(Updated Feb. 27, 2025)
Interactive Strength Inc.
How can you possibly project $50M in pro forma revenues for 2025, when your 2024 revenues are only expected to be $5M? Seems like “pro forma” = “junk projections.”
While $50M for 2025 pro forma revenues can seem improbable when compared to $5M for 2024 revenue (9M YTD ‘24 of $3M reported revenue plus guidance for Q4 ‘24 of $2M), the increase in revenue to $50M is largely as a result of Sportstech, the company we agreed to acquire, which had over $40M in revenue in 2024 and we expect it to surpass that level in 2025.
As page 8 of our investor presentation shows, the step-up is big – but it is high likelihood given the scale of the Sportstech revenue that will begin to be included in TRNR’s financials after the transaction legally completes, which we expect to be as early as April 2025. “Pro forma” describes what the revenue would be for the full year 2025 if Sportstech had been a part of TRNR from January 1 to provide context for shareholders of the impact of the Sportstech acquisition.
What are you doing to counter market manipulation like naked short selling? The trading volumes in TRNR stock can’t be real as it’s many multiples of the free-trading float.
Today is the third day during February when more than 50 million shares have traded in a day. This just highlights the many other times in the recent past when every share outstanding appears to have been traded more than 10 times in a single day. We have heard from many of our shareholders that they believe that this trading dynamic reflects an illegal “naked short.” If correct, this would harm all of us and our interests, as defending the share price is critical to our long-term plans. We have not been able to explain this volume and we are investigating the possible reasons for it, which include speaking with the Nasdaq Market Intelligence desk and possibly the Securities and Exchange Commission (SEC).
That being said, we are aware that TRNR has a low number of shares outstanding. A rush of buying, such as in response to the very positive Sportstech news, could move the share price up dramatically and attract traders with short time horizons. Beyond our investigating naked shorts, we are growing revenue through acquisitions and we are also spending a lot of time communicating the long-term value we expect to create so that we can attract more owners of TRNR to combat any short-sellers.
If you have enough cash to buy a German company, why don’t you buy back the stock instead of posting FAQs?
We are acquiring Sportstech with equity, not cash. This means that the shareholder of Sportstech is investing 100% of his ownership in shares of TRNR that are locked up for years. In fact, the correct way to think about our deal is that we have recruited a very large investor to TRNR who didn’t just buy shares in the company with cash, one time – but, instead, has purchased his shares with a successful business that’s been operating for years and that is expected to generate revenues for TRNR every year, which is the foundation for the $50M pro forma 2025 revenue. On top of this investment and its clear value to all stockholders, he is restricted from selling his shares.
We plan to reinvest [that cash – what cash? From operation into our operations and make them more valuable. As shareholders start to understand the value of our acquisition and operating strategy – see slide 10 of our investor deck – we think our multiple will improve significantly. We’re already showing progress.
What happened to Bitcoin as a treasury asset? Are you going to move forward with holding cash in some kind of crypto?
Especially as we scale and begin to generate free cash, we are very interested in this path – and that’s why the Board approved Bitcoin as a treasury asset. Our operating business is in the megatrend of health and wellness, but we are focused on creating shareholder value in many ways.
What is Interactive Strength’s business and how did it get started?
Interactive Strength Inc. (NASDAQ: TRNR) is the parent company of three leading brands serving the commercial and at-home markets with specialty fitness equipment and virtual training: CLMBR, FORME and FORME GOLF.
Most recently, TRNR has announced a binding agreement to acquire Sportstech, Germany’s largest connected fitness and equipment business.
CLMBR manufactures vertical climbing equipment and provides a unique digital and on-demand training platform. FORME is a hardware manufacturer and digital fitness service that combines award-winning smart home gyms with 1:1 personal training (from real humans) to deliver an immersive experience and better outcomes for both consumers and trainers. FORME GOLF combines the FORME Lift hardware with golf specific training delivered by Titleist Performance Institute certified trainers.
Who are its major customers? What about competitors?
Customers include gyms such as Crunch Fitness, Gold’s Gym, Chuze Fitness and Equinox, and hotels like the Four Seasons and Marriott and international distributors from countries like Germany, France, UAE, Indonesia and others. Our planned acquisition target, Sportstech, has sold products to more than 3 million consumers since it was founded in 2012.
We compete in a large, global fitness and equipment market that’s growing but also very fragmented – and which includes many, many companies and brands ranging from Technogym and Precor to Peloton, Nautilus and Stairmaster.
How long has TRNR been public?
TRNR listed on the NASDAQ in 2023 with only the FORME business.
Where are your offices located?
We are based in Austin, Texas and have an office in Taiwan.
Do you make your own equipment?
We rely on joint-development or contract manufacturers to produce the equipment and we use distribution partners to sell, providing us with an asset-light approach to making and selling our equipment.
Who’s on the management team? What is their experience?
We have an experienced management team anchored by Founder and CEO Trent Ward, Chief Technology Officer Deepak Mulchandani and CFO Michael J. Madigan. You can read more about their credentials and expertise on our website.
Stock/financials
Why has the share price declined even as you report better financials?
We believe that the market has not fully understood how to value a roll-up strategy, which means that we believe the share is very undervalued. Especially given our $50M 2025 pro forma revenue guidance, as well as earnout assumptions built into our binding agreement to acquire Sportstech, which produced over $40M in profitable revenue in 2024.
There are a lot of factors that go into stock prices and like any company we can’t predict or unpack how our shares trade. We can say that we are extremely bullish about our market – which is growing, and ripe for consolidation – and our brands and business. We can also say that we are confident in our formula for growth and success: accelerate via acquisition; structure deals with equity and earnouts; and so align deal strategy, acquisitions and shareholder upside while risk-managing any downside.
What are you doing to improve the share price?
We’re growing a valuable fitness and equipment portfolio, rapidly, in a capital efficient way. On a TTM basis, we expect to increase annual revenues nearly 10X from 2024 to the end of 2025. More specifically, over the past year, we have locked in:
A worldwide distribution agreement with Woodway, an established and high quality partner for selling fitness equipment globally
Gold’s, Crunch, Chuze and Armah gym-chain initial installations, giving TRNR gateways into over 1,000 gyms in the US and worldwide
Additional distribution agreements and certifications enabling sales in the EU overall, and Germany, France, the Gulf region and Indonesia, heavily populated regions with thousands more gyms
Initial orders and installations for over 1,000 CLMBR units – achieving a level of scaled order traction within months that CLMBR had never reached on its own
Five major tradeshow exhibition opportunities
An expansion of our FORME brand into new verticals like golf, physical therapy, the military and college use-cases;
Significant steps to strengthen our listing and balance sheet; and
Our binding agreement to acquire Sportstech, Germany’s largest connected fitness and equipment business.
We’re also not stopping here – we’ll continue to build our customer and geographic presence, and also remain focused on finding additional acquisition opportunities.
Why should I buy/hold onto my shares?
We believe the market significantly undervalues TRNR on both a top and bottom line basis. As our investor deck and shareholder letters outline, we are building a risk-managed portfolio of fitness-related brands, content and equipment that has major upside.
We’re acquiring and scaling businesses in a growing market with a lot of demand from both consumers and companies like gym chains, multi-family residential and hotels. We’ve announced two acquisitions, and by the end of 2025, we expect to scale revenues nearly 10X as compared to 2024. In short, we’re pleased with our progress in just the last twelve months and bullish on our prospects going forward.
What is TRNR’s status with Nasdaq? What’s the likelihood you are delisted?
We are in full compliance with Nasdaq continuing listing standards. You can read more details about this on our website or in our filings. Given our progress building the business and our revenues, we believe we will continue to be in compliance with Stockholder’s Equity. We cannot control the share price, but we are focused on maintaining compliance, so we are asking for shareholder approval for a reverse split in the chance that it is required by Nasdaq.
TRNR did two reverse splits in 2024; will this occur again in the future?
Given the revenue base after the Sportstech acquisition, the profit potential and the equity we’re building, we are hopeful that we will not require another reverse split. We have no plans for an equity offering, which it seems is what caused a sudden decrease in share price in July 2024 and therefore we fell out of compliance with the Nasdaq listing standard and had to perform a reverse split. We’d expect that as we start to report significantly higher revenues and integrate our acquisitions, shareholders will start to better appreciate the quality of the business and therefore we will not be required to perform a reverse split, but we do want to be prepared in case there is a sudden deterioration in markets, which is why we are asking for shareholder approval for one.
How is the company performing – what are the major achievements in the past year?
We are on track in terms of making significant progress over the past twelve months, laying the groundwork for a much larger business that matches our large opportunity. We have a value-based operating strategy, driven by disciplined acquisitions and an increasingly improving and efficient capital structure, applied to a large category that’s rich with targets. We’ve done a lot to set the company and shareholders up for success, including locking in:
– A worldwide distribution agreement with Woodway, an very established, and high quality partner for selling fitness equipment globally
– Gold’s, Crunch, Chuze and Armah gym-chain pilots/installations, giving TRNR gateways into over 1,000 gyms in the US and worldwide
– Additional distribution agreements and certifications enabling sales in the EU overall, and Germany, France, the Gulf region and Indonesia, heavily populated regions with thousands more gyms
– Initial orders and installations for over 1,000 CLMBR units – achieving a level of scaled order traction within months that CLMBR had never reached on its own
– Five major tradeshow exhibition opportunities
– An expansion of our FORME brand into new verticals like golf, physical therapy, the military and college use-cases;
– Took significant steps to strengthen our listing and balance sheet; and
– Our binding agreement to acquire Sportstech, Germany’s largest connected fitness and equipment business.
So, when you own TRNR stock, you get positive exposure to catalysts like:
– Our market tailwind – for people worldwide, health & wellness is increasingly an “essential” spend.
– Our portfolio strategy – TRNR is building a collection of opportunities for its investors to benefit from macro trends, the diversity of which helps lower the risk of any one opportunity.
– Our M&A expertise – TRNR’s goal is to source and purchase high-potential businesses before their multiples expand, within our highly-fragmented sector.
– Our growth – the more we grow and the more valuable our shares become, the more capital efficient our acquisitions and portfolio strategy.
– Our assortment of equipment, services and brands – as the range of what we offer both consumers and businesses expands, so do the ways we can create shareholder value.
Why does buying other companies make sense for the business?
In a nutshell, TRNR offers exposure to a huge, growing market that we define in terms of consolidating overlooked value opportunities – fitness platforms and equipment that we can acquire and scale more efficiently than smaller owner-operators by themselves, due to our listing and capital structure.
This acquisition strategy in turn gives us and our shareholders more exposure to a greater set of opportunities across the fitness, health and wellness markets.
When will we see meaningful growth in revenues? Profits?
Once the Sportstech acquisition closes – likely in April – we’ll be able to start reporting their results as part of TRNR operations in subsequent quarters. As noted in our most recent guidance, the most significant impact on the top line will be clear at the end of 2025, when we expect to report over $50M in revenues on a pro forma basis.
How are your brands doing in the marketplace? When will we see more customer announcements?
We’re pleased with our ability to grow both brands on a capital-efficient basis. It remains early days yet, but we expanded FORME into the golf vertical – and we were able to sign multiple distribution as well as customer agreements for CLMBR across the US, EU, EMEA and Asia within a few months of closing the deal for those assets.
What’s next for TRNR? More deals, or building out what you have?
Both. TRNR’s vision is building a portfolio of businesses that can capture value across different segments and geographies in health & wellness and drive significant multiple expansion for shareholders. Sportstech is large enough that our combined organic opportunity set is attractive, but also provides enough scale that we can acquire future businesses with larger synergies.
Going forward, we’ll continue to execute by both operating what we buy, well – and by strategically acquiring additional growth businesses on a low-cost, low-risk basis.
Should I buy more TRNR stock? Why?
You have to make your own decisions about what stocks are right for your portfolio. We can say that the Sportstech deal illustrates the increasingly low-risk, high-growth potential that TRNR management is working to provide to shareholders.
A roll-up strategy can provide consistent growth in all markets when executed well. We are focused on a portfolio strategy in a specific, high-growth sector ripe for consolidation and this can give stockholders terrific exposure to value creation. TRNR, especially with Sportstech, offers a lot of that kind of opportunity.
Sportstech Acquisition
What is Sportstech/what does it do?
Sportstech – the largest connected fitness and equipment company in Germany – is a profitable, $40M+ revenue business based in Berlin that serves customers in the DACH region (Germany, Austria and Switzerland), France and Spain.
It offers customers unique fitness equipment and app-based fitness content that’s designed to fit in with busy lifestyles and motivate anyone to achieve a healthier, more active lifestyle. Founded by CEO Ali Ahmad in 2012, as an outgrowth of his own personal journey to a happier, fitter and healthier life, Sportstech offers a uniquely successful combination of technology, branded equipment and training-oriented community in the health and wellness space.
What are the terms of the deal?
You can read in detail about the deal terms in the filings or our press release here. We’re buying Sportstech with stock, not cash or debt. The initial payment for the company is $15M worth of shares, which are locked-up until at least June 2026. TRNR could pay up to $40M more in stock over the next two years – but ONLY if Sportstech meets specific EBITDA targets in 2026 and 2027, and the price we are paying as a multiple of earnings decreases as more earnings are generated.
So this is a very capital efficient deal, in keeping with our strategy for acquiring profitable revenues from subscale businesses. Also worth noting: Sportstech’s founder and owner, Ali Ahmad, is converting his entire stake in his company to TRNR equity, joining our Board and becoming a long-term shareholder, with significant lock-ups on his equity. The earliest that a share could be sold is June 2026, but there are restrictions on how much an affiliate can sell at once so we do not expect much equity to be sold in the future.
Why is this a good deal for TRNR shareholders?
It’s a big milestone for a lot of reasons – but one of the most obvious is that it will dramatically grow TRNR revenues and profit. By the end of 2025, we expect to have over $50M in revenue, on a pro forma basis. That’s a huge step change, YOY. It’s literally transformative, because Sportstech has achieved a different level of scale, operations and profitability in large markets TRNR was just starting to enter.
Last year it produced more than $40M in profitable revenue, and it’s grown by double digits annually since 2016. So while we and Ali believe we can expand further, together, the deal is accretive to TRNR immediately. Longer term, and bigger picture, this is good for our investors because it diversifies our business, both in terms of geography and in terms of products and customers. It adds experienced talent to our team. It pushes us deeper into the German fitness market, the second largest in the world.
Why buy a German company? TRNR is listed and based in the US.
Sportstech and its German base actually fit our strategy very well. TRNR has operated internationally for over a year, and the fitness, health & wellness market globally has even more growth potential than the US on its own.
The mutual opportunity was huge – because TRNR’s NASDAQ listing and global footprint in the US and outside the EU offer Sportstech a much faster, more capital-efficient path to grow than it could achieve on its own. Remember, we’ve been selling into Germany since early 2024, so when we saw what Ali and Sportstech had achieved there, in the larger DACH region, and in France and Spain, their value was crystal clear. Really, the industrial logic of the deal couldn’t be better – it’s a win-win, especially for TRNR shareholders.
When are TRNR shareholders going to start seeing Sportstech results in earnings reports?
We expect the deal to close in April 2025, which would be the first time that the Sportstech revenue and earnings will be consolidated into our reporting. So we expect a partial, positive impact on TRNR results in Q2 ‘25, which are expected to be reported in August 2025. The first full quarter with Sportstech should be Q3 ‘25.
The important callout right now is that we’re projecting over $50M in revenue for full-year 2025 on a pro forma basis, driven by Sportstech’s current performance.
Why did Sportstech sell, if it’s doing so well and never had to raise money?
TRNR’s NASDAQ listing and global footprint in the US and outside the EU offer Sportstech a much faster, more capital-efficient path to grow than it could achieve on its own. It’s important to realize that Sportstech’s sole shareholder is rolling all of his equity into TRNR stock, so he is very aligned with growth in TRNR’s share price.
As with many successful, growing businesses there’s a big difference between continuing to grow independently, and then being given the resources, expertise and network that make it easier and more cost-effective to accelerate expansion plans, while still maintaining customer and product quality.
Isn’t an all-stock deal just going to dilute TRNR common shareholders further?
If the acquisition had been structured with cash, it is likely that there would have been a fundraise required that would have been more dilutive. The use of our stock as the currency means that there will be no additional shares in the market for more than 12 months and it aligns the Sportstech shareholder with TRNR shareholders. We believe the value received from Sportstech’s revenue and earnings more than offsets the reduction in ownership percentage of existing TRNR shareholders. So, very much a situation of owning a smaller piece of a much bigger pie.
While the all-stock deal structure may shrink the percentage ownership basis of a given TRNR shareholder, the value of the huge uptick in revenue, profit, and scaled operations we are buying more than makes up for it. The charts in this deck on slide 8 illustrates the value creation.
Why isn’t the stock going up if this is such a great deal?
Like any public company, we can’t speculate about our stock price. With that said, we can appreciate that the market may not understand or give the Company credit for the transaction that was announced. We believe that that view will change when we are able to share more about the performance of Sportstech and investors are able to see the Sportstech results in TRNR’s reported financials.
We can also appreciate the onus is on management to show the value of Sportstech given the previous acquisition (CLMBR) underperformed expectations.
You set big expectations for CLMBR that didn’t pan out; why is Sportstech different?
There are large differences between Sporstech and CLMBR. CLMBR was a purchase of assets as opposed to a fully-functional business. Sportstech is a different beast entirely – it has operated for over a decade, is self-funding, profitable and did over $40M in revenue in 2024, having served more than 3 million customers to date.
Also, it’s good to remember that due to our earnout-transaction formula, we ended up not paying anything material above liabilities when buying CLMBR and those assets ultimately allowed us to expand customers and distribution internationally. We’re applying the same performance-oriented formula to Sportstech, with the key difference being the proven scale and performance of Sportstech’s existing business. The bottom line is that we do not believe we overpaid for CLMBR despite its underperformance, and over 70% of the maximum price of the Sportstech deal depends on it continuing to surpass clear and specific earnings targets.
Is Sportstech going to open facilities and offices in the US? Where/when?
We expect to open a small sales office in the US in the next year to focus on developing the market for Sportstech, and we will also consolidate some of our other operations there.
They’ve got an app and fitness/training content production that can easily adapt to the North American market – ditto their equipment, especially combined with TRNR’s distribution expertise. We expect the deal to close in April 2025 – and after that we can go to market together formally. We can be more specific about plans and timing after that point.
Will TRNR management start running Sportstech?
The Board and management of TRNR will be responsible for budgeting and major decisions, but the execution on a daily basis will be done by the existing Sportstech management team. So, Sportstech will draw on our resources, connections and expertise. But our plan is that day-to-day, their team and company will operate and go to market independently and under their own brand.
This is consistent with how, over time, we will manage FORME and CLMBR – and how we intend to operate future acquisitions.
Will Sportstech start selling FORME and CLMBR equipment? Why/why not? When?
We expect the Sportstech deal to close in April 2025 – and after that we can go to market together formally. We can be more specific about plans and timing after that point.
What we can say right now is that one of the big reasons this deal makes sense is that the companies’ businesses are complementary. So, yes, in theory, we can cross sell equipment and fitness content.
CLMBR – for investors
What is CLMBR?
CLMBR is a commercial grade vertical climber suited for every body and any space, delivering one of the safest and most effective full-body workouts.
How is it different from other exercise equipment out there?
Climbing is a low-impact, full-body workout that combines cardio and strength training in a unique way, and thanks to our space-efficient equipment and training methods, CLMBR provides a truly unique, impactful fitness experience.
Do you sell it to individuals? Or businesses?
Both, but the focus is on B2B sales through distributors as it is much more capital efficient and the return on capital is more attractive than selling to consumers through paid media.
What’s going on with CLMBR?
We are developing its B2B markets and growing. We’ll have more news about CLMBR after we finalize the Sportstech deal. In the meantime, you can read about our related, upcoming conference and event appearances on our website.
How much does CLMBR contribute to TRNR growth and performance?
We don’t break out individual brand performance at this time, but a large portion of the growth in 2024 revenue has been from CLMBR.
How is CLMBR priced?
CLMBR starts at $3,995 and is available for purchase at CLMBR.com, volume discounts are available through our exclusive commercial distribution partner, Woodway.
Where can I try a CLMBR right now?
CLMBR is available at leading health club chains, hotels and more throughout the US and beyond, including: Gold’s Gym, Crunch, CHUZ, Equinox, Marriott properties, and more. Contact your local health club to inquire or email support@clmbr.com to learn where you can find CLMBR in your area.
Who are the biggest customers for CLMBR?
In the US, we have relationships and equipment in Planet Fitness, Gold’s, Chuze and Crunch, among other facilities.
FORME – for investors
What is FORME?
FORME delivers an innovative solution for resistance training, recovery and golf performance, with premium hardware and expert live and on-demand instruction. The interactive training device that fits on any wall can transform any space into a fitness hub – allowing individuals to create tailored workouts with a range of trainers, and building strength, including for golf. Businesses, including hotels and resorts as well as gyms can easily expand their offerings and/or add training/fitness utility to any space.
Do you sell it to individuals? Or businesses?
Both, but the focus is on B2B sales directly and through distributors as it is much more capital efficient and the return on capital is more attractive than selling to consumers through paid media.
What’s going on with FORME?
We are developing its B2B markets and growing. We’ll have more news about FORME after we finalize the Sportstech deal. In the meantime, you can read about our related, upcoming conference and event appearances on our website.
How much does FORME contribute to TRNR growth and performance?
We don’t break out individual brand performance at this time, but a large portion of the growth in 2024 revenue has been from CLMBR.