- Q4 Revenue Growth: Total revenue increased 12.3% to $745 million, driven by higher average dues ($223, +10.8%) and in-center performance.
- Net Income Surge: Net income rose 231% to $123 million, with adjusted net income up 28.4% to $77 million year-over-year.
- EBITDA Margin Expansion: Adjusted EBITDA hit $203 million (+14.5%), with margins improving 50 bps to 27.2% in Q4.
- 2025 Full-Year Performance: Revenue grew 14.3% to $2.995 billion, with comparable center revenue up 11.1%
Financial Performance Highlights
The company's full-year 2025 revenue grew 14.3% to $2.995 billion, driven by a 13.9% increase in membership dues and enrollment fees, and a 15.1% rise in in-center revenue. For 2026, Life Time expects comparable center revenue growth of 6.3% to 7.3%. The company's guidance suggests a continued strong performance, with plans to invest $875 million to $915 million in growth capital, primarily focused on new club openings.
Valuation Metrics and Growth Prospects
With a P/E Ratio of 16.45 and an EV/EBITDA of 10.71, the market appears to have priced in a certain level of growth. The company's ROE stands at 12.76%, indicating a relatively healthy return on equity. Analysts estimate revenue growth at 12.5% for the next year, suggesting a continued upward trajectory. As Bahram Akradi mentioned, "2025 was another great year of achieving our objectives and exceeding our financial goals." The company's focus on optimizing its membership mix, growing digital members, and enhancing the customer experience positions it for sustained growth.
Operational Highlights and Future Initiatives
Life Time is focusing on new formats and enhancing the customer experience, with a robust plan to increase visibility of LT Health products to club members. The company is also exploring ways to apply its personal training program more broadly, with DPT expected to continue growing. Additionally, the rollout of MIORA, a new fitness program, is ramping faster than expected, with plans to introduce it in every market.
Capital Allocation and Shareholder Returns
The company has announced a $500 million share repurchase program, demonstrating its commitment to returning value to shareholders. With a net leverage ratio of 1.6x, below its target of 2x, Life Time is well-positioned to manage its capital structure and invest in growth opportunities while maintaining a healthy balance sheet.