The Turn Toward Hardware

Cult.fit is aggressively transitioning from a pure-play subscription model to an integrated lifestyle brand, betting that high-margin retail will solve its long-standing profitability hurdle. By mirroring the Decathlon model, the company is attempting to capture the entire customer lifetime value—from membership to the equipment and gear used outside the studio.

What Happened

Under CEO Naresh Krishnaswamy, Cult.fit has scaled its product segment to account for 30% of total revenue. Product sales surged nearly 5x in three years, reaching ₹326.4 Cr in FY25, while total operating revenue hit ₹1,215.5 Cr. The company is simultaneously diversifying its service footprint through the affordable ‘Cult Neo’ gym tier and specialized Pilates studios.

Why It Matters

First-order: This shift reduces reliance on high-churn, low-margin fitness subscriptions. By selling equipment and athleisure, Cult.fit transforms gym-goers into a dedicated retail customer base, deepening brand lock-in.

Second-order: The move invites direct competition with global giants like Decathlon and specialized D2C athleisure brands in India. Cult.fit must now master inventory turnover, supply chain logistics, and retail floor management—domains vastly different from managing fitness class schedules.

Third-order: This signals a maturation of the Indian ‘phygital’ fitness market, where top-line growth is no longer rewarded at the expense of unit economics. Survival in this sector now requires a multi-channel revenue stack.

The Numbers

  • ₹326.4 Cr: FY25 revenue from products (up from ₹64.2 Cr in FY22).
  • ₹1,215.5 Cr: FY25 total operating revenue (up from ₹215.7 Cr in FY22).
  • 30%: Share of total revenue now attributed to product sales.

What To Watch

  • Supply Chain Execution: Whether product gross margins can offset the overhead of physical retail expansion in the next 180 days.
  • Brand Dilution: Can the brand maintain its premium gym reputation while competing on price with mass-market sports retailers?
  • Profitability Milestone: Watch for the company’s next audit; a narrowing EBITDA gap will determine if the retail pivot is truly value-accretive.