Inclusive gym franchise company (NYSE: PLNT) beat Wall Street’s revenue expectations in Q2 CY2026, with sales up 7.1% year on year to $365.2 million. Its non-GAAP profit of $0.88 per share was 3.7% above analysts’ consensus estimates.

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"During the second quarter, we made important progress advancing our strategies to reignite sustainable member growth," said Colleen Keating, Chief Executive Officer.

Company Overview

Founded by two brothers who purchased a struggling gym, Planet Fitness (NYSE: PLNT) is a gym franchise that caters to casual fitness users by providing a friendly and inclusive atmosphere.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Planet Fitness grew its sales at a 23.6% compounded annual growth rate. Though this growth is acceptable on an absolute basis, we need to see more than just topline growth for the consumer discretionary sector, which can display significant earnings volatility. This means our bar for the sector is particularly high, reflecting the non-essential and hit-driven nature of the products and services offered. Additionally, five-year CAGR starts around Covid, when revenue was depressed then rebounded.

We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Planet Fitness’s recent performance shows its demand has slowed as its annualized revenue growth of 12.6% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. Note that COVID hurt Planet Fitness’s business in 2020 and part of 2021, and it bounced back in a big way thereafter.

Planet Fitness also reports same-store sales, which show how much revenue its established locations generate. Over the last two years, Planet Fitness’s same-store sales averaged 5.2% year-on-year growth. Because this number is lower than its revenue growth, we can see the opening of new locations is boosting the company’s top-line performance.

This quarter, Planet Fitness reported year-on-year revenue growth of 7.1%, and its $365.2 million of revenue exceeded Wall Street’s estimates by 2.4%.

Looking ahead, sell-side analysts expect revenue to grow 4.7% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and implies its products and services will see some demand headwinds.

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Operating Margin

Planet Fitness’s operating margin has risen over the last 12 months and averaged 29.6% over the last two years. The company’s higher efficiency is a breath of fresh air, but its suboptimal cost structure means it still sports paltry profitability for a consumer discretionary business.

This quarter, Planet Fitness generated an operating margin profit margin of 33.9%, up 3.9 percentage points year on year. This increase was a welcome development and shows it was more efficient.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.

Planet Fitness’s EPS grew at 45.4% compounded annual growth rate over the last five years, higher than its 23.6% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

In Q2, Planet Fitness reported adjusted EPS of $0.88, up from $0.86 in the same quarter last year. This print beat analysts’ estimates by 3.9%. Over the next 12 months, Wall Street expects Planet Fitness’s full-year EPS to grow 4% from $3.25 to $3.38.

Key Takeaways from Planet Fitness’s Q2 Results

It was encouraging to see Planet Fitness beat analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Overall, this print had some key positives. The market seemed to be hoping for more, and the stock traded down 1.5% to $55.74 immediately after reporting.

So do we think Planet Fitness is an attractive buy at the current price? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).