Anthony Geisler: Yeah. Across all the brands, it’s in the low single digits. So it’s in the kind of 1% to 3% given the month. Typically, in the scaled brands, there’s pretty low churn when you look at it. We do look at it as of members that stick around after 12 months. You do get some volatility under 12 months as people, whether it’s New Year’s resolution or people getting ready for vacation or weddings or whatever it may be, where they’re trying to, I guess, get fitter for kind of a quick fix kind of mentality. But at the end of the day, the churn is pretty low at the scale brands, and you do see some volatility in less than 12 months. Across the brands, we’ve never really disclosed regular churn brand by brand, but it has been — remained pretty consistent since these brands have been operating.
Ryan Meyers : Great. Thanks for taking my questions.
Operator: The next question comes from Warren Cheng with Evercore ISI. Please go ahead.
Warren Cheng : Hey. Good evening, guys. The first question is for John. It’s actually just a follow-up on the last question. Would you be able to quantify for us the amount of SG&A those transition studios are going to carry for this year? And given that that’s going to be a tailwind next year on the SG&A line, would flat SG&A dollar growth in the real possibility for next year?
John Meloun : Yeah, the way you should think about — I’ll answer the question on SG&A for next year. SG&A next year is, like I said, it’s probably going to be around the 30% of revenue, excluding stock-based comp. There is opportunity as we continue to kind of optimize our SG&A as we scale into ’24-’25-’26, where I do feel it will remain relatively flat. Maybe it’s a 3% to 5% increase a year in the outer years as we grow at head count and just like we did this year with international, adding presidents to really make sure we have the right resources focused on the business. This year, when you look at SG&A, you’re probably talking probably around $40 million of SG&A would come out related to the company-owned Studios. You got to remember, we did in this quarter, take a restructuring charge of the lease liability. So that would be included in that number. But next year, you could probably think of the SG&A in 2024 a sub-$100 million number, excluding stock-based comp.
Warren Cheng: Thanks, John. And Anthony, I’m curious if you’ve given any thought on the top of GLP-1s given it’s pretty transformative on weight and increasingly having an effect on fitness activity too. Have you seen any impact on your business? And is there any sort of strategy to engage the GLP-1 population as it continues to grow pretty quickly here?
Anthony Geisler: Yeah, absolutely. I’m not sure if you saw the Morgan Stanley study that was done, but pretty great tailwinds that we have kind of coming out of that. Obviously, hard to quantify. We’re not doing survey work as people sign up and asking them what they’re on or what they’re doing. But we’re definitely leaning into that, and we understand that that we’re getting unique users from that, so.
Warren Cheng: Great. Thanks guys. Good luck.
Operator: The next question comes from Megan Alexander of Morgan Stanley. Please go ahead.
Megan Alexander : Good timing there, I suppose. Maybe I could just ask a little bit more near term, but the EBITDA flow through on the full year guide, was it a touch muted relative to the revenue? Is there anything in particular to call out there? You mentioned transition studios, franchise convention. Is there anything related to timing going on with that, with either of those relative to your expectations?
Anthony Geisler: Yeah. In Q3, we had planned in the kind of the Q3 forecast cycle to have ramped down some of the transition studios a little bit faster than we have. Our end goal is to get as many of those studios into the hands of qualified operators. And it did take a little bit longer to do in Q3 than, I guess, the kind of the ramp-down schedule that we were — had mapped in. So it did have a slightly muting impact, I guess, as you called it, in Q3 and into Q4. But overall, our goal is to get those studios refranchised. We do — as we — as I mentioned earlier on the call, as we do get those done and the faster we do it, the more we’ll see the margin expansion continue to play out. So in the fourth quarter, we — we’re trying to be as aggressive as possible in getting those refranchised back out.
We do see line of sight to a 35% to 39% adjusted EBITDA margin fourth quarter. However, at the end of the day, my goal is obviously to drive as much adjusted EBITDA dollars to the bottom line as possible. So from our perspective, if we come in slightly under 35% but deliver more dollars than great. But as it stands right now, we think the full year at 106.5% and looking at the fourth quarter being right around that mid- to high 35% range, adjusted EBITDA margin is very doable as we continue to execute and get those studios refranchised.
Megan Alexander: Okay. That’s helpful. And I understand you don’t want to provide detail for each brand. But maybe you could just help us in the context of the 15% comp. Were there any outliers to the up or downside? And maybe give an update on how some of the brands that maybe have been lagging like CycleBar are performing?
John Meloun: Yeah, absolutely. So when you look CycleBar, in particular, when you look at same-store sales, and these are all domestic numbers, CycleBar had a 7% same-store sales in the third quarter. So it was not a — again, it was a good quarter, a positive quarter for CycleBar. Some standout brands that may not be so surprising as Club Pilates did 20%, which was really strong. Pure Barre, again, continues to be a really strong performer of being the number of studios. They have 15%, YogaSix was 11%, Rumble’s and some of our start-up brands, 15%. So across the board, you’re seeing really good performance in the brands that have a low studios open or a good quality number of studios open. And again, as I talked about cohorts, when you look at the studios we opened in Q3, they’re already at 360,000 AUV at month three.
The Q2 is at 559 by — excuse me, 581 by month six and then you’re getting to the Q1, they’re at $553 by month nine. So you’re really seeing really good strong openings and sales curves on all these brands as we’ve opened them in 2023. And I think it really is attributed to just the overall consumer where they’re directing their spend. I think when it comes to some of the macro issues that people are reading in the headlines, it just hasn’t shown up in our numbers or our KPIs is a place where people are looking to cut. We’re actually seeing more members show up and the studios that we’re open are performing very well, and again, showing really strong comps.
Megan Alexander: Awesome. Thank you very much.
Operator: The next question comes from Jeff Van Sinderen with B. Riley. Please go ahead.
Jeff Van Sinderen : Hi, everyone. Just wanted to see if maybe we can circle back to seasonality for a minute. Just wondering if the monthly visits, the member adds, anything unusual you’re experiencing kind of the monthly progression there? Or has it been as usual through November to date?
