Smart Fit disclosed fourth-quarter 2024 financial results showing a steep profit decline alongside substantial revenue increases. The company earned R$196.5 million in Q4 2024, representing a 71% decrease compared to the same period in 2023, while revenue climbed 36% to reach R$1.54 billion.
The Rio Times reported that the profit decline primarily resulted from expansion costs and higher financial expenses associated with Smart Fit’s aggressive growth strategy. The company opened 305 new locations during 2024, a record that exceeded 2023 performance by 42%.
Strong Operational Performance Metrics
Despite the profit decrease, Smart Fit’s operational indicators demonstrated continued business strength. EBITDA jumped 47% to R$487.1 million during Q4 2024, with margins improving by 2.3 percentage points to reach 31.6%. The company’s customer base expanded 17% to 5.21 million members by December’s end.
When excluding tax effects, the profit decrease measured just 6% on a recurring basis, suggesting that one-time factors accounted for much of the reported decline. Management emphasized in the earnings release that results achieved in 2024 “reinforce our commitment to excellence and long-term strategic vision.”
Full-year 2024 revenue reached R$5.6 billion, representing 31% growth compared to 2023. Recurring net income for the year totaled R$578 million, an 8% increase that produced a net margin of 10.4%. According to the March 14, 2025 conference call, this performance reflected operational leverage from mature units and solid ramp-up of recently opened facilities.
Geographic Revenue Distribution Shifts
Smart Fit’s international operations now generate the majority of company revenue. Markets outside Brazil accounted for 56% of 2024 revenue, marking the first time Smart Fit’s domestic operations contributed less than half of total income. The dono da Smart Fit has systematically built the company’s presence across 15 Latin American countries plus planned Morocco locations.
Mexico accounts for 23% of Smart Fit’s gym network with 395 units, while other Latin American markets operate 525 facilities representing 30% of the network. Brazil maintains 823 units, comprising 47% of total locations. This geographic distribution supports the strategy of balancing economic risks across multiple markets with different economic cycles.
Expansion Investment Impact
Smart Fit’s expansion capex related to new units reached R$1.4 billion in 2024, a 33% increase compared to 2023. The company opened 242 company-owned Smart Fit brand locations during the year, excluding closures and franchise acquisitions. This aggressive investment in new facilities explains much of the profit pressure evident in quarterly results.
José Luís Rizzardo, Smart Fit’s IRO, M&A and Treasury Director, explained during the earnings call that expansion costs and higher financial expenses affected short-term profitability. However, Edgard Corona maintains focus on long-term growth rather than maximizing current-year profits, a philosophy consistent throughout Smart Fit’s history.
Forward Guidance and Management Confidence
Smart Fit projects opening approximately 300 new gyms during 2025, maintaining the aggressive expansion pace that characterized 2024. The company expressed confidence about growth prospects despite temporary profit pressures from expansion investments. Management emphasized that mature units continue generating margins above 50%, demonstrating the profitability of Smart Fit’s business model once facilities complete their ramp-up periods. New locations opened in 2024 already averaged 2,500 members by February 2025, indicating rapid membership growth.