Planet Fitness Inc. (NYSE: PLNT) shares plunged 31 percent to $44.20 after the gym chain slashed its full-year 2026 outlook, citing a slowdown in new member growth following its peak sign-up period.
"2026 is off to a slower than expected start from a net member growth perspective as we faced internal and external headwinds during our peak sign-up period,” Chief Executive Officer Colleen Keating said in the earnings release.
The company’s first-quarter results beat analyst expectations, but the positive report was overshadowed by the significant reduction in future guidance.
Shares sank to their lowest closing price since April 2020 as the company detailed the extent of the slowdown. Planet Fitness now expects 2026 revenue to grow by 7 percent, down from a previous forecast of 9 percent. The outlook for adjusted earnings per share growth was cut to approximately 4 percent from a prior range of 9 percent to 10 percent.
In response to the membership troubles, Keating said Planet Fitness is “pausing” its planned national price increase for its popular "Black Card" membership pending a broader review. The move follows a price hike on its Classic Card last year, which the company believes may have contributed to the current slowdown. Management also withdrew its three-year growth algorithm that had projected double-digit annual sales and earnings growth.
TD Cowen analyst Max Rakhlenko wrote Thursday that the “business trends and outlook have significantly deteriorated,” while Morgan Stanley’s Stephen Grambling noted his firm’s estimates are now under review.
Despite the headwinds, the company's member base is at an all-time high of 21.5 million, and it plans to open between 180 and 190 new locations in 2026. Keating attributed some of the weakness to marketing efforts that alienated the company's core "beginner fitness" customers.
The stock's decline to a four-year low puts pressure on management to demonstrate that the current issues are temporary. Investors will be watching for signs of stabilization in membership trends and the impact of new marketing strategies.
This article is for informational purposes only and does not constitute investment advice.
