Xponential fires CEO Anthony Geisler amid investigation

Geisler, who founded Xponential Fitness and grew it into the world’s largest franchisor of boutique fitness brands, was relieved of his duties and suspended after learning of a USAO investigation

Anthony Geisler, who has served as CEO of Xponential Fitness since the brand’s inception in 2017, has been removed from his position by the Xponential Board of Directors and placed on an indefinite suspension, effective immediately.

The move comes as the boutique fitness franchisor acknowledges receipt of a May 7 notice of an investigation by the United States Attorney’s Office (USAO) for the Central District of California.

Xponential has named Brenda Morris interim CEO while searching for a permanent CEO replacement for Geisler, the company announced.

The news dealt a major blow to XPOF shares, which plunged nearly 32% on Friday after the news broke.

Xponential previously disclosed an SEC investigation in December 2023. Last summer, Xponential was the target of a scathing short-seller report from Fuzzy Panda Research, which called the franchisor a “house of cards” on the verge of collapse and claimed that the company was an “abusive franchisor.” Xponential strenuously denied the claims, but the report caused Xponential’s shares to lose more than a third of their value. They still hadn’t fully recovered when Friday’s news sent XPOF shares even lower.

Around the time the SEC investigation was announced, Bloomberg reported that some of Xponential’s franchisees, including those who owned the Pure Barre and Club Pilates locations, had suffered significant financial losses.

During his time as head of Xponential, Geisler led the acquisitions of several brands such as Body Fit Training (BFT), Row House, YogaSix, CycleBar, StretchLab and most recently Lindora.

He has already been removed from Xponential’s management team page and replaced by Morris.

Morris, who has served on Xponential’s board since 2019, is currently a partner at CSuite Financial Partners and has more than 35 years of experience in finance, accounting and operations.

“The board has determined that the appointment of Brenda Morris as interim CEO is in the best interests of Xponential, its employees, customers, franchisees and shareholders,” said Mark Grabowski, chairman of Xponential. “Over the past five years, Brenda has been an extremely dedicated board member as we have pursued Xponential’s mission of making health and wellness accessible to everyone.”

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Xponential’s board said it has hired a leading search firm to help find a new CEO.

Xponential says it has cooperated with the SEC and intends to cooperate with the USAO. It has formed a special committee of directors consisting of independent directors Ms. Grayson, Jair Clarke and Jeffrey Lawrence.

The leadership change will have no impact on Xponential’s full-year 2024 guidance, which the company announced earlier this month. Last month, two more C-suite executives announced their departure from Xponential: John Kersh, who served as chief international development officer, and Garrett Marshall, president of digital platform Xponential+.

Xponential had 3,156 boutique fitness and wellness studios worldwide with 6,365 franchise licenses sold across its portfolio, the company said in its most recent earnings release.