Connected fitness company Peloton today reported a disappointing quarterly loss and is having difficulty luring in new subscribers.
While Peloton’s popularity exploded during the COVID-19 pandemic with its pricey at-home connected bikes, treadmills, rower, and in-app experiences, the company seems to have lost its stride. According to Forbes:
The company reported a net loss for the three-month period to Sept. 30 of $159.3 million, representing 44 cents per share, off revenue of $595.5 million. That compares with a loss of $408.5 million, or $1.20 per share, a year prior, when sales were $616.5 million.
With the upcoming holiday season approaching, Peloton needs its customers – both new and existing – to invest in its expensive equipment. As reported by CNBC:
[Peloton] ended the quarter with 2.96 million connected fitness subscriptions, below the 2.99 million that analysts had expected, according to StreetAccount, and a drop off of about 30,000 memberships compared with the prior quarter.
The revenue from Peloton’s subscriptions, at $415 million, far outpaces its hardware sales, coming in at $181 million.
Despite these continued losses, or perhaps because of them, Peloton recently struck a five-year partnership with athleisure giant lululemon, announced in September, bringing two of the most well-known fitness conglomerates together into the otherwise overly saturated fitness space.
Connect the Watts’ Take
With the price of… everything?… consistently on the uprise, soaring interest rates, and high inflation, it’s hard to imagine people purchasing Peloton’s hardware (which ranges in the thousands) as they begin thinking about holiday gift shopping.
The Peloton Tread+ went through a rough ride of its own after it had to be recalled because of safety concerns, including the death of a child caused by the Tread+. Now, it is apparently ready to reenter the market, with the availability of the Tread+ beginning this upcoming holiday season, set to cost about $6,000. This price point was justified to members in an email in July of this year, saying that the Tread+ price “reflects its premium nature.”
We’ll have to wait and see if Peloton can hang on for the ride or if it will continue to be an uphill battle.
More on Peloton:
- NBA League Pass coming to Peloton
- lululemon x Peloton apparel collaboration debuts in Chicago
- Peloton discontinues Heartrate Armband
- What happens if you cancel your Peloton membership? [Video]
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