[Fitness Industry Review ①] "The Obesity Drug Paradox"... Why US Gym Stocks Are Smiling Amid the Wegovy Craze

As GLP-1 analogs such as the obesity treatments 'Wegovy' and 'Mounjaro' spread globally, there were loud voices expressing concern over a crisis in the fitness industry. This was due to the observation that if people could easily lose weight with drugs, they would not bother with strenuous exercise. However, actual data from the US market is showing the exact opposite result. Amid a surge in obesity drug users, the frequency of gym visits has actually doubled, and related companies' stock prices are rising, forming a new ecosystem of 'the coexistence of obesity drugs and exercise.'

According to related industry data on the 23rd, the weekly exercise frequency of GLP-1 users in the US has nearly doubled compared to before their drug use. According to a survey by Morgan Stanley Research, a high proportion of the population rarely or infrequently exercised before using the drug, but the percentage of those actively exercising surged from 35% to 70% after use.

The cause of this strange phenomenon lies in 'muscle loss,' a side effect of rapid weight loss. GLP-1 class drugs have the characteristic of reducing not only body fat but also muscle mass. Because of this, a new coined term, 'Ozempic body,' has even emerged, referring to a body that has lost weight but has sagging and inelastic skin. Ultimately, analysts say drug users inevitably seek out gyms to maintain a healthy body after weight loss. Accordingly, US gyms are even changing their spatial configurations. As the demand for weight training zones for muscle maintenance outpaces the demand for treadmill-oriented cardio zones, there is a trend of significantly expanding strength training spaces within gyms.

The stock prices and earnings of major US fitness chains also prove this trend. Even amid forecasts that about 12.4% of the US adult population will use GLP-1 by 2025, the stock prices of large gym chains 'Planet Fitness' and 'Life Time' have not fallen and have shown solid trends.

During a meeting with analysts, the CEO of Planet Fitness, a low-cost mass gym, emphasized, "When people who have started losing weight with drugs try to exercise for the first time, they seek out our gyms as the most approachable option," adding, "Obesity drugs are a tailwind that is moving the 80% of the population who previously did not come to the gym."

Life Time, a premium gym brand, also stated during its fourth-quarter 2023 earnings presentation, "Since muscle maintenance is essential for GLP-1 users, the demand for premium services including expert coaching is actually increasing," defining this phenomenon as a positive 'megatrend' for the company.

In South Korea as well, prescriptions have been rapidly increasing since Wegovy was launched last October. According to data, 71.5% of patients prescribed Wegovy were women and 28.5% were men, with those in their 30s and 40s emerging as the primary consumer demographic. Looking at the precedent of the US market, the domestic fitness market is also expected to accelerate the reorganization of spaces and customized programs centered on strength training in line with the spread of obesity drugs.