Planet Fitness, Inc.PLNT
Planet Fitness, Inc. Income Taxes Disclosure
Income taxes
The Company adopted ASU No. 2023‑09, Improvements to Income Tax Disclosures, effective for the fiscal year ended December 31, 2025. In accordance with the transition guidance, the Company applied the amendments prospectively. As a result, the disclosures required by ASU 2023‑09 are presented for fiscal year 2025 only and prior periods have not been restated.
Income before the provision for income taxes as shown in the accompanying consolidated statements of operations is as follows:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Domestic | $ | 318,968 | $ | 249,145 | $ | 205,890 | |||||||||||
| Foreign | (9,990) | (2,417) | 1,651 | ||||||||||||||
Total income before the provision for income taxes | $ | 308,978 | $ | 246,728 | $ | 207,541 | |||||||||||
The provision for income taxes consists of the following:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Current: | |||||||||||||||||
| Federal | $ | 7,143 | $ | 4,752 | $ | 2,338 | |||||||||||
| State | 13,386 | 6,743 | 3,853 | ||||||||||||||
| Foreign | 1,469 | 1,259 | 1,132 | ||||||||||||||
Total current tax expense | 21,998 | 12,754 | 7,323 | ||||||||||||||
| Deferred: | |||||||||||||||||
| Federal | 63,631 | 47,338 | 41,010 | ||||||||||||||
| State | 299 | 8,516 | 10,136 | ||||||||||||||
| Foreign | (54) | (165) | 43 | ||||||||||||||
| Total deferred tax expense | 63,876 | 55,689 | 51,189 | ||||||||||||||
| Provision for income taxes | $ | 85,874 | $ | 68,443 | $ | 58,512 | |||||||||||
The Company is the sole managing member of Pla-Fit Holdings, which is treated as a partnership for U.S. federal and certain state and local income taxes. As a partnership, Pla-Fit Holdings is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Pla-Fit Holdings is passed through to and included in the taxable income or loss of its members, including the Company, on a pro rata basis. Planet Fitness, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income of Pla-Fit Holdings. The Company is also subject to taxes in certain foreign jurisdictions.
The following table provides a reconciliation of the U.S. statutory income tax rate to the Company’s provision for income taxes and respective effective tax rate disaggregated by required category for the year ended December 31, 2025 in accordance with ASU 2023‑09.
Year Ended December 31, | |||||||||||
| 2025 | |||||||||||
| (in thousands) | Amount | Tax Rate % | |||||||||
| U.S. federal statutory income tax rate | $ | 65,067 | 21.0 | % | |||||||
| Domestic federal: | |||||||||||
| Nontaxable or non-deductible items | 2,887 | 0.9 | % | ||||||||
| Change in valuation allowance | 1,432 | 0.5 | % | ||||||||
| Effect of cross-border tax laws | (262) | (0.1) | % | ||||||||
| Other reconciling items | 453 | 0.2 | % | ||||||||
| Domestic state and local taxes, net of federal benefit | 12,056 | 3.9 | % | ||||||||
| Foreign tax effects: | |||||||||||
| Spain: | |||||||||||
| Change in valuation allowance | 2,520 | 0.8 | % | ||||||||
| Other foreign jurisdictions | 1,537 | 0.5 | % | ||||||||
| Worldwide changes in unrecognized tax benefits | 183 | 0.1 | % | ||||||||
| Effective tax rate | $ | 85,874 | 27.8 | % | |||||||
The majority of the Company's domestic state and local income taxes impacting the effective tax rate in the table above relates to New York, Florida, California and New Hampshire.
A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows:
| Years Ended December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| U.S. statutory tax rate | 21.0 | % | 21.0 | % | |||||||
| State and local taxes, net of federal benefit | 4.6 | % | 4.2 | % | |||||||
| State rate change impact on deferred taxes | (0.3) | % | 1.4 | % | |||||||
| Tax benefit arrangement liability adjustment | 0.1 | % | (0.2) | % | |||||||
| Foreign tax rate differential | 0.1 | % | 0.1 | % | |||||||
| Withholding taxes and other | 1.4 | % | 0.8 | % | |||||||
| Change in valuation allowance | 0.5 | % | 0.3 | % | |||||||
| Equity-based compensation | (0.1) | % | (0.1) | % | |||||||
Non-deductible executive compensation | 0.6 | % | 1.6 | % | |||||||
| Income attributable to non-controlling interests | (0.2) | % | (0.9) | % | |||||||
| Effective tax rate | 27.7 | % | 28.2 | % | |||||||
Deferred income taxes are provided for the effects of temporary differences between the tax basis of an asset or liability and its reported amount in the accompanying consolidated balance sheets. These temporary differences result in taxable or deductible amounts in future years. Details of the Company’s deferred tax assets and liabilities are summarized as follows:
| As of December 31, | |||||||||||
| (in thousands) | 2025 | 2024 | |||||||||
| Deferred tax assets: | |||||||||||
| Deferred revenue | $ | 7,332 | $ | 6,814 | |||||||
| Goodwill and intangible assets | 404,531 | 452,587 | |||||||||
| Net operating loss | 8,295 | 22,825 | |||||||||
| Lease liabilities | 114,475 | 113,194 | |||||||||
| Equity-based compensation | 1,490 | 2,557 | |||||||||
Equity method investment | 3,553 | 3,486 | |||||||||
| Allowance for current expected credit loss | 6,259 | 4,769 | |||||||||
| Other | 4,839 | 3,293 | |||||||||
| Deferred tax assets | 550,774 | 609,525 | |||||||||
| Valuation allowance | (10,380) | (6,579) | |||||||||
| Deferred tax assets, net of valuation allowance | 540,394 | 602,946 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Property and equipment | (37,024) | (37,133) | |||||||||
| Right of use assets | (97,823) | (97,002) | |||||||||
| Total deferred tax liabilities | (134,847) | (134,135) | |||||||||
| Total deferred tax assets and liabilities | $ | 405,547 | $ | 468,811 | |||||||
| Reported as: | |||||||||||
| Deferred income taxes - non-current assets | $ | 406,724 | $ | 470,197 | |||||||
| Deferred income taxes - non-current liabilities | (1,177) | (1,386) | |||||||||
| Total deferred tax assets and liabilities | $ | 405,547 | $ | 468,811 | |||||||
As of December 31, 2025, we had a net deferred tax asset of $405.5 million, primarily resulting from tax attributes generated from past exchanges of Holdings Units which will reduce taxable income in future periods. Substantially all of our deferred tax assets are deemed to be more likely than not to be realized. In assessing the need for a valuation allowance, we consider, among other things, our recent history of generating positive income before taxes, projections of future taxable income and ongoing prudent and feasible tax planning strategies. For the years ended December 31, 2025 and 2024, the Company has continued to provide a valuation allowance of $10.4 million and $6.6 million, respectively, against the portion of its deferred tax assets that the Company does not have sufficient positive evidence to support its recoverability.
As of December 31, 2025, the Company had federal net operating loss carryforwards of $7.5 million, with an indefinite lived carryforward. These losses were generated in 2020 and 2021. The Company also has $50.2 million of state net operating loss carryforwards of which $49.1 million have various expirations from 2026 to 2041 and $1.1 million are indefinite.
The following table presents a reconciliation of the beginning and ending balances of the liability for unrecognized tax benefits, excluding interest and penalties, which is included within other liabilities on our consolidated balance sheets:
| As of December 31, | |||||||||||
| (in thousands) | 2025 | 2024 | |||||||||
| Balance at beginning of year | $ | 297 | $ | 273 | |||||||
| Increase related to current year tax positions | 162 | 59 | |||||||||
| Decrease related to prior year tax positions | — | (35) | |||||||||
| Balance at end of year | $ | 459 | $ | 297 | |||||||
The Company and its subsidiaries file U.S. federal income tax returns, as well as tax returns in various state and foreign jurisdictions. Generally, the tax years 2022 through 2025 remain open to examination by the tax authorities in these jurisdictions.
The following table provides details of cash paid for income taxes, net of refunds received, disaggregated by federal, state and foreign jurisdictions for the year ended December 31, 2025 in accordance with ASU 2023‑09. Significant individual jurisdictions are disclosed separately, while all others are aggregated.
For the Year Ended December 31, | |||||
| (in thousands) | 2025 | ||||
| U.S. Federal | $ | 9,140 | |||
| U.S. State & Local | |||||
| California | 1,510 | ||||
| Florida | 1,415 | ||||
| New Hampshire | 1,236 | ||||
| Other U.S. state and local jurisdictions | 5,594 | ||||
| Total U.S. State & Local | 9,755 | ||||
| Foreign | 2,555 | ||||
| Net cash paid for income taxes | $ | 21,450 | |||
The Company paid cash of $12.1 million and $5.3 million for income taxes, net of refunds received, during the years ended December 31, 2024 and 2023, respectively.
Tax benefit arrangements
The Company recorded other expense of $2.4 million and $1.3 million and other income of $2.0 million in the years ended December 31, 2025, 2024 and 2023, respectively, reflecting a change in the tax benefit obligation attributable to a change in the expected tax benefits. In each year, the remeasurement was primarily due to various state tax legislation changes enacted in the year and in 2022 was also due to the Sunshine Acquisition which resulted in a change in the amount of income apportioned to various states in future periods and accordingly resulted in a decrease to the tax benefit arrangement liability.
Certain existing holders of Holdings Units exercised their exchange rights and exchanged Holdings Units for newly-issued shares of Class A common stock, resulting in an increase in the tax basis of the net assets of Pla-Fit Holdings. As a result of these exchanges and other activity, the Company recognized deferred tax assets and tax benefit arrangement liabilities, each recorded with offsets to additional paid-in-capital within stockholders’ deficit, as summarized below:
Years Ended December 31, | |||||||||||
| (in thousands, except share amounts) | 2025 | 2024 | |||||||||
| Holding units exchanged | 25,713 | 1,055,326 | |||||||||
| Net deferred tax assets | $ | 749 | $ | 21,835 | |||||||
Tax benefit arrangement liabilities(1) | $ | 732 | $ | 14,899 | |||||||
(1) Represents approximately 85% of the tax benefit generated by TRA Holders who exchanged shares and participate in the tax benefit arrangements.
The tax benefit obligation was $415.8 million and $466.9 million as of December 31, 2025 and 2024, respectively.
Projected future payments under the tax benefit arrangements are as follows:
| (in thousands) | Amount | ||||
| 2026 | $ | 55,518 | |||
| 2027 | 41,498 | ||||
| 2028 | 42,612 | ||||
| 2029 | 44,442 | ||||
| 2030 | 47,103 | ||||
| Thereafter | 184,618 | ||||
| Total | $ | 415,791 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Mar 1, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Mar 1, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Mar 6, 2017 | |
| 2015 | Mar 4, 2016 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.