Xponential Fitness Cuts 2026 Studio Opening Guidance

The Tip Desk · November 5, 2026 · 4 min read

Third-quarter revenue was $62.3 million as the franchisor narrowed adjusted EBITDA and lowered its net new studio outlook.

Xponential Fitness, Inc. (XPOF), a global franchisor of boutique health and wellness brands, reported third-quarter revenue of $62.3 million, down 21% from $78.8 million a year earlier, after a 13% year-over-year decline in the second quarter.

The company said the drop was expected and driven primarily by lower franchise revenue, lower merchandise revenue after a shift to outsourced logistics, and fewer equipment installations. Franchise revenue was $43.4 million, down 16% from a year earlier, after a 3% year-over-year decline in the prior quarter. The company attributed the franchise drop primarily to lower territory revenue from franchise agreement terminations. Royalty fees were also lower, reflecting the decrease in same-store sales and the brand divestitures in 2025, and technology and training fees declined as well.

Equipment revenue was $4.3 million, down 42% year-over-year, after a 26% year-over-year decline in the second quarter, which the company tied to fewer global installations and studio openings. Merchandise revenue was $0.4 million, down 92% year-over-year, after a 90% year-over-year decline in the prior quarter, on the move from an in-house wholesale model to an outsourced retail model. Franchise marketing fund revenue was $8.5 million, down 4% year-over-year, after an 8% year-over-year decline in the second quarter. Other service revenue was $5.7 million, down 2% year-over-year, after a 10% year-over-year decline in the prior quarter.

North America system-wide sales were $424.3 million, down from $432.2 million a year earlier, after being flat year-over-year at $437.3 million in the second quarter. Same-store sales declined 7.5%, versus a 0.8% decrease a year earlier, after a 6.8% decline in the prior quarter. Quarterly run-rate average unit volume was $634,000, compared with $668,000 a year earlier, after $659,000 in the second quarter.

Selling, general and administrative expenses were $28.2 million, up 14% year-over-year, after a 33% year-over-year increase in the second quarter, which the company said was driven primarily by higher financial transaction fees and legal fees, partially offset by lower salaries and wages. Marketing fund expenses were $9.6 million, up 6% year-over-year, after a 29% year-over-year increase in the second quarter, reflecting the timing of marketing fund spend.

Net income was $4.9 million, or $0.10 a share, versus a net loss of $6.7 million, or $0.18 a share, a year earlier, after a $4.8 million net loss in the second quarter. Adjusted net income was $2.2 million, or $0.04 a share, compared with $19.3 million, or $0.36 a share, a year earlier, after $0.8 million, or $0.02 a share, in the prior quarter. Adjusted EBITDA was $24.3 million, down 27% from $33.5 million a year earlier, after $21.9 million in the second quarter.

Chief Executive Officer Mike Nuzzo said the company is making progress with initiatives across marketing, technology and brand management, and that priorities include improving franchisee and studio-level economics, supporting disciplined unit expansion, strengthening financial performance, and elevating the member experience.

The board’s April-initiated review of strategic alternatives, supported by Jefferies, remains active and may include a sale, merger or other transaction. The company said it does not intend to comment further until the process concludes.

Xponential reiterated full-year 2026 North America system-wide sales of $1.70 billion to $1.75 billion and revenue of $250.0 million to $260.0 million. It narrowed adjusted EBITDA guidance to $91.0 million to $94.0 million from $91.0 million to $97.0 million. Net new studio openings guidance was cut to a range of 124 to 130, a 37% decrease at the midpoint versus 2025, from previous guidance of approximately 150.

As of September 30, 2026, cash, cash equivalents and restricted cash was $27.2 million, with $521.1 million in total long-term debt. Net cash used in operating activities was $21.1 million for the nine months ended September 30, 2026.