Life Time Reports Third Quarter 2026 Financial Results
CHANHASSEN, Minn., Oct. 29, 2026 /PRNewswire/ -- Life Time Group Holdings, Inc. ("Life Time," "we," "our," "us," or the "Company") (NYSE: LTH) today announced its financial results for the fiscal third quarter ended September 30, 2026.
Bahram Akradi, Founder, Chairman and CEO, stated: "Our third quarter results reflect our continued delivery of exceptional member experiences and the strength of our brand. Member engagement continues to rise and our in-center businesses are performing very well, resulting in higher revenue per membership. We are on track to open all 14 new clubs planned for this year, and nearly all of our clubs planned for 2027 are already under construction. With our low leverage, strong cash flow and robust real estate pipeline, we are well positioned for long-term growth."
Financial Summary
Three Months Ended
Nine Months Ended
($ in millions, except for Average center
revenue per center membership data)
September 30,
September 30,
2026
2025
Percent
Change
2026
2025
Percent
Change
Total revenue
$893.5
$782.6
14.2 %
$2,548.2
$2,250.2
13.2 %
Center operations expenses
$474.5
$414.3
14.5 %
$1,335.0
$1,189.2
12.3 %
Rent
$96.1
$87.5
9.8 %
$280.3
$251.9
11.3 %
General, administrative and marketing
expenses (1)
$65.8
$59.8
10.0 %
$191.4
$179.4
6.7 %
Net income
$106.5
$102.4
4.0 %
$295.9
$250.7
18.0 %
Adjusted net income
$115.9
$93.0
24.6 %
$321.9
$251.2
28.1 %
Adjusted EBITDA
$256.3
$220.0
16.5 %
$729.4
$622.6
17.2 %
Comparable center revenue (2)
8.7 %
10.6 %
8.8 %
11.5 %
Center memberships, end of period
858,747
840,622
2.2 %
858,747
840,622
2.2 %
Average center revenue per center
membership
$1,016
$907
12.0 %
$2,914
$2,638
10.5 %
(1)
The three months ended September 30, 2026 and 2025 included non-cash share-based compensation expense of $13.9 million and $14.9 million, respectively. The nine months ended September 30, 2026 and 2025 included non-cash share-based compensation expense of $36.9 million and $39.4 million, respectively.
(2)
The Company includes a center, for comparable center revenue purposes, beginning on the first day of the 13th full calendar month of the center's operation, in order to assess the center's growth rate after one year of operation.
Third Quarter 2026 Information
Nine-Month 2026 Information
New Center Openings
Cash Flow Highlights
Three Months Ended
Nine Months Ended
($ in millions)
September 30,
September 30,
2026
2025
Percent
Change
2026
2025
Percent
Change
Growth capital expenditures (1)
$216.5
$156.0
38.8 %
$611.8
$416.4
46.9 %
Maintenance capital expenditures (2)
$35.5
$27.8
27.7 %
$107.6
$93.2
15.5 %
Modernization and technology capital
expenditures (3)
$36.7
$38.7
(5.2) %
$92.6
$77.4
19.6 %
Total capital expenditures
$288.7
$222.5
29.8 %
$812.0
$587.0
38.3 %
(1)
Consist of new center land and construction, initial major remodels of acquired centers, major remodels of existing centers that expand existing square footage, asset acquisitions including the purchase of previously leased centers and other growth initiatives.
(2)
Consist of capital expenditures required to maintain the operating condition of our existing centers.
(3)
Consist of capital expenditures related to updates and enhancements to our existing centers, technology investments, and corporate infrastructure.
Liquidity and Capital Resources
2026 Outlook
Full-Year 2026 Guidance
Percent
Year Ending
Year Ending
Year Ended
Change
December 31, 2026
December 31, 2026
December 31, 2025
(Using
(Guidance as of
($ in millions)
(Guidance)
(Actual)
Midpoints)
July 30, 2026)
Total revenue
$3,380 – $3,390
$2,995.3
13.0 %
$3,350 – $3,375
Rent
$378 – $382
$339.2
12.0 %
$378 – $384
Net Income
$358 – $360
$373.7
(3.9) %
$358 – $363
Adjusted net income
$408 – $412
$325.5
26.0 %
$394 – $402
Adjusted EBITDA
$958 – $962
$825.2
16.3 %
$940 – $955
The Company is reiterating the following expectations for fiscal 2026 as outlined in its second quarter 2026 results announced on July 30, 2026:
The Company is also updating the following operational and financial expectations for fiscal 2026:
Conference Call Details
A conference call to discuss our third quarter financial results is scheduled for today:
Replay Information
Webcast – A recorded replay of the webcast will be available within approximately three hours of the call's conclusion and may be accessed at: https://ir.lifetime.life.
Conference Call – A replay of the conference call will be available after 1:00 p.m. ET the same day through November 12, 2026:
Earnings Supplement Presentation
The Company has made available supplemental material regarding its revenue growth strategy and memberships on its investor relations website at https://ir.lifetime.life.
About Life Time
Life Time (NYSE: LTH) empowers people to live healthy, happy lives through its more than 195 athletic country clubs across the U.S. and Canada, the complementary and comprehensive Life Time app featuring its L•AI•C™ AI-powered health companion, and more than 25 iconic athletic events. Serving people ages 90 days to 90+ years, the Life Time ecosystem uniquely delivers healthy living, healthy aging, and healthy entertainment experiences, a range of unique healthy way of life programs, highly trusted LTH nutritional supplements and more. Recognized as a Great Place to Work®, the Company is committed to upholding an exceptional culture for its over 46,000 team members.
Use of Non-GAAP Financial Measures and Key Performance Indicators
This press release includes certain financial measures that are not presented in accordance with GAAP, including Adjusted net income, Adjusted net income per common share, Adjusted EBITDA, free cash flow and net debt and ratios and calculations with respect thereto. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should be considered in addition to, and not as a substitute for or superior to, net income, net income per common share, net cash provided by operating activities or total debt (defined as long-term debt, net of current portion, plus current maturities of debt) as a measure of financial performance or liquidity or any other performance measure derived in accordance with GAAP, and should not be construed as an inference that the Company's future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP financial measures should be read in conjunction with the Company's financial statements prepared in accordance with GAAP. The reconciliations of the Company's non-GAAP financial measures to the corresponding GAAP measures should be carefully evaluated.
Adjusted net income is defined as net income excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations, less the tax effect of these adjustments. Adjusted EBITDA is defined as net income before interest expense, net, provision for income taxes and depreciation and amortization, excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of the Company's ongoing operations. Free cash flow is defined as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales. Net debt is defined as long-term debt, net of current portion, plus current maturities of debt, excluding fair value adjustments, unamortized debt discounts and issuance costs, minus cash and cash equivalents. Net debt is as of the last day of the respective quarter or year. Our leverage ratio is calculated as our net debt divided by our trailing twelve months of Adjusted EBITDA.
The Company presents these non-GAAP financial measures because management believes that these measures assist investors and analysts in comparing the Company's operating performance across reporting periods on a consistent basis by excluding items that management does not believe are indicative of the Company's ongoing operating performance, and management believes that 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. Investors are encouraged to evaluate these adjustments and the reasons the Company considers them appropriate for supplemental analysis. In evaluating the non-GAAP financial measures, investors should be aware that, in the future, the Company may incur expenses that are the same as or similar to some of the adjustments in the Company's presentation of its non-GAAP financial measures. There can be no assurance that the Company will not modify the presentation of non-GAAP financial measures in future periods, and any such modification may be material. In addition, the Company's non-GAAP financial measures may not be comparable to similarly titled measures used by other companies in the Company's industry or across different industries.
The non-GAAP financial measures have limitations as analytical tools, and investors should not consider these measures in isolation or as substitutes for analysis of the Company's results as reported under GAAP.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of federal securities regulations. Forward-looking statements in this press release include, but are not limited to, the Company's plans, strategies and prospects, both business and financial, including its financial outlook for fiscal year 2026, growth, strength of its balance sheet, net debt and leverage, capital expenditures, interest expense, consumer demand, industry and economic trends, member engagement and mix, tax rates and expense, rent expense, expected number of diluted common shares outstanding, expected number, size and timing of new center openings, successful signings and closings of sale-leaseback transactions (including the amount, pricing and timing thereof) and the timing, amount and price of any share repurchase. These statements are based on the beliefs and assumptions of the Company's management. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning the Company's possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.
Factors that could cause actual results to differ materially from those forward-looking statements included in this press release include, but are not limited to, risks relating to our business operations and the growth of our business including the competitive and economic environment, 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") on February 24, 2026 (File No. 001-40887), as such factors may be updated from time to time in the Company's other filings with the SEC, which are accessible on the SEC's website at www.sec.gov. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any forward-looking statement that the Company makes in this press release speaks only as of the date of such statement. Except as required by law, the Company does not have any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2026
2025
2026
2025
Revenue:
Center revenue
$ 871,127
$ 760,897
$ 2,476,095
$ 2,182,416
Other revenue
22,397
21,752
72,125
67,743
Total revenue
893,524
782,649
2,548,220
2,250,159
Operating expenses:
Center operations
474,518
414,328
1,334,954
1,189,240
Rent
96,099
87,511
280,329
251,866
General, administrative and marketing
65,752
59,840
191,411
179,361
Depreciation and amortization
85,013
75,094
249,058
219,001
Other operating expense
14,137
10,231
49,920
58,927
Total operating expenses
735,519
647,004
2,105,672
1,898,395
Income from operations
158,005
135,645
442,548
351,764
Other income (expense):
Interest expense, net of interest income
(14,694)
(18,440)
(47,797)
(65,331)
Equity in earnings (loss) of affiliates
578
149
(1,999)
170
Other income
—
21,994
4,937
34,867
Total other (expense) income
(14,116)
3,703
(44,859)
(30,294)
Income before income taxes
143,889
139,348
397,689
321,470
Provision for income taxes
37,396
36,921
101,740
70,799
Net income
$ 106,493
$ 102,427
$ 295,949
$ 250,671
Income per common share:
Basic
$ 0.48
$ 0.47
$ 1.33
$ 1.15
Diluted
$ 0.46
$ 0.45
$ 1.30
$ 1.11
Weighted-average common shares outstanding:
Basic
224,056
220,063
222,853
217,132
Diluted
229,055
226,007
227,956
225,075
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
September 30,
2026
December 31,
2025
ASSETS
Current assets:
Cash and cash equivalents
$ 286,211
$ 204,807
Restricted cash and cash equivalents
28,049
27,362
Accounts receivable, net
25,827
24,092
Center operating supplies and inventories
62,490
67,618
Prepaid expenses and other current assets
79,283
61,881
Income tax receivable
11,079
—
Total current assets
492,939
385,760
Property and equipment, net
3,955,367
3,633,229
Goodwill
1,235,359
1,235,359
Operating lease right-of-use assets
2,634,812
2,479,804
Intangible assets, net
180,406
180,810
Other assets
97,541
92,989
Total assets
$ 8,596,424
$ 8,007,951
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$ 103,221
$ 90,249
Construction accounts payable
171,178
143,545
Deferred revenue
60,619
60,309
Accrued expenses and other current liabilities
228,829
214,351
Current maturities of debt
29,735
21,848
Current maturities of operating lease liabilities
85,041
79,208
Total current liabilities
678,623
609,510
Long-term debt, net of current portion
1,462,398
1,485,939
Operating lease liabilities, net of current portion
2,723,395
2,555,513
Deferred income taxes, net
222,772
172,217
Other liabilities
57,540
58,561
Total liabilities
5,144,728
4,881,740
Stockholders' equity:
Common stock, $0.01 par value per share; 500,000 shares authorized; 224,535 and
221,077 shares issued and outstanding, respectively
2,245
2,211
Additional paid-in capital
3,200,858
3,183,032
Retained earnings (accumulated deficit)
249,047
(46,902)
Accumulated other comprehensive loss
(454)
(12,130)
Total stockholders' equity
3,451,696
3,126,211
Total liabilities and stockholders' equity
$ 8,596,424
$ 8,007,951
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
September 30,
2026
2025
Cash flows from operating activities:
Net income
$ 295,949
$ 250,671
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
249,058
219,001
Deferred income taxes
45,440
60,918
Share-based compensation
41,733
45,179
Non-cash rent expense
23,475
28,876
Impairment charges associated with long-lived assets
282
1,293
(Gain) loss on disposal of property and equipment, net
(4,062)
4,953
Amortization of debt discounts and issuance costs
2,805
2,729
Changes in operating assets and liabilities
26,288
18,576
Other
(10,497)
(1,530)
Net cash provided by operating activities
670,471
630,666
Cash flows from investing activities:
Capital expenditures
(812,033)
(586,980)
Proceeds from sale-leaseback transactions
262,479
172,683
Other
5,873
(21,786)
Net cash used in investing activities
(543,681)
(436,083)
Cash flows from financing activities:
Repayments of debt
(17,177)
(14,292)
Proceeds from revolving credit facility
—
220,000
Repayments of revolving credit facility
—
(230,000)
Repayments of finance lease liabilities
(1,283)
(1,604)
Proceeds from financing obligations
—
10,300
Payments of debt discounts and issuance costs
(600)
(628)
Proceeds from stock option exercises
63,019
37,616
Common stock share repurchases
(73,392)
—
Proceeds from issuances of common stock in connection with the employee stock purchase plan
2,303
1,875
Employee tax withholding associated with net share-settled share-based awards
(17,308)
(4,334)
Other
(11)
(7)
Net cash (used in) provided by financing activities
(44,449)
18,926
Effect of exchange rates on cash and cash equivalents and restricted cash and cash equivalents
(250)
51
Increase in cash and cash equivalents and restricted cash and cash equivalents
82,091
213,560
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
$ 314,260
$ 241,438
Non-GAAP Measurements and Key Performance Indicators
See "Use of Non-GAAP Financial Measures and Key Performance Indicators" for a discussion of the Non-GAAP financial measures reconciled below.
Key Performance Indicators
($ in thousands, except for Average Center revenue per center membership data)
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2026
2025
2026
2025
Membership Data
Center memberships
858,747
840,622
858,747
840,622
On-hold memberships
49,707
50,603
49,707
50,603
Total memberships
908,454
891,225
908,454
891,225
Revenue Data
Membership dues and enrollment fees
71.4 %
71.9 %
71.9 %
72.2 %
In-center revenue
28.6 %
28.1 %
28.1 %
27.8 %
Total Center revenue
100.0 %
100.0 %
100.0 %
100.0 %
Membership dues and enrollment fees
$ 622,101
$ 547,306
$ 1,780,799
$ 1,576,268
In-center revenue
249,026
213,591
695,296
606,148
Total Center revenue
$ 871,127
$ 760,897
$ 2,476,095
$ 2,182,416
Average Center revenue per center membership (1)
$ 1,016
$ 907
$ 2,914
$ 2,638
Comparable center revenue (2)
8.7 %
10.6 %
8.8 %
11.5 %
Center Data
Net new center openings (3)
1
1
7
6
Total centers (end of period) (3)
196
185
196
185
Total center square footage (end of period) (4)
18,900,000
18,100,000
18,900,000
18,100,000
GAAP and Non-GAAP Financial Measures
Net income
$ 106,493
$ 102,427
$ 295,949
$ 250,671
Net income margin (5)
11.9 %
13.1 %
11.6 %
11.1 %
Adjusted net income (6)
$ 115,865
$ 92,992
$ 321,922
$ 251,168
Adjusted net income margin (6)
13.0 %
11.9 %
12.6 %
11.2 %
Adjusted EBITDA (7)
$ 256,259
$ 220,046
$ 729,446
$ 622,611
Adjusted EBITDA margin (7)
28.7 %
28.1 %
28.6 %
27.7 %
Center operations expense
$ 474,518
$ 414,328
$ 1,334,954
$ 1,189,240
Pre-opening expenses (8)
$ 2,907
$ 1,050
$ 7,030
$ 3,489
Rent
$ 96,099
$ 87,511
$ 280,329
$ 251,866
Non-cash rent expense (open properties) (9)
$ 12,846
$ 10,216
$ 23,475
$ 18,275
Non-cash rent expense (properties under development) (9)
$ —
$ 5,597
$ —
$ 10,601
Net cash provided by operating activities
$ 262,120
$ 251,112
$ 670,471
$ 630,666
Free cash flow (10)
$ 35,651
$ 62,530
$ 120,917
$ 216,369
(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.
(2)
We measure the results of our centers based on how long each center has been open as of the most recent measurement period. We include a center, for comparable center revenue purposes, beginning on the first day of the 13th full calendar month of the center's operation, in order to assess the center's growth rate after one year of operation.
(3)
Net new center openings is calculated as the number of centers that opened for the first time to members during the period, less any centers that closed during the period. 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, 2026, we opened one center.
(4)
Total center square footage (end of period) reflects the aggregate square footage, excluding the areas used for tennis courts, outdoor swimming pools, outdoor play areas and stand-alone Work, Sport and Swim locations. We use this metric for evaluating the efficiencies of a center as of the end of the period. These figures are approximations.
(5)
Net income margin is calculated as net income divided by total revenue.
(6)
We present Adjusted net income as a supplemental measure of our performance. We define Adjusted net income as net income excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations, less the tax effect of these adjustments.
Adjusted net income margin is calculated as Adjusted net income divided by total revenue.
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, except per share data)
2026
2025
2026
2025
Net income
$ 106,493
$ 102,427
$ 295,949
$ 250,671
Share-based compensation expense (a)
15,774
16,891
41,733
45,179
(Gain) loss on sale-leaseback transactions (b)
(3,049)
(7,732)
(5,084)
4,764
Capital transaction costs (c)
—
—
—
1,531
Legal settlements (d)
4
—
(4,863)
94
Employee retention credits (e)
—
(21,994)
—
(34,867)
Other (f)
(66)
(1)
3,116
108
Taxes (g)
(3,291)
3,401
(8,929)
(16,312)
Adjusted net income
$ 115,865
$ 92,992
$ 321,922
$ 251,168
Income per common share:
Basic
$ 0.48
$ 0.47
$ 1.33
$ 1.15
Diluted
$ 0.46
$ 0.45
$ 1.30
$ 1.11
Adjusted income per common share:
Basic
$ 0.52
$ 0.42
$ 1.44
$ 1.16
Diluted
$ 0.51
$ 0.41
$ 1.41
$ 1.12
Weighted-average common shares outstanding:
Basic
224,056
220,063
222,853
217,132
Diluted
229,055
226,007
227,956
225,075
(a)
Share-based compensation expense recognized during the three and nine months ended September 30, 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. Share-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 ESPP and liability-classified awards related to our 2025 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.
(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 or judgments as these costs and proceeds are non-recurring in nature and do not reflect costs or proceeds associated with our normal ongoing operations. Nearly all of the adjustment for the nine months ended September 30, 2026 is the recognition of settlement proceeds from Zurich for the remaining occurrences of jurisdictions that issued closure orders affecting our club operations in 2020 during the COVID-19 pandemic. These proceeds were offset by legal-related expenses in pursuit of our claim against Zurich of $0.1 million and $0.1 million for the nine months ended September 30, 2026 and 2025, respectively.
(e)
Represents refundable payroll tax credits for employee retention under the CARES Act.
(f)
Includes (i) a $(0.3) million favorable revision to previously estimated closing costs and a $2.6 million loss associated with the sale of assets in a non-club joint venture for the three and nine months ended September 30, 2026, respectively, and (ii) other immaterial transactions or items that are unusual or non-recurring in nature of $0.2 million for the three months ended September 30, 2026, and $0.5 million and $0.1 million for the nine months ended September 30, 2026 and 2025, respectively.
(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. We updated the Taxes amount used to arrive at Adjusted net income for the nine months ended September 30, 2025 to include $12.6 million in income tax benefits resulting from a significant exercise of stock options by our Chief Executive Officer that were set to expire in 2025. This change did not impact our condensed consolidated financial statements prepared in accordance with GAAP, but it did decrease our non-GAAP Adjusted net income and Adjusted income per common share for the nine months ended September 30, 2025.
(7)
We present Adjusted EBITDA as a supplemental measure of our performance. We define Adjusted EBITDA as net income before interest expense, net, provision for income taxes and depreciation and amortization, excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations.
Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by total revenue.
The following table provides a reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA:
Three Months Ended
Nine Months Ended
September 30,
September 30,
($ in thousands)
2026
2025
2026
2025
Net income
$ 106,493
$ 102,427
$ 295,949
$ 250,671
Interest expense, net of interest income
14,694
18,440
47,797
65,331
Provision for income taxes
37,396
36,921
101,740
70,799
Depreciation and amortization
85,013
75,094
249,058
219,001
Share-based compensation expense (a)
15,774
16,891
41,733
45,179
(Gain) loss on sale-leaseback transactions (b)
(3,049)
(7,732)
(5,084)
4,764
Capital transaction costs (c)
—
—
—
1,531
Legal settlements (d)
4
—
(4,863)
94
Employee retention credits (e)
—
(21,994)
—
(34,867)
Other (f)
(66)
(1)
3,116
108
Adjusted EBITDA
$ 256,259
$ 220,046
$ 729,446
$ 622,611
(a) – (f) 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. The number of centers under construction or development, the types of centers and our costs associated with any particular center opening can vary significantly from period to period.
(9)
Reflects the non-cash portion of our annual GAAP operating lease expense that is greater or less than the cash operating lease payments. Non-cash rent expense for our open properties represents non-cash expense associated with properties that were operating at the end of each period presented. Non-cash rent expense for our properties under development represents non-cash expense associated with properties that are still under development at the end of each period presented.
(10)
Free cash flow, a non-GAAP financial measure, is calculated as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales.
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,
($ in thousands)
2026
2025
2026
2025
Net cash provided by operating activities
$ 262,120
$ 251,112
$ 670,471
$ 630,666
Capital expenditures, net of construction reimbursements
(288,757)
(222,494)
(812,033)
(586,980)
Proceeds from sale-leaseback transactions
62,288
33,912
262,479
172,683
Free cash flow
$ 35,651
$ 62,530
$ 120,917
$ 216,369
Reconciliation of Net Income to Adjusted EBITDA Trailing Twelve Months
($ in thousands)
(Unaudited)
Twelve
Twelve
Months Ended
Months Ended
September 30, 2026
September 30, 2025
Net income
$ 418,949
$ 287,834
Interest expense, net of interest income
64,729
102,343
Provision for income taxes
150,773
83,382
Depreciation and amortization
326,402
288,614
Share-based compensation expense
48,304
65,763
(Gain) loss on sale-leaseback transactions
(22,633)
4,766
Capital transaction costs
—
1,531
Legal settlements
(43,586)
101
Asset impairments
5,791
—
Employee retention credits
(19,705)
(34,867)
Other
2,986
108
Adjusted EBITDA
$ 932,010
$ 799,575
Reconciliation of Net Debt and Leverage Calculation
($ in thousands)
(Unaudited)
Twelve
Twelve
Months Ended
Months Ended
September 30, 2026
September 30, 2025
Current maturities of debt
$ 29,735
$ 22,965
Long-term debt, net of current portion
1,462,398
1,489,908
Total Debt
$ 1,492,133
$ 1,512,873
Less: Fair value adjustment
15
169
Less: Unamortized debt discounts and issuance costs
(15,937)
(18,317)
Less: Cash and cash equivalents
286,211
218,897
Net Debt
$ 1,221,844
$ 1,312,124
Trailing twelve-month Adjusted EBITDA
932,010
799,575
Net Debt Leverage Ratio
1.3x
1.6x
Reconciliation of Net Income to Adjusted Net Income Guidance for the Year Ending 2026
($ in millions)
(Unaudited)
Year Ending
December 31, 2026
Net income
$358 – $360
Share-based compensation expense
54 – 56
Loss on sale-leaseback transactions
17 – 17
Other
(2) – (2)
Taxes
(19) – (19)
Adjusted net income
$408 – $412
Reconciliation of Net Income to Adjusted EBITDA Guidance for the Year Ending 2026
($ in millions)
(Unaudited)
Year Ending
December 31, 2026
Net income
$358 – $360
Interest expense, net of interest income
62 – 59
Provision for income taxes
132 – 133
Depreciation and amortization
337 – 339
Share-based compensation expense
54 – 56
Loss on sale-leaseback transactions
17 – 17
Other
(2) – (2)
Adjusted EBITDA
$958 – $962
SOURCE Life Time Group Holdings, Inc.