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Life Time Shares Soar as CEO Highlights Record Revenue and Member Engagement

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Life Time, the luxury fitness and lifestyle operator, reported strong financial results for the fourth quarter and full year of 2023, boosting its share price and outlook for 2024.

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Life Time beats expectations with 18.2% revenue growth in Q4

Life Time announced its total revenue increased 18.2% to $558.8 million for the fourth quarter of 2023, compared to $472.6 million for the same period in 2022. The company also reported a net income of $23.7 million for the quarter, up from a net loss of $12.4 million in Q4 2022.

The revenue growth was driven by a continued increase in membership dues and in-center revenue, as well as the opening of new centers and the acquisition of Massage Envy. Life Time ended the year with 170 centers in operation, including eight new centers opened in 2023.

Life Time beat Wall Street’s expectations, with shares popping in response to the Q1 report, closing Wednesday at $20.35 (+8.44%).

“We set record levels of revenue and adjusted EBITDA, improved our balance sheet, and further reduced our net debt leverage ratio,” said Bahram Akradi, Life Time founder, chairman, and CEO. “We also increased member engagement through our strategic programming initiatives, as highlighted by the increase to 135 average visits per membership compared to 124 in 2022 and, most notably, 108 in 2019 before the pandemic.”

Life Time expects to be free cash flow positive in Q2 and open 9 to 10 new centers in 2024

Life Time is optimistic about its prospects for 2024, as it expects to have positive free cash flow beginning in the second quarter and plans to open nine to ten new centers in 2024. The company also raised its full-year adjusted EBITDA guidance to $490 to $510 million, up from $470 to $490 million previously.

Akradi said the company is focused on expanding its footprint and offerings, as well as enhancing its member experience and retention. He said there are membership waitlists at over 20-lifetime clubs, with additional clubs expected to have waitlists by May.

“We expect to realize the highest retention rates in the history of Life Time in 2024,” he said. “We are also investing in new and existing centers to provide our members with the best possible environment and amenities.”

Some of the investments include new pickleball courts, personal training programs, assisted stretching services, and weight-loss drugs. Akradi said these initiatives are aimed at strengthening the luxury brand and increasing member engagement and spending.

Life Time faces competition from other premium fitness operators and digital platforms

Life Time’s strong performance comes amid a competitive landscape in the fitness industry, as other premium operators such as Equinox and SoulCycle, as well as digital platforms such as Peloton and Apple Fitness+, vie for the attention and wallets of wellness seekers.

Akradi said he is confident that Life Time’s differentiated value proposition and diversified revenue streams will help it maintain its leadership position and grow its market share.

“We believe we have a unique and compelling offering that appeals to a broad range of consumers who value health, wellness, and quality of life,” he said. “We are not just a gym, we are a lifestyle company that provides a comprehensive array of products and services to help our members achieve their goals and aspirations.”

He added that Life Time’s digital platform, Life Time Digital, which offers on-demand and live classes, personalized coaching, and access to Apple Fitness+, is complementary to its physical centers and helps extend its reach and engagement.

“We are very pleased with the adoption and retention of our digital platform, which has over 100,000 subscribers as of today,” he said. “We believe our digital platform is the best in the industry and provides a seamless and integrated experience for our members, whether they are at home, at work, or on the go.”

Written by
Jennifer Dixon

Jennifer Dixon is a passionate and professional news writer with over 15 years of experience in the media industry. She has worked as a reporter, editor, and correspondent for various news agencies such as Reuters, CNN, and BBC. She has covered a wide range of topics, from politics and business to culture and entertainment. She has a keen eye for detail and a flair for storytelling. She is also an avid reader and learner, always curious about the world and its people. Jennifer holds a master's degree in journalism from Northwestern University and a bachelor's degree in English from Yale University. She is currently working as a freelance writer and consultant, helping clients with their news and content needs. In her spare time, she enjoys hiking, yoga, and photography.

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