Xponential Fitness, Inc. reported a fourth‑quarter net loss of $45.6 million, or $1.17 per basic share, for the period ended December 31 2025. Adjusted net loss was $44.6 million, or $0.91 per share, on a share count of 35.2 million. Total revenue for the quarter was $83.0 million, a slight decline of $0.3 million from the same period a year earlier. Adjusted EBITDA for the quarter was $22.9 million, down 4% from $23.8 million a year earlier.
The quarter’s revenue mix shifted sharply: franchise revenue grew 14% to $51.5 million, while equipment revenue fell 45% to $7 million. The equipment decline was driven by a drop in installations, a trend that has persisted since late 2024. Merchandise revenue also slipped, partially offset by the stronger franchise performance.
For the full year, Xponential generated $314.9 million in revenue, a 2% decrease from $320.3 million in 2024. Adjusted EBITDA for the year was $111.8 million, down 4% from $116.2 million a year earlier. The year‑long decline reflects the combined impact of lower equipment and merchandise sales, even as franchise and franchise‑marketing‑fund revenue increased.
The company missed consensus earnings expectations, reporting an adjusted net loss of $-0.91 per share versus an estimate of $-0.03. Revenue, however, beat expectations by $9.5 million, with analysts forecasting $73.45 million. The earnings miss was largely due to higher marketing‑fund expenses, a sharp drop in equipment revenue, and ongoing portfolio streamlining costs that weighed on profitability.
Management guided for 2026 revenue of $260 million to $270 million, a 16% decline at the midpoint compared with the prior year. Adjusted EBITDA guidance for 2026 is $100 million to $110 million. The conservative outlook signals management’s concern about near‑term demand and a focus on improving margins rather than aggressive expansion.
CEO Michael Nuzzo highlighted progress on brand divestitures and the company’s leading market position, noting that Xponential is “7x the size of the next largest Pilates competitor.” CFO John Meloun reported 3,097 global studios, with 78 new openings in Q4, and confirmed the company’s plan to settle an FTC investigation with a $17 million payment over 12 months. Meloun also emphasized that the settlement would reduce regulatory uncertainty.
Investors reacted negatively to the earnings release, largely because the EPS miss and the cautious 2026 guidance outweighed the revenue beat. The market’s response reflected concerns about profitability and the company’s ability to sustain growth amid competitive and supply‑chain pressures.
Headwinds include declining equipment sales, marketing missteps that hurt same‑store performance, and increased competition. Tailwinds remain strong franchise revenue growth, continued unit expansion, and a dominant brand portfolio that supports long‑term resilience. The earnings report underscores a mixed picture: revenue growth is offset by profitability challenges, and the forward guidance signals a cautious outlook as the company navigates a shifting market landscape.
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