What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-05 compared with 2025-11-04 · 91 added, 194 removed, 205 unchanged (58% of the section changed)

2 unchanged sentences

Certain statements in this discussion and analysis are forward-looking statements within the meaning of federal securities regulations.

Forward-looking statements in this discussion and analysis include, but are not limited to, our plans, strategies and prospects, both business and financial, including our financial outlook and cash flow, possible or assumed future actions, opportunities for growth and margin expansion, improvements to our balance sheet and leverage, capital expenditures, consumer demand, industry and economic trends, business strategies, events or results of operations.

Forward-looking statements in this discussion and analysis include, but are not limited to, our plans, strategies and prospects, both business and financial, including our financial outlook, growth, business initiatives, memberships, cost efficiencies and margin expansion, capital expenditures and free cash flow, improvements to our balance sheet, net debt and leverage, interest expense, consumer demand, industry and economic trends, tax rates and expense, rent expense, expected number and timing of new center openings and successful signings and closings of center takeovers and sale-leaseback transactions (including the amount, pricing and timing thereof), possible or assumed future actions, business strategies, events or results of operations.

Generally, forward-looking statements are not based on historical facts but instead represent only our current beliefs and assumptions regarding future events.

7 unchanged sentences

The forward-looking statements are subject to various risks, uncertainties, assumptions or changes in circumstances that are difficult to predict or quantify.

Actual results may differ materially from these expectations due to numerous factors, many of which are beyond our control, including risks relating to our business operations and competitive and economic environment, risks relating to our brand, risks relating to the growth of our business, risks relating to our technological operations, risks relating to our capital structure and lease obligations, risks relating to our human capital, risks relating to legal compliance and risk management and risks relating to ownership of our common stock and the other important factors discussed under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (the “SEC”) and as such risk factors may be updated from time to time in our periodic filings with the SEC that are accessible on the SEC’s website at www.sec.gov .

Actual results may differ materially from these expectations due to numerous factors, many of which are beyond our control, including risks relating to our business operations and the growth of our business, risks relating to our brand, risks relating to our technological operations, risks relating to our capital structure and lease obligations, risks relating to our human capital, risks relating to legal compliance and risk management and risks relating to ownership of our common stock and the other important factors discussed under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission (the “SEC”) and as such risk factors may be updated from time to time in our periodic filings with the SEC that are accessible on the SEC’s website at www.sec.gov .

Since it is not possible to foresee all such factors, these factors should not be considered as complete or exhaustive.

5 unchanged sentences

Business and Strategy

Life Time, the “Healthy Way of Life Co mpany,” is a premier lifestyle and leisure brand offering premium health, fitness and wellness experiences to a communit y of more than 1.6 million individual members, who together comprise more than 891,000 memberships, as of September 30, 2025.

Life Time, the “Healthy Way of Life Co mpany,” is a premier lifestyle and leisure brand offering premium health, fitness and wellness experiences to a communit y of nearly 1.6 million individual members, who together comprise more than 888,000 memberships, as of March 31, 2026.

We are a leading innovator in the industry having successfully created a leisure model that incorporates the country club wellness lifestyle within a fitness and active living community.

6 unchanged sentences

Our premium service offerings are delivered by over 45,000 Life Time team members, including over 11,400 certified fitness professionals, ranging from personal trainers to studio performers.

We believe that no other company in the United States delivers the same quality and breadth of health, fitness and wellness experiences that we deliver, which has enabled us to consistently grow our annual membership dues and in-center revenue.

Our members are highly engaged and draw inspiration from the experiences and community we have created.

The value our members place on our community is reflected in the continued strength and growth of our average revenue per center membership, center usage and the visits to our athletic country clubs.

Our average revenue per center membership increased to $2,638 for the nine months ended September 30, 2025 as compared to $2,361 for the nine months ended September 30, 2024.

Total visits to our clubs were over 93 million for the nine months ended September 30, 2025 as compared to 87 million for the nine months ended September 30, 2024, and average visits per membership to our centers remained strong at 113 for the nine months ended September 30, 2025.

Our membership mix is notably shifting with couples and family comprising an increasingly larger portions of total memberships.

These memberships have historically been more engaged with higher retention and higher average monthly dues.

With these membership dynamics and our premium, high-use model, our newer clubs are typically reaching their desired utilization and revenue with fewer memberships and in certain centers we are limiting qualified memberships, which have significantly lower average membership dues.

Our total Center revenue increased to $2,182.4 million for the nine months ended September 30, 2025 as compared to $1,900.3 million for the nine months ended September 30, 2024.

Our average revenue per center membership, which includes membership dues and in-center revenue, increased to $930 for the three months ended March 31, 2026 as compared to $844 for the three months ended March 31, 2025.

Total visits to our clubs were nearly 32 million for the three months ended March 31, 2026 as compared to over 30 million for the three months ended March 31, 2025, and average visits per membership to our centers remained strong at 39 for the three months ended March 31, 2026.

Our membership mix has been improving with couples and families comprising increasingly larger portions of our total memberships and qualified memberships administered through medical insurance providers decreasing.

Our couples and family memberships have historically been more engaged with higher retention and higher average monthly dues.

Our qualified medical memberships have significantly lower average monthly dues and we are limiting their offering, along with certain of these third-party administrated programs having been terminated with more potentially terminating or expiring.

We have been able to successfully convert many of these qualified medical memberships that have terminated to direct memberships with minimal impact on membership dues.

With these membership dynamics and our premium, high-use model, our center membership growth has been smaller than our total Center revenue growth and we expect that trend to continue, including because our clubs are typically reaching their desired utilization and revenue with fewer memberships.

Our total Center revenue increased to $767.6 million for the three months ended March 31, 2026 as compared to $685.7 million for the three months ended March 31, 2025.

We believe it will continue to grow as we open new centers in desirable locations across the country, new members join at higher membership dues rates, our new centers ramp to expected performance and we continue to execute on our strategic initiatives discussed below.

Our new centers on average have taken three to four years to ramp to expected performance;

As of September 30, 2025, we had 30 centers open for less than three years and 17 new centers under construction.

however, many of our newer centers are ramping faster than this historical average.

As of March 31, 2026, we had 27 centers open for less than three years and 17 new centers under construction.

We are expanding the number of our centers using an asset-light model that targets affluent markets with higher income members, higher average revenue per center membership and higher returns on invested capital.

1 unchanged sentence

We believe we have significant opportunities to continue expanding our portfolio of premium centers in an asset-light manner.

We are now targeting 12 to 14 new locations on average per year starting in 2026 and we are planning to deliver at the high end of that range in 2026 and 2027.

We have opened five new centers in 2026 to date and are targeting 12 to 14 new centers on average per year.

We also expect a larger percentage of our new centers will be large format ground up construction builds as compared to 2024 and 2025.

We also continue to execute several strategic initiatives that are driving revenue, engagement, membership optimization and expansion as we elevate and broaden our member experiences and allow members and non-members to integrate health, fitness and wellness into their lives with greater ease and frequency.

These strategic initiatives include pickleball, Dynamic Personal Training, Dynamic Stretch, small group training such as Alpha, GTX, Ultra Fit and MB360, our ARORA community focused on members aged 55 years and older, where we have experienced a significant increase in our unique participants or total sessions, and most recently LT Games, a unique hybrid-athletic competition.

Our MIORA performance and longevity health offering is performing to our expectations in our first two locations, and we plan to expand these offerings to additional locations in 2025 and beyond.

We also continue to execute several strategic initiatives on a club-by-club basis that are driving revenue, engagement, membership optimization and expansion as we elevate and broaden our member experiences and allow members to integrate health, fitness and wellness into their lives with greater ease and frequency.

These strategic initiatives include pickleball, Dynamic Personal Training, Dynamic Stretch, small group training such as Alpha, GTX, Ultra Fit, MB360 and CTR, our ARORA community focused on members aged 55 years and older, and LT Games, a unique hybrid-athletic competition.

Our MIORA performance and longevity health offering is performing to our expectations and we now have a total of eight locations.

We have also been executing on enhanced offerings to accelerate growth beyond our centers.

We are selling our LTH nutritional products more broadly on e-commerce platforms.

Additionally, our digital platform is delivering a true omni-channel experience through our integrated digital app that is available to members and non-members at no cost, including live streaming fitness classes, remote goal-based personal training, nutrition and weight loss support and curated award-winning health, fitness and wellness content.

Our digital platform is delivering a true omni-channel experience through our integrated digital app, including live streaming fitness classes, remote goal-based personal training, nutrition and weight loss support and curated award-winning health, fitness and wellness content.

We are continuing to invest in our digital capabilities, including artificial intelligence such as L•AI•C, our first generative, artificial intelligence driven healthy way of life personal companion with personalized content and recommendations, to strengthen our relationships with our members, reach more people looking for a Healthy Way of Life and more comprehensively address their health, fitness and wellness needs so that they can engage and connect with Life Time at any time or place.

Additionally, we are selling our LTH nutritional products more broadly on e-commerce platforms.

We also continue to expand our “Healthy Way of Life” ecosystem in response to the desire of our members to holistically integrate health and wellness into every aspect of their daily lives.

In 2018, we launched Life Time Work, an asset-light branded

co-working model that offers premium work spaces in close proximity to our athletic country clubs and integrates ergonomic furnishings and promotes a healthy working environment.

In 2018, we launched Life Time Work, an asset-light branded co-working model that offers premium work spaces in close proximity to our athletic country clubs and integrates ergonomic furnishings and promotes a healthy working environment.

Life Time Work members also have the ability to receive access to all of our resort-like athletic country club destinations across the United States and Canada.

1 unchanged sentence

Additionally, our Life Time Living locations, which are also an asset-light model, offer luxury wellness-oriented residences in close proximity to our athletic country clubs.

As of September 30, 2025, we had 15 Life Time Work and four Life Time Living locations open and operating.

As of March 31, 2026, we had 15 Life Time Work and four Life Time Living locations open and operating.

Our Life Time Living concept is generating interest from new property developers and presenting opportunities for new center development and deal terms that were not previously available to us.

Our omni-channel platform continues to grow as we expand our footprint with new centers and nearby work and living spaces, as well as strengthen our digital capabilities.

Macroeconomy and Policy Environment

We continue to monitor the macroeconomic and policy environment and its impact on our business, including with respect to tariffs, inflation, interest rates, taxes and labor, as well as a potential economic recession and general economic and political conditions .

There continues to be macroeconomic uncertainty in many markets around the world, including as a result of international unrest and trade policy, and new or elevated tariffs, which have increased certain of our expenses and capital expenditures, but have not had a material impact on our business.

We continue to analyze the potential impact of these events and any resulting downstream impacts, including higher inflation.

Macroeconomy, Geopolitical and Policy Environments

We continue to monitor the macroeconomic, geopolitical and policy environments and their impact on our business, including with respect to inflation, the war in Iran, interest rates, tariffs, taxes and labor, as well as a potential economic recession or low growth and general economic and political conditions.

There continues to be macroeconomic and geopolitical uncertainty in many markets around the world, including as a result of military operations in the Middle East, the international unrest, and new or elevated tariffs, which combined have increased certain of our expenses and capital expenditures, but have not had a material impact on our business.

We continue to analyze the potential impact of these events and any resulting downstream impacts, including higher inflation and any disruption to the supply chain.

Despite these headwinds, we have experienced growth in our revenue and expanded our operating margins.

We will continue to monitor the macroeconomic and policy environment and while any future uncertainty or volatility, a decline in the U.S.

We will continue to monitor the macroeconomic, geopolitical and policy environments and while any future uncertainty or volatility, a decline in the U.S.

or global economy, or the public perception that any of these events may occur, could adversely affect our business and results of operations, we believe that our business is resilient and has performed well historically during different economic cycles including during a recession.

14 unchanged sentences

We define free cash flow as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales.

We believe free cash flow assists investors and analysts in evaluating our liquidity and cash flows, including our ability to make principal payments on our indebtedness

and to fund our capital expenditures and working capital requirements.

We believe free cash flow assists investors and analysts in evaluating our liquidity and cash flows, including our ability to make principal payments on our indebtedness and to fund our capital expenditures and working capital requirements.

Our management considers free cash flow to be a key indicator of our liquidity and we present this metric to our board of directors.

9 unchanged sentences

These are not measurements of our financial performance under GAAP and should not be considered as alternatives to any other performance measures derived in accordance with GAAP.

Set forth below are certain GAAP and non-GAAP measurements and key performance indicators for the three and nine months ended September 30, 2025 and 2024.

Set forth below are certain GAAP and non-GAAP measurements and key performance indicators for the three months ended March 31, 2026 and 2025.

The following information has been presented consistently for all periods presented.

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

Three Months Ended

($ in thousands, except for Average Center revenue per center membership data)

10 unchanged sentences

Average Center revenue per center membership (1)

$ 907 $ 815 $ 2,638 $ 2,361

Comparable center revenue (2)

10.6% 12.1% 11.5 % 11.8 %

Net new center openings (3)

Total centers (end of period) (3)

185 177 185 177

Total center square footage (end of period) (4)

18,100,000 17,400,000 18,100,000 17,400,000

GAAP and Non-GAAP Financial Measures

Net income $ 102,427 $ 41,355 $ 250,671 $ 119,077

Net income margin (5)

13.1 % 6.0 % 11.1 % 6.1 %

Adjusted net income (6)

$ 92,992 $ 56,278 $ 263,778 $ 140,158

Adjusted net income margin (6)

11.9 % 8.1 % 11.7 % 7.2 %

Adjusted EBITDA (7)

$ 220,046 $ 180,293 $ 622,611 $ 499,816

Adjusted EBITDA margin (7)

28.1 % 26.0 % 27.7 % 25.5 %

Center operations expense

Pre-opening expenses (8)

$ 1,050 $ 1,164 $ 3,489 $ 4,819

Rent $ 87,511 $ 78,575 $ 251,866 $ 225,804

Non-cash rent expense (open properties) (9)

$ 10,216 $ 9,684 $ 18,275 $ 20,734

Non-cash rent expense (properties under development) (9)

$ 5,597 $ 1,847 $ 10,601 $ 4,447

Net cash provided by operating activities

Free cash flow (10)

$ 62,530 $ 138,332 $ 216,369 $ 247,054

(1) We define Average Center revenue per center membership as Center revenue less On-hold revenue, divided by the average number of Center memberships for the period, where the average number of Center memberships for the period is an average derived from dividing the sum of the total Center memberships outstanding at the beginning of the period and at the end of each month during the period by one plus the number of months in each period.

3 unchanged sentences

Total centers (end of period) is the number of centers operational as of the last day of the period.

During the three months ended September 30, 2025, we opened one center.

During the three months ended March 31, 2026, we opened one center.

(4) Total center square footage (end of period) reflects the aggregate square footage excluding areas used for tennis courts, outdoor swimming pools, outdoor play areas and stand-alone Work, Sport and Swim locations.

6 unchanged sentences

The following table provides a reconciliation of net income and income per common share, the most directly comparable GAAP measures, to Adjusted net income and Adjusted net income per common share:

Three Months Ended Nine Months Ended

September 30, September 30,

($ in thousands) 2025 2024 2025 2024

Net income $ 102,427 $ 41,355 $ 250,671 $ 119,077

Three Months Ended

($ in thousands, except per share data)

Share-based compensation expense (a)

16,891 11,752 45,179 30,450

(Gain) loss on sale-leaseback transactions (b)

(7,732) 4,902 4,764 (2,620)

Capital transaction costs (c)

Legal settlements (d)

— 1,250 — 1,250

Employee retention credits (e)

(21,994) — (34,867) —

(1) 2,869 202 (927)

3,401 (5,850) (3,702) (7,072)

Capital transaction costs (b)

Adjusted net income

Income per common share:

Basic $ 0.47 $ 0.20 $ 1.15 $ 0.60

Diluted $ 0.45 $ 0.19 $ 1.11 $ 0.57

Adjusted income per common share:

Basic $ 0.42 $ 0.28 $ 1.21 $ 0.70

Diluted $ 0.41 $ 0.26 $ 1.17 $ 0.67

Weighted-average common shares outstanding:

Basic 220,063 202,945 217,132 199,793

Diluted 226,007 214,633 225,075 207,841

(a) Shar e-based compensation expense recognized during the three and nine months ended September 30, 2025 was associated with stock options, restricted stock units, performance stock units, our employee stock purchase plan (“ESPP”) and liability-classified awards related to our 2025 short-term incentive plan.

Shar e-based compensation expense recognized during the three and nine months ended September 30, 2024 was associated with stock options, restricted stock units, performance stock units, our ESPP and liability-classified awards related to our 2024 short-term incentive plan.

(b) We adjust for the impact of gains and losses on the sale-leaseback of our properties as they do not reflect costs associated with our ongoing operations.

For details on the (gain) loss on the sale-leaseback transactions that we recognized during the three and nine months ended September 30, 2025, see Note 9 , Leases, to our condensed consolidated financial statements in this report.

(c) Represents one-time costs related to capital transactions, including debt and equity offerings that are non-recurring in nature.

(d) We adjust for the impact of unusual legal settlements as these costs are non-recurring in nature and do not reflect costs associated with our normal ongoing operations.

(e) Represents refundable payroll tax credits for employee retention under the CARES Act.

(f) Includes (i) legal-related expenses in pursuit of our claim against Zurich of $0.1 million and $0.6 million for the nine months ended September 30, 2025 and 2024, respectively, (ii) a $3.5 million write-off of the unamortized debt discounts and issuance costs associated with the extinguishment of our former term loan facility and construction loan for the three and nine months ended September 30, 2024, (iii) gain on sales of land of $0.6 million and $5.0 million for the three and nine months ended September 30, 2024 , respectively, and (iv) other immaterial transactions that are unusual or non-recurring in nature of $0.1 million for the nine months ended September 30, 2025.

(g) Represents the estimated tax effect of the total adjustments made to arrive at Adjusted net income using the effective income tax rates for the respective periods.

(a) Shar e-based compensation expense recognized during the three months ended March 31, 2026 was associated with stock options, restricted stock units, performance stock units, our employee stock purchase plan (“ESPP”) and liability-classified awards related to our 2026 short-term incentive plan.

Shar e-based compensation expense recognized during the three months ended March 31, 2025 was associated with stock options, restricted stock units, performance stock units, our ESPP and liability-classified awards related to our 2025 short-term incentive plan.

(b) Represents one-time costs related to capital transactions, including debt and equity offerings that are non-recurring in nature.

(c) Includes (i) legal-related expenses in pursuit of our claim against Zurich of $0.1 million for the three months ended March 31, 2025 and (ii) other immaterial transactions or items that are unusual or non-recurring in nature of $0.5 million and $0.1 million for the three months ended March 31, 2026 and 2025, respectively.

(d) Represents the estimated tax effect of the total adjustments made to arrive at Adjusted net income using the effective income tax rates for the respective periods.

We updated the Taxes amount used to arrive at Adjusted net income for the three months ended March 31, 2025 to include $12.6 million in income tax benefits resulting from a significant exercise of stock options by our Chief Executive Officer that were set to expire in 2025.

This change did not impact our condensed consolidated financial statements

prepared in accordance with GAAP, but it did decrease our non-GAAP Adjusted net income and Adjusted income per common share for the three months ended March 31, 2025.

(7) We present Adjusted EBITDA as a supplemental measure of our performance.

2 unchanged sentences

The following table provides a reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA:

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

($ in thousands)

Net income $ 102,427 $ 41,355 $ 250,671 $ 119,077

Interest expense, net of interest income

2 unchanged sentences

Share-based compensation expense (a)

16,891 11,752 45,179 30,450

(Gain) loss on sale-leaseback transactions (b)

(7,732) 4,902 4,764 (2,620)

Capital transaction costs (c)

Legal settlements (d)

— 1,250 — 1,250

Employee retention credits (e)

(21,994) — (34,867) —

(1) (641) 202 (4,437)

Capital transaction costs (b)

Adjusted EBITDA

(a) - (e) See the corresponding footnotes to the table in footnote 6 immediately above.

(f) Includes (i) legal-related expenses in pursuit of our claim against Zurich of $0.1 million and $0.6 million for the nine months ended September 30, 2025 and 2024, respectively, (ii) gain on sales of land of $0.6 million and $5.0 million for the three and nine months ended September 30, 2024, respectively, and (iii) other immaterial transactions that are unusual or non-recurring in nature of $0.1 million for the nine months ended September 30, 2025.

(a) - (c) See the corresponding footnotes to the table in footnote 6 immediately above.

(8) Represents non-capital expenditures associated with opening new centers that are incurred prior to the commencement of a new center opening.

5 unchanged sentences

The following table provides a reconciliation from net cash provided by operating activities to free cash flow:

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

($ in thousands)

1 unchanged sentence

Capital expenditures, net of construction reimbursements

Proceeds from sale-leaseback transactions 33,912 65,043 172,683 207,714

Proceeds from land sales — 9,249 — 15,577

Free cash flow

5 unchanged sentences

The impact of these increases is dependent upon the timing of our centers under development and the center openings, the timing of sale-leaseback transactions and terms of the leases for the new centers or sale-leaseback transactions.

Macroeconomic and Policy Trends

We have been monitoring the macroeconomic and policy environment and its impact on our business, including with respect to tariffs, inflation, interest rates, taxes and labor, as well as a potential economic recession and general economic and political conditions .

See “—Overview—Macroeconomy and Policy Environment” for additional information.

Macroeconomic, Geopolitical and Policy Trends

We have been monitoring the macroeconomic, geopolitical and policy environments and their impact on our business, including with respect to inflation, the war in Iran, interest rates, tariffs, taxes and labor, as well as a potential economic recession or low growth and general economic and political conditions.

See “—Overview—Macroeconomy, Geopolitical and Policy Environments” for additional information.

Critical Accounting Policies and Estimates

10 unchanged sentences

Results of Operations

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

The following table sets forth our condensed consolidated statements of operations data (amounts in thousands) and data as a percentage of total revenue for the three months ended September 30, 2025 and 2024:

Three Months Ended September 30,

As a Percentage of Total Revenue

2025 2024 2025 2024

Center revenue $ 760,897 $ 674,775 97.2 % 97.3 %

Other revenue 21,752 18,459 2.8 % 2.7 %

Total revenue 782,649 693,234 100.0 % 100.0 %

Operating expenses:

Center operations 414,328 371,134 52.9 % 53.5 %

Rent 87,511 78,575 11.2 % 11.3 %

General, administrative and marketing 59,840 57,737 7.6 % 8.3 %

Depreciation and amortization 75,094 69,451 9.6 % 10.0 %

Other operating expense 10,231 22,642 1.3 % 3.3 %

Total operating expenses 647,004 599,539 82.6 % 86.4 %

Income from operations 135,645 93,695 17.4 % 13.6 %

Other income (expense):

Interest expense, net of interest income (18,440) (36,011) (2.4) % (5.2) %

Equity in earnings (loss) of affiliates 149 (116) — % — %

Other income 21,994 — 2.8 % — %

Total other income (expense) 3,703 (36,127) 0.4 % (5.2) %

Income before income taxes 139,348 57,568 17.8 % 8.4 %

Provision for income taxes 36,921 16,213 4.7 % 2.3 %

Net income $ 102,427 $ 41,355 13.1 % 6.1 %

Total revenue.

The $89.4 million increase in Total revenue for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was due to continued strong growth in membership dues and in-center revenue, including higher average dues, membership growth in our new and ramping centers and higher member utilization of our in-center offerings, particularly in Dynamic Personal Training.

With respect to the $86.1 million increase in Center revenue for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024:

• 68.7% was from membership dues and enrollment fees, which increased $59.2 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

This increase reflects the growth in our new and ramping centers, as well as higher average monthly dues per Center membership during the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 ;

• 31.3% was from in-center revenue, which increased $26.9 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 .

This increase was recognized across all of our primary in-center businesses and reflects the higher utilization of our offerings by our members, particularly Dynamic Personal Training, during the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 .

T he $3.3 million increase in Other revenue for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily driven by the improved performance of our media and events business and Life Time Work locations.

Center operations expenses .

Th e $43.2 million increase in Center operations expenses for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily due to operating costs related to our new and ramping centers, additional center operating expenses related to increased club utilization in our mature centers, as well as costs to support in-center business revenue growth.

Rent expense .

The $8.9 million increase in Rent expense for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily driven by sale-leaseback transactions, taking possession of other leased properties, as well as the recognition of a higher level of contingent rent expense, which is generally determined based on a percentage of center-specific revenue and/or other center-specific financial metrics over contractually specified levels.

General, administrative and marketing expenses.

The $2.1 million increase in General, administrative and marketing expenses for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily due to increases in center support overhead to enhance and broaden our member services and experiences and general corporate overhead .

Depreciation and amortization expenses .

The $5.6 million increase in Depreciation and amortization expenses for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily due to new center openings and capitalized software development costs.

Other operating expense .

The $12.4 million decrease in Other operating expense for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily due to a $7.7 million net gain on a sale-leaseback transaction during the three months ended September 30, 2025 as compared to a $4.9 million net loss on sale-leaseback transactions, partially offset by a $0.6 million gain on the sale of land, during the three months ended September 30, 2024 .

Interest expense, net of interest income .

The $17.6 million decrease in Interest expense, net of interest income for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily driven by lower average levels of outstanding borrowings and a lower interest rate largely as a result of the interest rate swaps entered into in April 2025.

Other income .

The $22.0 million increase in Other income for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was related to net cash proceeds received in connection with employee retention credits under the CARES Act to provide certain relief as a result of the COVID-19 pandemic.

Provision for income taxes .

The $20.7 million increase in provision for income taxes for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was primarily driven by an increase in earnings before taxes and a change in the valuation allowance in the prior year associated with certain of our deferred tax assets, partially offset by the excess tax deduction associated with share-based compensation.

The effective tax rate was 26.5% and 28.2% for those same periods, respectively.

The effective tax rate applied to our pre-tax income for the three months ended September 30, 2025 is higher than our statutory rate of 21% and is primarily due to the state income tax provisions and deductibility limitations associated with executive compensation, partially offset by the excess tax deduction associated with share-based compensation.

As a result of the factors described above, net income was $102.4 million for the three months ended September 30, 2025 as compared to $41.4 million for the three months ended September 30, 2024.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The following table sets forth our condensed consolidated statements of operations data (amounts in thousands) and data as a percentage of total revenue for the nine months ended September 30, 2025 and 2024:

Nine Months Ended September 30,

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Three Months Ended March 31,

As a Percentage of Total Revenue

2025 2024 2025 2024

Center revenue

3 unchanged sentences

Center operations

Rent 251,866 225,804 11.2 % 11.5 %

General, administrative and marketing

6 unchanged sentences

Equity in earnings (loss) of affiliates

Other income 34,867 — 1.5 % — %

Total other expense

1 unchanged sentence

Provision for income taxes

Net income $ 250,671 $ 119,077 11.1 % 6.0 %

Total revenue.

The $292.4 million increase in Total revenue for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was due to continued strong growth in membership dues and in-center revenue, including higher average dues, membership growth in our new and ramping centers and higher member utilization of our in-center offerings , particularly in Dynamic Personal Training .

With respect to the $282.1 million increase in Center revenue for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024:

• 70.9% was from membership dues and enrollment fees, which increased $200.0 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.

This increase reflects the growth in our new and ramping centers, as well as higher average monthly dues per Center membership during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024;

• 29.1% was from in-center revenue, which increased $82.1 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.

This increase was recognized across all of our primary in-center businesses and reflects the higher utilization of our offerings by our members, particularly Dynamic Personal Training, during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.

The $10.3 million increase in Other revenue for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by the improved performance of our media and events business and Life Time Work locations.

The $82.7 million increase in Total revenue for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was due to continued strong growth in membership dues and in-center revenue, driven by higher average dues including from improved membership mix , membership growth in our new and ramping centers and higher member utilization of our in-center offerings, particularly in Dynamic Personal Training.

With respect to the $81.9 million increase in Center revenue for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025:

• 73.0% was from membership dues and enrollment fees, which increased $59.8 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.

This increase reflects the higher average monthly dues per Center membership due to continued improvement in membership mix and the growth in our new and ramping centers during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 ;

• 27.0% was from in-center revenue, which increased $22.1 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 .

This increase was recognized across all of our primary in-center businesses and reflects the higher utilization of our offerings by our members, particularly Dynamic Personal Training, during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 .

T he $0.8 million increase in Other revenue for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by the improved performance of our Life Time Work locations and events business.

Center operations expenses .

The $140.7 million increase in Center operations expenses for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily due to operating costs related to our new and ramping centers, additional center operating expenses related to increased club utilization in our mature centers, as well as costs to support in-center business revenue growth.

Th e $35.7 million increase in Center operations expenses for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to operating costs related to our new and

ramping centers, additional center operating expenses related to increased club utilization in our mature centers, as well as costs to support in-center business revenue growth.

Rent expense .

The $26.1 million increase in Rent expense for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by sale-leaseback transactions, taking possession of other leased properties, as well as the recognition of a higher level of contingent rent expense, which is generally determined based on a percentage of center-specific revenue and/or other center-specific financial metrics over contractually specified levels, during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.

The $8.7 million increase in Rent expense for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by sale-leaseback transactions, taking possession of other leased properties, as well as the recognition of a higher level of contingent rent expense, which is generally determined based on a percentage of center-specific revenue and/or other center-specific financial metrics over contractually specified levels.

General, administrative and marketing expenses.

General, administrative and marketing expenses increased $19.5 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to the timing of share-based compensation and benefit-related expenses, increases in center support overhead to enhance and broaden our member services and experiences, general corporate overhead, information technology costs and costs attributable to the secondary offerings of our common stock completed in February and June 2025.

Depreciation and amortization .

Depreciation and amortization increased $13.9 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to new center openings and capitalized software development costs.

The $1.8 million increase in General, administrative and marketing expenses for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to increases in center support overhead to enhance and broaden our member services and experiences .

Depreciation and amortization expenses .

The $9.8 million increase in Depreciation and amortization expenses for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to new center openings and capitalized software development costs.

Other operating expense .

Other operating expense increased $11.0 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to a $4.8 million net loss on sale-leaseback transactions during the nine months ended September 30, 2025 as compared to a $2.6 million net gain on sale-leaseback transactions and a $5.0 million gain on the sale of land during the nine months ended September 30, 2024.

The $0.5 million decrease in Other operating expense for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to lower impairments on development costs incurred in the normal course of business.

Interest expense, net of interest income .

The $45.8 million decrease in Interest expense, net of interest income for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was driven by lower average levels of outstanding borrowings and a lower interest rate largely as a result of the interest rate swaps entered into in April 2025.

Other income .

The $34.9 million increase in Other income for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was related to net cash proceeds received in connection with employee retention credits under the CARES Act to provide certain relief as a result of the COVID-19 pandemic.

The $9.4 million decrease in Interest expense, net of interest income for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by lower average levels of outstanding borrowings and a lower interest rate largely as a result of the interest rate swaps entered into in April 2025.

Provision for income taxes .

The $30.9 million increase in provision for income taxes for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by an increase in earnings before taxes and a change in the valuation allowance in the prior year associated with certain of our deferred tax assets, partially offset by the excess tax deduction associated with share-based compensation.

The $24.8 million increase in provision for income taxes for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by an increase in earnings before taxes and a decrease in the excess tax deduction associated with share-based compensation.

The effective tax rate was 26.1% and 7.8% for those same periods, respectively.

The effective tax rate applied to our pre-tax income for the nine months ended September 30, 2025 is higher than our statutory rate of 21% and is primarily due to the state income tax provisions and deductibility limitations associated with executive compensation, partially offset by the excess tax deduction associated with share-based compensation.

As a result of the factors described above, net income was $250.7 million and $119.1 million for the nine months ended September 30, 2025 and 2024, respectively.

The effective tax rate applied to our pre-tax income for the three months ended March 31, 2026 is higher than our statutory rate of 21% and is primarily due to the state income tax provisions and deductibility limitations associated with executive compensation, partially offset by the excess tax deduction associated with share-based compensation.

As a result of the factors described above, net income was $88.1 million for the three months ended March 31, 2026 as compared to $76.1 million for the three months ended March 31, 2025.

Liquidity and Capital Resources

1 unchanged sentence

We have primarily satisfied our historical liquidity needs with cash flow from operations, drawing on the Revolving Credit Facility, construction reimbursements and through sale-leaseback transactions.

Additionally, we benefit from our in-house architecture and design expertise that allows us to design operationally efficient centers.

As the opportunity arises or as our business needs require, we may seek to raise capital through additional debt or equity financing.

2 unchanged sentences

In addition, it is possible that our ability to access the credit and capital markets could be limited at a time when we would like or need to do so.

As of September 30, 2025, there were no outstanding borrowings under our Revolving Credit Facility and there were $31.8 million of outstanding letters of credit, resulting in total availability under our $650.0 million Revolving Credit Facility of $618.2 million.

Total cash and cash equivalents at September 30, 2025 was $218.9 million, resulting in total cash and availability under our Revolving Credit Facility of $837.1 million.

As of March 31, 2026, there were no outstanding borrowings under our Revolving Credit Facility and there were $33.1 million of outstanding letters of credit, resulting in total availability under our $650.0 million Revolving Credit Facility of $616.9 million.

Total cash and cash equivalents at March 31, 2026 was $120.0 million, resulting in total cash and availability under our Revolving Credit Facility of $736.9 million.

The following table sets forth our condensed consolidated statements of cash flows data (amounts in thousands):

Nine Months Ended

September 30,

Three Months Ended

Net cash provided by operating activities

Net cash used in investing activities

Net cash provided by (used in) financing activities 18,926 (142,748)

Net cash (used in) provided by financing activities

Effect of exchange rates on cash and cash equivalents and restricted cash and cash equivalents

Increase in cash and cash equivalents and restricted cash and cash equivalents $ 213,560 $ 107,087

(Decrease) increase in cash and cash equivalents and restricted cash and cash equivalents

Operating Activities

The $218.7 million increase in net cash provided by operating activities for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily the result of increased business performance and profitability and timing of cash interest payments.

The $14.9 million increase in net cash provided by operating activities for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily the result of increased business performance and profitability.

Investing Activities

1 unchanged sentence

We fund the purchase of our property, centers and equipment through operating cash flows, proceeds from sale-leaseback transactions, construction reimbursements and draws on our Revolving Credit Facility.

The $274.0 million increase in net cash used in investing activities for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by a $198.8 million increase in capital expenditures and $50.6 million lower proceeds from sale-leaseback transactions and land sales.

The $118.5 million increase in net cash used in investing activities for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by a $117.5 million increase in capital expenditures.

The following table reflects capital expenditures by type of expenditure (in thousands):

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

Three Months Ended

Growth capital expenditures (1)

$ 155,967 $ 46,416 $ 416,427 $ 259,885

Maintenance capital expenditures (2)

27,834 21,566 93,186 70,002

Modernization and technology capital expenditures (3)

38,693 19,124 77,367 58,326

Total capital expenditures

(1) Consist of new center land and construction, initial major remodels of acquired centers, major remodels of existing centers that expand existing square footage, asset acquisitions including the purchase of previously leased centers and other growth initiatives.

(2) Consist of general maintenance of existing centers.

(3) Consist of modernization of existing centers and technology.

The increase in total capital expenditures for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by an increase in new center construction as we expand our new center openings to

12 to 14 centers per year, most of which will be large format ground up builds in 2026 and 2027, the acquisition of existing health club and racquet facilities, higher maintenance expenditures for member experiences and operational efficiencies, and higher modernization and technology expenditures for center remodels, fitness floor reconfigurations and digital and artificial intelligence initiatives.

(2) Consist of capital expenditures required to maintain the operating condition of our existing centers.

(3) Consist of capital expenditures related to updates and enhancements to our existing centers, technology investments and corporate infrastructure.

The increase in total capital expenditures for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by an increase in new center construction as we expand our new center openings to 12 to 14 centers per year, most of which will be large format ground up builds in 2026 and 2027, higher maintenance expenditures for member experiences and operational efficiencies, and higher modernization and technology expenditures for digital and artificial intelligence initiatives.

Financing Activities

The $161.7 million increase in net cash provided by financing activities for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 was primarily driven by lower repayments of debts, partially offset by higher net repayments under our Revolving Credit Facility and receiving no proceeds from the issuance of our common stock.

The $27.9 million increase in net cash used in financing activities for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily driven by lower proceeds from stock option exercises, employee tax withholding associated with net share-settled share-based awards and shares repurchases, partially offset by lower net repayments under our Revolving Credit Facility.

We believe we will generate adequate amounts of cash to meet our requirements and plans for cash in the short-term and long-term and expect to satisfy our short-term and long-term obligations through a combination of cash on hand, funds generated from operations, sale-leaseback transactions, the borrowing capacity available under our Revolving Credit Facility and additional debt and equity financing as needed.

During April 2026, we closed on sale-leasebacks for five owned properties with two institutional real estate investors for aggregate gross proceeds of approximately $200 million.

We expect to close on additional sale-leasebacks during 2026 for gross proceeds of an incremental $200 million and have positive Free cash flow for 2026.

Share Repurchase Program

On February 19, 2026, our board of directors approved a share repurchase program of up to $500 million of our outstanding common stock (the “Share Repurchase Program”).

Repurchases under the Share Repurchase Program may be made from time to time at the discretion of management through open market purchases, block trades, accelerated or other structured share repurchase programs, privately negotiated transactions, Rule 10b5-1 plans or other means, and may include purchases from affiliates.

The manner, timing, pricing and amount of any transactions will be subject to the discretion of management and may depend on a variety of factors, including business and market conditions, corporate and regulatory requirements, alternative investment opportunities, acquisition opportunities, and other factors.

During the three months ended March 31, 2026, we repurchased 0.4 million shares of common stock under the Share Repurchase Program for total consideration of approximately $10.7 million.

For additional detail on these share repurchases, refer to Part II, Item 2—Unregistered Sales of Equity Securities and Use of Proceeds, in this Quarterly Report on Form 10-Q.

As of March 31, 2026, we had approximately $489.3 million of availability remaining under our Share Repurchase Program.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis