Rating Upgrade and Outlook
S&P Global Ratings upgraded Life Time Inc.’s issuer credit rating to BB from BB‑, and lifted its senior secured debt rating to BBB‑ from BB+. The outlook remains stable. The agency cited sustained low‑leverage forecasts and strong operating performance as the basis for the upgrade.
Leverage Profile
Life Time’s net leverage improved to 3.5x for the twelve months ended 31 March 2026, down from roughly 4x for the same period a year earlier. S&P expects leverage to stay below 3.75x over the next 24 months, targeting the low‑ to mid‑3x range in 2026 and the low‑3x area by 2027.
Revenue and Membership Trends
First‑quarter revenue rose approximately 12% year‑over‑year, driven by an 8.6% increase in same‑center revenue. The company reported higher average dues, expansion of memberships, an improved mix of new and ramp‑up centers, and greater member utilization of in‑center offerings. Qualified medical memberships, which carry significantly lower dues, declined about 15%, while all other center memberships grew 3.7% YoY.
Guidance and Capital Plans
S&P Global Ratings expects Life Time to increase revenue 10‑12% in 2026, aligning with management’s guidance. Membership numbers are projected to rise in the low‑single‑digit percent range as the firm opens 14 new clubs. Life Time assumes capital expenditures of $1.1 billion‑$1.25 billion in 2026. In April 2026 the company executed a $200 million sale‑leaseback and aims to complete $400 million of sale‑leaseback transactions for the full year.
Ownership Changes
Financial sponsors Leonard Green & Partners L.P. and TPG Inc. reduced their common‑stock ownership to under 20% through a share‑buyback transaction and a concurrent sale of shares to an affiliate of Atairos in May 2026.
Outlook Summary
The stable outlook incorporates expectations that higher revenue and EBITDA will further reduce S&P‑adjusted leverage to the mid‑ to low‑3x area through 2027.