US gym memberships hit a record high in 2025. That headline is real, and the consumer demand behind it is genuine. But if you're a franchise operator or a prospective buyer eyeing a gym franchise deal before 2027, that number tells you almost nothing about whether your unit will survive.
The more instructive data point sits inside Anytime Fitness's domestic footprint. The brand recorded a net decline in US franchised locations across three consecutive years through 2026, with individual closures still posting as recently as November 2026. That's not a blip. That's a structural signal worth reading carefully.
Two Numbers, One Dangerous Misread
When an industry reports record membership, the natural instinct is to assume the rising tide lifts all boats. That instinct is wrong here, and understanding why is the most valuable thing you can do before signing a franchise agreement or renewing a lease.
Record memberships reflect category-level demand. They measure how many Americans hold at least one gym membership, a figure that has climbed steadily as post-pandemic fitness habits normalized and diversified. What they don't measure is where those members are spending, how much they're spending, or whether the economics of serving them work at the unit level.
Anytime Fitness operates roughly 2,600 domestic locations at its peak. A net decline across three straight years means closures are outpacing new openings, even as the parent company, Self Esteem Brands, continues expanding internationally. The global story and the US franchisee story are two different stories, and conflating them is expensive.
What's Actually Squeezing Franchisees
Three cost vectors are compressing margins at the unit level, and they're moving simultaneously.
First, occupancy costs. Commercial real estate in secondary and tertiary markets, the bread and butter of a brand like Anytime Fitness, did not cool the way some operators expected. Landlords who restructured leases during 2020 and 2021 have largely reset to market rates or above. A franchisee who locked in favorable terms five years ago is now renegotiating from a weaker position.
Second, labor. Even in a 24-hour access model where staffing is lighter than a full-service gym, labor costs for the front desk, cleaning, and management roles have risen materially. In many US metros, minimum wage increases have added $40,000 to $80,000 annually to a single-location payroll depending on headcount and state law.
Third, competitive intensity. PE-backed value chains, specifically Planet Fitness and its imitators, have continued aggressive expansion, driving membership price expectations down in overlapping markets. At the same time, the PE gym roll-up dynamic in 2026 has created well-capitalized regional operators who can undercut on price and outspend on marketing. A franchisee with one or two locations doesn't have that leverage.
The Median Is Not Your Friend
The Health and Fitness Association's 2026 Benchmarking Report, drawn from 244 operators, puts median EBITDA at 22.1%. That number circulates at industry conferences and gets quoted in franchise disclosure conversations. It sounds healthy. It probably isn't relevant to your situation.
Medians, by definition, hide the distribution. At 22.1%, the median operator is doing fine. But the bottom quartile, the operators sitting below the median, is where franchise stress is concentrated. Those locations may be running EBITDA margins in the single digits or running negative, depending on their local cost structure and competitive set.
Franchise disclosure documents in the US are required to include financial performance representations, but they're not required to show you the bottom quartile breakdown in a format that's immediately useful. You need to ask for it explicitly, and you need to model your own unit against the low end of the range, not the median.
The divergence between global brand health and unit-level economics is not unique to fitness. It's the same pattern showing up across franchised categories. But in gym franchising, the fixed-cost structure, long lease terms, and equipment financing create a particularly compressed runway when revenues soften.
Digital Pressure Is Not a Future Problem
Some operators still treat AI-powered fitness apps as a distant threat. That framing is outdated. Peloton's difficulties distracted attention from a broader shift: the app layer of the fitness market has matured, and AI-personalized programming is now genuinely good enough to retain members who might otherwise upgrade to or maintain a gym membership.
The more sophisticated pressure is coming from strength tech startups targeting the gym floor directly, with hardware and software products that make home and boutique training more effective and trackable. When a member can get progressive overload programming, form feedback, and performance data from an app or a connected device at home, the value proposition of a $30-per-month access gym narrows.
This doesn't mean access gyms are going away. It means that member churn driven by app alternatives is now a real line item in your attrition modeling, not a theoretical one. If your location runs 15% annual attrition today, you should be stress-testing for 20% to 25% under a scenario where AI app adoption accelerates among your core 25-to-40-year-old demographic.
Three Scenarios Every Operator Must Model Before 2027
If you're operating a franchise unit or evaluating one, here are the three scenarios your financial model needs to survive before you make a commitment.
- Continued PE roll-up price pressure. Assume a well-capitalized competitor opens within two miles of your location and prices at $10 to $15 per month. Model the member bleed, the pricing response you can realistically make, and what that does to your revenue per member. If your lease and royalty structure don't survive a 15% revenue decline, that's your answer.
- Further labor cost increases. Model a 10% year-over-year increase in total labor spend for two consecutive years. In states with indexed minimum wage laws, that's not a pessimistic scenario. It's plausible baseline planning. Know exactly which operating line breaks first.
- Accelerated member churn from digital alternatives. Model attrition at 5 percentage points above your current rate. Calculate the marketing spend required to replace those members at your current cost of acquisition, and assess whether that spend is fundable from operating cash flow or requires a draw on reserves.
If your unit economics don't survive any two of these three scenarios simultaneously, you're carrying more risk than the brand's global headline numbers suggest.
What the M&A Signal Tells You
It's worth watching what sophisticated capital is actually doing in this market, not what it's saying. PureGym's $315 million acquisition of Nonstop Gym in Switzerland and the broader European fitness M&A wave in 2026 share a common thesis: scale matters, and sub-scale operators are exit opportunities, not growth platforms.
When PE-backed consolidators buy gym portfolios, they're betting on operational leverage at scale, not on individual unit economics improving organically. That's a meaningful signal for the solo operator or the two-to-three-unit franchisee. You're not the beneficiary of that thesis. You're often the acquisition target, and acquisition multiples for underperforming units are not generous.
Multi-unit operators with five or more locations are better positioned to absorb fixed-cost pressure, negotiate better supply terms, and attract the kind of GM-level talent that improves retention and operations. Multi-unit franchise incentive structures in 2026 reflect this reality, with brands increasingly designing their economics to favor operators who can commit to scale upfront.
The Structural Fault Line
Record memberships are a real and meaningful indicator of category health. They tell you that Americans are willing to spend on fitness, that the behavior has normalized across demographics, and that the total addressable market is not shrinking. That's genuinely good news at the industry level.
But it doesn't protect an individual franchisee whose occupancy cost increased 18% at renewal, whose labor line is up $60,000 year over year, and who is now competing with a $10-per-month planet-branded box that opened six months ago. The macro tailwind and the unit-level headwind can coexist, and in this market, they clearly do.
The operators who will be in a strong position by 2027 are the ones who stress-test honestly, model conservatively, and don't mistake brand awareness for unit viability. The record membership headline is worth reading. It's just not worth betting your lease on.