Peloton Shares Drop 14% on Wider Q3 Loss Despite Slight Revenue Boost
Peloton Interactive shares plunged over 14% on Thursday after the fitness firm reported a wider-than-expected loss for the third quarter, reflecting continued struggles in hardware sales and subscriber retention amid a challenging economic climate.
Q3 Financial Highlights:
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Loss per share: $0.12, missing analyst estimates of $0.06.
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Revenue: $624 million, slightly above the $621.3 million estimate (LSEG).
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Connected fitness equipment revenue: Fell 27% to $206 million.
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Paid memberships: Down to 6.1 million, a decline of roughly 500,000 year-over-year.
Guidance & Strategic Shifts:
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2025 revenue guidance raised slightly to $2.46–$2.47 billion, from a previous midpoint of $2.4625 billion.
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Connected fitness subscription forecast raised to a range of 2.77 to 2.79 million, reflecting a 7% annual decline.
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App-based subscription outlook lowered to 540,000–550,000, from 570,000 previously — a 30,000 drop at midpoint.
Executive Commentary:
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New CEO Peter Stern’s first earnings call highlighted Peloton’s efforts to shift away from hardware and focus on digital content and subscriber engagement.
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CFO Liz Coddington acknowledged macroeconomic pressures like high inflation and tariff-induced uncertainty, stating that larger-ticket items like Peloton hardware are particularly vulnerable.
Despite minor gains in overall revenue and guidance adjustments, the bigger-than-expected losses and soft subscriber trends signal that Peloton’s post-pandemic transition remains bumpy.
