The boom caused by the corona pandemic has long since evaporated.
(Photo: AP)
new York The fitness equipment manufacturer Peloton made a higher loss in the past quarter than the market had expected. The US company reported a deficit of $757.1 million on Tuesday. Analysts had previously expected 132.1 million. According to the information, sales also shrank by 23.6 percent to 964.3 million dollars and missed expectations.
In addition, new CEO Barry McCarthy warned that at $879 million, the capital base was thin for a company of this size. Peloton shares fell a good 25 percent to $10.56 in premarket US trading. After once $ 50 billion, Peloton would only be worth around $ 3.5 billion.
Peloton had benefited greatly from gym closures early in the pandemic. Sales of the New York company’s training bikes and treadmills increased, and some interested parties had to wait a long time for their devices. However, Peloton did not interpret the boost as a special boom, but as the beginning of a growth era and invested in the expansion of capacities up to the construction of a factory in the USA.
That turned out to be a serious miscalculation: With the lifting of corona restrictions, interest in the company’s devices decreased again, Peloton was sitting on high inventories, and construction of the factory in the USA was canceled again.
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In February, co-founder John Foley had to give up the post after weak numbers. His successor McCarthy, former chief financial officer of streaming giants Netflix and Spotify, had announced plans to cut costs and generate more revenue from subscriptions. According to the company, the number of members rose by five percent to seven million in the first quarter.
McCarthy announced in a letter to shareholders on Tuesday that he intends to continue the effort. “Turnarounds are hard work,” wrote the peloton boss. “It’s intellectually challenging, emotionally draining, physically exhausting, and completely immersive.”
Peloton devices are now to be sold for the first time at other dealers instead of just directly from the company. In the third quarter, which ended in March, revenue from equipment sales fell 42 percent to just under $600 million. For the current quarter, the company expects sales of just $675 to $700 million – while analysts had expected an average of more than $820 million.
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