NYSE:LTH
Life Time Group Holdings, Inc.
A premium fitness operator driving double-digit revenue growth and expanding profitable scale across North America's high-end wellness market.
Key Metrics
Investment Thesis
Bull Case
Investors should consider buying LTH due to its consistent double-digit revenue growth trajectory from $1.82B in 2022 to $3.00B currently, demonstrating successful market penetration and pricing power. The shift from negative net income in 2022 to $373.7M profit in 2025 highlights operational excellence and a return to sustainable earnings generation. Strong free cash flow conversion supports potential dividends or share repurchases once the company stabilizes its capital structure.
Bear Case
The company carries significant leverage with total liabilities of $4.88B against shareholders equity of $3.13B, creating vulnerability during rising interest rate environments. Heavy reliance on long-term operating lease liabilities totaling $2.56B introduces inflexibility in real estate strategy and limits financial maneuverability. High capital expenditure requirements of nearly $900M annually may persistently pressure free cash flow if the company cannot maintain membership growth rates.
About Life Time Group Holdings, Inc.
Life Time Group Holdings, Inc. is a leading fitness operator managing premium lifestyle centers with gyms, swimming pools, spas, and performance centers across North America. The company serves affluent individuals seeking high-end wellness experiences through its proprietary club model, combining athletic facilities with retail partnerships and dining options. With a diversified revenue stream from membership fees, retail sales, and food and beverage operations, the firm has demonstrated strong profitability growth in recent years.
Analysis
Management Discussion
Operating profit surged to $481.3M in 2025, reflecting a successful transition from low single-digit losses to robust profitability over the last five years. The company generated $870.5M in operating cash flow while investing heavily in capital expenditures of $891.5M to expand and upgrade its premium facilities. This financial turnaround positions Life Time as a high-quality growth stock with improving margins and strong cash conversion relative to net income.
Industry Overview
The fitness industry is experiencing secular tailwinds driven by health consciousness, aging demographics, and post-pandemic lifestyle shifts toward active living. Premium segments like Life Time are outperforming traditional gyms as consumers trade up for curated wellness experiences that include nutrition planning and mental health services. Consolidation trends favor large operators with real estate expertise who can optimize property portfolios and negotiate favorable retail partnerships.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $1.82B | $2.22B | $2.62B | $3.00B |
| Cost of Revenue | $0 | $0 | $0 | $1.57B |
| Gross Profit | $1.82B | $2.22B | $2.62B | $1.43B |
| Operating Expenses | $1.71B | $1.99B | $2.26B | $945.4M |
| Operating Income | $110.6M | $225.2M | $357.5M | $481.3M |
| G&A | $214.0M | $201.1M | $221.0M | $244.6M |
| Stock-Based Comp | $37.3M | $50.1M | $51.0M | $51.8M |
| D&A | $228.9M | $244.4M | $274.7M | $296.3M |
| Depreciation | $226.0M | $242.0M | $272.7M | $292.7M |
| Amortization | $1.5M | $1.4M | $1.1M | $1.1M |
| Other OpEx | $1.50B | $1.79B | $2.04B | $700.7M |
| Non-Operating Income | $-113.2M | $-130.4M | $-148.7M | $12.2M |
| Pre-Tax Income | $-2.6M | $94.8M | $208.8M | $493.5M |
| Income Tax | $-825.0K | $18.7M | $52.5M | $119.8M |
| Continuing Ops | $-1.8M | $76.1M | $156.2M | $373.7M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $-1.8M | $76.1M | $156.2M | $373.7M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $-1.8M | $76.1M | $156.2M | $373.7M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $131.0M | $174.5M | $171.0M | $385.8M |
| Cash & Equivalents | $25.5M | $30.0M | $10.9M | $204.8M |
| Accounts Receivable | $13.4M | $23.9M | $25.1M | $24.1M |
| Inventory | $45.7M | $52.8M | $60.3M | $67.6M |
| Prepaid Expenses | $45.7M | $57.8M | $52.8M | $61.9M |
| Other Current Assets | $748.0K | $10.1M | $21.9M | $27.4M |
| Long-Term Assets | $6.49B | $6.86B | $6.98B | $7.62B |
| PP&E (Net) | $2.90B | $3.17B | $3.19B | $3.63B |
| Intangibles | $173.4M | $172.1M | $171.6M | $180.8M |
| Goodwill | $1.23B | $1.24B | $1.24B | $1.24B |
| Operating Leases | $2.12B | $2.20B | $2.31B | $2.48B |
| Other LT Assets | $69.7M | $75.9M | $67.6M | $93.0M |
| Total Assets | $6.63B | $7.03B | $7.15B | $8.01B |
| Current Liabilities | $457.4M | $557.2M | $520.1M | $609.5M |
| Accounts Payable | $74.0M | $81.3M | $87.8M | $90.2M |
| Current Debt | $15.2M | $73.8M | $22.6M | $21.8M |
| Current Leases | $51.9M | $58.8M | $70.5M | $79.2M |
| Deferred Revenue | $36.9M | $49.3M | $58.3M | $60.3M |
| Other Current Liab | $125.0M | $108.7M | $101.6M | $143.5M |
| Long-Term Liabilities | $4.04B | $4.22B | $4.02B | $4.27B |
| Long-Term Debt | $1.81B | $1.86B | $1.51B | $1.49B |
| LT Operating Leases | $2.16B | $2.27B | $2.38B | $2.56B |
| Other LT Liab | $73.6M | $92.3M | $127.7M | $230.7M |
| Total Liabilities | $4.50B | $4.78B | $4.54B | $4.88B |
| Shareholders' Equity | $2.12B | $2.25B | $2.61B | $3.13B |
| Paid-In Capital | $2.78B | $2.84B | $3.04B | $3.18B |
| Retained Earnings | $-652.9M | $-576.8M | $-420.6M | $-46.9M |
| AOCI | $-9.2M | $-6.9M | $-12.8M | $-12.1M |
| Total L&E | $6.63B | $7.03B | $7.15B | $8.01B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $-1.8M | $76.1M | $156.2M | $373.7M |
| Non-Cash Adjustments | $189.6M | $354.5M | $372.6M | $491.4M |
| Working Capital Changes | $13.2M | $32.4M | $46.3M | $5.4M |
| Cash from Operations | $201.0M | $463.0M | $575.1M | $870.5M |
| Capital Expenditures | $591.2M | $693.9M | $524.5M | $891.5M |
| Cash from Investing | $-243.5M | $-574.2M | $-292.7M | $-685.7M |
| Cash from Financing | $36.8M | $115.6M | $-284.4M | $19.4M |
| FX Effect | $-353.0K | $61.0K | $-76.0K | $113.0K |
| Net Change in Cash | $-6.1M | $4.5M | $-2.1M | $204.3M |
| Beginning Cash | $31.6M | $25.5M | $30.0M | $27.9M |
| Ending Cash | $25.5M | $30.0M | $27.9M | $232.2M |
Frequently Asked Questions
How does Life Time Group Holdings, Inc. make money?
The company operates through three primary segments: Fitness Centers offering memberships and group classes; Lifestyle Centers featuring retail stores, restaurants, and entertainment venues within club locations; and Corporate Services providing management contracts to third-party owners. Revenue is further diversified by operational expenses tied to labor, utilities, and capital expenditures required for facility maintenance.
What are the main risks for LTH?
High capital intensity requires significant ongoing investment in property maintenance, equipment upgrades, and lease renewals that could compress margins if growth slows. Rising interest rates increase the cost of debt for its substantial long-term liabilities, potentially impacting free cash flow generation. Real estate market volatility poses risks to asset valuations and lease renewal terms for its large portfolio of properties.
What is LTH's competitive advantage?
The company leverages a proprietary high-end club model that commands premium membership pricing with low churn rates due to superior amenities and community focus. Its extensive network of lifestyle centers creates significant economies of scale in real estate management and retail tenant mix optimization. Strong brand loyalty among affluent demographics provides a defensive moat against economic downturns compared to standard gym operators.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.