Planet Fitness's Black Card Price Pause and Classic Card Test Contradict Prior Guidance

Date of Call: Aug 6, 2026

Financials Results

• Revenue: $365M, up 7% YOY
• EPS: $0.88 per diluted share (adjusted), up from prior expectations
• Operating Margin: Adjusted EBITDA margin 41.8%, down from 43.3% prior year

Guidance:

• Adjusted net income per diluted share projected to grow approximately 6%, up from prior outlook of ~4%.
• System-wide same club sales growth expected to be approximately 1%.
• Revenue growth expected to be approximately 7%.
• Adjusted EBITDA growth expected to be approximately 6%.
• Plan to open between 180 and 190 new clubs system-wide.
• Replacement equipment sales to make up approximately 70% of total equipment segment revenue for the full year.
• Capital expenditures expected to be up 10%-15%.
• Depreciation and amortization expected to be up approximately 10%.

Business Commentary:

Member Growth and Marketing Strategy:

• Planet Fitness ended the second quarter with 21.5 million members, up 3.6% from last year, and system-wide same club sales increased by 1.7%.
• The company is evolving its marketing strategy to target the approximately 70% of the U.S. population without a gym membership, focusing on a more approachable and lighthearted tone to emphasize its unique value proposition.

Pricing Architecture and Promotional Tests:

• Planet Fitness conducted regional and local price tests to understand consumer responses and reinforce affordability. They have tested different price points and tiers.
• The company plans to test a $10 Classic Card promotion nationally to understand its impact and regional nuances, focusing on driving member acquisition without contemplating a permanent price rollback.

Churn Rate and Retention Efforts:

• Planet Fitness reported an average monthly attrition rate of 3.5%, which is the midpoint of its historical range of 3%-4%.
• The company is using a predictive AI churn model integrated into its CRM platform to identify early churn indicators and improve retention, with plans to deepen member engagement through a 100-day program with franchisees.

Financial Performance and Share Repurchase:

• Planet Fitness reported total revenue of $365 million, an increase of 7% from Q2 2025, with adjusted EBITDA rising by 3.5% to $153 million.
• The company repurchased 4 million shares for $200 million, bringing year-to-date repurchases to $250 million under a $500 million program, reflecting confidence in shareholder value creation.

Sentiment Analysis:

Overall Tone: Positive

• Management expressed confidence in strategic priorities to reignite member growth, highlighted strong brand resonance and long-term tailwinds, and noted momentum with new franchisee acquisition. They also raised EPS guidance, indicating optimism.

Q&A:

• Question from Arpine Kocharyan (UBS): You talked about having completed different pricing tests. Would you be able to share at all some of those initial findings, and learnings and what that could mean for your broader pricing structure? Specifically, how you’re thinking about maybe introducing a third tier of pricing. Does that even make sense at this point? Is it fair to assume that any update to that lower-end pricing or maybe Classic Card pricing or whatever it could be, wouldn’t come without a kind of a review of Black Card pricing at this point?
  Response: Multiple price tests are ongoing; results will inform pricing architecture focused on affordability, acquisition, and sustained growth. Evaluations consider price elasticity, join mix, and churn impact holistically.

• Question from Randal Konik (Jefferies): Is there any kind of difference you’re seeing between churn statistics of Black Card versus the Classic Card at the moment?
  Response: Churn is stable and within historical range (3%-4%), with no significant difference between Black Card and Classic Card members.

• Question from Simeon Siegel (Guggenheim Securities): If someone buys the $10 Classic Card, do they get it temporarily, or does that become their go-forward rate? Just curious how you’re thinking about the potential impact to franchisee unit economics. Do you have offsets to the lower revenue? Do you think it drives incremental members in that offset?
  Response: The $10 offer is a limited-time promotion, not a permanent rate change. Members who join at $10 retain that rate long-term. The test aims to understand regional price elasticity, not to rollback the $15 price.

• Question from Jonathan Komp (Baird): Would you characterize this [marketing pivot] more as a shift back to the historical Planet playbook? Are you contemplating within the tests ways to drive incremental value to members that you could find new ways to monetize?
  Response: The marketing shift emphasizes approachability and the 'Judgment Free Zone' to reach the 70% target audience. Value is being enhanced through Black Card Spa modalities and partnerships, with Net Promoter Scores up 9 percentage points.

• Question from Jonathan Komp (Baird): How should we view capital allocation in light of the pretty significant buyback completed during the quarter? Maybe more broadly, your business has become more capital-intensive over the past several years. Just any broader thoughts on evaluating the current structure, the current ownership rate of your unit base, especially with the new franchise interest you mentioned.
  Response: Capital allocation remains focused on growth (club openings, share buybacks) and recycling (e.g., Australia, California). The asset-light model (~90% franchisee-owned) is working, and the corporate portfolio serves as a test lab.

• Question from Rahul Kotrapalli (JPMorgan): Does it make sense to test weekly membership plans in the system, say at like a lower $499 or a $599 Classic Card, or like a $699, $799 Black Card, given mature club capacity still remains?
  Response: No current plans to test weekly billing in the U.S.; monthly billing is the standard.

• Question from Max Rakhlenko (TD Cowen): Can you remind us historically the mix of joins that would come during promotion versus non-promotion periods? As there are some concerns that this price test that you’re doing on the Classic Card could eventually become almost a shadow price decrease. Separately, how do you maintain the $15 Classic Card members from not quitting and rejoining at $10?
  Response: Historical promo/non-promo mix not disclosed. The $10 test is limited-time and not intended as a new price. Previous tests showed minimal trade-down from $15 to $10, and the limited-time nature avoids 'shadow pricing'.

• Question from Joseph Altobello (Raymond James): If the test [on Classic Card] does prove successful in certain areas, could you have different pricing across regions, for example, on Classic? Then to follow up on that, is the plan still to go to $30 nationally on Black Card at some point?
  Response: The $10 national promo tests regional nuance; future pricing decisions will be communicated after evaluating test results. Black Card pricing increase to $30 is paused for now, with future evaluation ongoing.

• Question from Sharon Zackfia (William Blair): Can you talk about any changes in the way you’re testing the creative relative to last year?
  Response: This year's creative emphasizes lightheartedness, approachability, and diverse talent to better reach the target audience. Extensive consumer testing will continue, with interim creative launching this quarter.

• Question from Santu (BNP Paribas): Could you compare [High School Summer Pass] a little bit to last year?... Is the marketing shift to maybe less sweat, less fit getting fitter, impacting the acquisition of younger consumers at all?
  Response: High School Summer Pass participation is tracking close to last year's strong levels. Gen Z is the fastest-growing membership segment, and marketing optimizations (e.g., DCO engine, influencer use) aim to reach younger consumers effectively.

Contradiction Point 1

Black Card Price Increase Rollout and Evaluation

Contradiction on the timeline and decision-making process for implementing the Black Card price increase.

Joseph Altobello (Raymond James) - Joseph Altobello (Raymond James)

2026Q2: The decision to pause the nationwide rollout was appropriate to focus on net member growth... The timing and specifics of any future Black Card price increase, including potential rollout to $30, are still under evaluation. - Colleen Keating(CEO)

If the test for Classic proves successful in certain areas, could different regional pricing be implemented for Classic, and is the plan still to increase Black Card to $30 nationally? - Joe Altobello (Raymond James)

2026Q1: Testing for the Black Card price increase began in early 2024... Markets still at $29 will remain there to observe mix shifts and cost structures; no imminent plans for a rollback. The nationwide rollout of the price increase has been paused. - Brendon Frey(Interim CFO), Colleen Keating(CEO)

Contradiction Point 2

Marketing Strategy Shift and Target Audience

Contradiction on the marketing campaign's focus and its impact on reaching the core target demographic.

Jonathan Komp (Baird) - Jonathan Komp (Baird)

2026Q2: The new marketing campaign aims to shift towards a lighter, more approachable tone to better reach the 70% of the population without a gym membership. - Colleen Keating(CEO)

Is the recent marketing pivot a return to historical strategies, and are there plans to test new monetization methods for members? - Randal Konik (Jefferies)

2026Q1: The previous campaign... may have overemphasized 'sweat' and fit imagery, moving away from the core message... It may have been 'over-torqued' with too much emphasis on intense workouts. - Colleen Keating(CEO)

Contradiction Point 3

Approach to Regional Pricing and Promotional Tests

Contradiction on the intent and management of regional pricing tests, particularly regarding the $10 Classic Card promotion.

Joseph Altobello (Raymond James) - Joseph Altobello (Raymond James)

2026Q2: The $10 Classic Card test is intended to read regional nuances in price elasticity.... The limited-time nature of the offer is designed to prevent it from becoming shadow pricing. - Colleen Keating(CEO)

"If the test for Classic proves successful in certain areas, could pricing vary by region, and is the plan still to increase Black Card to $30 nationally?" - Joe Altobello (Raymond James)

2026Q1: Testing for the Black Card price increase began in early 2024... Markets still at $29 will remain there to observe mix shifts and cost structures; no imminent plans for a rollback. - Brendon Frey(Interim CFO), Colleen Keating(CEO)

Contradiction Point 4

Nature and Purpose of Classic Card Price Test

The test is framed as temporary and exploratory in Q2 but was previously described as a key driver of growth.

Simeon Siegel (Guggenheim Securities) - Simeon Siegel (Guggenheim Securities)

2026Q2: The $10 offer is a limited-time promotion, not a permanent rate change... The test aims to understand price elasticity and regional impacts, not to contemplate a permanent rollback to $10. - Colleen Keating(CEO)

"If a customer purchases the $10 Classic Card, does the rate apply temporarily or permanently, and how might this impact franchisee unit economics?" - Simeon Siegel (Guggenheim Securities)

2025Q4: For the 2026 comp, ~75% is expected to come from rate growth (including Black Card pricing) and ~25% from net membership growth. - Jay Stasz(CFO)

Contradiction Point 5

Strategy and Timeline for Black Card Price Increase

The rollout timing for the Black Card price increase is described as paused and under evaluation, contradicting the previous clear Q3 rollout plan.

Joseph Altobello (Raymond James) - Joseph Altobello (Raymond James)

2026Q2: The decision to pause the nationwide rollout was appropriate to focus on net member growth... The timing and specifics of any future Black Card price increase, including potential rollout to $30, are still under evaluation. - Colleen Keating(CEO)

Is the plan still to increase the Black Card price to $30 nationally at some point? - Maksim Rakhlenko (TD Cowen)

2025Q4: The Black Card price increase will roll out after the peak join season, likely in Q3 (a lower join quarter), for competitive reasons. The increase is expected to provide organic rate lift, and the comp guide already anticipates ~75% rate growth (which would include this impact). - Colleen Keating(CEO)