Planet Fitness reports bigger quarterly loss than expected; CEO aims to get people safely back to gym
fifth anniversary as a public company, Planet Fitness CEO Chris Rondeau (who has been CEO since 2013 and at the company since 1993) finds himself reporting a once unthought of quarterly loss for the one-time growth juggernaut, working out a bit from his home gym (but also going to his local Planet Fitness) and thinking of ways to keep gym goers safe in the age of COVID-19.” data-reactid=”16″>Two days removed from its fifth anniversary as a public company, Planet Fitness CEO Chris Rondeau (who has been CEO since 2013 and at the company since 1993) finds himself reporting a once unthought of quarterly loss for the one-time growth juggernaut, working out a bit from his home gym (but also going to his local Planet Fitness) and thinking of ways to keep gym goers safe in the age of COVID-19.
Suffice it to say, it’s not normal times as scores of gyms across the country remain closed because of the pandemic while other former industry heavyweights such as 24 Hour Fitness enter bankruptcy.
Yahoo Finance via phone moments after his earnings call with analysts Tuesday evening.
Here’s how Planet Fitness’ second quarter stacked up compared to Wall Street estimates.
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Net Sales: declined 77.9% from a year ago to $40.2 million versus estimates for $38.1 million
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Adjusted loss per share: 32 cents a share (45 cents a share profit a year ago) versus estimates for a loss of 17 cents a share.
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Hot Notes: (1) No guidance provided; 1,477 out of 2,059 gyms have been reopened and are operating; Rondeau tells Yahoo Finance Planet Fitness still has 1,000 gyms in its development pipeline; initial share price reaction after-hours: -3%
It’s worth keeping in mind how abnormal 2020 will be for Planet Fitness.
per Yahoo Finance Premium data. The stock reached a peak in late February this year of $87 — marking a 480% surge from the first day of trading.
about $53 amid uncertainty on the future of gyms due to the lingering presence of COVID-19.
Lululemon just bought for a cool $500 million). Despite the unknown outlook, the main reason why Planet Fitness shares haven’t fallen further is because it may be the only national gym chain in business when this is all said and done. It may take some time to get there, but all signs suggest few will be able to rival Planet Fitness’ scale and subsequent low price membership model.
In the meantime, Rondeau is focused on supercharging Planet Fitness’ health protocols (masks are now mandatory for visitors) for its gyms and encouraging people to come back. Planet Fitness has also boosted its mobile app capabilities, for instance adding a feature for a member to check capacity at a local gym before visiting.
Rondeau says people are slowly returning to the 1,400 or so gyms that have reopened. But, it will take time.
“I think the issue is getting people in that first time [back] to feel comfortable and to see what the gym looks like and how it’s laid out, and to reduce the fear,” Rondeau says.
@BrianSozzi and on LinkedIn.” data-reactid=”46″>Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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