-- Planet Fitness (PLNT) shares cratered on Thursday as the fitness center operator tempered its full-year expectations amid fewer-than-expected member additions in the first quarter.
Planet Fitness now expects full-year adjusted net income per share to increase about 4%, compared with its prior guidance that called for an increase of 9% to 10%. Revenue is forecast to grow about 7%, down from about 9% previously projected.
Analysts in a FactSet poll are looking for full-year non-GAAP earnings of $3.37 per share on sales of $1.45 billion, compared with $3.07 and $1.32 billion the company reported for 2025.
System-wide same club sales growth is now pegged at 1%, down from the previous estimate of 4% to 5%. Analysts expect same-store sales to increase by 4.6% this year.
In the first quarter, same club sales grew 3.5%, while analysts expected a 3.6% increase. Planet Fitness added more than 700,000 net new members, below its own expectations, Chief Executive Colleen Keating said on a conference call.
"(The year) 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," Keating said in a statement.
Shares of Planet Fitness sank 33% in Thursday trade, taking their year-to-date loss to more than 60%.
The company saw "solid" trends of member additions in the first two weeks of the year, but severe winter weather conditions in January and February disrupted that momentum, Keating told analysts, according to a FactSet transcript. Several storms hit on Mondays, the company's busiest join day of the week, she said.
"We anticipated that our March campaign, Black Card First Month Free, which was very successful during the same time last year would improve our join momentum over the remainder of (the first quarter) and into (the second quarter)," Keating said on the call. "Yet, as we move through March and into early April, our join trends remain below our plan."
Adjusted EPS in the March quarter increased to $0.74 from $0.59 a year earlier and surpassed the consensus of $0.63. Revenue jumped 22% to $337.2 million, while analysts expected $298.6 million.
"We are sharpening our marketing to prioritize capturing demand and driving net member growth. Additionally, we are pausing the planned national Black Card price increase pending a broader pricing review," Keating said in the statement. "While we are resetting near-term expectations, we expect that these actions will help set the stage for enhanced top and bottom-line results in 2027."
Price: $43.15, Change: $-20.81, Percent Change: -32.54%