Core Insights - Life Time is expanding its CTR (Core. Tone. Reform.) program, a high-energy, Pilates-inspired reformer workout, to nearly 30 locations by the end of 2025, with a goal of over 60 locations by the end of 2026 [1][4] - The demand for reformer-based workouts has surged, with participation growing more than 70% since 2022, indicating a strong market trend towards this type of fitness [3] - Life Time's commitment to innovation and member experience is evident in the success of CTR, which has led to waitlists and increased class offerings in clubs where it has launched [4] Company Expansion Plans - CTR has debuted in 10 Life Time athletic country clubs, with 18 additional locations expected to be completed by the end of the year [1] - The program is set to expand to major cities including Atlanta, Chicago, Dallas, and New York City, reflecting a strategic growth initiative [4] - Life Time anticipates doubling the program's footprint in 2026, further enhancing its national presence [4] Member Engagement and Offerings - The introduction of CTR is driving interest in Life Time's broader Pilates offerings, which have been available for nearly 20 years, with over 175 dedicated studios and 800 certified instructors [5] - The Life Time app provides access to a wide range of on-demand and livestream classes, catering to members who may not be near a physical location [6] - Life Time's ecosystem supports healthy living and aging, appealing to a diverse demographic from ages 90 days to 90+ years [7]

Group 1: Stock Performance and Price Targets - Life Time Group Holdings, Inc. (LTH) shares have increased by 0.5% over the past four weeks, closing at $26.18, with a mean price target of $39.23 indicating a potential upside of 49.9% [1] - The average of 13 short-term price targets ranges from a low of $28.00 to a high of $48.00, with a standard deviation of $5.53, suggesting a 7% increase from the current price at the lowest estimate and an 83.4% upside at the highest [2] Group 2: Analyst Consensus and Earnings Estimates - There is strong agreement among analysts regarding LTH's ability to report better earnings than previously predicted, which supports the view of potential upside [4] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 0.1%, with two estimates moving higher and no negative revisions [12] - LTH currently holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] Group 3: Caution on Price Targets - Solely relying on consensus price targets for investment decisions may not be wise, as analysts' ability to set unbiased targets has been questioned [3] - Price targets set by analysts often reflect overly optimistic views due to business incentives, which can lead to inflated estimates [8] - While a tight clustering of price targets indicates agreement among analysts, it does not guarantee that the stock will reach the average target [9]

Core Insights - Life Time Group Holdings, Inc. (LTH) is a significant entity in the Leisure and Recreation Services industry, operating health and fitness clubs across the United States [1] Financial Performance - LTH reported an earnings per share (EPS) of $0.45, exceeding the estimated EPS of $0.35, and showing a year-over-year improvement from $0.26 [2][6] - The company achieved revenues of approximately $782.6 million, surpassing the estimated revenue of around $770.7 million, reflecting a 12.9% increase compared to the same quarter last year [3][6] - Net income increased by 147.3% to $102.4 million, while diluted EPS rose by 136.8% to $0.45 [4] - Adjusted net income was $93 million, up 65.2%, and adjusted EBITDA reached $220 million, a 22% increase [4] Market Position and Outlook - LTH has a price-to-earnings (P/E) ratio of approximately 24.05 and a price-to-sales ratio of about 1.94, indicating investor confidence and favorable market value [5] - The company has a solid balance sheet, low leverage, and strong cash generation, positioning it well for continued growth and an improved outlook for 2025 [5]

Financial Data and Key Metrics Changes - Total revenue increased by 12.9% to $783 million [5] - Average monthly dues grew by 10.0% year-over-year to $218 [5] - Net income for the quarter was $102 million, an increase of 147% [5] - Adjusted net income was $93 million, up 65.2% year-over-year [6] - Adjusted EBITDA increased by 22% to $220 million, with a margin improvement of 210 basis points to 28.1% [6][7] - Net cash provided by operating activities rose approximately 66% to $251 million [7] - Free cash flow was $63 million for the third quarter [7] Business Line Data and Key Metrics Changes - Comparable center revenue grew by 10.6%, driven by strong performance in dues and in-center businesses, particularly Dynamic Personal Training [5][10] - Revenue per center membership increased by 11.3% year-over-year [10] - In-center business revenue rose by 14.4% year-over-year, with significant growth in dynamic personal training [10] Market Data and Key Metrics Changes - The company ended the quarter with nearly 841,000 center memberships, with total memberships reaching approximately 891,000 [5] - Average monthly visits per membership reached 12.5, up 5.9% year-over-year [9] Company Strategy and Development Direction - The company aims to accelerate new club growth, with plans to deliver 12-14 new clubs in 2026 and beyond [8][9] - Focus on enhancing member experiences and increasing revenue per center membership through membership optimization [9][10] - The company is expanding its digital offerings and nutritional brand, with plans to release new features for its AI health companion by the end of the year [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and growth strategy, highlighting strong cash flow as a key driver for long-term growth [7][8] - There are no current signs of weakness in consumer demand, with all mature clubs making more money than in the past [41] - The company is prepared for various market conditions and is focused on maintaining a strong balance sheet [43][46] Other Important Information - The company expects to complete between $55 million-$65 million of additional sale-leaseback transactions before the end of the year [7] - Management is considering stock buybacks as a potential capital allocation strategy, but no decision has been made yet [43][46] Q&A Session Summary Question: In-center revenue opportunity and DPT penetration - Management highlighted strong execution in personal training and the potential for further growth in cafes and spas [15][16] Question: Prioritizing club openings beyond 2026 - The company plans to maintain a baseline of 12-14 new clubs annually, with a strong pipeline and successful urban and suburban club performance [18][19] Question: Comparable center revenue guidance and revenue maximization - Management emphasized membership optimization and delivering unmatched brand experiences to maximize revenue without overly relying on membership growth [22][24] Question: Geographic and income cohort weaknesses - Management reported no signs of weakness in consumer demand, with all clubs performing well across various markets [39][41] Question: Capital allocation and stock buybacks - The company is focused on maintaining a strong balance sheet while considering stock buybacks as a future option [43][46] Question: Relative value in the fitness industry - Management noted that Life Time is capturing market share from boutique studios due to its differentiated offerings and high utilization rates [51][52] Question: Life Time Living and Life Time Work contributions - Both initiatives are performing well, with Life Time Living showing superior performance and retention compared to traditional apartment businesses [84][86] Question: New club openings and margin considerations - New larger clubs are expected to have higher average revenue but may initially have negative margins [91][92] Question: Design considerations for new clubs - Management is focused on adapting club designs to meet customer preferences and enhance overall member experience [100]

Financial Data and Key Metrics Changes - Total revenue increased by 12.9% to $783 million [5] - Average monthly dues grew by 10.0% year-over-year to $218 [5] - Net income for the quarter was $102 million, an increase of 147% [5] - Adjusted net income was $93 million, up 65.2% year-over-year [6] - Adjusted EBITDA increased by 22% to $220 million, with a margin improvement of 210 basis points to 28.1% [6][7] - Net cash provided by operating activities rose approximately 66% to $251 million [7] - Free cash flow was $63 million for the third quarter [7] Business Line Data and Key Metrics Changes - Comparable center revenue grew by 10.6%, with guidance raised to between 10.8% and 11.0% for the full year [5] - Revenue per center membership increased by 11.3% year-over-year [10] - In-center business revenue rose by 14.4% year-over-year, particularly in dynamic personal training [10] Market Data and Key Metrics Changes - The company ended the quarter with nearly 841,000 center memberships, reaching approximately 891,000 including on-hold memberships [5] - Average monthly visits per membership reached 12.5, up 5.9% year-over-year [9] Company Strategy and Development Direction - The growth strategy focuses on accelerating new club growth and enhancing member experiences [8] - The company plans to deliver 12-14 new clubs in 2026 and beyond, with 13 clubs currently under construction [9] - Membership optimization is emphasized, aiming to improve the mix with more couples and families while managing qualified memberships [9][10] - The company is excited about the upcoming features of its AI health companion, L•AI•C, and plans to expand its nutritional brand, LTH [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and growth, noting strong execution and member engagement [8][10] - There are no current signs of weakness in consumer demand, with all mature clubs making more money than in the past [41] - The company is prepared for various market conditions, maintaining a strong balance sheet to support growth [43][46] Other Important Information - The company expects to complete between $55 million and $65 million of additional sale-leaseback transactions before the end of the year [7] - The management team is focused on maintaining a strong balance sheet while exploring stock buyback options [43][46] Q&A Session Summary Question: In-center revenue opportunity and DPT penetration - Management highlighted the success of the personal training program and the potential for further growth in cafes and spas [15][16] Question: Prioritizing club openings beyond 2026 - The company plans to maintain a baseline of 12-14 new clubs annually, with a strong pipeline and successful urban and suburban club performance [18][19] Question: Maximizing revenue without increasing membership count - The focus is on brand and member experience, optimizing membership types to increase revenue per membership [24][25] Question: Geographic or income cohort weaknesses - Management reported no signs of weakness, with all clubs performing well across various markets [39][41] Question: Capital allocation and stock buyback considerations - The board is discussing stock buyback options, but the primary focus remains on growth and club development [43][46] Question: Relative value in the fitness industry - The company is seeing increased interest from consumers trading up to Life Time due to its differentiated offerings [51][54] Question: Nutritional brand strategy post-consumer reports investigation - The strategy includes ensuring product quality and safety, with plans for a more aggressive marketing approach in 2026 [56][59] Question: New club openings and market considerations - New clubs are expected to perform similarly in both new and existing markets, with careful planning for wage growth and inflation [63][64] Question: Dynamic Personal Training growth and capacity - Some trainers are fully booked, while others have room for growth, indicating a mixed capacity situation across clubs [71][72] Question: Design considerations for new clubs - The company is adapting designs based on customer preferences and operational efficiency [100]

Financial Data and Key Metrics Changes - Total revenue increased by 12.9% to $783 million, with average monthly dues growing by 10.0% year-over-year to $218 [4] - Net income for the quarter was $102 million, an increase of 147%, benefiting from a $5.7 million tax-affected gain on sale-leasebacks [4] - Adjusted net income rose by 65.2% year-over-year to $93 million, while adjusted EBITDA increased by 22% to $220 million, with an adjusted EBITDA margin improvement of 210 basis points to 28.1% [5] - Net cash provided by operating activities rose approximately 66% to $251 million compared to the prior year quarter [5] Business Line Data and Key Metrics Changes - Comparable center revenue grew by 10.6%, driven by strong performance in dues and in-center businesses, particularly in Dynamic Personal Training [4] - Revenue per center membership increased by 11.3% year-over-year, and in-center business revenue rose by 14.4% year-over-year [9] Market Data and Key Metrics Changes - The company ended the quarter with nearly 841,000 center memberships, with total memberships reaching approximately 891,000, in line with expectations [4] - Average monthly visits per membership reached 12.5, up 5.9% year-over-year, with total visits increasing by 7% year-over-year for the quarter [9] Company Strategy and Development Direction - The growth strategy focuses on accelerating new club growth and enhancing member experiences, aiming to deliver 12-14 new clubs in 2026 and beyond [7] - Membership optimization is emphasized, with strategies to improve the mix of couples and families while limiting qualified memberships in certain clubs [9] - The company is excited about the upcoming release of new features for Lacy, the AI health companion, and plans to expand its nutritional brand, LTH [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and growth, noting that all mature clubs are making more money than in the past [39] - There are no current signs of weakness in the consumer base, with strong performance across various markets [40] - The company is prepared for potential economic challenges, with strategies in place to adapt as necessary [71] Other Important Information - The company expects to complete between $55 million-$65 million of additional sale-leaseback transactions before the end of the year [5] - The average size of new clubs planned for 2026 is approximately 95,000 square feet, compared to 66,000 square feet in 2025 [96] Q&A Session Summary Question: In-center revenue opportunity and DPT penetration - Management highlighted the success of the personal training program and the potential for further growth in in-center revenue, particularly in cafes and spas [12][15] Question: Prioritizing club openings beyond 2026 - The company confirmed a strong pipeline for new clubs, with a focus on urban and suburban locations, and emphasized the importance of maintaining a healthy execution level [17][18] Question: Average member per center growth and revenue optimization - Management discussed the focus on brand and member experience, emphasizing membership optimization to increase revenue per membership without relying heavily on membership unit growth [21][25] Question: Consumer dislocations and geographic performance - Management reported no signs of weakness in consumer behavior, with all clubs performing well across various markets [38][40] Question: Capital allocation and stock buyback considerations - The company is focused on maintaining a strong balance sheet while considering stock buybacks as a potential option, depending on market conditions [41][43] Question: Dynamic Personal Training growth and capacity - Management noted that while some trainers are fully booked, there is still room for growth in Dynamic Personal Training, with ongoing recruitment of new trainers [74][76] Question: Design considerations for new clubs - The company emphasized the importance of flexibility in club design to adapt to changing consumer needs over time [104][105]

Future Club Growth - Life Time Group Holdings预计在2026年开设12-14家俱乐部，2027年开设12-14家以上俱乐部[6,11] - 2026年计划开设的俱乐部主要为大型地面建筑俱乐部[11] - 2026年计划开设的俱乐部总面积超过120万平方英尺，目前在建[11,12] - 2024年开设8家俱乐部，平均每家约85,000平方英尺，总计680,000平方英尺[12] - 2025年开设10家俱乐部，平均每家约66,000平方英尺，总计660,000平方英尺[12] - 2026年预计开设12-14家俱乐部，平均每家约94,000平方英尺，总计超过120万平方英尺[12] Membership & Engagement - 中心会员人数同比增长3.2%[6,40] - 会员参与度持续增长，会员访问量同比增长5.9%，总访问量同比增长7%[6,43] Revenue Growth - Life Time Group Holdings的收入增长算法保持不变，目标增长率为10-12%[6,45]

Core Insights - Life Time Group Holdings, Inc. (LTH) reported quarterly earnings of $0.41 per share, exceeding the Zacks Consensus Estimate of $0.34 per share, and showing an increase from $0.26 per share a year ago, resulting in an earnings surprise of +20.59% [1] - The company achieved revenues of $782.65 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.61% and up from $693.23 million year-over-year [2] - Life Time Group Holdings has consistently surpassed consensus EPS estimates over the last four quarters [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.31 on revenues of $739.35 million, while for the current fiscal year, the estimate is $1.42 on revenues of $2.98 billion [7] - The company's favorable estimate revisions trend prior to the earnings release has resulted in a Zacks Rank 2 (Buy), indicating expected outperformance in the near future [6] Industry Context - The Leisure and Recreation Services industry, to which Life Time Group Holdings belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a positive outlook for the sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Membership Growth - Total memberships reached over 891,000 as of September 30, 2025, with more than 1.6 million individual members[84] - Total memberships increased to 891,225 in Q3 2025, up from 876,509 in Q3 2024, representing a growth of 1.8%[104] Revenue Performance - Total center revenue rose to $2,182.4 million for the nine months ended September 30, 2025, up from $1,900.3 million in the same period of 2024[88] - Membership dues and enrollment fees for Q3 2025 reached $547,306, a 12.1% increase from $488,105 in Q3 2024[104] - In-center revenue for Q3 2025 was $213,591, up 14.4% from $186,670 in Q3 2024[104] - Total revenue for the three months ended September 30, 2025, increased by $89.4 million to $782.6 million compared to $693.2 million for the same period in 2024, driven by strong growth in membership dues and in-center revenue[118] - Center revenue rose by $86.1 million to $760.9 million for the three months ended September 30, 2025, compared to $674.8 million in 2024, with 68.7% from membership dues and enrollment fees[119][120] Profitability - Net income for Q3 2025 was $102,427, compared to $41,355 in Q3 2024, reflecting a significant increase of 147.5%[105] - Adjusted EBITDA for Q3 2025 was $220,046, a 22.0% increase from $180,293 in Q3 2024[109] - Net income for the three months ended September 30, 2025, was $102.4 million, significantly up from $41.4 million in 2024, reflecting a net income margin of 13.1%[129] - Net income for the nine months ended September 30, 2025, was $250.7 million, up from $119.1 million in the same period in 2024[142] Cash Flow and Liquidity - Free cash flow for the nine months ended September 30, 2025, was $216,369, compared to $247,054 for the same period in 2024[104] - Free cash flow for the three months ended September 30, 2025, was $62.5 million, down from $138.3 million in 2024, with net cash provided by operating activities at $251.1 million[112] - Net cash provided by operating activities for Q3 2025 was $251,112, an increase from $151,146 in Q3 2024[104] - Net cash provided by operating activities increased by $218.7 million, totaling $630.7 million for the nine months ended September 30, 2025[148] Operational Expansion - The company plans to open 12 to 14 new locations annually starting in 2026, with a focus on affluent markets[89] - The company opened 1 new center in Q3 2025, bringing the total to 185 centers, up from 177 centers at the end of Q3 2024[104] - New centers typically take three to four years to reach expected performance, with 30 centers open for less than three years and 17 under construction[88] - Life Time Work and Life Time Living concepts are expanding, with 15 and 4 locations open respectively as of September 30, 2025[93] Expenses and Costs - Operating expenses for the three months ended September 30, 2025, totaled $647.0 million, representing 82.6% of total revenue, compared to 86.4% in 2024[118] - General, administrative, and marketing expenses rose by $2.1 million to $59.8 million for the three months ended September 30, 2025, reflecting increased support for member services[123] - Rent expense increased by $8.9 million to $87.5 million for the three months ended September 30, 2025, primarily due to sale-leaseback transactions and higher contingent rent[122] - Rent expense increased by $26.1 million, primarily due to sale-leaseback transactions and higher contingent rent expenses[135] - Center operations expenses rose by $140.7 million due to costs associated with new and ramping centers and increased club utilization[134] Economic Factors - The company continues to monitor macroeconomic factors, including inflation and interest rates, but has not seen a material impact on its business[94] - Interest expense, net of interest income, decreased by $17.6 million to $18.4 million for the three months ended September 30, 2025, due to lower borrowings and interest rates[126] - Interest expense decreased by $45.8 million due to lower average borrowings and interest rates from swaps entered into in April 2025[139] Taxation - The effective tax rate for the three months ended September 30, 2025, was 26.5%, compared to 28.2% in 2024, influenced by state income tax provisions and share-based compensation deductions[128] Digital and Technology - The digital platform offers an integrated experience, including live streaming fitness classes and personalized AI-driven health recommendations[91]

Financial Performance - Total revenue for Q3 2025 was $782.6 million, an increase of 12.9% compared to Q3 2024[8] - Net income for Q3 2025 reached $102.4 million, reflecting a 147.3% increase year-over-year[8] - Adjusted EBITDA for Q3 2025 was $220.0 million, up 22.0% from the previous year[8] - Center revenue reached $760.897 million, up 12.8% from $674.775 million year-over-year[30] - Net income for Q3 2025 was $102.427 million, compared to $41.355 million in Q3 2024, representing a 147.5% increase[30] - Adjusted EBITDA for the nine months ended September 30, 2025, was $351.764 million, up from $270.508 million in the same period of 2024[30] - Net income for the nine months ended September 30, 2025, was $250,671,000, a significant increase from $119,077,000 in the same period of 2024, representing a growth of 110.8%[34] - Total center revenue for the nine months ended September 30, 2025, reached $2,182,416,000, compared to $1,900,267,000 in 2024, reflecting a year-over-year increase of 14.9%[36] - Adjusted EBITDA for the nine months ended September 30, 2025, was $622,611,000, compared to $499,816,000 in 2024, representing a growth of 24.6%[36] Membership and Center Operations - Center memberships at the end of Q3 2025 totaled 840,622, a 1.7% increase from September 30, 2024[9] - The company opened 6 new centers during the nine months ended September 30, 2025, maintaining a total of 185 centers at the end of the period, up from 177 centers in 2024[36] - Average center revenue per center membership increased to $2,638 in the nine months ended September 30, 2025, compared to $2,361 in 2024, marking an increase of 11.7%[36] Cash Flow and Capital Expenditures - Cash flow from operating activities for the nine months ended September 30, 2025 was $630.7 million, a 53.1% increase compared to the prior year[13] - Free cash flow for the nine months ended September 30, 2025, was significantly improved, contributing to liquidity and capital expenditure funding[23] - Total capital expenditures for Q3 2025 were $222.5 million, a 155.5% increase compared to Q3 2024[11] - Capital expenditures for the nine months ended September 30, 2025, totaled $586,980,000, up from $388,213,000 in 2024, reflecting an increase of 51.1%[34] Debt and Financial Ratios - The net debt leverage ratio improved to 1.6 times as of September 30, 2025, down from 2.4 times a year earlier[17] - Total debt as of September 30, 2025, was $1,512,873 thousand, down from $1,652,191 thousand in 2024, showing a reduction of approximately 8.4%[49] - The net debt leverage ratio improved to 1.6x for the trailing twelve months ended September 30, 2025, compared to 2.4x for the same period in 2024[49] Guidance and Future Plans - Full-year 2025 revenue guidance is set between $2,978 million and $2,988 million, representing a 13.8% increase from 2024[15] - The company plans to open 10 new centers in 2025, with seven already open as of November 4, 2025[18] - The company plans to open new centers and engage in sale-leaseback transactions to enhance operational efficiency and financial flexibility[26] - The company projects adjusted EBITDA for the year ending December 31, 2025, to be between $820 million and $824 million[50] Operating Expenses and Profitability - Operating expenses for Q3 2025 totaled $647.004 million, an increase from $599.539 million in Q3 2024[30] - The company reported a diluted income per share of $0.45 for Q3 2025, compared to $0.19 in Q3 2024, indicating strong earnings growth[30] - The company reported a net income margin of 11.1% for the nine months ended September 30, 2025, compared to 6.1% in 2024, indicating improved profitability[36] Other Financial Metrics - Share-based compensation expense for the nine months ended September 30, 2025, was $45,179 thousand, an increase from $30,450 thousand in 2024, marking a rise of 48%[42] - Interest expense for the nine months ended September 30, 2025, was $65,331 thousand, down from $111,083 thousand in 2024, indicating a decrease of 41%[42] - The provision for income taxes for the nine months ended September 30, 2025, was $70,799 thousand, compared to $39,945 thousand in 2024, reflecting an increase of 77%[42] - Free cash flow for the three months ended September 30, 2025, was $62,530 thousand, compared to $138,332 thousand in the same period of 2024, indicating a decrease of 55%[45]