Financial Data and Key Metrics Changes - Total revenue for Q4 2025 increased by 12.3% to $745 million, driven by higher average dues and utilization of in-center businesses [4] - Net income for Q4 2025 was $123 million, a 231% increase, while adjusted net income rose by 28.4% to $77 million [5][6] - Adjusted EBITDA for Q4 2025 was $203 million, up 14.5%, with an adjusted EBITDA margin of 27.2% [6] - For the full year 2025, total revenue increased by 14.3% to $2.995 billion, with adjusted net income rising by 62.3% to $326 million [8] Business Line Data and Key Metrics Changes - Average monthly dues increased by 10.8% to $223, and average revenue per center membership was $882, also up 10.8% [4] - Comparable center revenue grew by 9.9% in Q4 2025, reflecting strong membership dues and in-center business performance [4] - For the full year, membership dues and enrollment fees increased by 13.9%, while in-center revenue rose by 15.1% [6] Market Data and Key Metrics Changes - The company ended 2025 with over 822,000 center memberships, and total memberships, including on-hold memberships, reached approximately 873,000 [4] - The company expects to open up to 28 clubs across 2026 and 2027, funded primarily through operating cash flow and a robust sale-leaseback market [12] Company Strategy and Development Direction - The company plans to invest between $875 million and $915 million in growth capital for 2026, with over half allocated for clubs opening in 2027 and beyond [9] - A $500 million share repurchase program has been approved, reflecting confidence in the business model and ability to generate cash [13] - The company is focused on optimizing member experience and revenue on a club-by-club basis, which has been key to its success [14] Management's Comments on Operating Environment and Future Outlook - Management noted that mature clubs are operating at optimal levels, and new clubs are ramping faster than expected [12] - The company anticipates full-year comparable center revenue growth of approximately 6.3%-7.3% for 2026, with a gradual decline in growth rate throughout the year [7] - Management emphasized the importance of maintaining a balance between member experience and shareholder value [70] Other Important Information - The company achieved a 27.5% adjusted EBITDA margin for 2025, exceeding initial guidance [12] - The company ended 2025 with a net leverage ratio of 1.6 times, well below the target of 2 times [12] - The company plans to capitalize between $33 million and $35 million of interest expense in 2026 due to increased growth capital spending [11] Q&A Session Summary Question: What are the biggest opportunities for 2026? - Management highlighted the need to modernize and evolve facilities to meet the demands of affluent customers seeking health and wellness services [21] Question: How are the new centers performing? - New clubs are opening stronger and ramping faster than ever, with some reaching contribution margin positive in the first month [25] Question: What are the unit economics of new clubs? - New clubs have higher membership prices and lower member counts, leading to a more efficient model [30] Question: How is the company managing inflation and healthcare costs? - The company has anticipated payroll and supply increases in its budget and has managed healthcare costs effectively [56][60] Question: What is the strategy for digital and retail opportunities? - The company is focusing on enhancing member experience through digital platforms and improving visibility for its health products [78][104] Question: Is there a plan to tap into higher-end market segments? - Management confirmed plans to offer more bundled services and white glove experiences for high-end consumers [131]