Life Time Group Holdings, Inc. (LTH) Business Profile

What it does

Life Time operates athletic clubs that combine fitness facilities with wellness, recreation and other services. Its customers are individuals, couples and families who pay for access to a home center and, depending on their membership, other centers. The company is headquartered in Chanhassen, and founder Bahram Akradi is chairman and chief executive officer.

A center can include exercise equipment, group fitness studios, pools, tennis and pickleball courts, a cafe, a spa and spaces for children. Offerings vary by location. Members can also use services such as personal training, swimming lessons, nutrition coaching and assessments. Some services and spaces require an additional fee or a higher membership tier.

Memberships are generally sold month to month without a long-term contract. Base memberships provide access to a selected home center and centers with the same or lower base dues. Signature memberships add access to certain services or spaces that would otherwise require extra payment. Life Time also offers reduced-rate qualified memberships, which may be subsidized through third-party administrators, including medical insurance providers.

The business extends beyond the clubs. Its app offers fitness classes, remote training and wellness support; it also operates athletic events and related services. Life Time Work offers shared workspaces near clubs, while Life Time Living offers wellness-oriented residences. The company sells nutritional products through e-commerce platforms as well.

How it makes money

Life Time earns revenue from membership dues and enrollment fees, purchases made inside its centers, and businesses outside the centers. Its core membership is a recurring monthly subscription, although members can cancel rather than commit to a long-term contract. Base memberships cover general access, while signature memberships include certain services or spaces that would otherwise cost extra. Qualified memberships can be offered at reduced rates and may have restricted hours or locations.

Membership dues and enrollment fees were $2.1 billion in FY2025, representing 70.5% of total revenue. Pricing is set center by center, taking account of factors such as geography, local competition, investment in the center and available amenities. The company also charges enrollment fees and offers an on-hold option for people who want to retain certain benefits without currently using a center.

In-center revenue comes from purchases such as personal training, children’s and aquatics programs, cafe products, spa services and tennis and pickleball programs. Some activities are included in membership tiers, while others carry an additional charge. Life Time has said in-center business has a lower margin than dues revenue.

Outside its centers, the company earns revenue from media, athletic events, race registration and timing, shared workspaces and residences. Center revenue was $2,909 million for the year ended December 31, 2025; total revenue was $893.5 million in Q3 2026. These measures cover different parts of the business.

In Q3 2026, comparable center revenue grew 8.7%. Life Time attributed the growth to changes in membership mix, price, in-center business and volume. The company said personal training and LifeSpa contributed to in-center growth.

Customers and how it sells

Life Time serves individual members as well as couples and families. Its members are primarily located in affluent suburban and urban areas. As of December 31, 2025, the company had nearly 1.6 million individual members comprising nearly 873,000 memberships. Member households had a median income of $160,000, and approximately 60% were part of a couples or family membership.

The company operated 189 athletic clubs across 31 states and one Canadian province. Members generally choose a home center, with access to other locations determined by their membership terms. The company also reaches members through its app, which offers classes, training and wellness content, and through activities such as athletic events.

Life Time has been managing the mix of memberships at its centers. Qualified memberships, some of which are subsidized through medical insurance arrangements, have lower average dues and can have limits on hours or locations. The company is limiting certain qualified medical memberships. At the end of Q3 2026, it had approximately 859,000 center memberships; qualified medical memberships declined by approximately 21,500 year over year, while all other memberships increased by approximately 39,600.

Demand also follows seasonal patterns. Membership growth has generally been greater at the beginning of the year, while some centers see increased membership during the summer pool season. Membership attrition typically rises in the third and fourth quarters.

Suppliers and costs

Life Time’s center operating expenses include salaries, commissions, payroll taxes and benefits, as well as real estate taxes, utilities, repairs, maintenance, supplies and pre-opening costs. Centers are generally staffed with approximately 220 to 260 full-time and part-time employees, depending on activity levels. Personal trainers and other licensed professionals must maintain the relevant professional license or certification.

The company owns and leases its club properties. Approximately 71% of its centers are leased, and rent is reported separately from center operating expenses. Other costs include centralized support functions, marketing, regional management, depreciation and amortization.

Developing new centers requires substantial spending. Life Time uses several arrangements to fund or reduce its investment, including landlord construction reimbursements and sale-leasebacks, in which it sells property and leases it back. It generally expects net invested capital of $25-$30 million per new location on average, after construction reimbursements and net sale-leaseback proceeds.

The company’s liquidity needs also include maintaining and updating centers and equipment, lease requirements, debt service and technology investment. It has historically met those needs through operating cash flow, its revolving credit facility, construction reimbursements and sale-leaseback transactions.

Competitive position

Life Time competes with other health center operators, including Equinox Holdings, The Bay Club Company, Invited, LA Fitness International and 24 Hour Fitness Worldwide. It also identifies smaller clubs and boutique fitness offerings, including Planet Fitness, Anytime Fitness, Snap Fitness, Orange Theory, Barre3 and StretchLab.

Competition extends beyond conventional gyms. Customers can choose community centers, country clubs, racquet-sport facilities, fitness amenities in residential buildings, digital training services or home-use fitness equipment. Life Time also competes with local providers of services such as cafes and salons, as well as providers of co-working spaces, apartments and wellness products.

Life Time says competition varies by market and can depend on the breadth and price of membership offerings, flexibility, quality, brand recognition and scale. It considers its brand, range of products and focus on services and amenities to be competitive advantages. Its trademarks cover the Life Time name and many branded classes, services and products.

Our reading: The combination of facilities and services under one membership provides some differentiation, but customers can buy many individual services elsewhere. Our reading: The club network and access to multiple locations can support member relationships, although the value of that network depends on where a member lives and travels. Our reading: The brand may help distinguish the offering, but month-to-month terms leave members free to cancel.

Growth opportunities

Life Time’s growth plans center on opening clubs, increasing revenue per membership and expanding services used by existing members. The company targets affluent markets and uses a mix of ground-up construction, acquisitions, leases and adaptations of existing space. It seeks construction contributions from landlords and may use sale-leasebacks to reduce the capital invested in a location.

The company has targeted 12 to 14 new locations on average per year starting in 2026. It said it was on track to open 14 new clubs in 2026 and expected to open 14 in 2027, nearly all of which were already under construction. New centers have taken three to four years on average to reach expected performance.

Within existing clubs, Life Time is expanding activities and services including pickleball, personal training, small group training and spa offerings. It also offers MIORA assessments and other wellness services. The company said it had paused MIORA work and was changing an administration and software system that had not worked for its team.

Life Time aims to increase revenue per center membership through its mix of members, dues and in-center offerings. It also continues to invest in its app and personalized digital capabilities, and sells nutritional products more broadly through e-commerce. Beyond clubs, Life Time Work and Life Time Living extend the company into shared workspaces and residences near its centers.

Structural risks

• Membership and pricing: Life Time may be unable to attract or retain members, optimize its membership mix or increase revenue per center membership. Memberships are generally month to month, and competition varies by local market.

• New-center execution: Developing and constructing or remodeling centers requires significant time and capital. Financing, permits, access to sites, labor and materials, inflation and other delays can affect whether centers open on schedule or within budget.

• Debt and leases: Indebtedness, lease obligations and their restrictions could limit financing, investment and flexibility. Debt service and lease payments also require cash that could otherwise fund operations, capital spending or growth.

• Brand and staffing: The business depends on its brand’s quality and reputation. Deterioration could affect market share and results; difficulty retaining key employees or hiring qualified staff could also impede operations and growth.

• Technology and regulation: Life Time relies on technology to deliver connected and digital experiences. It is also subject to laws covering membership contracts, health and safety, licensing, personal information, employment and other aspects of its operations.

Bottom line

Our reading

Life Time is a membership business built around physical clubs, with additional spending on services inside and outside those locations. Its recurring dues and range of amenities support the model, while month-to-month contracts make retaining members important. Expansion depends on developing and financing new centers, and the use of leased property brings continuing obligations alongside the opportunity to grow with less capital invested per location.