Equinox says CDC's new mask guidance sparked surge in membership, customers returning to gym

Key Points
  • Equinox said members are coming back to its gyms now that mask requirements have been eased in some parts of the country.
  • On Tuesday, it saw the most utilization since it closed its doors last March, and that figure could be topped on Wednesday.
  • The company saw a 55% increase in new memberships, week over week, in New York City alone.
  • Equinox and SoulCycle are not requiring fully vaccinated people to wear masks indoors while exercising or show proof of vaccination.
Equinox executive chairman on dropping mask mandate and the gym's future
Equinox executive chairman on dropping mask mandate and the gym's future

After more than a year of working out at home or running through their neighborhoods, people are ready to head back to the gym as mask requirements are lifted in parts of the U.S.

"We've been waiting for this day for 14 months, and what we are seeing is a tremendous amount of pent-up demand," Harvey Spevak, executive chairman of Equinox Group, said in an interview with CNBC's Frank Holland on "Power Lunch."

Equinox, which also owns SoulCycle and Blink Fitness, will no longer require members to wear masks while exercising, following new guidance from the Centers for Disease Control and Prevention. Last week, the agency said fully vaccinated people no longer need to wear masks indoors as a protection against Covid-19.

The company said it will continue to follow state or local guidelines, where masks are required indoors. Unvaccinated members and guests are still expected to wear face coverings.

At SoulCycle, fully vaccinated riders will be allowed to take their masks off during class, but everyone is still required to wear masks in common areas such as the lobby, locker rooms and hallways.

Spevak said the new policy is bringing people back to its facilities.

"Yesterday was our highest utilization across the Equinox portfolio since we closed in March of last year," he said. But that record could be broken Wednesday. "It's still early because usually we have our biggest surge at the end of the day, but I'm pretty confident [Wednesday] will be our biggest day."

"We are also seeing a big rush in demand for new sales," Spevak said.

In New York City alone, Equinox has seen a 55% increase in new membership sales from a week ago.

"Right now where our focus is is engaging with our community and making sure they feel safe and making sure they feel good about returning to their experience," Spevak said.

Both fitness chains will not require proof of vaccination.

"We trust our riders; they're looking out for each other, for the community at large. And so we believe you when you say you're vaccinated," said Evelyn Webster, the CEO of SoulCycle, in a separate interview.

Spevak expects the future of fitness to be a hybrid of digital and in-person experiences.

"People want to be able to go back and forth," Spevak said. "We believe our consumer that we cater to is going to want to engage in unique experiences both physically and digitally."

During the pandemic, SoulCycle closed its indoor studios and has had success moving its classes outside in 21 of its locations.

"They will continue to be a permanent feature of the SoulCycle offering for the very long term," said Webster.

SoulCycle also competes with connected fitness company Peloton in selling a cycle for the at-home market.

As previously reported, Equinox is in talks to go public via a special purpose acquisition company, or SPAC, headed by Chamath Palihapitiya, according to people familiar with the matter.

Equinox in talks to go public via Chamath-backed SPAC: Sources
Equinox in talks to go public via Chamath-backed SPAC: Sources