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Xponential Sells Row House To Streamline Boutique Fitness Portfolio

Xponential Sells Row House To Streamline Boutique Fitness Portfolio

The fitness and wellness franchisor says divesting from the indoor rowing brand will allow it to put more “time and resources on the brands that best fit our portfolio”

Xponential Fitness has completed the divestiture of indoor rowing brand Row House to emerging health and wellness franchisor Extraordinary Brands, which follows a similar move Xponential made earlier this year with the sale of Stride Fitness.

Extraordinary Brands currently counts purvelo cycle as one of its boutique fitness brands, while its barre, Pilates, HIIT and yoga categories will be “franchising soon,” according to its website. 

“The divestiture of Row House will further allow us to prioritize our time and resources on the brands that best fit our portfolio,” said Xponential Fitness interim CEO Brenda Morris. “We look forward to continuing to provide a high level of support for our franchisees as we execute against our strategic growth drivers.”

Terms of the deal weren’t disclosed.

Xponential acquired Row House in 2017, and as of December 2023, the indoor rowing brand had 78 studios in operation and 327 licenses sold globally. According to Xponential, the divestiture of Row House is not expected to materially impact revenue or EBITDA in 2024, and its 2024 guidance remains unchanged.

New Beginnings for Row House

Row House co-founder Debra Strougo thanked Xponential for its contributions to the brand but told Athletech News that the change in ownership represents a “huge opportunity” for Row House.

“Xponential has been a great owner of Row House and has taken it this far,” Strougo told ATN, adding that Extraordinary Brands should provide a new spark for the brand as it looks to continue growing.

“It is an opportunity to reset, reignite and re-energize the passionate Row House crew and to give it the love and amplification it needs to continue affecting lives in the deep and meaningful way that it does,” Strougo said. “The Row House community has saved people from suicide, addiction, massive health-related issues like heart disease, high blood pressure and much, much more.”

Xponential Narrows Its Focus, Eyes Wellness

Earlier this week, Xponential, known for its boutique fitness and wellness brands including Club Pilates, Pure Barre and StretchLab, announced the departure of CEO Anthony Geisler, who founded the company in 2017. The move comes as Xponential received a notice of investigation by the United States Attorney’s Office for the Central District of California on May 7 and has been the subject of an SEC investigation, which the franchisor disclosed late last year. 

The boutique fitness and wellness franchisor is now searching for a permanent CEO to replace Geisler.

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In February, Xponential completed the divestiture of Stride Fitness, its treadmill-based interval training brand.

In an email to franchise partners confirming the transition of Stride to a private owner, Xponential president Sarah Luna wrote that the decision was “thoughtfully considered” as Xponential “weighed the needs of the brand.” The boutique fitness and wellness franchisor noted that as of December 2023, its Stride Fitness locations represented less than 1% of its total studios open.

Xponential offloaded Stride Fitness in February (credit: Xponential Fitness)

The deals to offload Stride and Row House seem to signify Xponential’s desire to streamline its portfolio as it embarks on its restructuring plan which began in Q3 2023 and involves exiting company-owned transition studios and “other measures designed to reduce costs” to achieve long-term margin goals and focus on “pure franchise operations.”

While Xponential’s portfolio of brands gets slimmer, its newest acquisition, Lindora, is looking to help its members do the same. The chain of metabolic health clinics provides hormone replacement therapies and GLP-1 weight-loss drugs. Lindora had sold nearly 40 licenses as of March and is attracting franchisees from diverse backgrounds.

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