Fitness chains add financial muscle as more Americans hit the gym
By Deborah Mary Sophia
(Reuters) - Tighter budgets may not be a constraint for Americans looking to get back into shape, keeping gym operators financially fit, even as inflation pinches other consumer-focused sectors.
Some of the major players in the fitness sector have pushed the envelope on membership rates after the pandemic scare, helping them beef up earnings, when most other industries are under stress from the impact of a cautious consumer.
"In-person fitness is something consumers missed during the pandemic. Consumers feel a close connection to their gym community, which explains in part why spending in this sector is strong despite inflation," said Tanya Moryoussef, manager at Kearney Consumer Institute, a part of consulting firm Kearney.
Boutique gym group Xponential Fitness Inc added about 15,000 new members in the fourth quarter and had more than 600,000 members as of January, a more than 70% jump from 2019 pre-pandemic levels.
Larger rival Planet Fitness Inc added 400,000 members in the fourth quarter, taking the total to about 17 million in 2022.
(Graphic: Planet Fitness memberships jump exiting the pandemic - https://www.reuters.com/graphics/USA-FITNESS/lgpdkjkagvo/chart.png)
(Graphic: Xponential Fitness membership growth - https://www.reuters.com/graphics/USA-FITNESS/zjvqjnjobpx/chart.png)
"We have more members today than we've ever had, paying more than they ever have," Xponential CEO Anthony Geisler told Reuters in an interview.
Visits to fitness chains jumped 30.6% for the week starting Feb. 27, compared with 2019 levels, according to data from location analytics firm Placer.ai, which covers thousands of U.S. gym locations across more than 20 national and regional brands.
Its data also showed a 17.2% weekly jump in visits for the same period, compared with 2020.
"People that are working out, are working out slightly more than they did in the past ... So even with the recessionary talks and layoffs you see, cancellations are just slightly better," Planet Fitness CEO Chris Rondeau said at a JPMorgan conference last week.
Gen-Z's focus on fitness after being locked indoors during the COVID-19 crisis has also been a major driver.
A Planet Fitness executive said Gen Z represented 25% of the company's total membership.
"We're seeing lots of positive indications of consumer interest in living healthy and active lifestyles, and we see that especially in younger demographics," Baird analyst Jonathan Komp said.
Gen-Zs are generally much more aware of the food and nutrition they consume and the activities they need to engage in to be physically and mentally healthier, Komp added.
(Reporting by Deborah Sophia in Bengaluru; Editing by Anil D'Silva)