Winners And Losers Of Q2: Sphere Entertainment (NYSE:SPHR) Vs The Rest Of The Leisure Facilities Stocks

Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Sphere Entertainment (NYSE:SPHR) and its peers.

Leisure facilities companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted their spending from "things" to "experiences". Leisure facilities seek to benefit but must innovate to do so because of the industry's high competition and capital intensity.

The 12 leisure facilities stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 13.8% below.

After much suspense, the Federal Reserve cut its policy rate by 50bps (half a percent) in September 2024. This marks the central bank’s first easing of monetary policy since 2020 and the end of its most pointed inflation-busting campaign since the 1980s. Inflation had begun to run hot in 2021 post-COVID due to a confluence of factors such as supply chain disruptions, labor shortages, and stimulus spending. While CPI (inflation) readings have been supportive lately, employment measures have prompted some concern. Going forward, the markets will debate whether this rate cut (and more potential ones in 2024 and 2025) is perfect timing to support the economy or a bit too late for a macro that has already cooled too much.

Leisure Facilities stocks have held steady amidst all this with average share prices relatively unchanged since the latest earnings results.

Sphere Entertainment (NYSE:SPHR)

Famous for its viral Las Vegas Sphere venue, Sphere Entertainment (NYSE:SPHR) hosts live entertainment events and distributes content across various media platforms.

Sphere Entertainment reported revenues of $273.4 million, up 112% year on year. This print was in line with analysts’ expectations, and overall, it was a very strong quarter for the company with an impressive beat of analysts’ earnings estimates.

Executive Chairman and CEO James L. Dolan said, "Fiscal 2024 marked the opening of Sphere in Las Vegas and a new chapter for our Company. Sphere has already welcomed millions of guests, world-renowned artists and numerous global brands. We are confident that we are on the right path to execute on our vision for this next-generation medium."

Sphere Entertainment achieved the fastest revenue growth of the whole group. Unsurprisingly, the stock is up 15.2% since reporting and currently trades at $47.

Is now the time to buy Sphere Entertainment? Access our full analysis of the earnings results here, it’s free.

Best Q2: Life Time (NYSE:LTH)

With over 150 locations and gyms that include saunas and steam rooms, Life Time (NYSE:LTH) is an upscale fitness club emphasizing holistic well-being and fitness.

Life Time reported revenues of $667.8 million, up 18.9% year on year, outperforming analysts’ expectations by 5.2%. The business had a stunning quarter with an impressive beat of analysts’ same-store sales and earnings estimates.

Life Time achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 15.5% since reporting. It currently trades at $24.02.

Is now the time to buy Life Time? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Xponential Fitness (NYSE:XPOF)

Owner of CycleBar, Rumble, and Club Pilates, Xponential Fitness (NYSE:XPOF) is a boutique fitness brand offering diverse and specialized exercise experiences.

Xponential Fitness reported revenues of $76.52 million, down 1.1% year on year, falling short of analysts’ expectations by 8.5%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations and a miss of analysts’ earnings estimates.

Xponential Fitness delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 29.1% since the results and currently trades at $12.06.

Read our full analysis of Xponential Fitness’s results here.

Vail Resorts (NYSE:MTN)

Founded by two Aspen, Colorado ski patrol guides, Vail Resorts (NYSE:MTN) is a mountain resort company offering luxury experiences in over 30 locations across the globe.

Vail Resorts reported revenues of $265.4 million, down 1.6% year on year. This result met analysts’ expectations. Aside from that, it was a softer quarter as it logged a miss of analysts’ skier visits and earnings estimates.

The stock is down 7.3% since reporting and currently trades at $174.06.

Read our full, actionable report on Vail Resorts here, it’s free.

Planet Fitness (NYSE:PLNT)

Founded by two brothers who purchased a struggling gym, Planet Fitness (NYSE:PLNT) is a gym franchise which caters to casual fitness users by providing a friendly and inclusive atmosphere.

Planet Fitness reported revenues of $300.9 million, up 5.1% year on year. This print beat analysts’ expectations by 3.5%. It was a very strong quarter as it also recorded an impressive beat of analysts’ operating margin estimates and a decent beat of analysts’ earnings estimates.

The stock is up 14.9% since reporting and currently trades at $82.75.

Read our full, actionable report on Planet Fitness here, it’s free.

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