® initiative. Planet Fitness, Inc. and its franchisees have collectively donated more than $10.5 million to the organization since 2016, with contributions in 2024 alone exceeding $1 million. The partnership focuses on creating physical and emotional support spaces.

Key metrics from this partnership include:

• Total cumulative contribution since 2016: More than $10.7M+
• Scholarships awarded in 2024: 50 teens
• Value of 2024 scholarships: $5,000 per teen
• Mini Judgement Free Zone® fitness spaces built: More than 45+
• Additional Mini Judgement Free Zone® sites planned for: 2025

Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Key Activities

Franchisee Support: Training, site selection, and operational guidance.

The franchisor activity centers heavily on enabling franchisee success, which directly impacts royalty revenue. Franchisees pay a 7% royalty fee on gross sales. To maintain brand consistency and support local efforts, franchisees are also required to spend between 1-2% of gross sales on local advertising. The overall health of the network is reflected in membership penetration; as of the first quarter of 2025, Black Card memberships accounted for 65% of total memberships.

Here's a look at the financial structure supporting this relationship:

Metric	Value/Rate	Context/Date
Royalty Fee Rate	7% of gross sales	Ongoing Franchise Fee
Local Advertising Spend Requirement	1-2% of gross sales	Mandatory Local Marketing
Black Card Membership Penetration	65%	As of Q1 2025

National Marketing: Centralized brand advertising via the National Advertising Fund.

Centralized brand advertising is funded through a mandatory fee on franchisee gross sales. This fund is a key component of the Franchise segment revenue stream. For the second quarter of 2025, National Advertising Fund ('NAF') revenue contributed to a $2.7 million increase in Franchise segment revenue compared to the prior year period.

The core mechanism for this activity involves:

• Franchisee contribution rate of 2% on gross sales to the National Advertising Fund (NAF).
• Funding centralized brand advertising efforts.
• Operating expense for the franchisor, with NAF expense noted as $1.8 million higher in Q4 2024 compared to the prior year.

Equipment Sales: Procuring and selling fitness equipment to franchisees.

Equipment sales represent a significant, high-growth activity for Planet Fitness, Inc. The Equipment segment revenue for the second quarter of 2025 reached $82.2 million, a jump from $67.7 million in the same period last year. This growth was largely driven by higher revenue from equipment sales to existing franchisee-owned clubs, accounting for $14.3 million of the increase. The pipeline for new equipment sales is active, with equipment placed in 19 new franchisee-owned clubs during Q2 2025.

Equipment Segment Financial Snapshot (Q2 2025):

Metric	Amount	Comparison
Equipment Segment Revenue	$82.2 million	Up from $67.7 million in prior year period
Revenue Increase Attributable to Existing Franchisee Clubs	$14.3 million	Q2 2025 vs. Q2 2024
New Franchisee Clubs Receiving Equipment	19	During Q2 2025

Corporate Club Management: Operating 281 company-owned locations.

Planet Fitness, Inc. directly manages a portion of its club base, which provides direct operational insight and a segment for corporate-owned club revenue. As of June 30, 2025, the company operated 2,762 clubs system-wide. Of these, 283 were corporate-owned locations, with the remainder being franchisee-owned. The Corporate-owned clubs segment reported revenue of $139.0 million for the three months ended June 30, 2025. The average corporate-owned club four-wall Adjusted EBITDA, after deducting the 7.0% royalty, is estimated at approximately 35.1% as of September 30, 2025. The company expects capital expenditures to increase approximately 20% in 2025, driven by additional clubs in the corporate-owned portfolio.

Corporate Club Operations Data (as of mid-2025):

• Total System-wide Clubs: 2,762 (as of June 30, 2025).
• Corporate-Owned Clubs: 283 (as of June 30, 2025).
• Corporate-Owned Segment Revenue (Q2 2025): $139.0 million.
• Estimated Corporate Club Four-Wall Adjusted EBITDA Margin (after royalty): 35.1% (as of Sept 30, 2025).

Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Key Resources

You're looking at the hard assets and intangible strengths that power the business model for Planet Fitness, Inc. as of late 2025. These are the foundational elements that let the company generate revenue and maintain its market position.

The 'Judgement Free Zone' Brand: Core differentiator and non-intimidating culture. This brand promise is the primary intangible asset. It targets casual and newer gym-goers with a low-pressure atmosphere. The success of this culture is evidenced by the sheer scale it supports, which you can see in the membership numbers below. Also, the 2025 High School Summer Pass program saw more than 3.7 million teens complete over 19 million free workouts, showing the brand's reach with younger consumers.

Extensive Club Network: The physical footprint is massive and continues to expand. As of September 30, 2025, the system-wide club count reached 2,795 locations. This network growth is critical for member accessibility.

Membership Base: The scale of the paying customer base is a direct measure of the brand's appeal. As of the end of the third quarter of 2025, Planet Fitness, Inc. had approximately 20.7 million total members. A key component of this base is the higher-tier offering; Black Card penetration stood at 66.1% of the total membership at that time.

Here's a quick look at the network and membership composition as of the end of Q3 2025:

Metric	Value as of September 30, 2025
Total System-Wide Clubs	2,795
Total Members	Approximately 20.7 million
Black Card Membership Penetration	66.1%
New Clubs Opened in Q3 2025	35

Asset-Light Franchise Model: This structural advantage means Planet Fitness, Inc. minimizes its own capital expenditure risk while capturing high-margin, recurring revenue streams. More than 90% of Planet Fitness clubs are owned and operated by independent business people. This focus on franchising drives strong corporate margins. For instance, franchise segment revenue increased 11% year-over-year in the third quarter of 2025. Furthermore, the company actively recycles capital by selling corporate-owned locations to franchisees; for example, a binding agreement was signed in August 2025 to sell eight corporate clubs in California to a franchisee.

• Franchise Segment Adjusted EBITDA for Q2 2025 was $86.5 million, an increase of 11.7% year-over-year.
• The company expects to open between 160 and 170 new clubs in 2025.
• Equipment segment revenue growth in Q3 2025 was 27.8%, benefiting from equipment sales to franchisees.

Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Value Propositions

You're looking at the core reasons why Planet Fitness, Inc. (PLNT) keeps adding members, even when the economy feels tight. The value proposition is built around making fitness accessible and non-judgmental, which clearly resonates with their growing base.

High-Value, Low-Price: The Foundation

The entry point is designed to be an easy yes for almost anyone. The Classic membership is positioned at a low monthly rate, which is the bedrock of the High-Value, Low-Price (HVLP) strategy. While some reports indicate the price starts at $10 per month, the commonly cited starting rate you should focus on for the basic tier is $15 per month before taxes and fees. This low barrier to entry is crucial for acquiring new members, especially younger demographics.

• Classic Membership Starting Price: $15 per month,,.
• Annual Fee for Classic Membership: $49,,,.
• Enrollment Fee: Typically starts at $1,.

Non-Intimidating Environment: The Culture

The entire brand experience is wrapped in the core philosophy of the Judgement Free Zone. This isn't just a slogan; it's the cultural moat that keeps the environment welcoming for fitness newcomers, which is a key differentiator from more intense gyms. This philosophy supports the growth of their largest segment, which includes Gen Z members.

The company supports this welcoming atmosphere by continuing to optimize the club layout. By the end of 2025, the plan is for close to 80% of clubs system-wide to have some version of an optimized format, balancing cardio and strength equipment to keep the floor less intimidating for all users.

Premium Amenities: Driving Upsell to Black Card

The Black Card membership is where the real margin expansion comes from, offering a suite of recovery and convenience perks. The perceived value gap between the Classic and Black Card tiers is intentionally kept small, making the upgrade an easy decision for many. For instance, in Q2 2025, the gap was noted as only $10 between the two tiers.

The premium amenities include access to specialized recovery tools and expanded club access. Planet Fitness, Inc. is actively testing new wellness features in pilot programs, such as dry cold plunge and red light technology.

• Existing Black Card Perks: Access to massage chairs,,, HydroMassage,,, and tanning,,.
• New Equipment Focus: Expanding new plate-loaded strength equipment to nearly all 2,600+ locations by the end of 2025,.
• Total Clubs System-Wide (as of Q3 2025): 2,795,,.

Flexible Access: The Power of the Network

The ability to use any club is a major driver for upgrading to the Black Card. This flexibility is highly valued by members who travel or want options closer to home or work. The success of this tier is evident in the penetration rate, which has climbed significantly.

The penetration rate for the higher-tier membership reached 66.1% of the total membership base by the end of Q3 2025, marking a 300 basis point increase year-over-year,. This means that as of late 2025, nearly two-thirds of their 20.7 million members are opting for the premium, flexible access tier.

Here's a quick look at the scale of the business supporting these propositions as of the third quarter of 2025:

Metric	Value (Q3 2025)
Total Revenue	$330.3 million,,,
System-Wide Same Club Sales Growth	6.9%,,
Black Card Penetration	66.1% of total membership,
Total Members	Approximately 20.7 million,
Adjusted EBITDA Margin	42.6%

Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Customer Relationships

You're looking at how Planet Fitness, Inc. (PLNT) manages its massive member base as of late 2025. It's all about scale and digital efficiency in keeping those relationships humming.

Automated Digital Service: Managed primarily through the PF App and website

The PF App is definitely a core touchpoint. By January 2025, the app's monthly active users surpassed 8.5 million, showing members prefer mobile interaction for many services. Non-members also use the app, accessing a huge library of on-demand digital workouts.

The digital ecosystem extends to the website, planetfitness.com. In December 2024, the website saw a peak of over 26 million visits. The digital relationship is layered: members use the app for easy digital check-ins, the Crowd Meter to pick less busy times, and to manage their PF Black Card® perks, like bringing a guest. The Refer-a-Friend Program, managed via the app, offers up to 3 free months per calendar year for successful referrals.

Self-Service Model: Low-touch, high-volume interaction in clubs

The club experience is designed for high volume and low individual staff intervention. You see this in the sheer scale of the operation. As of the third quarter of 2025, Planet Fitness, Inc. had approximately 20.7 million members across 2,795 global clubs. This model relies on members knowing the routine and using the space effectively without constant staff guidance.

The High School Summer Pass program in 2025 demonstrated this high-volume, self-service capability, hosting more than 3.7 million teens who completed over 19 million free workouts in the clubs. The company is also pushing for physical format standardization; close to 80% of clubs system-wide are expected to have an optimized format by the end of 2025.

Metric	End of 2024 (Approx.)	Q3 2025
Total Members	19.7 million	20.7 million
Total Clubs	2,722	2,795
System-Wide Same Club Sales Growth (Annualized/Trailing)	5.0% (FY 2024)	6.9% (Q3 2025)

Centralized CRM: Data-driven marketing to manage member attrition

Managing attrition is key, especially after the Classic Card price moved from $10 to $15 for new members in mid-2024. The focus is clearly on moving members to the higher-tier offering, which is where the CRM efforts are concentrated.

The penetration of the higher-tier Black Card membership shows this success. By the end of Q3 2025, this penetration reached 66.1% of the total membership base, a 300 basis point increase from the same quarter last year. The marketing strategy is shifting to support this, with management noting a shift of 1 percentage point of marketing funding from local to national channels to spend dollars more efficiently.

Here are key relationship/value metrics driving the CRM strategy:

• Black Card penetration as of Q3 2025: 66.1%.
• Black Card price planned increase to $29.99 after peak join season in 2026.
• Gen Z is the fastest-growing demographic group since 2021.
• The company is increasing influencer involvement, which helped drive a 30% rise in Summer Pass participation.

Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Channels

You're looking at how Planet Fitness, Inc. gets its offering-the Judgement Free Zone® experience-into the hands of its members. It's a heavily franchised model, which is key to understanding their capital-light growth engine.

Franchise Clubs

The vast majority of the footprint runs through independent operators. As of June 30, 2025, the system-wide total club count stood at 2,762 locations. You can definitely count on the fact that more than 90% of these clubs are owned and operated by independent business people. This channel is the primary engine for unit expansion.

For instance, in the second quarter of fiscal 2025, the growth was clearly weighted toward the franchise side:

Metric	Count (Q2 2025)
New Franchisee-Owned Clubs Opened	20
New Corporate-Owned Clubs Opened	3
System-Wide New Clubs Opened	23

This structure means the franchisor collects royalties, which are high-margin revenue streams. Franchise segment revenue saw a boost, with $5.0 million attributable to a franchise same club sales increase of 8.3% in the second quarter of 2025.

Corporate Clubs

Corporate clubs are your control group, honestly. They exist to test new concepts and maintain a direct line on brand execution. In the full year 2024, the company opened 21 corporate-owned locations, which was part of the 150 total new clubs opened that year. This small fleet allows management to pilot changes before rolling them out system-wide.

The corporate-owned segment still contributes significantly, with its Segment Adjusted EBITDA increasing by $7.0 million in Q2 2025, primarily due to a corporate-owned same clubs sales increase of 7.0%.

Digital Platforms

The mobile app is becoming central to the member journey, not just a nice-to-have. For a brand aiming at the 80% of consumers who don't typically join gyms, digital access is crucial for convenience and retention. By January 2025, the Planet Fitness app was showing serious traction, with monthly active users surpassing 8.5 million.

The digital reach is broad:

• Website monthly deduplicated audience reached over 17 million in January 2025.
• Global fitness app downloads are expected to surpass 5 billion by 2025.
• 59% of smartphone users have at least one fitness app.

National Media

High-volume sign-ups are driven by broad, national reach campaigns. The National Advertising Fund (NAF) is the mechanism for this. For the third quarter of 2024, the National advertising fund expense was reported at $19.7 million. The marketing push for 2025 included a new brand platform kicking off during a major NFL game on Christmas, with spots also airing during Dick Clark's New Year's Rockin' Eve.

The financial impact is seen in the NAF revenue collected from franchisees. In the second quarter of 2025, Franchise segment revenue included $2.7 million of higher National Advertising Fund revenue. If you look back to 2021 context, the chain was spending nearly $200 million annually on media expenditures, showing the scale of this channel.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Customer Segments

You're looking at the core of the Planet Fitness, Inc. (PLNT) value proposition-the people who walk through the doors. Honestly, the strategy here is about mass-market appeal, built on a low-friction, low-cost entry point that then tries to upsell you to the premium experience. It's a volume play, plain and simple.

The customer base is intentionally broad, designed to capture individuals who might be intimidated by or unwilling to pay for traditional, high-intensity fitness centers. The structure clearly segments members based on their commitment level and desired amenities.

First-Time Gym Users and Budget-Conscious Consumers

The foundation of the membership base is built on attracting those new to fitness or those extremely sensitive to price. This segment values the 'Judgement Free Zone' environment, which lowers the barrier to entry significantly. They are the core of the value proposition, seeking high-quality fitness access without the high cost associated with premium clubs.

• The Classic Membership serves this group, priced at approximately $10/month before taxes and fees.
• This basic tier grants unlimited access only to the member's home club location.
• Both membership types share a mandatory annual fee of $49.

Here's a quick look at the pricing that defines the value for these segments:

Membership Tier	Monthly Price (Approximate)	Annual Fee	Key Access Feature
Classic Membership	$10	$49	Home Club Only
PF Black Card® Membership	$24.99	$49	Any Club Worldwide

Premium Users: Black Card Holders

This segment represents the higher-value customer, willing to pay a premium for convenience and recovery amenities. The success of this tier is crucial for driving Average Revenue Per User (ARPU) growth. Planet Fitness, Inc. has been very successful in migrating members to this tier; as of the third quarter of 2025, Black Card penetration stood at 66.1% of the total membership base, a 300 basis point increase from the same quarter last year.

If you look at the total membership base reported at the end of Q2 2025, which was approximately 20.8 million members, and apply the Q3 penetration rate, you're looking at roughly 13.7 million Black Card members by the end of Q3 2025.

The Black Card is the key to unlocking the full suite of non-workout perks:

• Ability to bring a guest anytime for free.
• Access to over 2,700+ clubs nationwide and worldwide.
• Use of the PF Black Card Spa amenities, including HydroMassage™, massage chairs, and tanning.
• Exclusive premium partner rewards, such as 50% off select drinks.

Gen Z/Young Adults: High School Summer Pass Engagement

Planet Fitness, Inc. specifically targets Gen Z and young adults through its High School Summer Pass (HSSP) program, offering free summer access to teens aged 14-19. This is a massive pipeline for future membership conversion and brand loyalty. The 2025 iteration of the program saw record-breaking participation.

The scale of this initiative is significant:

• In the summer of 2025, more than 3.7 million teens participated in the free program.
• These teens completed over 19 million workouts between June and August 2025.
• Since its inception in 2019, the company has invested more than $300M in waived membership dues through HSSP.

This program directly supports the mission of making fitness accessible and non-intimidating for the next generation of gym-goers. Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Cost Structure

You're looking at the core outflows that keep the Planet Fitness, Inc. machine running, which is heavily weighted toward supporting its massive franchise network. The cost structure here reflects a capital-light model, but the fixed and semi-fixed costs associated with brand management and debt service are significant.

Net Interest Expense is a substantial, relatively fixed cost driven by the company's debt load. For the full fiscal year 2025, Planet Fitness, Inc. continues to project this expense to be approximately $86.0 million. This figure is important because it's a non-operating cash outflow that must be covered before calculating net income attributable to shareholders.

The National Advertising Fund (NAF) Expense is a mandatory, centralized marketing spend funded by franchisees. For the fourth quarter of 2024, the NAF expense was reported at $19.4 million. We see this cost is dynamic, as Q3 2025 results indicated a higher NAF expense of $1.7 million as an offset to revenue growth compared to the prior year period. This fund is critical for national brand presence, which benefits all franchisees.

Equipment Cost of Goods Sold is directly tied to the Equipment Segment's revenue, which comes from equipment sales to franchisees. For the full fiscal year ended December 31, 2024, the total Cost of Revenue, which includes equipment COGS, was $197,122 thousand, or $197.1 million. This cost base fluctuates based on the volume and mix of equipment placements, including new club builds and replacement equipment sales.

Franchise Support Costs are embedded within general operating expenses, such as Selling, General and Administrative (SG&A), which covers the infrastructure to support the franchise base. For example, adjusted SG&A for the fourth quarter of 2024 was $34.4 million, an increase driven by incremental marketing spend and payroll. This category represents the corporate overhead necessary to manage the franchise relationship, training, and operational consistency across the system.

Here's a look at some of the key cost and expense metrics for context:

Cost/Expense Category	Latest Reported/Projected Amount	Period/Context
Net Interest Expense (Projected)	$86.0 million	Fiscal Year 2025 Expectation
National Advertising Fund Expense	$19.4 million	Fourth Quarter 2024
Total Cost of Revenue (Proxy for Equipment COGS)	$197.1 million	Full Year Ended December 31, 2024
Adjusted Selling, General and Administrative Expense (SG&A)	$34.4 million	Fourth Quarter 2024

You also have significant corporate-level operating costs that support the entire enterprise, not just the franchise segment. These include the costs associated with running the corporate-owned clubs and the general corporate overhead. For instance, Club operations costs for the fourth quarter of 2024 were $74.4 million.

The cost structure also involves depreciation and amortization, which the company expected to remain flat compared to 2024 in its earlier 2025 outlook, though a later update projected it to be approximately $155 million for 2025.

The company's asset-light franchise model means that a large portion of the variable costs related to club operations are borne by the franchisees, but the centralized costs like NAF and interest on corporate debt remain core to Planet Fitness, Inc.'s own cost structure. Finance: draft 13-week cash view by Friday.

Planet Fitness, Inc. (PLNT) - Canvas Business Model: Revenue Streams

You're analyzing the financial engine of Planet Fitness, Inc. (PLNT) right now, trying to map out exactly where the cash comes from. Honestly, the structure is heavily weighted toward recurring fees and equipment sales to its massive franchise base, which is the key to their asset-light model.

For the trailing twelve months ending September 30, 2025, Planet Fitness, Inc. (PLNT) reported total revenue of approximately $1.288 billion. This revenue is cleanly divided into three reportable segments: Franchise, Corporate-owned Stores, and Equipment.

Franchise Royalties and NAF Fees

The ongoing relationship with franchisees is a cornerstone of Planet Fitness, Inc.'s revenue. Franchisees are contractually obligated to remit two primary ongoing fees based on their gross sales.

• Franchise Royalties: An ongoing fee set at 7% of franchisees' gross sales.
• NAF Fees: A mandatory 2% fee on franchisee gross sales, directed to the National Advertising Fund.

In the second quarter of 2025 (for the three months ended June 30, 2025), the total Franchise segment revenue, which includes these royalties and NAF contributions, was $119.7 million. This segment saw an 11.0% increase year-over-year for that quarter, driven by higher royalty revenue from an 8.3% increase in franchise same club sales.

Corporate Club Revenue

Membership fees from company-owned locations form the second major component of the revenue base. This is the more traditional gym operator revenue stream, though it represents a smaller portion of the total compared to franchise fees and equipment sales.

For the three months ended June 30, 2025, the Corporate-owned clubs segment generated $139.0 million in revenue. This figure reflects growth from same club sales increases, which saw a 7.0% increase in that segment for the quarter. The company ended the second quarter of 2025 with 283 corporate-owned clubs out of 2,762 system-wide locations.

Equipment Sales

A predictable and growing revenue source comes from the contractual obligation for franchisees to purchase fitness equipment from Planet Fitness, Inc. or its required vendor for new and re-equipped clubs. This is reported under the Equipment segment.

Equipment segment revenue for the three months ended June 30, 2025, was $82.2 million, marking a significant 21.5% increase year-over-year. This revenue is primarily driven by sales to existing franchisee-owned clubs needing to replace equipment, creating a recurring refresh cycle for the company.

Annual Membership Fees

While often bundled into the recurring royalty base calculation, the one-time annual membership fee charged to members is a distinct revenue event. This fee contributes directly to the revenue reported by both franchise and corporate-owned clubs.

To show the impact of this specific fee, looking at the first quarter of 2025, the corporate-owned clubs segment revenue increase included $1.5 million specifically attributable to annual fee revenue.

Here's a quick look at the segment revenue contribution for Q2 2025, which totaled $340.9 million for the quarter:

Revenue Segment	Revenue (3 Months Ended June 30, 2025)	Percentage of Q2 2025 Total Revenue
Corporate-owned Clubs	$139.0 million	40.77%
Franchise	$119.7 million	35.11%
Equipment	$82.2 million	24.11%

The company ended the second quarter of 2025 with approximately 20.8 million members across the system. The Black Card membership penetration is a key metric, standing at 66.1%, which typically carries higher fee structures.