Life Time Reports Second Quarter 2025 Financial Results

2025-08-05

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Total revenue of $761.5 million increased 14.0% over the prior year quarter Net income of $72.1 million increased 36.6% over the prior year quarter Diluted EPS of $0.32 increased 23.1% over the prior year quarter Adjusted net income of $84.1 million increased 60.5% over the prior year quarter Adjusted EBITDA of $211.0 million increased 21.6% over the prior year quarter Adjusted diluted EPS of $0.37 increased 48.0% over the prior year quarter Achieved positive free cash flow for the fifth consecutive quarter Reduced net debt leverage ratio to 1.8 times Raised 2025 outlook

CHANHASSEN, Minn. , Aug. 5, 2025 /PRNewswire/ -- Life Time Group Holdings, Inc. ("Life Time," "we," "our," "us," or the "Company") (NYSE: LTH) today announced its financial results for the fiscal second quarter ended June 30, 2025 .

Bahram Akradi , Founder, Chairman and CEO, stated: "We are pleased with our second quarter results and the momentum we are seeing in our business. Total visits, visits per membership, and retention continued to achieve all-time highs. Our business performance, combined with the strength of our balance sheet and cash flow, positions us well to continue to grow, including modestly accelerated new club growth in 2026 from our robust club development pipeline."

Financial Summary

| | Three Months Ended | | | | Six Months Ended | | | | | | | | ($ in millions, except for Average center revenue per center membership data) | June 30, | | | | June 30, | | | | | | | | 2025 | | 2024 | | Percent Change | | 2025 | | 2024 | | Percent Change | | | Total revenue | $761.5 | | $667.8 | | 14.0 % | | $1,467.5 | | $1,264.5 | | 16.1 % | | Center operations expenses | $403.9 | | $355.5 | | 13.6 % | | $774.9 | | $677.4 | | 14.4 % | | Rent | $83.2 | | $74.9 | | 11.1 % | | $164.4 | | $147.2 | | 11.7 % | | General, administrative and marketing expenses (1) | $61.7 | | $53.2 | | 16.0 % | | $119.5 | | $102.1 | | 17.0 % | | Net income | $72.1 | | $52.8 | | 36.6 % | | $148.2 | | $77.7 | | 90.7 % | | Adjusted net income | $84.1 | | $52.4 | | 60.5 % | | $172.4 | | $83.4 | | 106.7 % | | Adjusted EBITDA | $211.0 | | $173.5 | | 21.6 % | | $402.6 | | $319.5 | | 26.0 % | | Comparable center revenue (2) | 11.2 % | | 12.0 % | | | | 12.0 % | | 11.6 % | | | | Center memberships, end of period | 849,643 | | 832,636 | | 2.0 % | | 849,643 | | 832,636 | | 2.0 % | | Average center revenue per center membership | $888 | | $794 | | 11.8 % | | $1,733 | | $1,541 | | 12.5 % |

| | | | (1) | The three months ended June 30, 2025 and 2024 included non-cash share-based compensation expense of $14.2 million and $9.7 million, respectively. The six months ended June 30, 2025 and 2024 included non-cash share-based compensation expense of $24.5 million and $16.8 million, respectively. | | (2) | The Company includes a center, for comparable center revenue purposes, beginning on the first day of the 13th full calendar month of the center's operation, in order to assess the center's growth rate after one year of operation. |

Second Quarter 2025 Information

Revenue increased 14.0% to $761.5 million due to continued strong growth in membership dues and in-center revenue, driven by an increase in average dues, membership growth in our new and ramping centers, and higher member utilization of our in-center offerings, particularly in Dynamic Personal Training. Center memberships of 849,643 increased by 17,007, or 2.0%, when compared to June 30, 2024 , and increased by 23,269, or 2.8%, from March 31, 2025 , which sequential growth was due in part to typical seasonality. Total subscriptions, which include center memberships and on-hold memberships, of 898,850 increased 2.3% compared to June 30, 2024 . Center operations expenses increased 13.6% to $403.9 million primarily due to operating costs related to our new and ramping centers, additional center operating expenses related to increased club utilization in our mature centers, as well as costs to support in-center business revenue growth. General, administrative and marketing expenses increased 16.0% to $61.7 million primarily due to the timing of share-based compensation and benefit-related expenses, increases in center support overhead to enhance and broaden our member services and experiences, information technology costs, and costs attributable to the secondary offering of common stock completed in June 2025 . Net income increased 36.6% to $72.1 million primarily due to improved business performance and tax-effected net cash proceeds of $9.3 million received from employee retention credits under the CARES Act, partially offset by a tax-effected net loss of $9.0 million on a sale-leaseback transaction. Net income in the prior year period included tax-effected net benefits of $6.0 million from a net gain on sale-leaseback transactions and $3.4 million from a gain on the sale of land. Adjusted net income increased 60.5% to $84.1 million and Adjusted EBITDA increased 21.6% to $211.0 million as we experienced greater flow through of our increased revenue and benefited from the structural improvements to our business that have improved our margins.

Six-Month 2025 Information

Revenue increased 16.1% to $1,467.5 million due to continued strong growth in membership dues and in-center revenue, driven by an increase in average dues, membership growth in our new and ramping centers, and higher member utilization of our in-center offerings, particularly in Dynamic Personal Training. Center operations expenses increased 14.4% to $774.9 million primarily due to operating costs related to our new and ramping centers, additional center operating expenses related to increased club utilization in our mature centers, as well as costs to support in-center business revenue growth. General, administrative and marketing expenses increased 17.0% to $119.5 million primarily due to the timing of share-based compensation and benefit-related expenses, increases in center support overhead to enhance and broaden our member services and experiences, information technology costs, and costs attributable to the secondary offerings of common stock completed in February and June 2025 . Net income increased 90.7% to $148.2 million primarily due to improved business performance, a $15.0 million tax benefit as a result of an excess tax deduction associated with stock option exercises, and the tax-effected net cash proceeds of $10.5 million received from employee retention credits under the CARES Act, partially offset by a tax-effected net loss of $10.2 million on a sale-leaseback transaction. Net income in the prior year period included tax-effected net benefits of $5.8 million from a net gain on sale-leaseback transactions and $3.3 million from a gain on the sale of land. Adjusted net income increased 106.7% to $172.4 million and Adjusted EBITDA increased 26.0% to $402.6 million as we experienced greater flow through of our increased revenue and benefited from the structural improvements to our business that have improved our margins.

New Center Openings

We opened four new centers during the second quarter of 2025. As of June 30, 2025 , we operated a total of 184 centers.

Cash Flow Highlights

Net cash provided by operating activities for the six months ended June 30, 2025 was $379.6 million , an increase of 45.5% compared to the prior year period. We achieved positive free cash flow of $112.5 million for the second quarter of 2025, including $138.8 million of net proceeds from a sale-leaseback transaction of three properties. We achieved positive free cash flow of $153.8 million for the six months ended June 30, 2025 . Our capital expenditures by type of expenditure were as follows:

| | Three Months Ended | | | | Six Months Ended | | | | | | | | ($ in millions) | June 30, | | | | June 30, | | | | | | | | 2025 | | 2024 | | Percent Change | | 2025 | | 2024 | | Percent Change | | | Growth capital expenditures (1) | $167.0 | | $108.6 | | 53.8 % | | $260.5 | | $213.5 | | 22.0 % | | Maintenance capital expenditures (2) | $35.9 | | $27.3 | | 31.5 % | | $65.4 | | $48.4 | | 35.1 % | | Modernization and technology capital expenditures (3) | $19.1 | | $8.4 | | 127.4 % | | $38.7 | | $39.2 | | (1.3) % | | Total capital expenditures | $222.0 | | $144.3 | | 53.8 % | | $364.6 | | $301.1 | | 21.1 % |

| | | | (1) | Consist of new center land and construction, initial major remodels of acquired centers, major remodels of existing centers that expand existing square footage, asset acquisitions including the purchase of previously leased centers and other growth initiatives. | | (2) | Consist of general maintenance of existing centers. | | (3) | Consist of modernization of existing centers and technology. |

Liquidity and Capital Resources

Our net debt leverage ratio improved to 1.8 times as of June 30, 2025 , from 3.0 times as of June 30, 2024 . As of June 30, 2025 , our total available liquidity was $794.0 million , which included $618.5 million of availability on our $650.0 million revolving credit facility and $175.5 million of cash and cash equivalents. At June 30, 2025 , there were no outstanding borrowings under our revolving credit facility and there were $31.5 million of outstanding letters of credit. Our $175.5 million of cash and cash equivalents is higher than historical levels due to the sale-leaseback transaction completed shortly before the end of the quarter. We expect to use this cash to fund our growth initiatives. Effective April 8, 2025 , we entered into interest rate swap agreements for our entire term loan facility notional amount of $997.5 million , which converted the variable interest rate of our term loan facility to a fixed interest rate of 3.409%, plus the applicable margin that was reduced 0.25% to 2.25% effective June 19, 2025 . On June 18, 2025 , S&P Global Ratings upgraded the Company's issuer credit rating to 'BB-' from 'B+'. As a result, our term loan facility margin improved by 25 basis points as described immediately above and our revolving credit facility improved by 25 basis points to Secured Overnight Financing Rate (SOFR) plus 2.00%, or the Base Rate plus 1.00%.

2025 Outlook

Full-Year 2025 Guidance

| | | | | | Percent | | Year Ending | | | Year Ending | | Year Ended | | Change | | December 31, 2025 | | | December 31, 2025 | | December 31, 2024 | | (Using | | (Guidance as of | | ($ in millions) | (Guidance) | | (Actual) | | Midpoints) | | May 8, 2025) | | Revenue | $2,955 – $2,985 | | $2,621.0 | | 13.3 % | | $2,940 – $2,980 | | Net Income | $290 – $293 | | $156.2 | | 86.6 % | | $286 – $293 | | Adjusted EBITDA | $805 – $815 | | $676.8 | | 19.7 % | | $792 – $808 | | Rent | $337 – $343 | | $304.9 | | 11.5 % | | $337 – $347 |

The Company is also reiterating or updating the following operational and financial guidance for full-year fiscal 2025:

Open 10 new centers. Manage our net debt leverage ratio to remain at or below 2.00 times. Comparable center revenue growth of 9.5% to 10.0%, increased from our previous expectations of 8.5% to 9.5%. Adjusted EBITDA growth driven primarily by dues revenue growth and expanded operating leverage. Rent to include non-cash rent expense of $34 million to $37 million , decreased from our previous expectations of $35 million to $38 million . Interest expense, net of interest income and capitalized interest, of approximately $80 million to $84 million . Provision for income tax rate estimate of 24%, increased from our previous expectations of 23%. Cash income tax expense of $25 million to $27 million , which compares to our previous expectation of $39 million to $41 million and reflects tax benefits of the One Big Beautiful Bill Act. Depreciation and amortization expense of $288 million to $294 million , tightened from our previous expectation of $286 million to $294 million . Complete $100 million in additional sale-leaseback transactions in the second half of the year, resulting in total gross proceeds of approximately $250 million for the year.

Conference Call Details

A conference call to discuss our second quarter financial results is scheduled for today:

Date: Tuesday, August 5, 2025 Time: 10:00 a.m. ET ( 9:00 a.m. CT ) U.S. dial-in number: 1-877-451-6152 International dial-in number: 1-201-389-0879 Webcast: LTH 2Q 2025 Earnings Call A link to the live audio webcast of the conference call will be available at https://ir.lifetime.life.

Replay Information

Webcast – A recorded replay of the webcast will be available within approximately three hours of the call's conclusion and may be accessed at: https://ir.lifetime.life/ .

Conference Call – A replay of the conference call will be available after 1:00 p.m. ET the same day through August 19, 2025 :

U.S. replay number: 1-844-512-2921 International replay number: 1-412-317-6671 Replay ID: 1375 4608

About Life Time

Life Time (NYSE: LTH) empowers people to live healthy, happy lives through its portfolio of more than 180 athletic country clubs across the United States and Canada , the complimentary, comprehensive Life Time app and nearly 30 of the most iconic athletic events in the country. The health and wellness pioneer uniquely serves people 90 days to 90+ years old through its healthy living, healthy aging, healthy entertainment communities and ecosystem, along with a range of healthy way of life programs and information, and highly trusted LTH nutritional supplements and products. Life Time was recently certified as a Great Place to Work ® , reinforcing its commitment to fostering an exceptional workplace culture on behalf of its more than 49,000 dedicated team members.

Use of Non-GAAP Financial Measures and Key Performance Indicators

This press release includes certain financial measures that are not presented in accordance with GAAP, including Adjusted net income, Adjusted net income per common share, Adjusted EBITDA, free cash flow and net debt and ratios and calculations with respect thereto. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should be considered in addition to, and not as a substitute for or superior to, net income, net income per common share, net cash provided by operating activities or total debt (defined as long-term debt, net of current portion, plus current maturities of debt) as a measure of financial performance or liquidity or any other performance measure derived in accordance with GAAP, and should not be construed as an inference that the Company's future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP financial measures should be read in conjunction with the Company's financial statements prepared in accordance with GAAP. The reconciliations of the Company's non-GAAP financial measures to the corresponding GAAP measures should be carefully evaluated.

Adjusted net income is defined as net income excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations, less the tax effect of these adjustments. Adjusted EBITDA is defined as net income before interest expense, net, provision for income taxes and depreciation and amortization, excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of the Company's ongoing operations. Free cash flow is defined as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales. Net debt is defined as long-term debt, net of current portion, plus current maturities of debt, excluding fair value adjustments, unamortized debt discounts and issuance costs, minus cash and cash equivalents. Net debt is as of the last day of the respective quarter or year. Our net debt leverage ratio is calculated as our net debt divided by our trailing twelve months of Adjusted EBITDA.

The Company presents these non-GAAP financial measures because management believes that these measures assist investors and analysts in comparing the Company's operating performance across reporting periods on a consistent basis by excluding items that management does not believe are indicative of the Company's ongoing operating performance, and management believes that free cash flow assists investors and analysts in evaluating our liquidity and cash flows, including our ability to make principal payments on our indebtedness and to fund our capital expenditures and working capital requirements. Investors are encouraged to evaluate these adjustments and the reasons the Company considers them appropriate for supplemental analysis. In evaluating the non-GAAP financial measures, investors should be aware that, in the future, the Company may incur expenses that are the same as or similar to some of the adjustments in the Company's presentation of its non-GAAP financial measures. There can be no assurance that the Company will not modify the presentation of non-GAAP financial measures in future periods, and any such modification may be material. In addition, the Company's non-GAAP financial measures may not be comparable to similarly titled measures used by other companies in the Company's industry or across different industries.

The non-GAAP financial measures have limitations as analytical tools, and investors should not consider these measures in isolation or as substitutes for analysis of the Company's results as reported under GAAP.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of federal securities regulations. Forward-looking statements in this press release include, but are not limited to, the Company's plans, strategies and prospects, both business and financial, including its financial outlook for fiscal year 2025, growth, business initiatives, cost efficiencies and margin expansion, capital expenditures and free cash flow, improvements to its balance sheet, net debt and leverage, interest expense, consumer demand, industry and economic trends, tax rates and expense, rent expense, expected number and timing of new center openings and successful signings and closings of center takeovers and sale-leaseback transactions (including the amount, pricing and timing thereof). These statements are based on the beliefs and assumptions of the Company's management. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning the Company's possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.

Factors that could cause actual results to differ materially from those forward-looking statements included in this press release include, but are not limited to, risks relating to our business operations and competitive and economic environment, risks relating to our brand, risks relating to the growth of our business, risks relating to our technological operations, risks relating to our capital structure and lease obligations, risks relating to our human capital, risks relating to legal compliance and risk management and risks relating to ownership of our common stock and the other important factors discussed under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 , filed with the Securities and Exchange Commission (the "SEC") on February 27, 2025 (File No. 001-40887), as such factors may be updated from time to time in the Company's other filings with the SEC, which are accessible on the SEC's website at www.sec.gov . These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any forward-looking statement that the Company makes in this press release speaks only as of the date of such statement. Except as required by law, the Company does not have any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.