Financial Data and Key Metrics Changes - The company reported a 12% increase in revenue for 2025, with same-club sales growing by 6.7% and adjusted EBITDA increasing by 13% [4][20] - Adjusted diluted EPS grew by 19%, reaching $0.83 [24] - For Q4 2025, total revenue was $376.3 million, up from $340.5 million in Q4 2024, driven by growth across all segments [22][20] - Adjusted EBITDA margin for Q4 was 38.9%, slightly up from 38.4% in the previous year [24] Business Line Data and Key Metrics Changes - The franchise segment saw a revenue increase of 9.6%, while corporate-owned clubs grew by 7.4% and the equipment segment increased by 15.3% [22] - Black Card penetration reached an all-time high of 66.5%, up 260 basis points from the previous year [21] Market Data and Key Metrics Changes - The company ended 2025 with approximately 20.8 million members and nearly 2,900 clubs globally, reflecting strong market presence [4][5] - The company opened 181 new clubs in 2025, including 104 in Q4, marking the highest quarterly openings in its history [5][16] Company Strategy and Development Direction - The company focuses on four strategic imperatives: redefining brand promise, enhancing member experience, optimizing product offerings, and accelerating new club growth [7][10] - International expansion remains a key growth pillar, with plans to enter one to two new markets annually while scaling presence in existing markets like Mexico and Spain [18][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2026 would be the lowest growth year in their three-year algorithm due to an extended equipment replacement cycle and the sale of corporate-owned clubs [26] - The company expects system-wide same-club sales growth of 4%-5% for 2026, with plans to open 180-190 new clubs [27][29] Other Important Information - The company has returned nearly $800 million to shareholders through buybacks over the last two years while funding strategic investments for future growth [20] - The company received recognition as one of USA Today's America's Best Customer Service 2026, highlighting its commitment to exceptional service [19] Q&A Session Summary Question: Insights on 2026 guidance and growth algorithm - Management indicated that 2026 would represent the lowest growth year due to specific impacts, but they expect to return to growth targets in subsequent years [31][33] Question: January join trends and weather impact - Management noted that join trends were healthy before a storm impacted volumes, but they have seen a rebound since then [35][36] Question: Black Card penetration and pricing strategy - Management confirmed that Black Card penetration is at an all-time high and that they expect a 75/25 split in revenue growth from rate and volume [42][44] Question: Attrition rates and Click to Cancel impact - Management stated that attrition rates have returned to expectations and that the Click to Cancel feature has positively influenced member experience and retention [60][62] Question: Interest expense increase and debt refinancing - Management explained that the increase in interest expense is due to refinancing at a higher coupon rate and the impact of an accelerated share repurchase [66][67] Question: Join trends and member growth opportunities - Management expressed confidence in driving strong member growth, citing a 10% increase in net members in 2025 despite challenges [91][92]