Blink Fitness files for Chapter 11 bankruptcy

The Street

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why Blink Fitness is filing for bankruptcy.

Transcript

00:00I'm Conway Gittins reporting from the New York Stock Exchange.

00:02Here's what we're watching on the street today.

00:04There were green arrows across the board with the S&P 500 and the Nasdaq up for a third

00:09day in a row.

00:10A report showing a tame rise in July producer prices bolstered chance for a September interest

00:15rate cut by the Federal Reserve.

00:17Wall Street is looking ahead to the Consumer Price Index, which is due on Wednesday.

00:23Turning to corporate headlines, Blink Fitness has filed for bankruptcy.

00:28President and CEO Guy Harkless said in a statement, quote,

00:31After evaluating our options, the board and management team determined that using the

00:36court-supervised process to optimize the company's footprint and effectuate a sale of the business

00:42is the best path forward for Blink and will help ensure Blink remains the destination

00:47for all people seeking an inclusive, community-focused gym.

00:51Blink, which is owned by luxury gym Equinox, said it will close locations during the bankruptcy.

00:57It did not, however, detail how many of its 101 clubs will be impacted.

01:02Blink's restructuring means trouble for lower-priced gym options, as monthly memberships range

01:07from $15 to $45, compared to the national average of $40 to $70, excluding fees.

01:14Blink's bankruptcy comes as the fitness industry faces three challenges.

01:18First, consumers are cutting back on non-essential spending like gym memberships.

01:23Second, the roaring success of GLP-1 weight loss drugs is reshaping the fitness world.

01:30And finally, there are still lingering effects from the pandemic.

01:34Blink said it is still trying to make up for late rent payments it did not make during

01:39that tumultuous time.

01:4124-Hour Fitness and Gold's Gym went bankrupt during that period, and the industry saw 10,000

01:47locations close permanently.

01:49And that'll do it for your daily briefing.

01:51From the New York Stock Exchange, I'm Conway Gittins with The Street.

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