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A person walks past a Peloton store on January 20, 2022 in Coral Gables, Florida.
Joe Raedle | Getty Images
Peloton on Thursday reported a wider-than-expected loss in the fiscal third quarter, but pointed to signs of progress with its turnaround plan.
The connected fitness company reported subscription growth and a reduction of free cash flow losses.
Here’s how the connected fitness equipment company did in the three months that end March 31 compared with what Wall Street was anticipating, based on a survey of analysts by Refinitiv:
- Loss per share: 79 cents vs. 46 cents expected
- Revenue: $749 million vs. $708 million expected
Peloton’s net loss for the period was $275.9 million, or 79 cents per share, compared with a loss of $757.1 million, or $2.27 per share, a year earlier. It marked the ninth quarter in a row of the company reporting losses.
Separately, Peloton announced it had reached an agreement with Dish Technologies over a patent dispute. The company said it will pay Dish $75 million to settle an International Trade Commission complaint.
The company had said it aimed to reach break-even cash flow on a quarterly basis in the second half of its fiscal year 2023.
The fitness company has sought to stabilize its business and find a path to profitability again, after seeing a sharp reversal of fortunes. Sales of its bikes and treadmills slowed dramatically after a pandemic-related surge.
That forced the company to cut costs by laying off thousands of employees, shuttering many of its stores and outsourcing its last-mile delivery and manufacturing. Its co-founder and former CEO John Foley also stepped down last year and later resigned as executive chairman.
As fitness equipment sales continue to lag, Peloton has focused on other ways to drive growth and attract new customers. Under CEO Barry McCarthy, a former Spotify and Netflix executive, the company has emphasized increasing subscriptions.
The company has tried to nudge sales of equipment by tinkering with prices, offering a rental option and adding rowing machines to its lineup. It got into wholesale by allowing Amazon and Dick’s Sporting Goods to carry its equipment. Peloton also struck a deal with Hilton to put bikes in all of its U.S. hotels.
Peloton’s stock has risen about 11% so far this year. Yet its shares are still less than half of its 52-week high of $18.86 — and just a tiny fraction of their over $100 highs during the early years of the pandemic.
Peloton’s market cap is $3.06 billion, after reaching as high as almost $50 billion in early 2021.
This story is developing. Please check back for updates.
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