Life Time Group Holdings, Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) (Unaudited) March 31, 2026 December 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 119,951 $ 204,807 Restricted cash and cash equivalents 30,232 27,362 Accounts receivable, net 25,476 24,092 Center operating supplies and inventories 67,028 67,618 Prepaid expenses and other current assets 80,315 61,881 Total current assets 323,002 385,760 Property and equipment, net 3,799,840 3,633,229 Goodwill 1,235,359 1,235,359 Operating lease right-of-use assets 2,472,648 2,479,804 Intangible assets, net 180,532 180,810 Other assets 94,489 92,989 Total assets $ 8,105,870 $ 8,007,951 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 92,193 $ 90,249 Construction accounts payable 124,844 143,545 Deferred revenue 63,250 60,309 Accrued expenses and other current liabilities 226,100 214,351 Current maturities of debt 20,705 21,848 Current maturities of operating lease liabilities 81,585 79,208 Total current liabilities 608,677 609,510 Long-term debt, net of current portion 1,482,099 1,485,939 Operating lease liabilities, net of current portion 2,558,596 2,555,513 Deferred income taxes, net 182,122 172,217 Other liabilities 55,105 58,561 Total liabilities 4,886,599 4,881,740 Commitments and contingencies (Note 9) Stockholders’ equity: Common stock, $ 0.01 par value per share; 500,000 shares authorized; 222,447 and 221,077 shares issued and outstanding, respectively 2,225 2,211 Additional paid-in capital 3,184,562 3,183,032 Retained earnings (accumulated deficit) 41,196 ( 46,902 ) Accumulated other comprehensive loss ( 8,712 ) ( 12,130 ) Total stockholders’ equity 3,219,271 3,126,211 Total liabilities and stockholders’ equity $ 8,105,870 $ 8,007,951 See notes to unaudited condensed consolidated financial statements. 3 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) Three Months Ended March 31, 2026 2025 Revenue: Center revenue $ 767,566 $ 685,654 Other revenue 21,134 20,387 Total revenue 788,700 706,041 Operating expenses: Center operations 406,704 370,987 Rent 89,891 81,165 General, administrative and marketing 59,631 57,847 Depreciation and amortization 80,693 70,919 Other operating expense 16,943 17,453 Total operating expenses 653,862 598,371 Income from operations 134,838 107,670 Other income (expense): Interest expense, net of interest income ( 15,697 ) ( 25,107 ) Equity in earnings (loss) of affiliates 126 ( 16 ) Total other expense ( 15,571 ) ( 25,123 ) Income before income taxes 119,267 82,547 Provision for income taxes 31,169 6,405 Net income $ 88,098 $ 76,142 Income per common share: Basic $ 0.40 $ 0.36 Diluted $ 0.39 $ 0.34 Weighted-average common shares outstanding: Basic 221,853 211,958 Diluted 227,454 223,619 See notes to unaudited condensed consolidated financial statements. 4 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In thousands) (Unaudited) Three Months Ended March 31, 2026 2025 Net income $ 88,098 $ 76,142 Other comprehensive income: Foreign currency translation adjustments, net of tax of $ 0 ( 1,225 ) 65 Derivative instruments: Unrealized gain, net of tax of $ 1,802 and $ 0 , respectively 5,129 — Realized gain reclassified from accumulated other comprehensive loss to earnings, net of tax of $( 170 ) and $ 0 , respectively ( 486 ) — Other comprehensive income 3,418 65 Comprehensive income $ 91,516 $ 76,207 See notes to unaudited condensed consolidated financial statements. 5 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (In thousands) (Unaudited) Common Stock Additional Paid-In Capital (Accumulated Deficit) Retained Earnings Accumulated Other Comprehensive Loss Total Equity Shares Amount Balance at December 31, 2025 221,077 $ 2,211 $ 3,183,032 $ ( 46,902 ) $ ( 12,130 ) $ 3,126,211 Net income — — — 88,098 — 88,098 Other comprehensive income — — — — 3,418 3,418 Share-based compensation — — 9,752 — — 9,752 Stock option exercises 682 7 7,321 — — 7,328 Shares of common stock issued in connection with the vesting of restricted stock units and performance stock units 1,277 13 ( 13 ) — — — Shares of common stock repurchased ( 400 ) ( 4 ) ( 10,698 ) — — ( 10,702 ) Settlement of accrued compensation liabilities through the issuance of shares of common stock 234 2 6,181 — — 6,183 Shares of common stock withheld to cover employee tax withholding and exercise price associated with share-based awards ( 423 ) ( 4 ) ( 11,013 ) — — ( 11,017 ) Balance at March 31, 2026 222,447 $ 2,225 $ 3,184,562 $ 41,196 $ ( 8,712 ) $ 3,219,271 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Equity Shares Amount Balance at December 31, 2024 207,495 $ 2,075 $ 3,041,645 $ ( 420,573 ) $ ( 12,797 ) $ 2,610,350 Net income — — — 76,142 — 76,142 Other comprehensive income — — — — 65 65 Share-based compensation — — 10,276 — — 10,276 Stock option exercises 11,843 118 27,762 — — 27,880 Shares of common stock issued in connection with the vesting of restricted stock units and performance stock units 1,240 12 ( 12 ) — — — Settlement of accrued compensation liabilities through the issuance of shares of common stock 454 5 13,822 — — 13,827 Shares of common stock withheld to cover employee tax withholding and exercise price associated with share-based awards ( 3,133 ) ( 31 ) ( 4,038 ) — — ( 4,069 ) Balance at March 31, 2025 217,899 $ 2,179 $ 3,089,455 $ ( 344,431 ) $ ( 12,732 ) $ 2,734,471 See notes to unaudited condensed consolidated financial statements. 6 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Three Months Ended March 31, 2026 2025 Cash flows from operating activities: Net income $ 88,098 $ 76,142 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 80,693 70,919 Deferred income taxes 8,429 1,177 Share-based compensation 10,548 11,909 Non-cash rent expense 2,354 3,403 Impairment charges associated with long-lived assets 18 966 Loss on disposal of property and equipment, net 827 128 Amortization of debt discounts and issuance costs 930 906 Changes in operating assets and liabilities 5,526 17,926 Other 1,370 380 Net cash provided by operating activities 198,793 183,856 Cash flows from investing activities: Capital expenditures ( 260,016 ) ( 142,482 ) Other ( 96 ) 839 Net cash used in investing activities ( 260,112 ) ( 141,643 ) Cash flows from financing activities: Repayments of debt ( 5,686 ) ( 5,559 ) Proceeds from revolving credit facility — 125,000 Repayments of revolving credit facility — ( 135,000 ) Repayments of finance lease liabilities ( 417 ) ( 842 ) Proceeds from stock option exercises 7,328 27,880 Common stock share repurchases ( 10,702 ) — Employee tax withholding associated with net share-settled share-based awards ( 11,017 ) ( 4,069 ) Other ( 4 ) ( 30 ) Net cash (used in) provided by financing activities ( 20,498 ) 7,380 Effect of exchange rates on cash and cash equivalents and restricted cash and cash equivalents ( 169 ) — (Decrease) increase in cash and cash equivalents and restricted cash and cash equivalents ( 81,986 ) 49,593 Cash and cash equivalents and restricted cash and cash equivalents – beginning of period 232,169 27,878 Cash and cash equivalents and restricted cash and cash equivalents – end of period $ 150,183 $ 77,471 See notes to unaudited condensed consolidated financial statements. 7 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 454 1. Nature of Business and Basis of Presentation Nature of Business Life Time Group Holdings, Inc. (collectively with its direct and indirect subsidiaries, “Life Time,” “we,” “our,” or the “Company”) is a holding company incorporated in the state of Delaware. As a holding company, Life Time Group Holdings, Inc. does not have its own independent assets or business operations, and all of our assets and business operations are through Life Time, Inc. and its direct and indirect subsidiaries. We are primarily dedicated to providing premium health, fitness and wellness experiences at our athletic country club destinations and via our comprehensive digital platform and portfolio of iconic athletic events – all with the objective of inspiring healthier, happier lives. We design, build and operate our athletic country club destinations that are distinctive and large, multi-use sports and athletic, professional fitness, family recreation and spa centers in a resort-like environment. As of March 31, 2026, we operated 190 centers in 31 states and one Canadian province. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and as required by rules and regulations of the Securities and Exchange Commission (the “SEC”). While these statements reflect normal recurring adjustments that are, in the opinion of management, necessary for a fair statement of the results of the interim period, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements. When preparing financial statements in conformity with GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. All intercompany balances and transactions have been eliminated in consolidation. 2. Summary of Significant Accounting Policies Segment Reporting We have one operating segment and one reportable segment. Our segment derives revenues from customers by providing premium health, fitness and wellness experiences and products at our athletic country club destinations and via our comprehensive digital platform and portfolio of iconic athletic events – all with the objective of inspiring healthier, happier lives. We manage our business activities on a consolidated basis. The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer (“CEO”). The CODM assesses performance for the segment and allocates resources based on consolidated net income. The measure of segment assets is reported on the balance sheet as total consolidated assets. Our CODM does not review segment assets at a different asset level and is regularly provided with only the consolidated expenses as noted on the face of the consolidated statements of operations. New Accounting Pronouncements Not Yet Adopted In November 2024, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public entities to disclose the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization and depletion, as applicable, included in each relevant expense caption presented in its income statement. We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2027. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures. 8 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to software development project stages and requires that an entity capitalize software costs when both (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended (referred to as the “probable-to-complete recognition threshold”). We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2028. We are currently evaluating the impact that the updated standard will have on our financial statements. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies interim disclosure requirements and the applicability of Topic 270 and includes a disclosure principle that requires disclosure of events since the end of the last annual reporting period that have a material impact on the entity. We expect to adopt this accounting guidance for our Quarterly Report on Form 10-Q for the period ended March 31, 2028. We are currently evaluating the impact that the updated standard will have on our disclosures. In December 2025, the FASB issued ASU 2025-12, Codification Improvements, to clarify, correct errors, or make minor improvements to the Codification to make the Codification easier to understand and apply. We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2027. We are currently evaluating the impact that the updated standard will have on our financial statements. Fair Value Measurements The accounting guidance establishes a framework for measuring fair value and expanded disclosures about fair value measurements. The guidance applies to all assets and liabilities that are measured and reported on a fair value basis. This enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The guidance requires that each asset and liability carried at fair value be classified into one of the following categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts related to cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, income tax receivable, accounts payable and accrued liabilities approximate fair value. Fair Value Measurements on a Recurring Basis. As of March 31, 2026 and December 31, 2025, assets and liabilities that are measured at fair value on a recurring basis were as follows: March 31, 2026 Level 1 Level 2 Level 3 Total Assets: Interest rate swaps (1) $ — $ 3,623 $ — $ 3,623 Cash surrender value of life insurance policies (2) — 17,484 — 17,484 Total assets $ — $ 21,107 $ — $ 21,107 Liabilities: Deferred compensation (3) 16,037 — — 16,037 Total liabilities $ 16,037 $ — $ — $ 16,037 9 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) December 31, 2025 Level 1 Level 2 Level 3 Total Assets: Interest rate swaps (1) $ — $ 397 $ — $ 397 Cash surrender value of life insurance policies (2) — 17,963 — 17,963 Total assets $ — $ 18,360 $ — $ 18,360 Liabilities: Interest rate swaps (1) $ — $ 2,917 $ — $ 2,917 Deferred compensation (3) 16,379 — $ — $ 16,379 Total liabilities $ 16,379 $ 2,917 $ — $ 19,296 (1) Interest rate swaps are valued using pricing models that incorporate market interest rate curves that are observable at commonly quoted intervals for the full term of the swaps. (2) The life insurance policies are valued based on the underlying investment assets, which are priced using observable market data. (3) Deferred compensation liabilities are valued based on the quoted market prices associated with the underlying assumed investments that have been selected by the plan participants. For more information regarding our interest rate swaps, see Note 5, Derivative Instruments and Hedging Activities. Long-term debt. At March 31, 2026 and December 31, 2025, the carrying value and fair value of our outstanding long-term debt was as follows: March 31, 2026 December 31, 2025 Carrying Value Fair Value Carrying Value Fair Value Long-term debt (1) $ 1,519,639 $ 1,523,389 $ 1,525,363 $ 1,539,085 (1) Excludes unamortized debt discounts and issuance costs. The fair value of our debt is based on the amount of future cash flows discounted using rates we would currently be able to realize for similar instruments of comparable maturity. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. For more information regarding our debt, see Note 6, Debt. Fair Value Measurements on a Nonrecurring Basis. Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to our goodwill, intangible assets and other long-lived assets, which are remeasured when the derived fair value is below carrying value on our condensed consolidated balance sheets. For these assets, we do not periodically adjust carrying value to fair value except in the event of impairment. If we determine that impairment has occurred, the carrying value of the asset would be reduced to fair value and the difference would be recorded as a loss within operating income in our condensed consolidated statements of operations. We had no material remeasurements of such assets or liabilities to fair value during the three months ended March 31, 2026 and 2025. 10 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 3. Supplemental Balance Sheet and Cash Flow Information Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: March 31, 2026 December 31, 2025 Property held for sale $ 2,471 $ 2,471 Construction contract receivables 5,449 12,231 Interest rate swap assets 2,475 397 Prepaid insurance 11,645 2,082 Prepaid commissions 8,261 7,569 Prepaid rent 4,831 4,053 Prepaid events expense 4,011 2,908 Prepaid software licenses and maintenance 11,729 7,306 Prepaid payroll 15,882 13,155 Other 13,561 9,709 Prepaid expenses and other current assets $ 80,315 $ 61,881 Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: March 31, 2026 December 31, 2025 Real estate taxes $ 34,400 $ 38,147 Accrued interest 15,514 7,637 Accrued income tax 20,897 345 Payroll liabilities 43,860 53,050 Accrued variable rent 12,251 16,693 Self-insurance accruals 37,266 35,549 Goods and services received but not invoiced 42,347 42,099 Current maturities of finance lease liabilities 12,169 12,099 Other 7,396 8,732 Accrued expenses and other current liabilities $ 226,100 $ 214,351 11 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Supplemental Cash Flow Information (Increases) decreases in operating assets and increases (decreases) in operating liabilities are as follows: Three Months Ended March 31, 2026 2025 Accounts receivable $ ( 1,527 ) $ 437 Center operating supplies and inventories 579 ( 2,216 ) Prepaid expenses and other current assets ( 20,409 ) ( 15,514 ) Income tax receivable — 3,728 Other assets 7,870 ( 511 ) Accounts payable ( 807 ) ( 3,669 ) Accrued expenses and other current liabilities 18,330 31,414 Deferred revenue 2,932 4,712 Other liabilities ( 1,442 ) ( 455 ) Changes in operating assets and liabilities $ 5,526 $ 17,926 Additional supplemental cash flow information is as follows: Three Months Ended March 31, 2026 2025 Net cash paid for income taxes, net of refunds received $ 2,184 $ 1,500 Net cash paid for interest (including cash settlements associated with interest rate swaps), net of capitalized interest 8,519 6,366 Capitalized interest 6,452 2,529 Non-cash activities: Settlement of accrued compensation liabilities through the issuance of common stock 6,183 13,827 Right-of-use assets obtained in exchange for initial lease liabilities: Operating leases — 53,580 Finance leases 188 11,585 Right-of-use asset adjustments recognized as a result of the remeasurement of existing operating lease liabilities 25,031 2,364 Non-cash increase in finance lease liabilities as a result of interest accretion 106 181 Non-cash increase in financing obligations as a result of interest accretion 23 12 12 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 4. Revenue Revenue associated with our membership dues, enrollment fees, and certain services from our in-center businesses is recognized over time as earned. Revenue associated with products and services offered in our cafes and spas, as well as through e-commerce, is recognized at a point in time. The following is a summary of revenue, by major revenue stream, that we recognized during the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 Membership dues and enrollment fees $ 561,454 $ 501,653 In-center revenue 206,112 184,001 Total center revenue 767,566 685,654 Other revenue 21,134 20,387 Total revenue $ 788,700 $ 706,041 The timing associated with the revenue we recognized during the three months ended March 31, 2026 and 2025 is as follows: Three Months Ended March 31, 2026 Three Months Ended March 31, 2025 Center Revenue Other Revenue Total Revenue Center Revenue Other Revenue Total Revenue Services transferred over time $ 689,268 $ 20,928 $ 710,196 $ 612,517 $ 20,387 $ 632,904 Goods and services transferred at a point in time 78,298 206 78,504 73,137 — 73,137 Total revenue $ 767,566 $ 21,134 $ 788,700 $ 685,654 $ 20,387 $ 706,041 Contract liabilities Contract liabilities, which represent payments or consideration received in advance for goods or services that we have not yet transferred to the customer, consisted of the following: March 31, 2026 December 31, 2025 Classification in Condensed Consolidated Balance Sheets Contract liabilities - current $ 63,250 $ 60,309 Deferred revenue Contract liabilities - long-term 26 41 Other liabilities Total contract liabilities $ 63,276 $ 60,350 Contract liabilities consist primarily of deferred revenue for fees collected in advance for Dynamic Personal Training, media and athletic events, enrollment fees, other in-center service offerings and membership dues. The following table reflects the change in contract liabilities for the three months ended March 31, 2026: Amount Total contract liabilities balance at December 31, 2025 $ 60,350 Revenue recognized that was included in contract liabilities at the beginning of the year ( 40,193 ) Increase, excluding amounts recognized as revenue during the period 43,119 Total contract liabilities balance at March 31, 2026 $ 63,276 13 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 5. Derivative Instruments and Hedging Activities We have entered into receive-variable, pay-fixed interest rate swap agreements with five high-quality institutional banks, each of which had an effective date of April 8, 2025 and is set to expire on April 5, 2028. On the effective date, the initial aggregate notional amount associated with these interest rate swaps was $ 997.5 million, the then-outstanding variable rate borrowings under our Term Loan Facility. The aggregate notional amount associated with these interest rate swaps decreases over time in a manner that is aligned with the timing and amount of scheduled principal payments due with respect to the outstanding borrowings under our Term Loan Facility. At March 31, 2026 , the aggregate notional amount associated with these interest rate swaps was $ 990.0 million. Pursuant to these interest rate swaps, we make fixed interest payments at 3.409 % in exchange for receiving variable interest payments based on Term Secured Overnight Financing Rate (“SOFR”). Because the fair value of interest rate swap arrangements is derived from market-based rates, they are classified as derivative financial instruments. We recognize all of our interest rate swap assets and liabilities at fair value (see “Fair Value Measurements” within Note 2, Summary of Significant Accounting Policies). Each of our interest rate swaps qualifies for and has been designated as a cash flow hedge. As of March 31, 2026, w e have determined that each of our interest rate swaps is highly effective in achieving offsetting changes in the fair value of the expected future variable cash flows associated with the outstanding borrowings under our Term Loan Facility. Accordingly, unrealized gains or losses associated with changes in the fair value of our interest rate swaps are recognized as a component of accumulated other comprehensive loss (“AOCL”) on our condensed consolidated balance sheets. Realized gains or losses associated with the monthly cash settlements we receive or pay, respectively, in connection with our interest rate swaps are reclassified out of AOCL and recognized in Interest expense, net of interest income in our condensed consolidated statements of operations in the same period during which interest expense associated with the hedged variable interest rate payments is recognized. The monthly cash settlements we receive or pay in connection with these interest rate swaps are reported within operating activities in our condensed consolidated statements of cash flows. The fair value of our outstanding designated interest rate swap assets and liabilities is reported in our condensed consolidated balance sheet as follows: March 31, 2026 December 31, 2025 Classification on Condensed Consolidated Balance Sheet Interest rate swap assets: Current $ 2,475 $ 397 Prepaid expenses and other current assets Non-current 1,148 — Other assets Total interest rate swap assets $ 3,623 $ 397 Interest rate swap liabilities $ — $ 2,917 Other liabilities 14 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) The unrealized gain (loss) associated with our interest rate swaps that was recognized in AOCL, as well as the realized gain that was reclassified out of AOCL to earnings, during the three months ended March 31, 2026 were as follows: Three Months Ended March 31, 2026 Affected Line Item on Condensed Consolidated Statements of Operations Balance in AOCL at December 31, 2025 $ ( 2,053 ) Unrealized gain: Pretax unrealized gain (effective portion) 6,931 Less: Tax expense ( 1,802 ) Unrealized gain, net of tax (effective portion) 5,129 Realized gain reclassified to earnings: Pretax realized gain reclassified to earnings (effective portion) ( 656 ) Interest expense, net of interest income Less: Tax expense 170 Provision for income taxes Realized gain reclassified to earnings, net of tax (effective portion) ( 486 ) Balance in AOCL at March 31, 2026 $ 2,590 At March 31, 2026 , we expect approximately $ 1.8 million of after-tax realized gain on interest rate swaps to be reclassified out of AOCL to earnings within the next 12 months. The remaining maturity of our interest rate swaps at March 31, 2026 was 2.0 years. 6. Debt Debt consisted of the following: March 31, 2026 December 31, 2025 Term Loan Facility, maturing November 2031 $ 990,025 $ 992,512 Revolving Credit Facility, maturing September 2029 — — 6.000 % Senior Secured Notes, maturing November 2031 500,000 500,000 Mortgage Notes, various maturities 26,225 29,423 Other debt 3,298 3,298 Fair value adjustment 91 130 Total debt 1,519,639 1,525,363 Less unamortized debt discounts and issuance costs ( 16,835 ) ( 17,576 ) Total debt less unamortized debt discounts and issuance costs 1,502,804 1,507,787 Less current maturities ( 20,705 ) ( 21,848 ) Long-term debt, less current maturities $ 1,482,099 $ 1,485,939 Term Loan Facility The variable rate interest payments on our Term Loan Facility are hedged by our interest rate swaps. Pursuant to these interest rate swaps, we effectively pay fixed interest on our outstanding Term Loan Facility borrowings at 3.409 %, plus an applicable margin. With the upgrade of our issuer credit rating by S&P Global Ratings on June 18, 2025, our applicable margin was reduced by 0.25 % to 2.25 % effective on June 19, 2025, and with the amendment to our Term Loan Facility on August 18, 2025, our applicable margin was reduced by an additional 0.25 % to 2.00 %. As a result, the effective fixed interest rate associated with our outstanding Term Loan Facility borrowings a t March 31, 2026 was 5.409 %. We are required to make quarterly principal payments of 0.25 % of the outstanding balance on the Term Loan Facility. See Note 5, Derivative Instruments and Hedging Activities for more information regarding our interest rate swaps. 15 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Revolving Credit Facility We did not borrow or repay any amounts under our Revolving Credit Facility during the three months ended March 31, 2026. At March 31, 2026, there wer e no outstanding b orrowings under our $ 650.0 million Revolving Credit Facility, and there were $ 33.1 million of outstanding letters of credit, resulting in total revolver availability of $ 616.9 million, which was available at intervals ranging from 30 to 180 days at interest rates of SOFR plus an applicable margin of 2.00 % or base rate plus 1.00 % . Debt Covenants We are required to comply with certain affirmative and restrictive covenants under our Term Loan Facility and Revolving Credit Facility (collectively, our “Credit Facilities”), 6.000 % Senior Secured Notes and Mortgage Notes. We are also required to comply with a first lien net leverage ratio covenant under the Revolving Credit Facility, which requires us to maintain a first lien net leverage ratio, if 30.00 % or more of the Revolving Credit Facility commitments are outstanding shortly after the end of any fiscal quarter (excluding all cash collateralized undrawn letters of credit and other undrawn letters of credit up to $ 90.0 million). As of March 31, 2026, we were either in compliance in all material respects with the covenants or the covenants were not applicable. Future Maturities of Long-Term Debt Aggregate annual future maturities of long-term debt, excluding unamortized discounts, issuance costs and fair value adjustments, at March 31, 2026 were as follows: April 2026 through March 2027 $ 20,705 April 2027 through March 2028 25,757 April 2028 through March 2029 10,139 April 2029 through March 2030 10,150 April 2030 through March 2031 10,167 Thereafter 1,442,630 Total future maturities of long-term debt $ 1,519,548 7. Stockholders’ Equity Share-Based Compensation Expense Share-based compensation expense for the three months ended March 31, 2026 was $ 10.5 million, of which $ 9.7 million and $ 0.8 million was associated with equity-classified awards and liability-classified awards, respectively. Share-based compensation expense for the three months ended March 31, 2025 was $ 11.9 million, of which $ 10.3 million and $ 1.6 million was associated with equity-classified awards and liability-classified awards, respectively. Restricted Stock Units During the three months ended March 31, 2026, the Company granted approximately 0.6 million restricted stock unit awards under the 2021 Incentive Award Plan, of which approximately 0.3 million were time-based vesting awards granted to our executives in connection with our long-term incentive compensation program that vest in ratable installments over three years , and approximately 0.3 million were performance-based vesting awards granted to our executives in connection with our short-term incentive compensation program, in each case subject to continuous employment from the grant date through the applicable vesting date unless otherwise agreed with the award recipient. We determine the grant date fair value of restricted stock unit awards by multiplying the number of restricted stock unit awards by the closing trading price of our common stock on the grant date. 16 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Performance Stock Units During the three months ended March 31, 2026, the Company granted approximately 0.3 million three-year performance stock unit awards under the 2021 Incentive Award Plan, half of which are based on our Adjusted EBITDA with performance determined each year for one-third of such award but the entire award does not vest until the end of the three-year period, and half of which are based on relative total shareholder return over a three-year period that cliff vest at the end of the three-year period. We determine the grant date fair value of performance stock unit awards with Adjusted EBITDA performance metrics by multiplying the number of performance stock unit awards by the closing trading price of our common stock on the grant date. We determine the grant date fair value of performance stock unit awards with relative total shareholder return market metrics by multiplying the number of performance stock unit awards by the grant date fair value per unit which is calculated using the Monte Carlo simulation model. Other Share-Based Payment Awards 2026 Short-Term Incentive Program During the three months ended March 31, 2026, the Company adopted a short-term incentive compensation program for eligible team members who are not executive officers. Pursuant to this program, awards will be paid o ut in cash and/o r through the issuance of fully-vested shares of the Company’s common stock in early 2027 if the Company’s performance exceeds the tranche one performance metric. As of March 31, 2026, we expect that a portion of these awards will be settled in fully-vested shares of the Company’s common stock. As it relates to the portion of these awards that we expect to settle in fully-vested shares of the Company’s common stock, we are accounting for the potential issuance of these shares of common stock as share-based payment awards granted under this program. Because the incentive compensation associated with these awards represents a fixed dollar amount that, if payable, will be settled in a variable number of shares of the Company’s common stock, we are currently accounting for these awards as liability-classified share-based payment awards. Accordingly, the offset to the share-based compensation expense we have recognized in connection with these awards during the three months ended March 31, 2026 is included in Accrued expenses and other current liabilities on our March 31, 2026 condensed consolidated balance sheet. 2025 Short-Term Incentive Program In February 2026, our board of directors determined that our 2025 performance exceeded the tranche three performance metric under our 2025 short-term incentive compensation program and issued corresponding shares of common stock to certain of our eligible employees. Effective as of the determination date, the $ 6.2 million then-outstanding liability we had recognized in connection with these liability-classified share-based payment awards was reclassified out of Accrued expenses and other current liabilities and into Common stock and Additional paid-in capital on our condensed consolidated balance sheet during the three months ended March 31, 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. As of March 31, 2026, we had approximately $ 489.3 million of availability remaining under our Share Repurchase Program. 17 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Accumulated Other Comprehensive Loss Changes in the AOCL balances for the three months ended March 31, 2026 were as follows (all amounts are reported net of tax): Three Months Ended March 31, 2026 Foreign Currency Translation Adjustments Unrealized (Loss) Gain on Derivative Instruments Total AOCL balance at December 31, 2025 $ ( 10,077 ) $ ( 2,053 ) $ ( 12,130 ) Other comprehensive (loss) income before reclassifications ( 1,225 ) 5,129 3,904 Amounts reclassified from AOCL to earnings — ( 486 ) ( 486 ) AOCL balance at March 31, 2026 $ ( 11,302 ) $ 2,590 $ ( 8,712 ) Changes in AOCL balances for the three months ended March 31, 2025 were related to foreign currency translation adjustments only. 8. Income Per Share For the three months ended March 31, 2026 and 2025 , o ur potentially dilutive securities included stock options, restricted stock units, performance stock units, shares to be issued under our employee stock purchase plan (“ESPP”) and contingently issuable shares related to our short-term incentive compensation program. The following table sets forth the calculation of basic and diluted income per share for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 Net income $ 88,098 $ 76,142 Weighted-average common shares outstanding – basic 221,853 211,958 Dilutive effect of stock-based compensation awards 5,601 11,661 Weighted-average common shares outstanding – diluted 227,454 223,619 Income per common share – basic $ 0.40 $ 0.36 Income per common share – diluted $ 0.39 $ 0.34 The following is a summary of potential shares of common stock that were antidilutive and excluded from the weighted average share computations for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 Stock options 28 37 Restricted stock units 556 2 Performance stock units 159 — ESPP shares 96 — Potential common shares excluded from the weighted average share calculations 839 39 18 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 9. Commitments and Contingencies Life Time, Inc. et al. v. Zurich American Insurance Company On August 19, 2020, Life Time, Inc., several of its subsidiaries, and a joint venture entity, Bloomingdale Life Time Fitness LLC (collectively, the “Life Time Parties”) filed a complaint against Zurich American Insurance Company (“Zurich”) in the Fourth Judicial District of the State of Minnesota, County of Hennepin (the “District Court”) (Case No. 27-CV-20-10599) (the “Action”) seeking declaratory relief and damages with respect to Zurich’s failure under a property/business interruption insurance policy to provide certain coverage to the Life Time Parties related to the closure or suspension by governmental authorities of their business activities due to the spread or threat of the spread of COVID-19. On March 15, 2021, certain of the Life Time Parties filed a First Amended Complaint in the Action adding claims against Zurich under a Builders’ Risk policy related to the suspension of multiple construction projects. The Court granted Zurich’s dispositive motions on July 25, 2024, dismissing the Life Time Parties’ claims with prejudice, and entered judgment on July 26, 2024. The Life Time Parties appealed from that judgment to the Minnesota Court of Appeals (the “Court of Appeals”). On August 11, 2025, the Court of Appeals reversed the District Court’s order granting summary judgment in favor of Zurich, holding that governmental closure orders were the causes of Life Time Parties’ losses under the property/business interruption policy, and not the pandemic. The Court of Appeals concluded that Life Time Parties have a coverage limit of $ 1.0 million per occurrence and there were 29 occurrences, reflecting the 29 different jurisdictions that issued closure orders affecting the Life Time Parties’ 150 locations. The Court of Appeals remanded the Action to the District Court for further proceedings. On September 8, 2025, Zurich petitioned the Minnesota Supreme Court for review of the decision of the Court of Appeals. On September 30, 2025, the Life Time Parties filed an opposition to Zurich’s petition for review. In November 2025, Zurich paid ap proximately $ 40 million to the Life Time Parties in partial satisfaction of their legal claims in this Act ion, which was recognized in 2025. This payment represents up to $ 1.0 million plus interest for 26 occurrences of 29 total occurrences found by the Court of Appeals in its order dated August 11, 2025. The Life Time Parties’ claims with respect to the remaining three occurrences were settled with Zurich in April 2026 and the Act ion will be dismissed. We w ill recognize the settlement related to these remaining three occurrences in the second quarter of 2026. Other We are also engaged in other proceedings incidental to the normal course of business. Due to their nature, such legal proceedings involve inherent uncertainties, including but not limited to court rulings, negotiations between affected parties and governmental intervention. We establish reserves for matters that are probable and estimable in amounts we believe are adequate to cover reasonable adverse judgments. Based upon the information available to us and discussions with legal counsel, it is our opinion that the outcome of the various legal actions and claims that are incidental to our business will not have a material adverse impact on our consolidated financial position, results of operations or cash flows. Such matters are subject to many uncertainties, and the outcomes of individual matters are not predictable with assurance. 10. Subsequent Events During April 2026, we closed on the sale-leaseback of five owned properties with two institutional real estate investors for aggregate gross proceeds of approximately $ 200 million. In preparing the accompanying condensed consolidated financial statements, we have evaluated the period from March 31, 2026 through the date the condensed consolidated financial statements were issued for material subsequent events. There have been no other events or transactions du ring this time which would have a material effect on the condensed consolidated fina ncial statements and therefore would require recognition or disclosure. 19 Table of Contents