There was another CEO change.
On Friday, the Planet Fitness (PLNT) board of directors announced a decision to “transition to new management,” resulting in the departure of CEO Chris Rondeau, a 30-year veteran of the company. I decided to do it.
“As we enter the next chapter of Planet Fitness’ journey, the board felt now was the right time to make a leadership transition,” board chairman Steven Spinelli Jr. said in a release. .
Craig Benson, who has served on the board for six years, has been appointed interim CEO, effective immediately, as the company searches for new leadership. Benson previously served as governor of New Hampshire and is a franchisee of Planet Fitness and Dunkin Donuts. The company said it is considering both internal and external candidates.
Planet Fitness is the latest company to shake up its leadership, and Wall Street isn’t taking it lightly. Planet Fitness stock fell as much as 16% on Friday, hitting a 52-week low. The stock was also a trend ticker on Yahoo Finance.
Planet Fitness did not immediately respond to Yahoo Finance’s request for comment.
The exact reason for Rondeau’s immediate departure was not disclosed, but over his 10-year tenure, Rondeau grew the fitness center’s membership more than 5.5 times to 18.4 million and quadrupled its footprint. It is estimated that the number has increased by more than 2,400 stores.
William Blair analyst Sharon Zakfir also said in a note that he has increased his revenue nearly fivefold from $200 million in 2013 to more than $1 billion this year, and in 2015 he increased his sales to more than $1 billion. He said it was made public. Since the company’s IPO, its stock price has more than tripled.
In a statement, Rondeau called his career at Planet Fitness “an incredible journey,” and thanked employees, franchisees and members. He will continue to serve as a member of the Board of Directors and will be up for re-election at the company’s 2024 Annual General Meeting.
Wall Street stunned by Rondeau’s resignation
The sudden change in leadership appears to have taken Wall Street by surprise.
“The trigger for the change in leadership is unclear,” said William Blair analyst Zakfir. “The company also canceled presentations at two investor conferences scheduled for this week, and this was sudden and unplanned, as the decision was made by the board of directors, not Rondeau’s. It seems so.”
It’s also unclear who the board will be able to nominate as the next CEO.
“While there is no potential internal successor, we suspect the board will instead seek an external candidate with extensive franchise experience (considering Planet’s unique go-to-market strategy relative to its peer group).” “We don’t think fitness club experience is necessary,” Zakfia added.
Zackfir also mentioned potential opportunities that the next CEO should consider top of mind, saying: “The key will be to lower costs for the club to improve profitability and further stimulate expansion. I guess so,” he said.
Stifel analyst Chris Okal echoed similar sentiments.
“While the timing of the announcement was surprising, the change in leadership may put certain elements of the model on the table, such as price increases for the Classic Membership package, and we anticipate a faster pace of change. We believe that this could be a stepping stone.”Please consider this,” Okal said.
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Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @brooke di palma Or email bdipalma@yahoofinance.com.
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