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Earnings/results
Peloton misses EPS estimates by 3x; share price plummets post-earnings release
Connected Fitness
May 10, 2022
Older updates:
Product updates
iFIT launches new AI-integrated fitness machines
Connected Fitness
Sep 10, 2024
Product updates
Peloton launches Strength+ app for gym workouts
Connected Fitness
Sep 3, 2024
Earnings/results
Product updates
Partnerships
Peloton announces Q2 2024 results
Connected Fitness
Aug 22, 2024
Product updates
Bowflex and Horizon Fitness launch new connected treadmills
Connected Fitness
Aug 21, 2024
Partnerships
CLMBR partners with Crunch Fitness to expand reach and distribution
Connected Fitness
Jul 25, 2024
M&A
Echelon acquires ThriveX to support new product development
Connected Fitness
Jun 5, 2024
Product updates
Partnerships
Peloton launches Pet-Friendly Fitness Collection; collaborates with Canada Pooch to offer co-branded pet accessories
Connected Fitness
Jun 4, 2024
Funding
Peloton secures USD 1.35 billion in debt funding to refinance existing debts
Connected Fitness
May 30, 2024
Management news
Peloton announces to lay off 15% of global workforce in broad restructuring plan
Connected Fitness
May 2, 2024
Management news
Peloton appoints Karen Boone and Chris Bruzzo as interim co-CEOs
Connected Fitness
May 2, 2024
Connected Fitness

Connected Fitness

May 10, 2022

Peloton misses EPS estimates by 3x; share price plummets post-earnings release

Earnings/results

  • Peloton reported a net loss per share of USD 2.27 in Q3 FY2022, nearly 3x worse off than the consensus estimated loss per share of USD 0.83 and significantly wider than the net loss per share of USD 0.03 recorded in Q3 FY2021. The company reported revenue of USD 964.3 million in Q3, down 23.6% YoY, and also below the consensus estimate of USD 972.9 million.

<ul><li>Connected fitness product revenue (61.6% of total revenue) declined 41.9% YoY to USD 594.4 million in Q3 FY2022. The significant decline can be attributed to a reduction in bike prices, falling consumer demand from existing pandemic-peak levels, and Tread+ returns valued at USD 18 million (higher than expected), resulting from a product recall. This was despite 42.3% YoY growth in the connected fitness subscriber base to 3.0 million in Q3 FY2022. The average monthly churn rate for the quarter stood at 0.75% (up from 0.31% a year ago).</ul>

  • On the other hand, subscription revenue grew 54.4% YoY to 369.9 million in Q3 FY2022. This is due to its fitness-as-service (FaaS) strategy that combines the cost of connected fitness equipment and its subscription service into one low monthly fee. 

  • Peloton reported an adjusted EBITDA loss of USD 194.0 million in Q3 FY2022 (vs. a profit of USD 63.2 million a year ago). The decline in EBITDA is due to an increase in general and administrative expenses (up 34.2% YoY) and the incurring of one-time expenses such as goodwill impairment, impairment expenses, loss on disposals on long-lived assets, and restructuring expenses during the quarter. 

  • For the upcoming quarter, the company expects to generate total revenue in the range of USD 675 million–700 million (implying a decline of 27% YoY on average) and an adjusted EBITDA loss in the range of USD 115 million–120 million (2.6x the loss in Q3 FY2021). Following the earnings announcement, Peloton’s share price plummeted 8.7% during the trading hours.

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