June 25, 2024

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Planet Fitness shares surge as company raises revenue outlook

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A person works out at Planet Fitness as they re-open at 25 percent capacity in Boston’s Dorchester on Feb. 1, 2021.

Jessica Rinaldi | Boston Globe | Getty Images

Planet Fitness shares surged double digits after beating expectations on both lines for the third quarter and raising its outlook for the year.

Here’s how the company did compared with Wall Street analysts’ expectations, according to LSEG, formerly known as Refinitiv.

  • Earnings per share: 59 cents, adjusted, vs. 55 cents expected
  • Revenue: $277.6 million vs. $268.2 million expected

For the quarter ended Sept. 30, Planet Fitness posted a profit of $39.1 million, or 46 cents a share, up from $26.9 million, or 32 cents a share, a year earlier. Adjusting for one-time items, the company reported per-share earnings of 59 cents.

Revenue jumped nearly 14% to $277.6 million.

The company said it now expects to post 14% revenue growth for the year, up from its previous guidance of 12% and higher than analysts’ expectations of 11.6%.

Interim CEO Craig Benson led the company’s quarterly earnings call with analysts and investors following the abrupt departure of former Chief Executive Chris Rondeau.

The gym chain’s board ousted Rondeau in mid-September, stunning both investors and employees. The company didn’t share additional details on his departure during the earnings call, but Benson confirmed the search for his successor is “going well.” Planet Fitness shares have recovered since Rondeau’s departure, but remain down more than 20% year to date.

Benson outlined Planet Fitness’ forward-looking growth strategy in the company’s press release.

“We’re adjusting our store-level return model to further improve the attractiveness of opening and operating Planet Fitness stores in a new macro-environment,” Benson said. “The changes include decreasing certain capital investments by extending the timing for replacing equipment and completing remodels, to set us and our franchisees up for continued long-term sustainable growth.”

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2023-11-07 12:24:35

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