Irvine, California-based Xponential Fitness, the nation’s largest boutique fitness franchisor, debuted on the New York Stock Exchange on Friday. The company boasts a diverse portfolio of nine fitness brands, including YogaSix, AKT, and CycleBar. It priced its initial public offering at $12 per share, aiming to raise a total of $120 million.
Founded by Anthony Geisler, Xponential Fitness has experienced remarkable growth since its inception in 2017. Geisler’s foray into the boutique fitness industry began with the acquisition of Club Pilates in early 2015, a small collection of boutique Reformer Pilates studios that has since grown to 900 licensed locations. Building upon this success, Geisler founded Xponential Fitness, making Club Pilates the company’s flagship brand. Over the years, Xponential has expanded its portfolio to include eight additional fitness brands catering to various workout preferences and demographics.
The COVID-19 pandemic presented unprecedented challenges for the fitness industry. The U.S. fitness club industry lost $20.4 billion in 2020, just a year after generating a record $35 billion in revenue. Despite these setbacks, Xponential Fitness adapted to the changing landscape, offering a combination of in-studio and streaming workouts that allowed the company to serve more than 850,000 customers during the height of the pandemic.
While the company’s system-wide sales and total revenue declined in 2020 due to the pandemic’s impact, Xponential Fitness remained focused on expansion. In 2020, the company opened 240 new studios and extended its global reach to countries such as Saudi Arabia, Japan, South Korea, and Australia. CFO John Meloun attributes the company’s resilience to its diversified portfolio and ability to keep consumers within the Xponential ecosystem through offerings like XPASS, a fitness pass allowing members to attend classes across all nine of the company’s brands.
As the boutique fitness industry prepares for a post-pandemic comeback, Xponential Fitness is well-positioned to capitalize on the sector’s anticipated growth. According to an independent analysis by research firm Frost & Sullivan, the U.S. boutique fitness market is expected to recover to $22.1 billion by 2022 and grow to $26.2 billion by 2025.
Meloun remains optimistic about the future of boutique fitness and Xponential’s role in the industry’s recovery. “Our consumers came right back to the studio [post-COVID],” he states. Our system-wide sales exceed pre-COVID levels. That tells us that boutique fitness is strong and that consumers are returning to the gym.”
The IPO of Xponential Fitness follows that of Mark Wahlberg-backed F45 Training, another franchise studio operator, highlighting the growing interest in the boutique fitness sector. Industry experts believe that the unique energy and social aspect of in-person fitness experiences will continue to attract consumers, setting the stage for a robust recovery.
As Xponential Fitness embarks on this new chapter as a publicly traded company, it remains committed to providing consumers with a diverse range of high-quality boutique fitness experiences. With its proven business model, strategic approach to growth, and ability to adapt to changing market conditions, Xponential Fitness is well-equipped to lead the charge in the boutique fitness industry’s post-pandemic resurgence.