Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying unaudited interim condensed consolidated financial statements as of and for the three and six months ended June 30, 2026 and the related notes included in this Quarterly Report on Form 10-Q and our audited consolidated financial statements as of and for the year ended December 31, 2025 and the related notes contained in the Company's Annual Report on Form 10-K filed with the SEC on February 25, 2026. Unless the context requires otherwise, references in this report to the "Company," "we," "us" and "our" refer to Planet Fitness, Inc. and its consolidated subsidiaries.
Overview
We are one of the largest and fastest-growing franchisors and operators of fitness centers in the world by number of members and locations, with a highly recognized national brand. Our mission is to enhance people's lives by providing a high-quality fitness experience in a welcoming, non-intimidating environment, which we call the Judgement Free Zone. Our bright, clean clubs are typically 20,000 square feet, with a large selection of high-quality Planet Fitness-branded cardio, circuit- and strength-training equipment and friendly staff trainers who offer unlimited free fitness instruction to all our members in small groups. We offer this differentiated fitness experience starting at only $15 per month to new members for our standard Classic Card membership. This attractive value proposition is designed to appeal to a broad population, inclusive of all fitness levels from beginners to athletes. We and our franchisees fiercely protect Planet Fitness' community atmosphere-a place where you do not need to be fit before joining and where progress toward achieving your fitness goals (big or small) is supported and applauded by our staff and fellow members.
As of June 30, 2026, we had approximately 21.5 million members and 2,930 clubs in all 50 states, the District of Columbia, Puerto Rico, Canada, Panama, Mexico, Australia and Spain. Of our 2,930 clubs, 2,636 are franchised and 294 are corporate-owned.
As of June 30, 2026, we had contractual commitments to open approximately 800 new clubs.
Our segments
We operate and manage our business in three business segments: Franchise, Corporate-owned clubs and Equipment. Our Franchise segment includes operations related to our franchising business in the United States, Puerto Rico, Canada, Panama, Mexico and Australia, as well as revenues and expenses of our National Advertising Fund ("NAF") and Canadian Advertising Fund ("CAF," and together with the NAF, the "NAFs"). Our Corporate-owned clubs segment includes operations with respect to all corporate-owned clubs throughout the U.S., Canada, and Spain. The Equipment segment includes the sale of equipment to franchisee-owned clubs in the U.S., Canada, Mexico, and Australia.
We evaluate the performance of our segments and allocate resources to them based on revenue and adjusted earnings before interest, taxes, depreciation and amortization, referred to as Segment Adjusted EBITDA. Revenue and Segment Adjusted EBITDA for all operating segments include only transactions with unaffiliated customers and do not include intersegment transactions.
Segment Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, and amortization, adjusted for the impact of certain non-cash and other items that the Company's chief operating decision maker ("CODM") does not consider in her evaluation of ongoing performance of the segment's core operations. For additional information, see Note 13 to the condensed consolidated financial statements.
The following table summarizes revenue and Adjusted EBITDA broken out by our segments:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Revenue | |||||||||||||||||||||||
| Franchise segment | $ | 135,778 | $ | 119,658 | $ | 270,245 | $ | 234,838 | |||||||||||||||
| Corporate-owned clubs segment | 143,862 | 138,989 | 284,484 | 272,658 | |||||||||||||||||||
| Equipment segment | 85,583 | 82,232 | 147,730 | 110,045 | |||||||||||||||||||
| Total revenue | $ | 365,223 | $ | 340,879 | $ | 702,459 | $ | 617,541 | |||||||||||||||
Adjusted EBITDA | |||||||||||||||||||||||
| Franchise segment | $ | 91,737 | $ | 86,502 | $ | 186,458 | $ | 171,367 | |||||||||||||||
| Corporate-owned clubs segment | 57,481 | 56,598 | 103,966 | 102,447 | |||||||||||||||||||
| Equipment segment | 24,326 | 26,435 | 43,793 | 33,877 | |||||||||||||||||||
Segment Adjusted EBITDA(2) | 173,544 | 169,535 | 334,217 | 307,691 | |||||||||||||||||||
Corporate and other Adjusted EBITDA(1) | (20,791) | (21,926) | (41,596) | (43,077) | |||||||||||||||||||
Adjusted EBITDA(2) | $ | 152,753 | $ | 147,609 | $ | 292,621 | $ | 264,614 | |||||||||||||||
(1) Corporate and other Adjusted EBITDA includes adjusted corporate overhead costs, such as payroll and related benefit costs and professional services that are not directly attributable to any individual segment and thus are unallocated.
(2) Segment Adjusted EBITDA plus the Adjusted EBITDA of corporate and other is equal to Adjusted EBITDA. Adjusted EBITDA is a metric that is not presented in accordance with GAAP. Refer to "-Non-GAAP Financial Measures" for a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP measure.
How we assess the performance of our business
In assessing the performance of our business, we consider a variety of performance and financial measures. The key measures for determining how our business is performing include total monthly dues and annual fees from members (which we refer to as system-wide sales), the number of new club openings, same club sales for both corporate-owned and franchisee-owned clubs, Adjusted EBITDA, Segment Adjusted EBITDA, Adjusted net income, and Adjusted net income per share, diluted. See "-Non-GAAP Financial Measures" below for more information.
Number of new club openings
The number of new club openings reflects clubs opened during a particular reporting period for both corporate-owned and franchisee-owned clubs. Opening new clubs is an important part of our growth strategy and we expect the majority of our future new clubs will be franchisee-owned. Before we obtain the certificate of occupancy or report any revenue for new corporate-owned clubs, we incur pre-opening costs, such as rent expense, labor expense and other operating expenses. Our clubs open with an initial start-up period requirement of higher-than-normal marketing spend and operating expenses may also be higher, particularly as a percentage of monthly revenue. New clubs may not be profitable and their revenue may not follow historical patterns. The following table shows the growth in our corporate-owned and franchisee-owned club base:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Franchisee-owned clubs: | |||||||||||||||||||||||
| Clubs operated at beginning of period | 2,617 | 2,461 | 2,604 | 2,445 | |||||||||||||||||||
| New clubs opened | 21 | 20 | 36 | 36 | |||||||||||||||||||
Clubs debranded, sold, closed or consolidated(1) | (2) | (2) | (4) | (2) | |||||||||||||||||||
| Clubs operated at end of period | 2,636 | 2,479 | 2,636 | 2,479 | |||||||||||||||||||
| Corporate-owned clubs: | |||||||||||||||||||||||
| Clubs operated at beginning of period | 292 | 280 | 292 | 277 | |||||||||||||||||||
| New clubs opened | 2 | 3 | 2 | 6 | |||||||||||||||||||
| Clubs operated at end of period | 294 | 283 | 294 | 283 | |||||||||||||||||||
| Total clubs: | |||||||||||||||||||||||
| Clubs operated at beginning of period | 2,909 | 2,741 | 2,896 | 2,722 | |||||||||||||||||||
| New clubs opened | 23 | 23 | 38 | 42 | |||||||||||||||||||
Clubs debranded, sold, closed or consolidated(1) | (2) | (2) | (4) | (2) | |||||||||||||||||||
| Clubs operated at end of period | 2,930 | 2,762 | 2,930 | 2,762 | |||||||||||||||||||
(1) The term "debranded" refers to a franchisee-owned club whose right to use the Planet Fitness brand and marks has been terminated in accordance with the franchise agreement. We retain the right to prevent debranded clubs from continuing to operate as fitness centers. The term "consolidated" refers to the combination of a franchisee's club with another club located in close proximity with our prior approval. This often coincides with an enlargement, re-equipment and/or refurbishment of the remaining club.
Same club sales
Same club sales refers to year-over-year sales comparisons for the same club sales base of both corporate-owned and franchisee-owned clubs. We define the same club sales base to include those clubs that have been open and for which monthly membership dues have been billed for longer than 12 months. We measure same club sales based solely upon monthly dues billed to members of our corporate-owned and franchisee-owned clubs.
Several factors affect our same club sales in any given period, including the following:
•the number of clubs that have been in operation for more than 12 months;
•the percentage mix and pricing of PF Black Card and standard Classic Card memberships in any period;
•growth in total net memberships per club;
•consumer recognition of our brand and our ability to respond to changing consumer preferences;
•overall economic trends, particularly those related to consumer spending;
•our and our franchisees' ability to operate clubs effectively and efficiently to meet consumer expectations;
•marketing and promotional efforts;
•local competition;
•trade area dynamics; and
•opening of new clubs in the vicinity of existing locations.
We present same club sales as compared to the same period in the prior year for all clubs that have been open and for which monthly membership dues have been billed for longer than 12 months, beginning with the 13th month and thereafter, as applicable. Same club sales of our international clubs are calculated on a constant currency basis, meaning that we translate the current year's same club sales of our international clubs at the same exchange rates used in the prior year. Since opening new clubs is a significant component of our revenue growth, same club sales is only one measure of how we evaluate our performance.
Clubs acquired from or sold to franchisees are removed from the franchisee-owned or corporate-owned same club sales base, as applicable, upon the ownership change and for the 12 months following the date of the ownership change. These clubs are included in the corporate-owned or franchisee-owned same club sales base, as applicable, beginning in the 13th month after the acquisition or sale. These clubs remain in the system-wide same club sales base in all periods. The following table shows our same club sales:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Same club sales growth: | |||||||||||||||||||||||
| Franchisee-owned clubs | 1.7 | % | 8.3 | % | 2.6 | % | 7.3 | % | |||||||||||||||
| Corporate-owned clubs | 1.7 | % | 7.0 | % | 2.6 | % | 6.1 | % | |||||||||||||||
| System-wide clubs | 1.7 | % | 8.2 | % | 2.6 | % | 7.1 | % | |||||||||||||||
| Number of clubs in same club sales base: | |||||||||||||||||||||||
| Franchisee-owned clubs | 2,489 | 2,352 | 2,489 | 2,352 | |||||||||||||||||||
| Corporate-owned clubs | 271 | 259 | 271 | 259 | |||||||||||||||||||
| System-wide clubs | 2,768 | 2,611 | 2,768 | 2,611 | |||||||||||||||||||
Total monthly dues and annual fees from members (system-wide sales)
We review the total amount of dues we bill to our members on a monthly basis, which allows us to assess changes in the performance of our corporate-owned and franchisee-owned clubs from period to period, any competitive pressures, local or regional membership traffic patterns, and general market conditions that might impact our club performance. System-wide sales is an operating measure that includes monthly membership dues and annual fee billings by franchisees that are not revenue realized by the Company in accordance with GAAP, as well as monthly membership dues and annual fee billings by the Company's corporate-owned clubs. While the Company does not record sales by franchisees as revenue, and such sales are not included in the Company's consolidated financial statements, the Company believes that this operating measure aids in understanding how the Company derives its royalty revenue and is important in evaluating its performance. We typically bill monthly dues on or around the 17th of every month and bill annual fees once per year to each member based upon when the member signed their membership agreement. System-wide sales were $1.4 billion during each of the three months ended June 30, 2026 and 2025, and $2.8 billion and $2.7 billion for the six months ended June 30, 2026 and 2025, respectively.
Non-GAAP financial measures
We refer to Adjusted EBITDA, Adjusted net income and Adjusted net income per share, diluted as we use these measures to evaluate our operating performance and we believe these measures are useful to investors in evaluating our performance. Adjusted EBITDA, Adjusted net income and Adjusted net income per share, diluted, as presented in this Quarterly Report on Form 10-Q, are supplemental measures of our performance that are neither required by, nor presented in accordance with GAAP and should not be considered as substitutes for GAAP metrics such as net income or any other performance measures derived in accordance with GAAP. Also, in the future we may incur expenses or charges such as those added back to calculate Adjusted EBITDA, Adjusted net income and Adjusted net income per share, diluted. Our presentation of Adjusted EBITDA, Adjusted net income and Adjusted net income per share, diluted should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items.
We define Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, as adjusted for the impact of certain non-cash and other items that we do not consider in our evaluation of ongoing performance of the Company's core operations. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of certain expenses and other items that we believe reduce the comparability of our underlying core business performance from period to period and is therefore useful to our investors. Our Board of Directors also uses Adjusted EBITDA as a key metric to assess the performance of management. Our CODM also uses Segment Adjusted EBITDA, which is Adjusted EBITDA specific to each of our three reportable segments, to assess the financial performance of and allocate resources to our segments in accordance with ASC 280, Segment Reporting. Corporate overhead costs not directly attributable to any individual segment are not allocated to the three segments and are included in Corporate and Other Adjusted EBITDA within Adjusted EBITDA.
Adjusted net income assumes that all net income is attributable to Planet Fitness, Inc., which assumes the full exchange of all outstanding Holdings Units for shares of Class A common stock of Planet Fitness, Inc., adjusted for certain non-cash and other items that we do not believe directly reflect our core operations. Adjusted net income per share, diluted, is calculated by dividing Adjusted net income by the total weighted-average shares of Class A common stock outstanding plus any dilutive options and restricted stock units as calculated in accordance with GAAP and assuming the full exchange of all outstanding Holdings Units and corresponding Class B common stock as of the beginning of each period presented. We believe Adjusted net income and Adjusted net income per share, diluted, supplement GAAP measures and enable us to more effectively evaluate our performance period-over-period.
Reconciliations of Non-GAAP financial measures
A reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA is set forth below:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income | $ | 67,404 | $ | 58,295 | $ | 119,200 | $ | 100,374 | |||||||||||||||
| Interest income | (5,271) | (5,690) | (10,933) | (11,502) | |||||||||||||||||||
| Interest expense | 33,401 | 26,181 | 66,368 | 52,378 | |||||||||||||||||||
| Provision for income taxes | 28,513 | 24,930 | 47,822 | 41,146 | |||||||||||||||||||
| Depreciation and amortization | 40,143 | 38,429 | 80,394 | 76,710 | |||||||||||||||||||
| EBITDA | 164,190 | 142,145 | 302,851 | 259,106 | |||||||||||||||||||
Severance costs(1) | - | 52 | - | 649 | |||||||||||||||||||
Executive transition costs(2) | 735 | 1,406 | 1,577 | 2,447 | |||||||||||||||||||
| Loss on adjustment of allowance for credit losses on held-to-maturity investment | 521 | 4,311 | 1,023 | 4,603 | |||||||||||||||||||
| Dividend income on held-to-maturity investment | (618) | (578) | (1,221) | (1,139) | |||||||||||||||||||
Insurance recovery(3) | - | - | - | (1,636) | |||||||||||||||||||
Lease closure expenses, net(4) | - | 1,067 | - | 1,067 | |||||||||||||||||||
Tax benefit arrangement remeasurement(5) | - | (1,210) | - | (1,294) | |||||||||||||||||||
Gain on sale of equity method investment(6) | (12,541) | - | (12,541) | - | |||||||||||||||||||
Amortization of basis difference of equity-method investments(7) | 240 | 240 | 480 | 480 | |||||||||||||||||||
Other(8) | 226 | 176 | 452 | 331 | |||||||||||||||||||
| Adjusted EBITDA | $ | 152,753 | $ | 147,609 | $ | 292,621 | $ | 264,614 | |||||||||||||||
(1) Represents severance related expenses recorded in connection with a reduction in force during the three and six months ended June 30, 2025.
(2) Represents certain expenses recorded in connection with executive leadership transitions. During the three and six months ended June 30, 2026, amounts represent costs associated with the departure of the Company's former Chief Financial Officer and costs associated with the search for and equity-based compensation associated with certain equity awards granted to the Company's new Chief Financial Officer and Chief Executive Officer. During the three and six months ended June 30, 2025, amounts represent costs for equity-based compensation associated with certain equity awards granted to the Company's Chief Executive Officer and retention payments for certain key employees through the Chief Executive Officer transition.
(3) Represents insurance recoveries, net of costs incurred.
(4) Represents lease termination costs, impairment charges, and loss on disposal of property and equipment from the closure of our Florida Corporate Support Center located in Orlando, Florida.
(5) Represents a gain related to the adjustment of our tax benefit arrangements primarily due to changes in our deferred state tax rate.
(6) Represents a gain related to the sale of the Company's equity method investment in Bravo Fit Holdings Pty Ltd.
(7) Represents the Company's pro-rata portion of the basis difference related to intangible asset amortization expense in its equity method investees, which is included within losses from equity-method investments, net of tax on our condensed consolidated statements of operations.
(8) Represents certain other gains and charges that we do not believe reflect our underlying business performance.
A reconciliation of net income, the most directly comparable GAAP measure, to Adjusted net income and the computation of Adjusted net income per share, diluted, are set forth below:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(in thousands, except per share amounts) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income | $ | 67,404 | $ | 58,295 | $ | 119,200 | $ | 100,374 | |||||||||||||||
| Provision for income taxes | 28,513 | 24,930 | 47,822 | 41,146 | |||||||||||||||||||
Severance costs(1) | - | 52 | - | 649 | |||||||||||||||||||
Executive transition costs(2) | 735 | 1,406 | 1,577 | 2,447 | |||||||||||||||||||
| Loss on adjustment of allowance for credit losses on held-to-maturity investment | 521 | 4,311 | 1,023 | 4,603 | |||||||||||||||||||
| Dividend income on held-to-maturity investment | (618) | (578) | (1,221) | (1,139) | |||||||||||||||||||
Insurance recovery(3) | - | - | - | (1,636) | |||||||||||||||||||
Lease closure expenses, net(4) | - | 1,067 | - | 1,067 | |||||||||||||||||||
Tax benefit arrangement remeasurement(5) | - | (1,210) | - | (1,294) | |||||||||||||||||||
Gain on sale of equity method investment(6) | (12,541) | - | (12,541) | - | |||||||||||||||||||
Amortization of basis difference of equity-method investments(7) | 240 | 240 | 480 | 480 | |||||||||||||||||||
Other(8) | 226 | 176 | 452 | 331 | |||||||||||||||||||
Purchase accounting amortization(9) | 8,019 | 9,178 | 16,039 | 18,356 | |||||||||||||||||||
| Adjusted income before income taxes | 92,499 | 97,867 | 172,831 | 165,384 | |||||||||||||||||||
Adjusted income taxes(10) | 24,050 | 25,299 | 44,936 | 42,752 | |||||||||||||||||||
| Adjusted net income | $ | 68,449 | $ | 72,568 | $ | 127,895 | $ | 122,632 | |||||||||||||||
| Adjusted net income per share, diluted | $ | 0.88 | $ | 0.86 | $ | 1.62 | $ | 1.45 | |||||||||||||||
Adjusted weighted-average shares outstanding, diluted(11) | 77,462 | 84,398 | 78,771 | 84,570 | |||||||||||||||||||
(1) Represents severance related expenses recorded in connection with a reduction in force during the three and six months ended June 30, 2025.
(2) Represents certain expenses recorded in connection with executive leadership transitions. During the three and six months ended June 30, 2026, amounts represent costs associated with the departure of the Company's former Chief Financial Officer and costs associated with the search for and equity-based compensation associated with certain equity awards granted to the Company's new Chief Financial Officer and Chief Executive Officer. During the three and six months ended June 30, 2025, amounts represent costs for equity-based compensation associated with certain equity awards granted to the Company's Chief Executive Officer and retention payments for certain key employees through the Chief Executive Officer transition.
(3) Represents insurance recoveries, net of costs incurred.
(4) Represents lease termination costs, impairment charges, and loss on disposal of property and equipment from the closure of our Florida Corporate Support Center located in Orlando, Florida.
(5) Represents a gain related to the adjustment of our tax benefit arrangements primarily due to changes in our deferred state tax rate.
(6) Represents a gain related to the sale of the Company's equity method investment in Bravo Fit Holdings Pty Ltd.
(7) Represents the Company's pro-rata portion of the basis difference related to intangible asset amortization expense in its equity method investees, which is included within losses from equity-method investments, net of tax on our condensed consolidated statements of operations.
(8) Represents certain other gains and charges that we do not believe reflect our underlying business performance.
(9) Represents the amount of actual non-cash amortization expense recorded, in accordance with GAAP, associated with intangible assets created in connection with historical acquisitions of franchisee-owned clubs.
(10) Represents corporate income taxes at an assumed effective tax rate of 26.0% for each of the three and six months ended June 30, 2026 and 25.9% for each of the three and six months ended June 30, 2025, applied to adjusted income before income taxes.
(11) Assumes the full exchange of all outstanding Holdings Units and corresponding shares of Class B common stock for shares of Class A common stock of Planet Fitness, Inc.
A reconciliation of net income per share, diluted, to Adjusted net income per share, diluted is set forth below:
| Three Months Ended June 30, 2026 | Three Months Ended June 30, 2025 | ||||||||||||||||||||||||||||||||||
| (in thousands, except per share amounts) | Net income | Weighted Average Shares | Net income per share, diluted | Net income | Weighted Average Shares | Net income per share, diluted | |||||||||||||||||||||||||||||
Net income attributable to Planet Fitness, Inc.(1) | $ | 67,082 | 77,146 | $ | 0.87 | $ | 58,019 | 84,065 | $ | 0.69 | |||||||||||||||||||||||||
Net income attributable to non-controlling interests(2) | 322 | 316 | 276 | 333 | |||||||||||||||||||||||||||||||
| Net income | 67,404 | 58,295 | |||||||||||||||||||||||||||||||||
Adjustments to arrive at adjusted income before income taxes(3) | 25,095 | 39,572 | |||||||||||||||||||||||||||||||||
| Adjusted income before income taxes | 92,499 | 97,867 | |||||||||||||||||||||||||||||||||
Adjusted income taxes(4) | 24,050 | 25,299 | |||||||||||||||||||||||||||||||||
| Adjusted net income | $ | 68,449 | 77,462 | $ | 0.88 | $ | 72,568 | 84,398 | $ | 0.86 | |||||||||||||||||||||||||
| Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | ||||||||||||||||||||||||||||||||||
| (in thousands, except per share amounts) | Net income | Weighted Average Shares | Net income per share, diluted | Net income | Weighted Average Shares | Net income per share, diluted | |||||||||||||||||||||||||||||
Net income attributable to Planet Fitness, Inc.(1) | $ | 118,636 | 78,455 | $ | 1.51 | $ | 99,886 | 84,233 | $ | 1.19 | |||||||||||||||||||||||||
Net income attributable to non-controlling interests(2) | 564 | 316 | 488 | 337 | |||||||||||||||||||||||||||||||
| Net income | 119,200 | 100,374 | |||||||||||||||||||||||||||||||||
Adjustments to arrive at adjusted income before income taxes(3) | 53,631 | 65,010 | |||||||||||||||||||||||||||||||||
| Adjusted income before income taxes | 172,831 | 165,384 | |||||||||||||||||||||||||||||||||
Adjusted income taxes(4) | 44,936 | 42,752 | |||||||||||||||||||||||||||||||||
| Adjusted net income | $ | 127,895 | 78,771 | $ | 1.62 | $ | 122,632 | 84,570 | $ | 1.45 | |||||||||||||||||||||||||
(1) Represents net income attributable to Planet Fitness, Inc. and the associated weighted average shares of Class A common stock outstanding (see Note 10 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q).
(2) Represents net income attributable to non-controlling interests and the assumed exchange of all outstanding Holdings Units and corresponding shares of Class B common stock for shares of Class A common stock of Planet Fitness, Inc. as of the beginning of the period presented.
(3) Represents the total impact of all adjustments identified in the adjusted net income table above to arrive at adjusted income before income taxes.
(4) Represents corporate income taxes at an assumed effective tax rate of 26.0% for each of the three and six months ended June 30, 2026 and 25.9% for each of the three and six months ended June 30, 2025, applied to adjusted income before income taxes.
Results of operations
Comparison of the three months ended June 30, 2026 and three months ended June 30, 2025
The following table sets forth a comparison of our condensed consolidated statements of operations in dollars and as a percentage of total revenue:
| Three Months Ended June 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| (in thousands) | Amount | % of Total Revenues | Amount | % of Total Revenues | |||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Franchise | $ | 102,856 | 28.2 | % | $ | 96,877 | 28.4 | % | |||||||||||||||
| National advertising fund revenue | 32,922 | 9.0 | % | 22,781 | 6.7 | % | |||||||||||||||||
| Franchise segment | 135,778 | 37.2 | % | 119,658 | 35.1 | % | |||||||||||||||||
| Corporate-owned clubs | 143,862 | 39.4 | % | 138,989 | 40.8 | % | |||||||||||||||||
| Equipment | 85,583 | 23.4 | % | 82,232 | 24.1 | % | |||||||||||||||||
| Total revenue | 365,223 | 100.0 | % | 340,879 | 100.0 | % | |||||||||||||||||
| Operating costs and expenses: | |||||||||||||||||||||||
| Cost of revenue | 64,495 | 17.7 | % | 59,423 | 17.4 | % | |||||||||||||||||
| Club operations | 81,698 | 22.4 | % | 77,437 | 22.7 | % | |||||||||||||||||
| Selling, general and administrative | 34,406 | 9.4 | % | 35,511 | 10.4 | % | |||||||||||||||||
| National advertising fund expense | 32,922 | 9.0 | % | 22,777 | 6.7 | % | |||||||||||||||||
| Depreciation and amortization | 40,143 | 11.0 | % | 38,429 | 11.3 | % | |||||||||||||||||
| Other (gains) losses, net | (12,254) | (3.4) | % | 4,900 | 1.4 | % | |||||||||||||||||
| Total operating costs and expenses | 241,410 | 66.1 | % | 238,477 | 69.9 | % | |||||||||||||||||
| Income from operations | 123,813 | 33.9 | % | 102,402 | 30.1 | % | |||||||||||||||||
| Other income (expense), net: | |||||||||||||||||||||||
| Interest income | 5,271 | 1.4 | % | 5,690 | 1.7 | % | |||||||||||||||||
| Interest expense | (33,401) | (9.1) | % | (26,181) | (7.7) | % | |||||||||||||||||
| Other income, net | 446 | 0.1 | % | 1,942 | 0.6 | % | |||||||||||||||||
| Total other expense, net | (27,684) | (7.6) | % | (18,549) | (5.4) | % | |||||||||||||||||
| Income before income taxes | 96,129 | 26.3 | % | 83,853 | 24.7 | % | |||||||||||||||||
| Provision for income taxes | 28,513 | 7.8 | % | 24,930 | 7.3 | % | |||||||||||||||||
| Losses from equity-method investments, net of tax | (212) | (0.1) | % | (628) | (0.2) | % | |||||||||||||||||
| Net income | 67,404 | 18.4 | % | 58,295 | 17.2 | % | |||||||||||||||||
| Less net income attributable to non-controlling interests | 322 | 0.1 | % | 276 | 0.1 | % | |||||||||||||||||
| Net income attributable to Planet Fitness, Inc. | $ | 67,082 | 18.3 | % | $ | 58,019 | 17.1 | % | |||||||||||||||
Revenue
Total revenue was $365.2 million for the three months ended June 30, 2026, compared to $340.9 million for the three months ended June 30, 2025, an increase of $24.3 million, or 7.1%.
Franchise segment revenue was $135.8 million for the three months ended June 30, 2026, compared to $119.7 million for the three months ended June 30, 2025, an increase of $16.1 million, or 13.5%.
Franchise revenue was $102.9 million for the three months ended June 30, 2026, compared to $96.9 million for the three months ended June 30, 2025, an increase of $6.0 million, or 6.2%. Included in franchise revenue are the following:
| Three Months Ended June 30, | |||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | $ Change | % Change | |||||||||||||||||||
| Royalty revenue | $ | 85,879 | $ | 81,134 | $ | 4,745 | 5.8 | % | |||||||||||||||
| Franchise and other fees | 10,896 | 9,634 | 1,262 | 13.1 | % | ||||||||||||||||||
| Placement revenue | 6,081 | 6,109 | (28) | (0.5) | % | ||||||||||||||||||
| Total franchise revenue | $ | 102,856 | $ | 96,877 | $ | 5,979 | 6.2 | % | |||||||||||||||
Of the $4.7 million increase in royalty revenue, $1.7 million was attributable to a franchise same club sales increase of 1.7%, $2.5 million was attributable to new clubs opened since April 1, 2025 before moving into the same club sales base and $0.5 million was from higher royalties on annual fees. The $1.3 million increase in franchise and other fees was primarily attributable to higher "PF Perks" revenue.
NAF revenue was $32.9 million for the three months ended June 30, 2026, compared to $22.8 million for the three months ended June 30, 2025, an increase of $10.1 million, or 44.5%. This increase was primarily attributable to a 1% rate increase to NAF contributions from 2% to 3% for 2026, higher same club sales and new clubs opened since April 1, 2025.
Corporate-owned clubs segment revenue was $143.9 million for the three months ended June 30, 2026, compared to $139.0 million for the three months ended June 30, 2025, an increase of $4.9 million, or 3.5%. This increase was primarily attributable to $5.0 million from new clubs opened since April 1, 2025 before moving into the same club sales base and $4.8 million from the corporate-owned clubs included in the same club sales base, including $3.0 million attributable to a same club sales increase of 1.7% and $1.6 million attributable to other fees. This increase was partially offset by $4.9 million of lower revenue attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Equipment segment revenue was $85.6 million for the three months ended June 30, 2026, compared to $82.2 million for the three months ended June 30, 2025, an increase of $3.4 million, or 4.1%. This increase was primarily attributable to $1.7 million of higher revenue from equipment sales to new franchisee-owned clubs and $1.6 million of higher revenue from equipment sales to existing franchisee-owned clubs. In the three months ended June 30, 2026, we had equipment sales to 21 new franchisee-owned clubs compared to 19 in the same period last year.
Cost of revenue
Cost of revenue, which primarily relates to our equipment segment, was $64.5 million for the three months ended June 30, 2026, compared to $59.4 million for the three months ended June 30, 2025, an increase of $5.1 million, or 8.5%. This increase was primarily attributable to higher equipment sales to new and existing franchisee-owned clubs, as described above.
Club operations
Club operations expense, which relates to our corporate-owned clubs segment, was $81.7 million for the three months ended June 30, 2026, compared to $77.4 million for the three months ended June 30, 2025, an increase of $4.3 million, or 5.5%. This increase was primarily attributable to $4.6 million from new clubs opened since April 1, 2025 before moving into the same club sales base and $3.2 million from clubs included in our same club sales base, both as a result of higher marketing, payroll, and occupancy related expenses. This increase was partially offset by $3.5 million of lower club operations expense attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Selling, general and administrative
Selling, general and administrative expenses were $34.4 million for the three months ended June 30, 2026, compared to $35.5 million for the three months ended June 30, 2025, a decrease of $1.1 million, or 3.1%. This decrease was primarily attributable to lower costs relating to consulting and marketing partially offset by higher rent expense associated with our new Boston office, which has not yet opened.
National advertising fund expense
NAF expense was $32.9 million for the three months ended June 30, 2026, compared to $22.8 million for the three months ended June 30, 2025, an increase of $10.1 million, or 44.5%. This increase was primarily attributable to higher advertising and marketing expenditures due to higher national advertising revenue as described above.
Depreciation and amortization
Depreciation and amortization expense was $40.1 million for the three months ended June 30, 2026, compared to $38.4 million for the three months ended June 30, 2025, an increase of $1.7 million, or 4.5%. This increase was primarily attributable to an increase in depreciation expense, primarily from new clubs opened since April 1, 2025, partially offset by a decrease in amortization expense as a result of certain intangible assets becoming fully amortized during the current year period.
Other (gains) losses, net
Other (gains) losses, net was a $12.3 million gain for the three months ended June 30, 2026, compared to a $4.9 million loss for the three months ended June 30, 2025. The current year period amount is primarily attributable to a gain recognized on the sale of our equity method investment in Australia. The prior year period amount is primarily attributable to an allowance for expected credit losses on the Company's held-to-maturity debt security and costs incurred on the closure of the Company's Florida Corporate Support Center located in Orlando, Florida.
Interest income
Interest income was $5.3 million for the three months ended June 30, 2026, compared to $5.7 million for the three months ended June 30, 2025, a decrease of $0.4 million, or 7.4%.
Interest expense
Interest expense primarily consists of interest on long-term debt as well as the amortization of deferred financing costs.
Interest expense was $33.4 million for the three months ended June 30, 2026, compared to $26.2 million for the three months ended June 30, 2025, an increase of $7.2 million, or 27.6%. This increase was primarily due to a higher principal balance and blended interest rate on our indebtedness related to the issuance of the Series 2025-1 5.274% Fixed Rate Senior Secured Notes, Class A-2-I (the "2025 Class A-2-I Notes") with an initial principal amount of $400.0 million and Series 2025-1 5.649% Fixed Rate Senior Secured Notes, Class A-2-II (the "2025 Class A-2-II Notes," and together with the 2025 Class A-2-I Notes, the "2025 Notes") in December 2025 and draw down on the 2025 Variable Funding Notes (as defined below) in the current year period.
Other income, net
Other income, net was a $0.4 million income for the three months ended June 30, 2026, compared to a $1.9 million income for the three months ended June 30, 2025. This decrease in other income, net was primarily attributable to a gain on the remeasurement of our tax benefit arrangements in the prior year period due to changes in our effective tax rate.
Provision for income taxes
Income tax expense was $28.5 million for the three months ended June 30, 2026, compared to $24.9 million for the three months ended June 30, 2025, an increase of $3.6 million, or 14.4%. This increase is primarily attributable to higher income before taxes in the current year period.
The Company's effective tax rate was 29.7% for both the three months ended June 30, 2026, and 2025.
Losses from equity-method investments
Losses from equity-method investments were $0.2 million for the three months ended June 30, 2026, compared to $0.6 million for the three months ended June 30, 2025.
Segment results
Franchise
Franchise Segment Adjusted EBITDA was $91.7 million for the three months ended June 30, 2026, compared to $86.5 million for the three months ended June 30, 2025, an increase of $5.2 million, or 6.1%. This increase was primarily attributable to higher NAF and franchise revenue of $10.1 million and $6.0 million, respectively, as described above, partially offset by $10.1 million of higher NAF expense and $0.4 million of higher selling, general and administrative expense.
Corporate-owned clubs
Corporate-owned clubs Segment Adjusted EBITDA was $57.5 million for the three months ended June 30, 2026, compared to $56.6 million for the three months ended June 30, 2025, an increase of $0.9 million, or 1.6%. This increase in Adjusted EBITDA was primarily attributable to $1.6 million from clubs included in the same club sales base, $0.4 million of lower selling, general and administrative expenses primarily from the closure of the Company's Florida Corporate Support Center in the prior year period and $0.3 million from new clubs opened since April 1, 2025 before moving into the same club sales base, partially offset by $1.3 million of lower Adjusted EBITDA attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Equipment
Equipment Segment Adjusted EBITDA was $24.3 million for the three months ended June 30, 2026, compared to $26.4 million for the three months ended June 30, 2025, a decrease of $2.1 million, or 8.0%. This decrease was primarily attributable to the timing of replacement equipment discounts, partially offset by higher equipment sales to new and existing franchisee-owned clubs.
Comparison of the six months ended June 30, 2026 and six months ended June 30, 2025
The following table sets forth a comparison of our condensed consolidated statements of operations in dollars and as a percentage of total revenue:
| Six Months Ended June 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| (in thousands) | Amount | % of Total Revenues | Amount | % of Total Revenues | |||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Franchise | $ | 205,105 | 29.2 | % | $ | 190,117 | 30.8 | % | |||||||||||||||
| National advertising fund revenue | 65,140 | 9.3 | % | 44,721 | 7.2 | % | |||||||||||||||||
| Franchise segment | 270,245 | 38.5 | % | 234,838 | 38.0 | % | |||||||||||||||||
| Corporate-owned clubs | 284,484 | 40.5 | % | 272,658 | 44.2 | % | |||||||||||||||||
| Equipment | 147,730 | 21.0 | % | 110,045 | 17.8 | % | |||||||||||||||||
| Total revenue | 702,459 | 100.0 | % | 617,541 | 100.0 | % | |||||||||||||||||
| Operating costs and expenses: | |||||||||||||||||||||||
| Cost of revenue | 109,836 | 15.6 | % | 81,908 | 13.3 | % | |||||||||||||||||
| Club operations | 169,892 | 24.2 | % | 159,117 | 25.8 | % | |||||||||||||||||
| Selling, general and administrative | 68,556 | 9.8 | % | 69,818 | 11.3 | % | |||||||||||||||||
| National advertising fund expense | 65,140 | 9.3 | % | 44,721 | 7.2 | % | |||||||||||||||||
| Depreciation and amortization | 80,394 | 11.4 | % | 76,710 | 12.4 | % | |||||||||||||||||
| Other (gains) losses, net | (13,841) | (2.0) | % | 3,663 | 0.6 | % | |||||||||||||||||
| Total operating costs and expenses | 479,977 | 68.3 | % | 435,937 | 70.6 | % | |||||||||||||||||
| Income from operations | 222,482 | 31.7 | % | 181,604 | 29.4 | % | |||||||||||||||||
| Other income (expense), net: | |||||||||||||||||||||||
| Interest income | 10,933 | 1.6 | % | 11,502 | 1.9 | % | |||||||||||||||||
| Interest expense | (66,368) | (9.4) | % | (52,378) | (8.5) | % | |||||||||||||||||
| Other income, net | 1,061 | 0.2 | % | 2,225 | 0.4 | % | |||||||||||||||||
| Total other expense, net | (54,374) | (7.6) | % | (38,651) | (6.2) | % | |||||||||||||||||
| Income before income taxes | 168,108 | 24.1 | % | 142,953 | 23.2 | % | |||||||||||||||||
| Provision for income taxes | 47,822 | 6.8 | % | 41,146 | 6.7 | % | |||||||||||||||||
| Losses from equity-method investments, net of tax | (1,086) | (0.2) | % | (1,433) | (0.2) | % | |||||||||||||||||
| Net income | 119,200 | 17.1 | % | 100,374 | 16.3 | % | |||||||||||||||||
| Less net income attributable to non-controlling interests | 564 | 0.1 | % | 488 | 0.1 | % | |||||||||||||||||
| Net income attributable to Planet Fitness, Inc. | $ | 118,636 | 17.0 | % | $ | 99,886 | 16.2 | % | |||||||||||||||
Revenue
Total revenue was $702.5 million for the six months ended June 30, 2026, compared to $617.5 million for the six months ended June 30, 2025, an increase of $84.9 million, or 13.8%.
Franchise segment revenue was $270.2 million for the six months ended June 30, 2026, compared to $234.8 million for the six months ended June 30, 2025, an increase of $35.4 million, or 15.1%.
Franchise revenue was $205.1 million for the six months ended June 30, 2026, compared to $190.1 million for the six months ended June 30, 2025, an increase of $15.0 million, or 7.9%. Included in franchise revenue are the following:
| Six Months Ended June 30, | |||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | $ Change | % Change | |||||||||||||||||||
| Royalty revenue | $ | 170,145 | $ | 159,411 | $ | 10,734 | 6.7 | % | |||||||||||||||
| Franchise and other fees | 24,732 | 22,088 | 2,644 | 12.0 | % | ||||||||||||||||||
| Placement revenue | 10,202 | 8,435 | 1,767 | 20.9 | % | ||||||||||||||||||
| HVAC revenue | 26 | 183 | (157) | (85.8) | % | ||||||||||||||||||
| Total franchise revenue | $ | 205,105 | $ | 190,117 | $ | 14,988 | 7.9 | % | |||||||||||||||
Of the $10.7 million increase in royalty revenue, $4.5 million was attributable to a franchise same club sales increase of 2.6%, $4.7 million was attributable to new clubs opened since January 1, 2025 before moving into the same club sales base and $1.5 million was from higher royalties on annual fees. The $2.6 million increase in franchise and other fees was primarily attributable to higher "PF Perks" revenue and ADA fees and the $1.8 million increase in placement revenue was primarily driven by higher replacement equipment placements.
NAF revenue was $65.1 million for the six months ended June 30, 2026, compared to $44.7 million for the six months ended June 30, 2025, an increase of $20.4 million, or 45.7%. This increase was primarily attributable to a 1% rate increase to NAF contributions from 2% to 3% for 2026, higher same club sales and new clubs opened since January 1, 2025.
Corporate-owned clubs segment revenue was $284.5 million for the six months ended June 30, 2026, compared to $272.7 million for the six months ended June 30, 2025, an increase of $11.8 million, or 4.3%. This increase was primarily attributable to $11.7 million from the corporate-owned clubs in the same club sales base, including $7.3 million attributable to a same club sales increase of 2.6% and $4.3 million attributable to other fees. Additionally, $9.9 million was from new clubs opened since January 1, 2025 before moving into the same club sales base. This increase was partially offset by $9.8 million of lower revenue attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Equipment segment revenue was $147.7 million for the six months ended June 30, 2026, compared to $110.0 million for the six months ended June 30, 2025, an increase of $37.7 million, or 34.2%. This increase was primarily attributable to $33.7 million of higher revenue from equipment sales to existing franchisee-owned clubs and $4.0 million of higher revenue from equipment sales to new franchisee-owned clubs. In the six months ended June 30, 2026, we had equipment sales to 35 new franchisee-owned clubs compared to 29 in the six months ended June 30, 2025.
Cost of revenue
Cost of revenue, which primarily relates to our equipment segment, was $109.8 million for the six months ended June 30, 2026, compared to $81.9 million for the six months ended June 30, 2025, an increase of $27.9 million, or 34.1%. This increase was primarily attributable to higher equipment sales to existing and new franchisee-owned clubs, as described above.
Club operations
Club operations expense, which relates to our corporate-owned clubs segment, was $169.9 million for the six months ended June 30, 2026, compared to $159.1 million for the six months ended June 30, 2025, an increase of $10.8 million, or 6.8%. This increase was primarily attributable to $9.7 million from new clubs opened since January 1, 2025 before moving into the same club sales base and $7.8 million from clubs included in our same club sales base, both as a result of higher marketing, payroll, and occupancy related expenses. This increase was partially offset by $6.7 million of lower club operations expense attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Selling, general and administrative
Selling, general and administrative expenses were $68.6 million for the six months ended June 30, 2026, compared to $69.8 million for the six months ended June 30, 2025, a decrease of $1.3 million, or 1.8%. This decrease was primarily attributable to lower costs relating to consulting and marketing partially offset by higher payroll costs and higher rent expense associated with our new Boston office, which has not yet opened.
National advertising fund expense
NAF expense was $65.1 million for the six months ended June 30, 2026, compared to $44.7 million for the six months ended June 30, 2025, an increase of $20.4 million, or 45.7%. This increase was primarily a result of higher advertising and marketing expenditures due to higher national advertising revenue, as described above.
Depreciation and amortization
Depreciation and amortization expense was $80.4 million for the six months ended June 30, 2026, compared to $76.7 million for the six months ended June 30, 2025, an increase of $3.7 million, or 4.8%. This increase was primarily attributable to an increase in depreciation expense primarily from new clubs opened since January 1, 2025, partially offset by a decrease in amortization expense as a result of certain intangible assets becoming fully amortized during the current year period.
Other (gains) losses, net
Other (gains) losses, net was a $13.8 million gain for the six months ended June 30, 2026, compared to a $3.7 million loss for the six months ended June 30, 2025. The current year period amount is primarily attributable to a gain recognized on the sale of our equity method investment in Australia and on fees received in connection with the transfer of clubs between franchisee groups. The prior year period amount is primarily attributable to an allowance for expected credit losses on the Company's held-to-maturity debt security and costs incurred on the closure of the Company's Florida Corporate Support Center located in Orlando, Florida.
Interest income
Interest income was $10.9 million for the six months ended June 30, 2026, compared to $11.5 million for the six months ended June 30, 2025, a decrease of $0.6 million, or 4.9%.
Interest expense
Interest expense primarily consists of interest on long-term debt as well as the amortization of deferred financing costs.
Interest expense was $66.4 million for the six months ended June 30, 2026, compared to $52.4 million for the six months ended June 30, 2025, an increase of $14.0 million, or 26.7%. This increase was primarily attributable to a higher principal balance and blended interest rate on our indebtedness related to the issuance of the 2025 Notes in December 2025 and draw down on the Variable Funding Notes in the current year period.
Other income, net
Other income, net was $1.1 million for the six months ended June 30, 2026, compared to $2.2 million for the six months ended June 30, 2025. This decrease in other income was primarily attributable to a gain on the remeasurement of our tax benefit arrangements in the prior year period due to changes in our effective tax rate.
Provision for income taxes
Income tax expense was $47.8 million for the six months ended June 30, 2026, compared to $41.1 million for the six months ended June 30, 2025, an increase of $6.7 million, or 16.2%. This increase is primarily attributable to higher income before taxes and higher non-deductible compensation in the current year period.
The Company's effective tax rate was 28.4% for the six months ended June 30, 2026, compared to 28.8% for the six months ended June 30, 2025. The decrease in the effective income tax rate was primarily due to the remeasurement of deferred tax assets in the prior year period.
Losses from equity-method investments
Losses from equity-method investments were $1.1 million for the six months ended June 30, 2026, compared to $1.4 million for the six months ended June 30, 2025, a decrease of $0.3 million.
Segment results
Franchise
Franchise Segment Adjusted EBITDA was $186.5 million for the six months ended June 30, 2026, compared to $171.4 million for the six months ended June 30, 2025, an increase of $15.1 million, or 8.8%. This increase was primarily attributable to higher NAF and franchise revenue of $20.4 million and $15.0 million, respectively, as described above, and higher other gains, net of $2.1 million partially offset by $20.4 million of higher NAF expense and $1.6 million of higher selling, general and administrative expense.
Corporate-owned clubs
Corporate-owned clubs Segment Adjusted EBITDA was $104.0 million for the six months ended June 30, 2026, compared to $102.4 million for the six months ended June 30, 2025, an increase of $1.5 million, or 1.5%. This Adjusted EBITDA increase was primarily attributable to $3.9 million from clubs included in the same club sales base, and $0.6 million of lower selling, general and administrative expenses resulting from the closure of the Company's Florida Corporate Support Center in the prior year period, partially offset by $2.9 million of lower Adjusted EBITDA attributable to the eight clubs located in California that the Company sold to a franchisee in August 2025.
Equipment
Equipment Segment Adjusted EBITDA was $43.8 million for the six months ended June 30, 2026, compared to $33.9 million for the six months ended June 30, 2025, an increase of $9.9 million, or 29.3%. This increase was primarily attributable to higher equipment sales to existing and new franchisee-owned clubs, as described above, partially offset by the timing of replacement equipment discounts.
Liquidity and capital resources
As of June 30, 2026, we had $298.3 million of cash and cash equivalents, $102.5 million of short-term marketable securities, $70.7 million of long-term marketable securities and $72.9 million of restricted cash.
We require cash principally to fund day-to-day operations, to finance capital investments, to service our outstanding debt and tax benefit arrangements and to address our working capital needs. Based on our current level of operations, we believe that
with our available cash balance, the cash generated from our operations, and amounts available under our 2022 Variable Funding Notes will be adequate to meet our anticipated debt service requirements and obligations under our tax benefit arrangements, capital expenditures and working capital needs for at least the next 12 months. Our ability to continue to fund these items could be adversely affected by the occurrence of any of the events described under "Risk Factors" in the Annual Report on Form 10-K for the year ended December 31, 2025. There can be no assurance that our business will generate sufficient cash flows from operations or otherwise to enable us to service our indebtedness, including our securitized senior notes, or to make anticipated capital expenditures. Our future operating performance and our ability to service, extend or refinance our indebtedness will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control.
Summary of Cash Flows
| Six Months Ended June 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | $ | 193,449 | $ | 177,894 | |||||||
| Investing activities | (42,588) | (70,962) | |||||||||
| Financing activities | (191,450) | (66,089) | |||||||||
| Effect of foreign exchange rates on cash | (157) | 1,658 | |||||||||
| Net (decrease) increase in cash, cash equivalents and restricted cash | $ | (40,746) | $ | 42,501 | |||||||
Operating activities
Net cash provided by operating activities of $193.4 million for the six months ended June 30, 2026 was primarily attributable to $119.2 million of net income and $106.0 million of adjustments to reconcile net income to net cash provided by operating activities, primarily consisting of depreciation and amortization, deferred tax expense, equity-based compensation expense, amortization of deferred financing costs, gain on sale of equity-method investment and other adjustments and a $31.7 million working capital cash outflow. The working capital cash outflow was primarily attributable to a decrease in the tax benefit arrangement liability as a result of payments made during the current year period and an increase in restricted assets for the NAF. The working capital cash outflow was partially offset by an increase in deferred revenue primarily from increased annual fee billing and NAF revenue, a decrease in right-of-use assets, net of lease liabilities primarily from the amortization of straight line rent, and a decrease in accounts receivable primarily from collections in 2026.
Net cash provided by operating activities of $177.9 million for the six months ended June 30, 2025 was primarily attributable to $100.4 million of net income and $114.6 million of adjustments to reconcile net income to net cash provided by operating activities, primarily consisting of depreciation and amortization, deferred tax expense, equity-based compensation expense, amortization of deferred financing costs and other adjustments and a $37.1 million working capital cash outflow. The working capital cash outflow was primarily attributable to a decrease in the tax benefit arrangement liability as a result of payments made during the period, an increase in restricted assets for the NAF, an increase in other assets and other current assets, and a decrease in income taxes payable. The working capital cash outflow was partially offset by an increase in deferred revenue primarily from increased annual billing and NAF revenue, an increase in lease liabilities primarily from new corporate-owned clubs in 2025, an increase in equipment deposits and a decrease in accounts receivable primarily from collections in 2025.
Investing activities
For the six months ended June 30, 2026, net cash used in investing activities was $42.6 million compared to $71.0 million in the six months ended June 30, 2025, a decrease of $28.4 million. This decrease was primarily attributable to purchases of marketable securities, net of maturities of $31.3 million and proceeds from the sale of an equity-method investment of $24.3 million, partially offset by the issuance of a note receivable to a related party of $18.0 million and higher capital expenditures of $8.6 million. Capital expenditures for the six months ended June 30, 2026 and 2025 were as follows:
| Six Months Ended June 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| New corporate-owned clubs | $ | 18,566 | $ | 19,870 | |||||||
| Existing corporate-owned clubs | 38,205 | 30,035 | |||||||||
| Information systems | 6,943 | 7,766 | |||||||||
| Corporate and all other | 3,711 | 1,130 | |||||||||
| Total capital expenditures | $ | 67,425 | $ | 58,801 | |||||||
Financing activities
For the six months ended June 30, 2026, net cash used in financing activities was $191.5 million compared to $66.1 million in the six months ended June 30, 2025, an increase of $125.4 million. This increase was primarily attributable to a $199.2 million increase in cash used for share repurchases in the current year, partially offset by $75.0 million of borrowings under the Variable Funding Notes.
Securitized Financing Facility
Planet Fitness Master Issuer LLC (the "Master Issuer"), a limited-purpose, bankruptcy remote, wholly-owned indirect subsidiary of Pla-Fit Holdings, LLC, is the master issuer of outstanding senior secured notes under a securitized financing facility that was entered into in August 2018.
In February 2022 and December 2025, the Master Issuer issued the Series 2022-1 Class A-1 Notes (the "2022 Variable Funding Notes") and the Series 2025-1 Class A-1 Notes (the "2025 Variable Funding Notes" and together with the 2022 Variable Funding Notes, the "Variable Funding Notes"), respectively, each of which allow for the drawing of up to $75 million of Variable Funding Notes, including letters of credit facilities. As of June 30, 2026, the 2022 Variable Funding Notes are undrawn while the 2025 Variable Funding Notes are fully drawn. The proceeds from the 2025 Variable Funding Notes were used to partially fund share repurchases made during the three months ended June 30, 2026.
There were no material changes to the terms of any debt obligations in the six months ended June 30, 2026. The Company was in compliance with its debt covenants as of June 30, 2026. See Note 5 to the Condensed Consolidated Financial Statements contained in Item 1 herein for further information related to our long-term debt obligations.
Off-balance sheet arrangements
As of June 30, 2026, our off-balance sheet arrangements consisted of guarantees of lease agreements for certain franchisees up to a maximum period of ten years with earlier expiration dates possible if certain conditions are met. Our maximum total obligation under these lease guarantee agreements is approximately $3.3 million and would require payment only upon default by the primary obligor. The estimated fair value of these guarantees as of June 30, 2026 was not material, and no accrual has been recorded for our potential obligation under these arrangements.
Critical accounting policies and use of estimates
There have been no material changes to our critical accounting policies and use of estimates from those described under "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended December 31, 2025.