{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "XPOF",
  "name": "Xponential Fitness, Inc.",
  "url": "https://frontierpicks.com/dossiers/XPOF/",
  "json_url": "https://frontierpicks.com/dossiers/XPOF.json",
  "status": "DORMANT",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a5",
    "n": 5
  },
  "current_thesis": "Xponential Fitness's weak third quarter (same-store sales down 7.5%) undercuts the business behind Fund 1's $5.61–$7.00 cash proposal, so the shares are more likely to lag the S&P 500 unless the board's review yields a signed or financed deal.",
  "invalidation_trigger": "A daily close above $5.90, the 200-day average of closes as of 2026-11-11, which would show the shares leading the S&P 500. A signed merger agreement at or above $5.61 per share would also show the shares leading.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "m-and-a-special-situations"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "Xponential Fitness, Inc. - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0001802156/000119312526449959/d137051dex991.htm",
      "date": "2026-11-05"
    },
    {
      "title": "Xponential Fitness (XPOF) Q3 2026 Earnings Call: Revenue Falls 21%, Guidance Updated",
      "url": "https://www.tradingkey.com/news/transcripts/262285945-",
      "date": null
    },
    {
      "title": "Xponential Fitness (NYSE:XPOF) misses Q3 2026 revenue estimates, stock drops",
      "url": "https://finance.yahoo.com/markets/stocks/articles/xponential-fitness-nyse-xpof-misses-214308976.html",
      "date": "2026-11-05"
    },
    {
      "title": "News analysis",
      "url": "https://franchiseinvestordata.com/news/xponential-fitness-take-private-bid-stretchlab/",
      "date": null
    },
    {
      "title": "ocbj.com",
      "url": "https://www.ocbj.com/retail/xponential-shareholder-considers-takeover-bloomberg/",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter revenue fell 21% to $62.3 million from $78.8 million; adjusted EBITDA fell 27% to $24.3 million.",
      "source": "Q3 2026 earnings release (8-K exhibit 99.1)",
      "as_of": "2026-11-05"
    },
    {
      "claim": "North America same-store sales fell 7.5% in the third quarter, versus a 0.8% decline a year earlier; Club Pilates same-store sales fell 5.6%.",
      "source": "Q3 2026 earnings release; TradingKey transcript of 2026-11-05 call",
      "as_of": "2026-11-05"
    },
    {
      "claim": "2026 net new studio guidance was cut to 124–130 from about 150; adjusted EBITDA guidance narrowed to $91.0–$94.0 million from $91.0–$97.0 million; revenue guidance stayed at $250.0–$260.0 million.",
      "source": "Q3 2026 earnings release (8-K exhibit 99.1)",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Long-term debt was $521.1 million and cash, equivalents and restricted cash were $27.2 million; operations used $21.1 million of cash in the first nine months of 2026.",
      "source": "Q3 2026 earnings release (8-K exhibit 99.1)",
      "as_of": "2026-09-30"
    },
    {
      "claim": "The board's strategic review with Jefferies continues and may lead to a sale or merger; the company does not intend to comment further until it concludes, and the release does not name Fund 1.",
      "source": "Q3 2026 earnings release (8-K exhibit 99.1)",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Fund 1 Investments delivered a non-binding proposal to take Xponential private at $5.61 to $7.00 per share in cash, at least 50% above the $3.74 close of 2026-10-29.",
      "source": "Schedule 13D/A Amendment No. 4, Fund 1 Investments, LLC",
      "as_of": "2026-10-30"
    },
    {
      "claim": "Fund 1 Investments beneficially owns 4,170,610 Class A shares (9.9%) and says it would seek a waiver of the rights plan to work with other holders.",
      "source": "Schedule 13D/A Amendment No. 4, Fund 1 Investments, LLC",
      "as_of": "2026-10-30"
    },
    {
      "claim": "The company filed its Form 10-Q for the quarter ended 2026-09-30 with the SEC.",
      "source": "SEC EDGAR filing list, Xponential Fitness, Inc.",
      "as_of": "2026-11-09"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Consumer Cyclical",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
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              "end": "2026-09-30",
              "filed": "2026-11-09",
              "restated": null,
              "value_musd": 2.9,
              "yoy_pct": 23.4
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-07",
              "restated": null,
              "value_musd": 2.7,
              "yoy_pct": -1
            },
            {
              "end": "2026-03-31",
              "filed": "2026-05-08",
              "restated": null,
              "value_musd": 2.2,
              "yoy_pct": -17.4
            },
            {
              "end": "2025-12-31",
              "filed": "2026-03-04",
              "restated": null,
              "value_musd": 3.4,
              "yoy_pct": 8.8
            },
            {
              "end": "2025-09-30",
              "filed": "2025-11-10",
              "restated": null,
              "value_musd": 2.4,
              "yoy_pct": -37.4
            },
            {
              "end": "2025-06-30",
              "filed": "2025-08-08",
              "restated": null,
              "value_musd": 2.7,
              "yoy_pct": -22
            }
          ]
        },
        "gross_margin": {
          "status": "not reported"
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-09",
              "restated": null,
              "pct": 664
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-07",
              "restated": null,
              "pct": 352
            },
            {
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              "restated": null,
              "pct": 603.3
            },
            {
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              "filed": "2026-03-04",
              "restated": null,
              "pct": -244.6
            },
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              "filed": "2025-11-10",
              "restated": null,
              "pct": 149.6
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              "end": "2025-06-30",
              "filed": "2025-08-08",
              "restated": null,
              "pct": 542.8
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 5
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "four_quarters_end": "2026-09-30",
          "value_musd": 4.2,
          "four_quarters_musd": -33.5
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "first_end": "2025-12-31",
          "value_musd": -10.4
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "first_end": "2025-12-31",
          "value_musd": 1.8
        },
        "free_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "first_end": "2025-12-31",
          "value_musd": -12.2
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "base_end": "2025-09-30",
          "pct": 40.3
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 27.2
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 521.1,
          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": -493.9
        },
        "deferred_revenue": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 81.4,
          "yoy_pct": -21.1
        },
        "backlog": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 71.7,
          "yoy_pct": -20.1
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 14.8
        },
        "inventory": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": 5.3
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-09",
          "value_musd": -316.3
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-09",
          "value_musd": 231.6
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-09",
          "value_musd": 725.5
        },
        "ev_sales": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-09",
          "multiple": 65
        },
        "ev_ebit": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-09",
          "multiple": 21.4
        },
        "pe": {
          "status": "not meaningful"
        },
        "pb": {
          "status": "not meaningful"
        },
        "fcf_yield": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-09",
          "pct": -5.3
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 24.67,
      "days_to_cover": 13.3,
      "change_pct": 11.4
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 964078,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\n\nXponential Fitness's third-quarter report weakened the business behind Fund 1 Investments' $5.61 to $7.00 per share cash proposal, and the board has given the proposal no public answer. The shares are more likely to lag the S&P 500 than lead it over the next three months. A signed or financed deal from the board's strategic review would settle it the other way.\n\nThe 2026-11-05 release reported North America same-store sales down 7.5%, a cut to 2026 net new studio guidance to 124–130 from about 150, and a narrowing of adjusted EBITDA guidance to $91.0–$94.0 million from $91.0–$97.0 million. EBITDA is earnings before interest, taxes, depreciation and amortization. The company said it does not intend to comment further on the review until it concludes, and it did not name Fund 1.\n\nThe shares closed at $4.79 on 2026-11-11, under the $5.61 low end of Fund 1's range. They have recovered from the $4.42 close of 2026-11-05, the day of the report. The company filed its third-quarter Form 10-Q with the SEC on 2026-11-09.\n\n## Bull Case\n\n- **A cash proposal remains on the table.** Fund 1's Schedule 13D/A of 2026-10-30 proposes $5.61 to $7.00 per share in cash, at least 50% above the $3.74 close of 2026-10-29. No withdrawal or board rejection had been reported as of 2026-11-12.\n- **The sale process is still open.** The 2026-11-05 release says the board, led by independent directors and advised by Jefferies, is reviewing alternatives that may include a sale or merger.\n- **Large holders favor a transaction.** Fund 1 reported 4,170,610 Class A shares, or 9.9%, on 2026-10-30 and said it would seek a waiver of the company's rights plan to work with other holders. Voss Capital called for a sale in an open letter in March 2026.\n- **The profit floor in guidance survived.** The company kept the low end of 2026 adjusted EBITDA at $91.0 million on 2026-11-05. Revenue guidance stayed at $250.0 to $260.0 million.\n- **Club Pilates economics remain strong.** Management said on the 2026-11-05 call that average sales per Club Pilates studio exceed $1 million, according to a TradingKey transcript. It attributed the brand's 5.6% same-store decline mainly to new-member acquisition rather than retention.\n\n## Bear Case\n\n- **Studio sales fell faster.** North America same-store sales fell 7.5% in the third quarter, against a 0.8% decline a year earlier, per the 2026-11-05 release.\n- **Guidance came down again.** On 2026-11-05 the company cut 2026 net new studio openings to 124–130 from about 150 and narrowed the top of its adjusted EBITDA range by $3.0 million.\n- **The quarter missed estimates.** Revenue fell 21% to $62.3 million, against a $63.0 million estimate, and adjusted earnings of $0.04 a share missed an $0.11 estimate, per Benzinga on 2026-11-05. Adjusted EBITDA fell 27% to $24.3 million.\n- **No relief is signaled yet.** Management modeled fourth-quarter sales at levels similar to the third and declined to discuss current-quarter same-store sales, according to the TradingKey transcript of the 2026-11-05 call.\n- **Debt is heavy against shrinking cash flow.** At 2026-09-30 the company reported $521.1 million of long-term debt and $27.2 million of cash, equivalents and restricted cash. Operations used $21.1 million of cash in the first nine months of 2026.\n- **The proposal is non-binding and unanswered.** The 2026-10-30 filing discloses no financing commitments, and the 2026-11-05 release does not mention Fund 1.\n\n## Setup & Price Structure\n\nThe shares closed at $4.79 on 2026-11-11, after $4.59 on 2026-11-10, $4.74 on 2026-11-09, $4.65 on 2026-11-06 and $4.42 on 2026-11-05. The 3-month change is −1.6%, measured from the $4.87 close of 2026-08-13.\n\nThe last close sits above the 50-day average of closes at $4.38 and well below the 200-day average of closes. The 52-week high is $9.25 (intraday, 2026-02-02), and the last close is 48.2% below it. The 52-week closing low is $3.65 on 2026-09-18.\n\nThe market price reflects a partial chance of a deal: the shares closed at $3.74 on 2026-10-29, before the Bloomberg report and Fund 1's filing, and at $4.79 on 2026-11-11, still below the low end of the proposed range.\n\nSEC Form 4 filings show only director share grants dated 2026-10-01, filed 2026-10-15, and a CEO tax withholding on 2026-08-07, filed 2026-08-27. They show no open-market insider purchases. UBS's $4.50 target with a Neutral rating, reported by Benzinga on 2026-09-16, predates both the proposal and the third-quarter report.\n\n## Catalyst Calendar\n\n- **not yet scheduled:** Board response to Fund 1's $5.61–$7.00 take-private proposal. A special committee or opened talks would support a move toward the proposed range; a rejection would remove the premium.\n- **not yet scheduled:** Conclusion of the strategic review led by independent directors with Jefferies. The company says it will not comment further until then, so this decides whether any sale or merger follows.\n- **~2027-02-26 (est.):** Fourth-quarter 2026 report. Tests management's model of fourth-quarter sales similar to the third and whether same-store sales improve from the 7.5% decline.\n\n## What Would Change Our Mind\n\nA daily close above $5.90, the 200-day average of closes as of 2026-11-11, which would show the shares leading the S&P 500. A signed merger agreement at or above $5.61 per share would also show the shares leading.\n\n## Correlation Notes\n\nThe shares trade mainly on the outcome of the board's review and on Fund 1's next filing. The 2026-10-30 jump of 19.5% intraday to $4.47 came on Bloomberg's report and the 13D/A, not on a company result, per Benzinga.\n\nBoutique fitness demand is the second driver. Management cited card-spending figures on the 2026-11-05 call showing a wider slowdown in the third quarter than in the first half of 2026. With $521.1 million of long-term debt, the equity also depends on lenders' willingness to finance any buyout.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-12T17:31:33+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}