Q2 is over. Here's the good, the bad and the ugly
And the question I am not yet ready to answer
Every quarter, I close the books and sit with three categories: what worked, what didn’t and what is outside my control.
Q2 had something in all three.
The good
Going into Q2, we had a specific goal: convert five package clients to 12-month contracts before June 30. We hit it. Overall package client count dropped by ten, but five of those ten converted to contracts. The other five represent genuine attrition: clients who stepped away for summer or a move, and one who ghosted.
The contract conversions matter more than the raw number suggests. Package clients pay when they buy. Contract clients pay every month. Five clients moving from one model to the other is a structural improvement, not just a retention win.
The bad
Leads held steady from Q1. Intros sold dropped by 50%.
Before making assumptions, I had to ask a few other questions first. Are we capturing leads that are actually spam? Are our automations stale? Is it even easy to purchase an intro from us?
That gap between Q1 and Q2: the same number of people expressed interest, but only half as many purchased an intro. This tells me the problem is in the transition from lead to new client, not in how we are finding people. A lead who does not convert is not a lost client (yet.) She is still a lead, ideally one conversation away from coming onboard.
Intro-to-long-term conversion was also down sharply. Upon learning this, I leaned into a specific adjustment I had been considering for a while.
At Somaspace, we moved client management and sales to a front desk role in late 2023. So our front desk has been closely associated with the sales process since that time: following up on leads, presenting packages, closing and scheduling.
But our front desk does not teach and is not present on the floor where the actual experience happens. An initial sales conversation coming from someone other than the teacher can land as abrupt, no matter how well-scripted.
The new model shifts those intro-period sales interactions toward the teachers. Connection before commerce. A teacher who is aware of a new client, who asks how the first session felt, what they are hoping to work on, whether they have questions, is having a different conversation than a post-session sales pitch from the desk. The relationship starts first. The pricing conversation follows.
It is too early to know if it is working. I will report back in Q3.
The ugly
Gross revenue was down approximately 14% compared to the same quarter last year.
Despite the immediate anxiety it produced, that number deserves context.
Consumer sentiment in the United States fell to its lowest point on record in April 2026, according to the University of Michigan Consumer Sentiment Index. That’s below the levels recorded during the 2008 financial crisis.
Boutique fitness is being squeezed from both ends: budget gyms are picking up price-sensitive clients while high-end clubs are capturing the clients who want to spend. The middle, where most independent studios operate, is feeling it.
According to Bain and Company’s spring 2026 luxury market study, bookings for dining, leisure and entertainment are up over 30% this year. People aren’t spending less. They are spending differently, and this quarter they spent it on vacation rather than their standing Tuesday session.
A 14% revenue drop is not a small number. It is also not the same story as losing 14% of your clients. Our active roster is largely intact. The revenue drop is a combination of slower new client conversion, seasonal attrition and an external spending environment that is genuinely difficult for premium service businesses.
I chose to not panic. I looked at the data, compared it to Q1 and asked what was mine to solve and what was not.
What I actually pull for a quarterly review
Gross revenue, month by month, compared to the same quarter last year
Total active clients by the definition I described in the last issue (How Many Clients Do You Actually Have?)
Package holders versus contract clients
Leads in, intros sold, conversions to a long-term option
Payroll as a percentage of revenue
Operating expenses as a percentage of revenue
Those six numbers tell most of the story. The rest is context. You can build a simple version of this in a spreadsheet or pull it from your scheduling software reports. It does not need to be complicated to be useful.
My takeaway
Q2 was instructive. The numbers confirmed some things I have been watching for a while about where this industry is heading and what that means for studios like mine. That is a longer conversation, and I am already having it with myself. More on that later.
If something here was useful, send it to a studio owner who could use it.
More on the question I am sitting with soon.
-Amanda