In a new Bloomberg article, Peloton CEO John Foley is called the Exercise, and the article takes a look at the wild ride $PTON has been on in 2020 while trying to keep pace with ever-increasing demand.
“I think that for a long time we’re going to be scrambling to increase our capacity,” Foley says, adding that he hopes to resolve some outstanding supply issues by April. For now, he says, the company has slashed its ad spending to avoid inflating expectations.
Foley is very bullish on Peloton after the COVID-19 pandemic subsides. He notes that Peloton has doubled its revenue every year since its launch in 2012. He also notes that they believe people won’t return to gyms once they have a bike at home with the option to take live and on-demand classes. Foley says that he could see Peloton having 20 or 30 million subscribers in the not-too-distant future.
Peloton has a lead on its competitors with interactive fitness, but that doesn’t mean that competitors, some large, are looming in the distance. Apple Fitness+ is rumored to be launching in the coming days, while companies like Nordictrack and Echelon are offering similar products at a lower cost in many situations. Peloton does have a lead and brand awareness, though.
The more Peloton customers use their bikes, the more likely it is that they’ll buy one of the company’s treadmills and convert friends, says Laura Martin, an analyst for Needham & Co., an investment bank and financial adviser. “Thanks to Covid,” she says, “Peloton has an eight-month lead.”
This time a year ago, Peloton was being mocked for its holiday ad and created a social media uproar. Today, many of those same people are on a long waiting list to receive their Peloton Bike and Treadmill. What a difference a year can make for a company.