Life Time Q1 2025 Earnings Summary: Record Growth in Revenue, Net Income, and Free Cash Flow

Life Time Group Holdings (NYSE: LTH) delivered strong financial results for Q1 2025, driven by higher member engagement, expanded center usage, and improved margins.

Key Financial Highlights:
• Revenue: $706.0 million, up 18.3% from $596.7 million in Q1 2024
• Net income: $76.1 million, up 205.6% from $24.9 million
• Adjusted net income: $88.1 million, up 188.9%
• Adjusted EBITDA: $191.6 million, up 31.2%
• Diluted EPS: $0.34 (vs. $0.12 last year); Adjusted Diluted EPS: $0.39
• Net cash from operating activities: $183.9 million, up 103.4%
• Free cash flow: $41.4 million (vs. -$66.4 million last year)
• Net debt leverage ratio: Reduced to 2.0x from 3.6x a year ago

Operational Metrics:
• Center memberships: 826,374, up 3.0%
• Average center revenue per membership: $844, up 13.3%
• Comparable center revenue growth: 12.9%
• Centers operated: 180, with one new opening in Q1
• Center square footage: 17.7 million

Capital and Investment Updates:
• Capital expenditures: $142.5 million, down 9.1% year-over-year
• Interest rate swap agreement: Locked in fixed rate of 3.409% + 2.50% margin
• Signed LOI for $150 million sale-leaseback on 3 properties (expected Q2 close)

Updated 2025 Guidance:
• Revenue: $2.94 – $2.98 billion (previously $2.925 – $2.975 billion)
• Net income: $286 – $293 million (up from $277 – $284 million)
• Adjusted EBITDA: $792 – $808 million (up from $780 – $800 million)
• Comparable center revenue growth: 8.5% – 9.5% (raised from 7% – 8%)
• Interest expense forecast lowered to $80 – $84 million due to interest rate swap
• Cash tax expense revised down to $39 – $41 million due to Q1 tax benefit

Founder and CEO Bahram Akradi emphasized strong brand desirability, increased member engagement, and strategic growth opportunities, including digital expansion and LTH nutritional products.

Life Time Group Holdings appointed Jennifer Pomerantz as a Class II independent director following its 2025 Annual Meeting of stockholders. She will also serve on the Nominating and Corporate Governance Committee and the Capital Allocation Committee. Additionally, four Class I directors were re-elected to serve until the 2028 annual meeting. Shareholders approved the Say-on-Pay proposal and ratified Deloitte & Touche LLP as the independent auditor for the 2025 fiscal year.

Life Time Group Holdings, Inc. announced the closing of a secondary public offering of 23 million shares of its common stock by selling stockholders at a price of $30.40 per share. The company did not receive any proceeds from the offering, which was conducted under an underwriting agreement with J.P. Morgan Securities LLC and BofA Securities, Inc.

The shares were sold pursuant to an effective shelf registration statement on Form S-3, with a related prospectus supplement and accompanying prospectus filed with the SEC. The underwriting agreement includes customary representations, warranties, and indemnification obligations between the company, the selling stockholders, and the underwriters.

The transaction was completed on March 3, 2025.

Life Time Group Holdings reported strong financial results for the fourth quarter and full-year 2024, delivering double-digit revenue growth, record membership retention, and improved profitability. The company also raised its 2025 outlook based on early results.

Key financial highlights:

Fourth Quarter 2024:
- Revenue: $663.3 million, up 18.7% from Q4 2023
- Net income: $37.2 million, up 57.0%
- Diluted EPS: $0.17 per share
- Adjusted net income: $60.3 million, up 58.7%
- Adjusted EBITDA: $177.0 million, up 28.5%
- Memberships: 812,062, a 6.4% increase year-over-year
- Average revenue per membership: $796, up 12.0%

Full-Year 2024:
- Total revenue: $2.62 billion, up 18.2%
- Net income: $156.2 million, up 105.3%
- Diluted EPS: $0.74
- Adjusted net income: $200.5 million, up 54.6%
- Adjusted EBITDA: $676.8 million, up 26.1%
- Free cash flow: $273.6 million, positive for the third consecutive quarter
- Net debt leverage ratio: reduced to 2.28x from 3.61x

Operational and strategic updates:

- Membership and engagement: Achieved record member retention and highest-ever visits per membership, leading to the highest revenue per membership in company history.
- New center openings: Opened two new centers in Q4, totaling eight for the year.
- Debt management: Strengthened financial position through refinancing and sale-leaseback transactions totaling $207.4 million in net proceeds.

2025 outlook:

- Revenue: $2.91 billion – $2.97 billion (midpoint: +12.6% year-over-year)
- Net income: $262 million – $284 million (midpoint: +79.6% year-over-year)
- Adjusted EBITDA: $760 million – $800 million (+16.7% year-over-year)
- New center openings: 10 – 12 planned
- Net debt leverage ratio: maintain at or below 2.25x
- Comparable center revenue growth: 7% – 8%

CEO commentary:

Founder and CEO Bahram Akradi highlighted the company’s success in exceeding financial targets, achieving record member engagement, and maintaining strong margins. He expressed confidence in sustaining high growth in 2025 while strengthening financial flexibility.

Conclusion:

Life Time’s robust membership growth, increased revenue per membership, and strategic debt management have positioned it for continued success in 2025. With an expanded footprint and improving margins, the company is poised to capitalize on long-term growth opportunities in the premium fitness and wellness sector.