Nike-Backed Fitness Chain FitLab Files Bankruptcy
Fitness studio operators see how a partner-funded expansion and supplier change can drain capital fast.
Updated on Nov. 5, 2026 in Openings & Closings
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FitLab, which owns Y7 Studio and Mile High Run Club, filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court in Delaware in late October 2026, after a Nike-backed studio pilot collapsed. Fitness studio operators and franchise investors should note the case as a cautionary example of concentrated revenue and debt-funded expansion.
Why it matters
FitLab attributes the filing partly to inconsistent operating profitability that prevented stable growth and to import-cost uncertainty after tariff changes beginning in April 2025. The collapse shows how a single large investor's pilot, when slow to permit and build, can drain capital faster than a company can replace it.
Nike put $20 million into FitLab as lead investor in a $25 million Series B round, and FitLab spent substantially all of it on a 10-studio pilot across California and Texas. Net revenue fell more than 50 percent in 2025, and about $20 million in merchant cash advances and similar loans is owed to 17 funders.
The players
FitLab
A fitness company that owns Y7 Studio and Mile High Run Club and operates the Assault Fitness brand, whose business depends on studio concepts and equipment sales.
Nike
A global athletic apparel and footwear manufacturer that served as lead investor in FitLab's Series B round and ended its studio partnership after the pilot.
U.S. Bankruptcy Court in Delaware
The federal court where FitLab filed its Chapter 11 reorganization case, overseeing the company's restructuring of debts and operations.
The details
FitLab's core business, according to the filing context, was Assault Fitness, which generated the vast majority of its revenue and profitability before the bankruptcy; FitLab acquired Assault Fitness in 2024. When FitLab changed its major manufacturer from Impulse Fitness to a different supplier, Assault Fitness went out of market for roughly six to eight months, including through the 2025 holiday season, and FitLab lost $5 million to $7 million in supplier credit before coverage ended. Permitting and construction for the Nike studios ran longer than expected, and after Nike ended the partnership FitLab agreed to take on the studio leases.
Timeline
2024: FitLab acquires Assault Fitness.
April 2025: Tariff changes begin, raising import-cost uncertainty.
2025: FitLab's net revenue declines more than 50 percent.
Late October 2026: FitLab files for Chapter 11 bankruptcy in Delaware.
Market Landscape
The filing lands in a boutique fitness segment where brand partnerships with large apparel makers have been used to fund studio rollouts. FitLab's case shows that such deals can leave a smaller operator carrying leases and debt when the investor exits.
Operators who depend on a single product line or revenue source should stress-test their cash flow against a sudden drop in that line. Owners of franchise or partnership-funded studios should review lease obligations and supplier terms, and consult qualified counsel before entering any concentrated investor arrangement.
The takeaway
A pilot funded by a single investor can consume a company's capital before it produces stable revenue, so operators should track cash runway against each expansion step. Watch the bankruptcy docket in Delaware for disclosures on creditor claims and the fate of the studio leases.
Further reading
For more on business closures and shutdowns, see Openings & Closings.
Source note: This article includes information reported by Inc..
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