Xponential Fitness Plunges 10.59% on Disappointing Earnings

On August 8, 2025, Xponential Fitness experienced a significant drop of 10.59% in pre-market trading, reflecting investor concerns over the company's recent financial performance.

Xponential Fitness reported Q2 CY2025 earnings that fell short of Wall Street's expectations. The company's revenue remained flat year over year at $76.21 million, missing analyst estimates of $77.35 million. The non-GAAP profit of $0.26 per share was also below expectations, coming in at 11.1% lower than the consensus estimate of $0.29 per share. The company's adjusted EBITDA of $28.1 million was 4% below analyst estimates of $29.27 million.

Xponential Fitness revised its full-year revenue guidance down to $305 million at the midpoint, a 4.7% decrease from the previous estimate of $320 million. The company's EBITDA guidance for the full year was also lowered to $108.5 million at the midpoint, below analyst estimates of $121.2 million. Despite these challenges, the company's operating margin improved to 19.5%, up from -3.1% in the same quarter last year.

Over the past five years, Xponential Fitness has shown impressive growth, with a compounded annual growth rate of 23.5%. However, recent performance indicates a slowdown in demand, with annualized revenue growth of 5.8% over the last two years, significantly below its five-year trend. The company's franchise revenue, which accounts for 59.5% of total revenue, has averaged 17.6% year-on-year growth over the last two years. In contrast, equipment revenue has been flat, and merchandise revenue has declined by an average of 6.1% annually over the same period.