The fitness industry is offering a stark reflection of the broader U.S. Economy: while overall spending remains resilient, a clear divide is emerging between those who can comfortably afford premium experiences and those who are increasingly price-sensitive. Recent earnings reports from two of the nation’s largest gym operators, Life Time Group Holdings and Planet Fitness, underscore this “K-shaped” economic recovery, where higher-income households continue to spend freely while lower and middle-income consumers present signs of strain.
Both companies reported strong growth in 2025, but the details reveal a diverging path. Life Time, catering to a more affluent clientele, saw revenue jump 12.3% in the fourth quarter to $745.1 million, fueled by higher membership dues and increased spending on amenities like personal training and spa services. Planet Fitness, focused on value and accessibility, as well added 1.1 million new members last year, but its 2026 outlook raised concerns among investors, signaling a potential slowdown in demand from its core customer base. This divergence in performance highlights a growing trend across industries, from airlines offering enhanced luxury options to fast-food chains emphasizing value meals.
Life Time: A Premium Experience Drives Growth
Life Time’s success is rooted in its ability to attract and retain high-income members who prioritize health and wellness. The company increased membership dues by roughly $10 to $30 last year without experiencing a decline in demand, a testament to the discretionary income of its customer base. According to Life Time CFO Erik Weaver, the revenue increase was driven by “continued execution in our centers,” including higher average dues and stronger utilization of in-center businesses.
Beyond membership fees, Life Time is benefiting from increased spending on in-center services, which topped $191 million in the fourth quarter. Members are fully utilizing amenities like personal training, spa treatments, and food and beverage options, treating the clubs as lifestyle destinations. Average revenue per center membership rose 10.8% to $882. Life Time Group Holdings CEO Bahram Akradi described the model as “a super engaged membership model instead of a non-use membership model,” indicating high levels of member activity and satisfaction.
Despite operating fewer locations than Planet Fitness, Life Time generates significantly more revenue, underscoring the higher spending power of its members. Mizuho analyst John Baumgartner noted that the model’s resilience throughout a challenging macroeconomic environment, coupled with a membership base skewed towards high-income households, limits downside risks.
Planet Fitness: Outlook Raises Questions About Broader Demand
Planet Fitness also experienced substantial growth in 2025, adding 1.1 million new members and achieving double-digit percentage revenue gains. But, investors reacted negatively to the company’s 2026 outlook, which projected slower revenue growth of 9% and weaker same-store sales of 4% to 5% than previously anticipated.
The company attributed some of the slowdown to external factors, such as storms and cold weather in January, which impacted join trends and led to a slightly higher cancellation rate. Planet Fitness CFO Jay Stasz noted that attrition trends are now returning to expected levels. The company is also testing price hikes in some markets, with plans for a full rollout in summer 2026, and investing in new amenities like red light therapy and additional classes to attract younger members and increase revenue per member.
However, some analysts remain skeptical. Stifel analyst Chris Cull argued that Planet Fitness now faces a “credibility hurdle,” questioning whether the 2026 guidance is conservative or if the long-term targets are unrealistic. The gap between the company’s results and Wall Street expectations has created uncertainty about its future growth trajectory.
The K-Shaped Economy in Action
The contrasting performances of Life Time and Planet Fitness provide a microcosm of the broader “K-shaped” economic recovery. Higher-income consumers, as demonstrated by Life Time’s results, continue to spend on discretionary items and premium experiences, largely insulated from economic pressures. Meanwhile, Planet Fitness’s outlook suggests that price-sensitive consumers are becoming more cautious with their spending.
This trend is not unique to the fitness industry. As CNBC reported earlier this month, a similar pattern is emerging across various sectors. Airlines are investing in luxury offerings to cater to affluent travelers, while fast-food companies are leaning on value meals to attract budget-conscious customers. The differing trajectories of these businesses reinforce the idea of a K-shaped economy, where the recovery is unevenly distributed.
William Blair analyst Sharon Zackfia lowered her firm’s projections for Planet Fitness’ 2026 member growth to 800,000 from 1 million, citing projected weakness in the first quarter. Despite this revision, Zackfia remains optimistic about the company’s long-term prospects, citing its industry-leading low-price/non-intimidating club format.
For now, the fitness industry is offering a clear signal: consumer spending remains strong but it is increasingly divided along income lines. The coming quarters will be crucial in determining whether Planet Fitness can maintain its growth momentum and whether the broader economy will continue to follow this K-shaped path.
Disclaimer: This article provides information for general knowledge and informational purposes only, and does not constitute financial advice.
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