Planet Fitness stock plunges after company slashes guidance

shares Planet Sport It fell more than 30% on Thursday after the company reported a shortage in records and lowered its guidance.

The stock was having its worst day in history as of midday trading.

Despite 21.9% revenue growth and 3.5% same-club sales growth in the fitness company’s first fiscal quarter, CEO Colleen Keating said the company saw “a slower than expected start from a net member growth perspective.”

“As a result, we are sharpening our marketing to prioritize capturing demand and driving net member growth,” Keating said in a statement. “We are also halting the planned national Black Card price increase pending a wider pricing review.”

The first fiscal quarter is typically the company’s busiest booking period. Keating said “internal and external headwinds” were taking a toll on the company’s performance.

Planet Fitness lowered its revenue growth forecast to 7% from the previous forecast of 9%. It also expects same-club sales to increase only 1% compared to previous expectations of 4% to 5%, and adjusted net income to decrease 2% compared to the previous expected increase of 4% to 5%.

On a call with analysts Thursday, Keating said four factors affected the company’s first-quarter performance: lack of marketing resonance, competition in some markets, bad weather and macroeconomic pressures.

“We are making immediate, short-term adjustments to expand our reach and ensure our messages are both visible and resonate with fitness newbies and more casual gymgoers,” Keating said on the call.

Keating also reaffirmed his confidence in the company’s long-term return to growth strategy. He said Planet Fitness is focused on increasing member recruitment and strengthening affordability this year.

“Looking at data from Q4 last year and Q1 this year, we found that our messaging and targeting were successful in driving increased penetration among fitness-savvy consumers, but we may still have gone too far,” he said.