Source disclosure: February 13, 2026

LOIVE Co.,Ltd. [352A.T]

TOKYO, Feb 13 (Pulse News Wire) -- LOIVE Co., Ltd. (352A.T), a leading provider of boutique-style fitness classes, released its third-quarter earnings report for the fiscal year ending March 2026. The company reported record-high sales but faced challenges in meeting profit targets due to increased advertising expenses aimed at accelerating market dominance.

The company's unique business model combines small-scale boutique studios with group class formats, achieving an impressive gross margin of 41.7%. Each studio ranges between 65 to 80 square meters, allowing one instructor to teach up to 30 students simultaneously while maintaining low operational costs. Initial investments, including rent, typically range from ¥35 million to ¥45 million per store. This model enables a rapid payback period of approximately two years for both Pilates K and LOIVE stores, according to the company’s estimates.

In terms of personnel, LOIVE has successfully expanded its workforce, recruiting 144 new graduates and 271 mid-career hires by the end of the quarter. The company boasts a high ratio of female managerial positions at 98.5%, which contributes to its ability to rapidly open new locations across Japan. Additionally, the company reports strong employee satisfaction, with 93.5% feeling they have grown within their roles and 95% expressing alignment with the company’s values.

Despite these positive developments, LOIVE experienced significant growth in operating expenses, particularly in advertising and marketing, leading to lower-than-budgeted profits. Sales reached ¥8.246 billion, representing a 33.9% increase over the previous quarter, while operating income fell short of expectations, dropping to ¥426 million compared to the budgeted ¥566 million. Similarly, net income declined to ¥219 million against a target of ¥354 million.

The company attributes this performance gap primarily to a decline in free customer acquisition rates and higher than anticipated spending on advertisements. Free customer acquisitions dropped significantly since the beginning of the fiscal year, falling below the targeted levels. To counteract this trend, LOIVE intensified its paid advertising efforts starting in the second quarter, resulting in a substantial rise in advertising costs that exceeded the initial budget by ¥2.5 billion cumulatively over the second and third quarters.

Looking ahead, LOIVE remains committed to its strategy of expanding market share through strategic investments and aggressive advertising campaigns. The company believes that despite the current shortfall in profitability, the long-term benefits of increasing membership numbers will outweigh the immediate cost increases. With a lifetime value-to-customer-acquisition-cost ratio of 11.5 times, LOIVE maintains confidence in the sustainability of its business model and plans to continue scaling operations efficiently.

This disclosure could not be fully translated automatically. View original filing (Japanese) • Terms