Life Time Group Holdings, Inc. Q1 FY2026 earnings call

• Eric mentioned total revenue growth driven by portfolio performance, comparable center revenue growth, and details on components of comparable center revenue. - Bron noted strong performance across all business aspects, no impact from broader macro environment, strong demand for new clubs, robust real estate pipeline, and focus on positive free cash flow. - Discussed various initiatives like improving membership mix, pricing strategy, in-center businesses, and ongoing club openings and construction. - Talked about innovation initiatives such as Lifetime Innovation Hub, CTR, dynamic stretch, hybrid XT, and Lifetime Health and Wellness Hub.

Total revenue increased 11.7% to $789 million. Comparable center revenue grew 8.6%, with improved membership mix contributing 3.5% growth, price contributing 3% growth, and in-center businesses contributing 2.3% growth. Average monthly dues were $230, up ~10.5% YOY; average revenue per center membership was $930, up 10.2% YOY. Net income was $88 million, up 15.8% YOY. Adjusted net income was $96 million, up 27.4% YOY. Adjusted EBITDA was $227 million, up 18.3% YOY, with margin improving by 160 basis points to 28.7%. Net cash provided by operating activities increased to $199 million. Total capital expenditures were $260 million, up 82% from prior year.

• Updated midpoint of full year adjusted EBITDA margin guidance to 28% including impact from clubs opening in second half of 2026 and associated pre-opening expenses. - Expect to deliver growing positive free cash flow each year going forward, with long-range plan showing free cash flow more than $400 million by roughly 2030. - Guidance on membership growth excluding qualified medical memberships: 3.5% to 3.8% in Q2, 4% to 5% in Q3 and Q4. - Revenue growth expected to be 10% to 12% for each quarter and full year.

Q: John Heinbockel asked about beyond 2027 club openings, takeovers, and white space.

A: Brahm responded on urban and suburban club performance, white space not a concern.

Q: Brian Nagel asked about DPT penetration and membership upgrade impact on DPT.

A: Brahm and Eric talked about DPT team's work, increased DPT productivity, and membership mix driving DPT opportunity.

Q: Brian Nagel asked about CapEx related to clubs beyond current year.

A: Brahm explained half of CapEx for 2026 clubs, with investment in 2026, 2027, 2028, etc.

Q: Arpaneh Kocharian asked about revenue flow through, member growth vs volume.

A: Eric and Brahm discussed revenue flow through from dues and DPT, and focus on membership mix for better revenue and LTV.

Q: Arpaneh Kocharian asked about buybacks.

A: Brahm said will use $500 million authorization if stock below fair value.

Q: Randy Koenig asked about product services and amenities, and revenue per membership quintiles.

A: Brahm talked about innovation initiatives like CTR, dynamic stretch, hybrid XT, and Lifetime Health and Wellness Hub; Eric said always adding value to memberships at all quintiles.

Q: Chris Woronka asked about importance of metrics in club underwriting.

A: Brahm said cares about rate of return on facility investment, not just members per club.

Q: Chris Woronka asked about app monetization.

A: Brahm said main focus on delivering club experience, Lacey as ai companion.

Q: Stephen Grambling asked about KPIs for new clubs.

A: Brahm and Eric said results are fantastic, no reason to believe deterioration.

Q: Anthony Bonadio asked about EBITDA margin and consumer demand.

A: Eric talked about EBITDA margin drivers and strong consumer demand.

Q: Eric DeLaurier asked about improving membership mix runway and competitive dynamics.

A: Eric and Brahm talked about membership mix runway and no concern about competition.

Q: Logan Reich asked about visits per member and on-hold memberships.

A: Brahm said visits per membership up, retention great; Eric said on-hold memberships fluctuate.

Q: Owen Rickard asked about Lifetime Innovation Hub and Miura.

A: Brahm talked about innovation hub and Miura's potential.

Q: Noah Zaskin asked about comp building blocks and GLP-1s.

A: Eric talked about comp building blocks and Brahm talked about GLP-1s being a win for health clubs.

Q: John Baumgartner asked about membership mix and programming.

A: Eric talked about membership mix trends; Bron talked about programming and space utilization.