Anthony Geisler, Founder and CEO of Xponential Fitness (NYSE:XPOF), a boutique gym franchisor, is facing heavy accusations from Fuzzy Panda Research. As a result, XPOF stock is down substantially in today’s trading session. The report claims Geisler has a history of misleading investors and partners, and it reveals that numerous XPOF brands and franchisees are struggling, despite previous assurances. Geisler’s past, which includes involvement in a pump-and-dump scheme using Bangkok boiler rooms, was unveiled in the film “Beyond The Boiler Room.” Colleagues and former franchisees from his time at LA Boxing have described him as deceptive and fraudulent.
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The report further disclosed XPOF’s financial distress, showing more than 30 permanently closed stores, contrary to Geisler’s assertion that “we have never closed a store.” Fuzzy Panda Research examined over 16,000 pages of Franchise Disclosure Documents (FDDs), suggesting that eight out of ten XPOF brands are operating at a loss, with over 50% of XPOF studios never turning a profit. They also found over 100 franchises for resale at significant markdowns, and some franchisees reportedly sold their studios back to XPOF for a mere dollar due to heavy losses. The report raises further concerns about potentially skewed financial metrics, high fees, and alleged sexual harassment claims, all while XPOF continues to amass loss-making studios on its balance sheet. It appears the stability of XPOF is under serious scrutiny.
A look at the past five trading days for XPOF stock highlights the level of impact today’s news had on it. Indeed, shares plunged over 30% at the time of writing. As a result, investors are now down 33% during this timeframe.
