Xponential Fitness Reports $78.8 Million Revenue in Q3 2025, Down 2% Year-Over-Year

Xponential Fitness, Inc. reported a total revenue of $78.8 million for the third quarter of 2025, a decrease of 2% from $80.5 million in the same period last year. The decline was primarily attributed to a significant drop in equipment revenue, which fell by 49% to $7.5 million, and a 27% decrease in merchandise revenue to $4.8 million. However, franchise revenue increased by 17% to $51.9 million, driven by higher royalty fees and franchise territory fees, reflecting the company's ongoing expansion efforts. For the nine months ended September 30, 2025, total revenue was $231.9 million, down from $237.1 million in the prior year.

The company's operating costs and expenses also saw a notable reduction, totaling $75.3 million in the third quarter, down 13.6% from $87.1 million in the previous year. This decrease was largely due to a significant drop in selling, general, and administrative expenses, which fell by 47% to $24.7 million, primarily due to lower legal expenses and restructuring charges. Despite these reductions, the company recorded an impairment of goodwill and other noncurrent assets of $17.6 million, compared to $4.5 million in the prior year, reflecting ongoing challenges in certain business segments.

Xponential Fitness has undergone significant strategic changes, including the divestiture of several brands. In September 2025, the company divested the Lindora brand, with expected total consideration of up to $6 million, and in July 2025, it divested the CycleBar and Rumble brands for $7 million. These divestitures are part of a broader strategy to streamline operations and focus on core brands, which include Club Pilates, StretchLab, and YogaSix. The company also entered into a Retail Supply Agreement with Fit Commerce to outsource retail merchandising, allowing it to concentrate on its primary business operations.

As of September 30, 2025, Xponential Fitness operated 3,066 studios globally, with 2,575 in North America and 491 internationally. The company has a total of 5,318 franchise licenses sold, with 746 additional licenses contractually obligated to open internationally. The average unit volume (AUV) for the trailing twelve months was reported at $701, reflecting a 6% increase in same-store sales. The company continues to face challenges related to studio openings and franchisee performance, which could impact future revenue growth.

Looking ahead, Xponential Fitness anticipates ongoing restructuring costs between $7.3 million and $11 million through 2025, as it aims to achieve annualized savings of approximately $13.5 million to $15.5 million. The company remains focused on expanding its franchise operations and improving profitability, despite the challenges posed by market conditions and operational adjustments.