Is Peloton Really Back on Track?

By Chris Lange Updated Jan 6, 1:28AM EST · Published Nov 5, 9:00AM EST

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Is Peloton Really Back on Track? — © keeweeboy / Getty Images

Peloton Interactive Inc. (NASDAQ: PTON) released its fiscal first-quarter earnings report before the opening bell Tuesday. The firm said that it had a net loss of $1.29 per share and $228.0 million in revenue, which compares with consensus estimates calling for a net loss of $0.40 per share and $196.86 million in revenue. The same period of last year reportedly had a net loss of $2.18 per share and $112.1 million in revenue.

During the most recent quarter, total revenue increased 103% year over year. Connected Fitness Product revenue was $157.6 million, representing 102% year-over-year growth and 69% of total revenue. Subscription revenue was $67.2 million, a 112% year-over-year increase, and 29% of total revenue.

Peloton ended the quarter with 562,774 Connected Fitness subscribers, an increase of 103% year over year. As of quarter’s end, 90% of Connected Fitness subscribers were on month-to-month payment plans. At the same time, the company boasted 105,856 Digital subscribers, up 116% from last year.

Looking ahead to the fiscal second quarter, the company expects to see total revenue in the range of $410 million to $420 million and an adjusted EBITDA between −$70 million and −$65 million. The consensus estimates are a net loss of $0.41 per share and $384.26 million in revenue for the quarter.

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John Paul Foley, co-founder, board chair and CEO of Peloton, commented:

We had a strong start to our fiscal year ended June 30, 2020 with revenue growth of 103% in our first quarter versus last year. We benefited from continued strong demand for our connected fitness experience, attributable to our effective brand and performance marketing and growing word-of-mouth referrals from our loyal Members. Despite the significant investments we are making to grow internationally, scale operations, and enhance our end-to-end Member experience, we narrowed our Net Loss by $4.8 million to $(49.8) million and improved our Adjusted EBITDA margin of (9.2)% by 283 basis points versus last year.

Shares of Peloton closed Monday at $24.61, in a post-IPO range of $20.46 to $27.98. The consensus price target is $30.95. Following the announcement, the stock was up over 5% at $25.89 in early trading indications Tuesday.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.