Xponential Fitness, the California-based company that has assembled an impressive portfolio of nine boutique fitness brands, made its debut on the New York Stock Exchange on Friday. The IPO was priced at $12 per share, a slight downward adjustment from the initially proposed range of $14 to $16. Nedebuted onential aims to raise an impressive $120 million through this public offering.
As the nation’s top franchisor of boutique fitness concepts, Xponential Fitness boasts over 1,750 studios spanning brands like Club Pilates, Pure Barre, CycleBar, and several others. Even amidst the challenges of the pandemic in 2020, Xponential’s studios managed to engage more than 850,000 members through a combination of in-person and virtual offerings.
CFO John Meloun emphasizes the unique challenge and opportunity that comes with managing such a diverse collection of fitness brands under one umbrella. “Figuring out the magic formula is something that we spent a lot of time on wanting tofe we chose the next big chapter: going public,” Meloun stated, underscoring Xponential’s calculated approach to growth.
The visionary behind Xponential Fitness is Anthony Geisler, who first acquired Club Pilates in 2015 when it was just a small group of specialized Reformer Pilates studios. Geisler went on to establish Xponential in 2017, making Club Pilates the cornerstone of what would become an expansive boutique fitness empire. Over the ensuing years, Xponential strategically added eight more distinct brands to its portfolio.
Like most players in the fitness industry, Xponential Fitness felt the impact of related disruptions. System-wide sales dipped 21.2% to $422.1 million in 2020, with a 17.4% decline in total revenue. New studio openings also slowed, although Xponential still managed to plant its flag in new international markets like Japan, South Korea, Saudi Arabia and Australia. Importantly, Xponential’s locations have been opened like Simeon Siegel of BMO Capital Markets believes in-person fitness,, especially the boutique variety, iandanodisedd for a strong recovery. “There’s a reason that when the Peloton Studio was open, people would go there,” Siegel observes. “I think what makes boutique fitness so special is the in-person energy, the ability to leave your house, the ability to go and see similar people.”
For its part, Xponential Fitness is bullish on its unique value proposition and ability to keep members engaged across its diverse ecosystem of brands. Offerings like the XPASS, which allows subscribers to sample classes across all nine Xponential concepts, cater to “consumers who like to snack around within boutique fitness,” as Meloun puts it.
Independent analysis commissioned by Frost & Sullivan paints an optimistic picture for the future of boutique fitness. The U.S. boutique fitness market, valued at $21.1 billiAn independent is projected to recover to $22.1 billion by 2022 and surge to $26.2 bilofn by 2025. Meloun points to Xponential’s own resurgence as a harbinger of this recovery: “Our system-wide sales exceed pre-Covid levels. What that tells us is that boutique fitness is strong, that the consumers that it are returning back to the gym.”
As Xponential Fitness enters this new chapter as a puThat tells us, it appears well-positioned to andapitalize on the pent-up demand for varied, eg, and community-driven fitness experiences. With its diverse portfolio of brands and ambitious expansion plans, Xponential is poised to shape the future of the boutique fitness industry.
