Deadline Reminder: Law Offices of Howard G. Smith Reminds Investors of Looming Deadline in the Class Action Lawsuit Against Xponential Fitness, Inc. (XPOF)

Law Offices of Howard G. Smith reminds investors of the upcoming April 9, 2024 deadline to file a lead plaintiff motion in the case filed on behalf of investors who purchased Xponential Fitness, Inc. (“Xponential” or the “Company”) (NYSE: XPOF) Class A common stock between July 26, 2021 and December 7, 2023, inclusive (the “Class Period”).

Investors suffering losses on their Xponential investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to howardsmith@howardsmithlaw.com.

On June 26, 2023, Fuzzy Panda Research published a report alleging, among other things, that Xponential is “hiding the fact that many of their brands and franchisees are struggling.” The report further alleges that, despite CEO claims that the Company has “never closed a store,” Fuzzy Panda found over 30 permanently closed stores. Fuzzy Panda also claims that franchise documents suggest that 8 out of every 10 Xponential brands are losing money monthly, with over half of Xponential studios never making a positive financial return.

On this news, Xponential’s stock price fell $9.39, or 37.4%, to close at $15.72 per share on June 27, 2023, thereby injuring investors.

Then, on December 7, 2023, Bloomberg Businessweek published an article stating that interviews with former business partners, employees, and franchisees of Xponential revealed that the Company misled many franchisees into a “financial nightmare.” The article further alleged that “many of the company’s franchisees . . . have either declared bankruptcy or [lost] their retirement savings.”

On this news, Xponential’s stock price fell $1.61, or 15.2%, to close at $8.99 per share on December 11, 2023, thereby injuring investors further.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Xponential had permanently closed at least 30 stores; (2) that Xponential’s reported SSS and AUV metrics had been misstated by excluding underperforming stores; (3) that 8 out of 10 Xponential brands were losing money monthly; (4) that over 50% of Xponential studios did not make a positive financial return; (5) that over 60% of Xponential’s revenue was one-time and nonrecurring; (6) that more than 100 of the Company’s franchises were for sale at a price that is at least 75% less than their initial cost; (7) that Xponential had misled many of its franchisees into opening franchises by misrepresenting the financial profile and profitability of its studios, as well as the expected rate of return for new studio openings; (8) that many Xponential franchisees were substantially in debt, suffering high attrition rates and running non-viable studios that had no realistic path to profitability; and (9) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.

If you purchased or otherwise acquired Xponential common stock during the Class Period, you may move the Court no later than April 9, 2024 to ask the Court to appoint you as lead plaintiff if you meet certain legal requirements. To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action. If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240214605372/en/