Anthony Geisler, who founded multi-brand platform company Xponential Fitness in 2017 and has served as its CEO ever since, has been removed from his position and suspended indefinitely, effective immediately, the company announced Friday.
The decision comes as the parent company of boutique fitness brands such as Club Pilates, CycleBar and StretchLab is currently facing an expanded federal investigation that includes the U.S. Attorney’s Office for the Central District of California. The company announced that Brenda Morris, who has been a member of Xponential’s board of directors since 2019, will replace Geisler as interim CEO.
Xponential said it received notice of the investigation by the U.S. Attorney’s Office on May 7. In December, the company disclosed the findings of an investigation by the U.S. Securities and Exchange Commission, which found the company misled investors by making “materially false and misleading statements and omissions about Xponential’s business, financial results, and prospects.” is facing multiple class action lawsuits.
Xponential said in a statement that the company “intends to continue working with the SEC and will also work with the USAO.” The board also established a special committee of directors, consisting of independent directors Chelsea Grayson, Jaya Clark and Geoffrey Lawrence, “to investigate these matters.”
Anthony Geisler, founder of Xponential Fitness, has been fired as CEO, effective immediately, the company’s board of directors announced on May 10th.
Shares of Xponential, which went public in 2021 and trades under the ticker symbol XPOF, fell nearly 32% to $8.48 at the close on May 10th. It’s down more than 70% over the past 12 months.
Mr. Geisler founded Xponential two years after acquiring Club Pilates, which at the time had 30 units. This franchisor has grown to 10 brands, primarily through the purchase of the founder-led Studio His Fitness His Concept. Earlier this year, it acquired weight loss clinic company Lindora and its 31 units. In February, it sold its running-focused concept Stride to Sean Grove, who has since stepped down as president of Rumble Boxing, another Xponential brand.
Mr. Geisler, who is also a director, remains employed by Exponential and will continue to receive a salary, the company said in an 8-K filing May 10. However, the filing states, “He will not be involved in the company’s affairs or oversight.” , USAO investigation. ”
Xponential’s board of directors announced that it has hired an executive search firm to assist in the search for a new CEO. Morris is an executive at his services firm and he is a partner at CSuite Financial Partners.
“The Board of Directors has determined that the appointment of Brenda Morris as interim CEO is in the best interest of Xponential, its employees, customers, franchisees, and shareholders,” said Xponential Chairman and Founding Investor Snapdragon Capital. said Mark Grabowski, managing partner. statement. “Over the past five years, Brenda has been deeply involved as a board member, pursuing her Xponential mission of making health and wellness accessible to everyone. I am confident that she will be a leader and look forward to working with her.”
In its latest earnings call, Xponential said it operates 3,156 studios around the world.
Update: This article has been updated to include information from Xponential’s 8-K filed with the Securities and Exchange Commission.
