Interactive Strength (TRNR) has announced a definitive agreement to acquire Ergatta, a pioneer in game-based connected fitness. This strategic move is projected to significantly increase TRNR’s 2026 pro forma revenue guidance by 50%, surpassing the $30 million mark. The acquisition is expected to close in the first quarter of 2026.
Interactive Strength, known for its Wattbike, FORME, and CLMBR brands, is set to acquire Ergatta, a company celebrated for its innovative game-based fitness content. Ergatta boasts a stable, cash-generating subscription business with an industry-leading monthly net retention rate exceeding 98%. The company is anticipated to generate over $10 million in revenue in 2026, with a substantial 70% derived from recurring subscriptions, offering high visibility. Furthermore, Ergatta operates an asset-light model, contributing to strong operational cash flow without significant inventory investment.
The total enterprise value for Ergatta could reach up to $19.5 million, contingent on the achievement of specific EBITDA targets for 2026 and 2027. Approximately 50% of the maximum valuation is tied to Ergatta’s 2026 EBITDA performance, with an additional 5% linked to 2027 EBITDA. To ensure an attractive valuation multiple for TRNR, the deal is structured with a modest upfront cash component, debt, equity, and performance-based earn-outs. Less than 10% of the transaction value will be funded at closing, and TRNR anticipates receiving more cash flow from Ergatta in 2026 than the initial cash consideration paid. The base transaction value is set at $8.8 million, comprising $1.8 million in cash at closing, $1.8 million in debt, and $5.3 million in equity locked until May 2027.
TRNR CEO Trent Ward expressed enthusiasm for the acquisition, highlighting Ergatta’s unique fitness experience and its potential to be immediately accretive to TRNR. He noted that Ergatta’s gaming experience, already licensed by iFIT, could be integrated into Wattbike and CLMBR. The Ergatta team’s customer acquisition capabilities are also expected to drive revenue growth for all TRNR brands in the U.S. Ergatta’s founders and key management are expected to continue leading the business post-acquisition, ensuring a smooth transition and continued innovation.
Ergatta’s business model is characterized by its asset-light approach and a strong focus on recurring revenue through subscriptions. The company projects an approximate 30% EBITDA margin for 2026, underscoring its profitability. This recurring revenue stream provides significant visibility and predictable cash flow, aligning well with TRNR’s strategy of building a diversified connected fitness platform through strategic acquisitions.
Following the announcement, TRNR’s stock experienced a moderate negative reaction, declining by approximately 4.97%. Historically, TRNR’s acquisition-related news has typically resulted in modest single-digit price movements. The company has a track record of using acquisitions, such as the Wattbike transaction, to expand its market presence and product portfolio in the connected fitness sector.