Life Time Group Holdings and Planet Fitness recently reported robust growth in their latest earnings, though their financial narratives reveal contrasting dynamics within the American consumer landscape. The reports indicate a divergence between affluent households that maintain their spending habits and price-sensitive consumers who are beginning to feel economic pressure.
Life Time’s fourth-quarter earnings reflected a 12.3% year-over-year revenue increase, reaching $745.1 million. The company attributed this growth to successful operational strategies, including increased membership dues, which rose by $10 to $30 per member. Despite this price hike, demand remained strong, bolstered by members engaging more deeply with services such as personal training and spa offerings. Life Time reported over $191 million in revenue from in-center spending, exemplifying the trend of treating fitness spaces as lifestyle hubs.
Conversely, Planet Fitness also saw significant gains, adding 1.1 million new members and achieving double-digit revenue growth. However, its 2026 revenue projections fell short of analysts’ expectations, raising concerns about demand sustainability. CFO Jay Stasz noted that recent weather disruptions impacted membership trends but remained optimistic about a return to normal attrition rates as they implement price increases and new amenities.
The outcomes from both companies illustrate a broader economic pattern. Higher-income consumers continue to spend on premium fitness experiences, while budget-conscious customers at Planet Fitness exhibit a reluctance to increase their expenditures. This trend has been echoed across various industries, indicating a growing divide in consumer spending.
Why this story matters
- Highlights the disparity in spending between high-income and price-sensitive consumers.
Key takeaway
- Growth in the fitness sector reflects a split in consumer behavior, with affluent households well-positioned to absorb price increases.
Opposing viewpoint
- Concerns about Planet Fitness’ future membership growth suggest potential challenges for budget-focused fitness models amidst economic uncertainty.
