F45 Training is cutting jobs and changing CEOs as its hypergrowth strategy faces a reality check.
HIITing the Panic Button
Citing “ongoing macroeconomic uncertainty,” F45 is cutting 110 jobs and restructuring in an effort to reduce operational expenses.
The publicly traded fitness studio franchisor also announced Adam Gilchrist’s exit from the chief executive role. It’s searching for a permanent replacement as the company scrambles to regroup.
Slashing 2022 projections, F45 revised its full-year outlook:
- Net new franchises sold: 350–450, down from 1.5K
- Net initial studio openings: 350–450, down from 1K
- Revenue: $120–130M, down from $255–275M
- Adjusted EBITDA: $25–30M, down from $90–100M
The new plan is a stark reversal from just two months prior, when Gilchrist doubled down on cementing the brand’s status as the “world’s fastest-growing fitness franchise.”
Attempting to fill the void left by pandemic-induced gym closures, F45 aggressively inked contracts for new studios while also expanding its presence in country clubs, military bases, office buildings, and hospitality.
Zooming out: Rebounding after pandemic lockdowns, gyms have been gaining ground while at-home fitness companies faced slowdowns and layoffs — with Peloton, Tonal, Hydrow, iFIT, and others reducing their workforce.
Now, despite receiving a $150M credit facility to fast-track franchisee development in May, F45’s outlook looks less certain.
Looking ahead: F45’s woes signal the far-reaching impact of the economic downturn, lingering effects of shuttered studios, and some operational miscues. Not alone, gym operators that were chasing growth will likely need to plot a more sustainable course.