Peloton’s latest earnings call actually gave investors something to smile about. After years of sliding sales, shrinking membership, and wave after wave of cuts, the company managed to do something it hasn’t pulled off in ages: turn a profit.
Q4 2025 wasn’t just about hitting targets. It was about showing that Peloton might finally be stabilizing. The results point to a leaner operation with a broader vision that stretches well past bikes and treadmills. But while the numbers are moving in the right direction, the story underneath is still complicated.
Profit that wasn’t expected
Peloton ended the quarter with a GAAP profit of $0.05 per share. Not only flipping from a loss a year ago but also beating expectations that were leaning toward more red ink. Revenue hit $606.9 million, down 6% year-over-year but ahead of forecasts and above the company’s own guidance.
CEO Peter Stern summed it up plainly: “Our team exceeded all our key financial performance goals for Q4 and fiscal 2025.”
The market liked it… at first. Shares jumped about 10% on the news but gave up those gains by midday. Even with the beat, Peloton’s stock is still down roughly 20% for the year, which says a lot about how much trust they still need to earn back.
Leaner, smarter – or just leaner?
That profit didn’t appear out of thin air. It came from cutting costs hard. Operating expenses dropped 20% year-over-year, thanks to previous restructuring moves. And Peloton isn’t done trimming.
A fresh round of layoffs (about 6% of staff) is already underway, with plans to cut at least $100 million in annual costs by the end of FY2026. Stern called it a difficult decision, but “necessary for the long-term health of our business.”
It may be the right move financially, but at some point you have to ask: after two years of constant downsizing, how much more can they cut before they start cutting into what makes Peloton, Peloton?
Subscription still shrinking
Here’s the catch: turning a profit is nice, but the membership base is still moving in the wrong direction.
Peloton closed the quarter with 2.8 million Connected Fitness subscribers, down about 80,000 from last quarter and 6% lower than a year ago. Digital subscriptions also slipped, and hardware sales were down, too. The company even warned that both product and digital revenue will probably keep falling through 2025.
Attempts to reignite growth haven’t stuck. The “freemium” app tier launched in 2023 never caught on (the free content was too limited to keep users engaged) and by mid-2024, Peloton shut it down entirely. The result: still fewer paying members than last year, and no clear evidence of a turnaround in sign-ups.
No longer just cardio
Peloton’s plan now is to redefine what the company is. Stern laid out a vision to become “the world’s most trusted wellness partner,” moving beyond cardio into strength training, meditation, recovery, sleep, and eventually, nutrition.
And it’s not just talk. Here’s what’s already in motion:
- AI coaching to deliver personalized training plans.
- MicroStores – new smaller, cheaper retail locations are here – with more rolling out this year.
- Peloton Repowered, a certified pre-owned marketplace, making equipment more affordable.
- Discount programs for students, educators, first responders, and more.
It’s a broader pitch aimed at reaching more people in more ways, with the hope to get them to stick around longer.
Can Peloton Actually Grow Again?
Q4’s numbers show a company that’s finally a little more stable. The profit beat, the cost discipline, the new direction… it’s all promising. Wall Street is cautiously warming back up, with UBS upgrading to a “Buy” and Morgan Stanley suggesting subscription hikes could be on the horizon.
But the elephant in the room hasn’t moved: fewer people are paying for Peloton today than a year ago. The connected fitness market is smaller than it was at the pandemic peak, and competition in digital fitness is only getting tougher.
Execution is everything now. Peloton has a long history of good ideas that stumble in the rollout – from hardware recalls, to the recently extinct Peloton Guide, to the failed app experiment. If they want this vision to stick, they’ll need to break that pattern fast.
Bottom line
Peloton’s Q4 is more than just numbers. It could be the opening chapter of a potential comeback. Or just the calm before another downturn.
The company has trimmed, refocused, and fashioned a new narrative: part cardio brand, part wellness coach.
But the real test lies ahead. Can Peloton stabilize subscribers, grow its services, and stick the execution this time? If yes, this could mark a rebirth. If not, this quarter will look like a brief reprieve in a longer decline.
For now, Peloton has something to show: a plan, a profit, and a pulse. And for a company that once felt like it was tumbling off a cliff, that’s something.
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