The Joint Corp. Closes Sale of 31 Corporate Clinics in Arizona and New Mexico and Acquires Regional Developer Rights in the Northwest Region

Rhea-AI Summary

The Joint Corp (NASDAQ: JYNT) has completed a significant transaction involving the sale of 31 corporate-owned clinics in Arizona and New Mexico to Joint Ventures, LLC for $8.3 million in cash. As part of the deal, JYNT acquired regional developer rights in the Northwest region, which generated $855,000 in royalties and franchise fees over the 12 months ended March 31, 2025.

The acquired Northwest territory rights cover 46 existing franchised clinics and 30 sites for future development. Joint Ventures, one of JYNT's strongest franchisees, will grow to 96 clinics and has committed to opening 10 additional locations. The company expects this refranchising initiative to strengthen its business model, reduce commission obligations, and increase operating margins.

Positive

• Sale generates $8.3 million in cash, strengthening company's working capital
• Acquisition of Northwest RD rights eliminates $855,000 in annual commission obligations
• Strategic expansion with proven operator committing to 10 new clinics
• Simplified business model through refranchising to experienced operators
• Potential for increased operating margins through reduced commission structure

Negative

• Reduction in direct corporate clinic ownership and associated revenue
• Exposure to nationwide labor shortage in recruiting qualified chiropractors
• Increased operating expenses due to inflation pressures
• Disclosed material weaknesses in internal control over financial reporting

Insights

Financial Restructuring Analyst

Joint Corp's $8.3M clinic sale plus acquisition of regional developer rights streamlines operations and improves margin potential.

The Joint Corp has executed a strategic restructuring through a dual transaction: selling 31 corporate-owned clinics for $8.3 million while simultaneously acquiring valuable regional developer rights in the Northwest region. This refranchising initiative represents a capital-light pivot that should improve the company's operating profile in multiple ways.

The sale to Joint Ventures (described as one of their strongest franchisees) accomplishes several objectives. First, it simplifies the corporate structure by reducing direct clinic operation responsibilities. Second, it brings an immediate $8.3 million cash injection to strengthen the balance sheet. Third, by transferring these locations to a proven operator already familiar with The Joint's business model, the company minimizes transition risks while potentially improving those clinics' performance.

The acquired Northwest regional developer rights cover 46 existing franchised clinics plus 30 future development sites. These rights generated $855,000 in royalties and franchise fees over the past year. By eliminating this commission layer, The Joint immediately captures 100% of those franchise revenues going forward rather than sharing them with the regional developer. This improves unit economics on those 46 clinics and all future developments in that territory.

From a strategic perspective, this transaction accelerates The Joint's transformation toward a more franchise-focused business model. The reduced operational complexity combined with expanded working capital should allow management to focus resources on higher-return initiatives that strengthen their core franchise proposition. With existing franchisees expanding their investment (growing to 96 locations plus committing to 10 new openings), this serves as a validation of management's strategic direction and the underlying health of The Joint's business model.

- Proven Operator Grows to 96 Clinics and Commits to Open 10 Additional Clinics -
- Sale Price Included $8.3 Million Plus Regional Developer Rights that Generated $855,000 in Royalties and Franchise Fees over the 12 Months Ended March 31, 2025 -

SCOTTSDALE, Ariz., July 07, 2025 (GLOBE NEWSWIRE) -- The Joint Corp. (NASDAQ: JYNT), the nation's largest franchisor of chiropractic care through The Joint Chiropractic^® network, closed the sale of 31 corporate owned and managed clinics and associated franchise licenses in Arizona and New Mexico to Joint Ventures, LLC in exchange for $8.3 million in cash and the regional developer (RD) territory rights of the Northwest region that generated $855,000 in royalties and franchise fees over the 12 months ended March 31, 2025.

“Our goal for the refranchising initiative is to strengthen and simplify our business, while ensuring our clinics go to proven franchise operators that can improve performance and grow within their regions,” said The Joint Corp.’s President, Chief Executive Officer and Director Sanjiv Razdan. “We are very happy that Joint Ventures, one of our strongest franchisees, is purchasing 31 clinics in Arizona and New Mexico. As part of the consideration for the clinics, we are acquiring Joint Ventures' regional developer rights for the Northwest region, covering 46 existing franchised clinics and 30 sites for future clinic development. By acquiring RD rights, we will reduce commission obligations and increase operating margin, as these clinics incurred $855,000 in royalties and commissions under these RD rights in the trailing twelve months ended March 31, 2025. By increasing their stake in The Joint, existing franchisees are validating our initiatives to strengthen the patient experience, drive revenue and reduce operational costs. We expect to deploy our expanding working capital to generate value for stockholders.”

Forward-Looking Statements
This press release contains statements about future events and expectations that constitute forward-looking statements. Forward-looking statements are based on our beliefs, assumptions and expectations of industry trends, our future financial and operating performance and our growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Words such as, “anticipates,” “believes,” “continues,” “estimates,” “expects,” “goal,” “objectives,” “intends,” “may,” “opportunity,” “plans,” “potential,” “near-term,” “long-term,” “projections,” “assumptions,” “projects,” “guidance,” “forecasts,” “outlook,” “target,” “trends,” “should,” “could,” “would,” “will,” and similar expressions are intended to identify such forward-looking statements. Specific forward-looking statements made in this press release include, among others, our goal for the refranchising initiative to strengthen and simplify our business, while ensuring our clinics go to proven franchise operators that can improve performance and grow within their regions; our belief that by increasing their stake in The Joint, existing franchisees are validating our initiatives to strengthen the patient experience, drive revenue and reduce operational costs; our belief that by acquiring RD rights, we will reduce commission obligations, increase operating margin; and our expectation to deploy our expanding working capital to generate value for stockholders. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements, and you should not place undue reliance on such statements. Factors that could contribute to these differences include, but are not limited to, our inability to identify and recruit enough qualified chiropractors and other personnel to staff our clinics, due in part to the nationwide labor shortage and an increase in operating expenses due to measures we may need to take to address such shortage; inflation, which has increased our costs and which could otherwise negatively impact our business; our failure to profitably operate company-owned or managed clinics; our failure to refranchise as planned; short-selling strategies and negative opinions posted on the internet, which could drive down the market price of our common stock and result in class action lawsuits; our failure to remediate future material weaknesses in our internal control over financial reporting, which could negatively impact our ability to accurately report our financial results, prevent fraud, or maintain investor confidence; and other factors described in our filings with the SEC, including in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 14, 2025 and subsequently filed current and quarterly reports. We qualify any forward-looking statements entirely by these cautionary factors. We assume no obligation to update or revise any forward-looking statements for any reason or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

About The Joint Corp. (NASDAQ: JYNT)
The Joint Corp. (NASDAQ: JYNT) revolutionized access to chiropractic care when it introduced its retail healthcare business model in 2010. Today, it is the nation’s largest operator, manager and franchisor of chiropractic clinics through The Joint Chiropractic network. The company is making quality care convenient and affordable, while eliminating the need for insurance, for millions of patients seeking pain relief and ongoing wellness. With over 950 locations nationwide and more than 14 million patient visits annually, The Joint Chiropractic is a key leader in the chiropractic industry. The brand is consistently named to Franchise Times’ annual “Top 400” and “Fast & Serious” list of 40 smartest growing brands. Entrepreneur named The Joint “No. 1 in Chiropractic Services,” and is regularly ranked on the publication’s “Franchise 500,” the “Fastest-Growing Franchises,” the “Best of the Best” lists, as well as its “Top Franchise for Veterans” and “Top Brands for Multi-Unit Owners.” SUCCESS named the company as one of the “Top 50 Franchises” in 2024. The Joint Chiropractic is an innovative force, where healthcare meets retail. For more information, visit www.thejoint.com. To learn about franchise opportunities, visit www.thejointfranchise.com.

The Joint Business Structure
The Joint Corp. is a franchisor of clinics and an operator of clinics in certain states. In Arkansas, California, Colorado, District of Columbia, Florida, Illinois, Kansas, Kentucky, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Washington, West Virginia and Wyoming, The Joint Corp. and its franchisees provide management services to affiliated professional chiropractic practices.

Media Contact:
Margie Wojciechowski, The Joint Corp., margie.wojciechowski@thejoint.com

Investor Contact:
Kirsten Chapman, Alliance Advisors IR, 415-433-3777, thejointinvestor@allianceadvisors.com

FAQ

What is the value of The Joint Corp's (JYNT) sale of 31 clinics in Arizona and New Mexico?

The Joint Corp sold the clinics to Joint Ventures, LLC for $8.3 million in cash, plus acquiring regional developer rights in the Northwest region that generated $855,000 in annual royalties and fees.

How many clinics will Joint Ventures operate after acquiring JYNT's Arizona and New Mexico locations?

Following the acquisition, Joint Ventures will operate 96 clinics and has committed to opening 10 additional locations.

What territory rights did JYNT acquire in the Northwest region as part of the deal?

JYNT acquired regional developer rights covering 46 existing franchised clinics and 30 sites for future clinic development in the Northwest region.

How much revenue did the Northwest regional developer rights generate for JYNT?

The Northwest regional developer rights generated $855,000 in royalties and franchise fees over the 12 months ended March 31, 2025.

What are the main benefits of this transaction for The Joint Corp (JYNT)?

The transaction provides $8.3 million in cash, eliminates commission obligations, simplifies the business model, and is expected to increase operating margins while transferring operations to a proven franchise operator.